"Our employees just don’t understand the value of their benefits," this is a common complaint from employers and those tagged with managing benefits. This is scary since benefits make up approximately 30% - 40% of an average employee’s compensation.
There are many great ways to promote your benefits program and increase employee engagement. But, total compensation, or total reward statements may be at the top of our list when it comes to educating employees about their compensation above and beyond their base salary.
Compensation - more than pay?
A personalized overview of an employee’s total compensation package – including all their cash income and the value of the benefits they receive. This total compensation statement can help uncover the hidden value because most employees focus on their NET pay and forget or underestimate the value of their benefits package.
As employers struggle to attract and retain talent, communicating the value of total compensation can make a really BIG statement.
Tips for creating an effective statement
A single-page versus multi-page…paper versus online, there’s a lot of options to consider. Here are some things to keep in mind:
- Get personal – The more personalized the statements, the more meaningful they become. However, be sure the data is presented in a way that is accurate, consistent and understandable. Showing all the benefits that make up total compensation numbers reinforces your commitment to your employees by showing the true value of their position within the company.
Showing accrued and projected retirement benefits can also help employees with financial planning. Such data can often be captured through your payroll and benefit administration systems or with the help of your benefits/IT professionals.
- Consider your audience – What’s most important to your employees? Are they number crunchers who love pie charts and figures? Or, do they like it clean and simple? How do they like to receive information? Online or in print? Knowing your audience will help you determine the level of detail and best delivery method for your statement.
- Promote the TRUE value – In addition to including information about cash compensation, this is your opportunity to highlight the true value of benefits and highlight those that are underutilized. Be sure to show both the company and employee’s share in the cost of benefits, and include the value of paid leave and other lesser-known perks. Statements are an effective way to underscore the high cost of health care – and the significant contribution made by the company.
- How do you compare? – Consider including benchmarking information. If your company provides better than average health care benefits, or a stellar 401(k) match, show how you stack up to the competition.
- Make it visually appealing – Keep it simple! Use graphs and charts to easily convey data. Use bold and engaging infographics and images to make it pop! Customize the look and feel to promote your internal brand.
- Online or paper? – This generally depends on your employee preferences. Online statements can often be integrated with your benefits platform – and can be easily accessible, interactive and can even include modeling tools. They allow employers to update them easily and monitor usage through analytics. However, many still lack a high-end branded presentation. Some clients still prefer a well-designed paper statement mailed to employees at home. A colorful printed statement can have perceived value and can easily be shared with family members.
More bang for your buck
Total compensation statements can provide a significant ROI – through increased employee engagement, retention and greater appreciation. Make the most of the investment you make in your employees and help them uncover their hidden value.