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Total Compensation Statements
Creating an Effective Total Compensation Statement
Communicating the value of your investment in employee compensation, health insurance, pension plans and other
benefits is crucial for engaging and motivating employees.
Chances are employee compensation, bonuses, health insurance, pension plans, vacation time, sick leave and other benefits
add up to the single largest expense in your budget. Communicating the value of these investments is crucial for employee engagement.
According to the most recent Watson Wyatt WorkUSA(R) research, employees who know the value of their total compensation package are twice
as likely to be engaged in their work as employees who don't.
Web-based total compensation statements, or eStatements, are important tools for increasing employees' benefits awareness. Important features include 24/7 accessibility, real-time data and easy integration with external vendors, HRIS systems and other data sources.
As with any technology tool, getting the most out of eStatements requires thoughtful design and planning.
The following five steps can help:
- Focus on integration. The greatest advantage web-based total compensation statements have over paper-based statements is
their ability to provide real-time information. They give employees quick, up-to-date access and flexible spending account balances, pension projections, stock prices, payroll and other dynamic data - all from one location.
- Encourage interactivity. eStatements' second big advantage is their interactivity. When linked with pension or health and welfare
benefits modelers, eStatements show employees the impact of different scenarios on their total compensation. Employees also can initiate fund
transfers, asset reallocation and claims management transactions from this starting point.
- Promote ease-of-use. eStatements should be attractive, easy-to-navigate and accessible from anywhere via a single sign-on over a secure server. Colorful, two-dimensional graphs and pie charts grab attention and help employees understand the data. Frequently asked questions with answers, a glossary of terms and links to other valuable information on the HR intranet add to the robust nature of the tool.
- Communicate early and often. Regular communication before, during and after the launch of an eStatement is critical. Employees need to know why the statements are important, where they can be found and how they should be used. Fresh material and regular reminders keep employees coming back to the statements for current information.
- Measure. Periodically solicit feedback from employees. Does the statement provide the information they need? What should be added or
changed? Have benefits-related calls to HR staff decreased? Are employees using the statements as launch points for HR-related transactions?
eStatements are valuable tools for improving employees' awareness of compensation and benefits. When properly designed and implemented, they improve employees' knowledge and satisfaction while reducing HR's administrative workload and costs.
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