Did you know you can increase employee morale and improve retention by providing your employees with an annual total compensation statement?
Total compensation statements are personalized to each employee and highlight the direct and indirect benefits your company provides and the financial investment your company makes to provide those benefits. These statements benefit you as a business owner as much as they benefit your employees.
How Total Compensation Statements Benefit Your Employees
Employees tend to focus on their base salary alone and don’t think of health benefits, paid time off and holidays as part of their compensation. By providing total compensation statements, you can demonstrate to your employees that their compensation goes far beyond the paycheck. Employee benefits can make up more than a third of an employee’s compensation package, and presenting insight into the indirect compensation they receive can be eye-opening to employees who overlooked it or weren’t aware of it.
This kind of transparency benefits everyone, as employees often don’t know if they are compensated fairly. Providing total compensation statements can motivate employees to remain with the company by giving them insight into the total cost of the benefits you offer. Employees also feel appreciated because they see how much the company invests to provide those benefits.
What’s Shared on a Total Compensation Statement?
Total compensation statements include:
- Base pay
- Bonus compensation
- Retirement
- Health benefits
- Paid leave
- Voluntary benefits
These statements also emphasize fringe benefits beyond regular pay that enhance an employee’s overall compensation package.
Fringe Benefits
We’re currently in an innovative era of incentives. In the post-COVID-19 work environment, competition for top talent has employers offering benefits that address career development, work-life balance, financial wellness and mental and physical health.
We see employers offering fringe benefits to help acquire and keep employees, including:
- Employee stipends
- Mental health days
- Pet insurance
- Volunteer time off
- Subscription services
All those benefits add up in dollars and can be competitive differentiators in the talent market.
Creating compensation and benefit programs designed to attract and retain talent is a strategic business approach that invests in employee productivity. In today’s environment, where transparency and clear communication are crucial, rewarding employees and demonstrating the full value of their compensation package boosts business success. Total compensation statements offer more than just a detailed view of compensation and benefits; they foster a loyal and more engaged workforce.
If your organization is looking to leverage total compensation statements for better retention and engagement, RKL Virtual’s Workforce Strategies team can help. Our experienced HR advisors can help you design a strategy for the development and execution of this increasingly popular approach. Contact me at the link below or learn more about our HR advisory services.
