Even if you haven’t upped the salary for your employees recently, chances are you have increased their compensation package. Further, there’s an even greater chance that you didn’t even think to tell your workers, missing a fantastic opportunity to show your workers how much you appreciate them and help boost employee morale at the same time.
Now, the compensation increase that you handed over likely took one of the following forms:
- Increasing your contribution to employees’ health insurance
- Giving employees additional paid time off
- Boosting the amount you contributed to employees’ retirement funds
However, you probably didn’t think to notify employees of these seemingly minor – but certainly important – boosts.
Enter the total compensation statement, which allows you to show employees that their pay is increasing, even if they aren’t seeing a salary bump. However, in order to demonstrate benefit, you need to follow three key steps:
- Break up the benefits: To truly showcase your investment, divide each element of the employee’s compensation into its own line item, rather than lumping them together (i.e., separating medical insurance from dental and vision, rather than listing them all under “health benefits”). For example, your list should include all of the following (where applicable):
- Base salary/hourly rate
- Overtime paid
- Bonus compensation paid
- Paid holidays — and the wage value of each if the employee is hourly
- Sick days issued (not taken)
- Vacation days issued (not taken)
- Other forms of paid leave — personal, medical, bereavement, military, jury duty, etc.
- Medical insurance — include the amount paid by the employer
- Dental insurance
- Vision insurance
- Disability insurance
- Life insurance
- Retirement contributions
- Tuition assistance
- Training courses paid for by the employer
- Non-cash compensation — gifts, travel, meals, tickets, etc.
- Employee assistance programs offered (list the cost of each program separately), and
- Relocation expenses
- Go year-to-year: To further showcase benefit, sometimes you have to show employees where they came from! To do this, include in the statement a comparison of what you paid for each element of a person’s compensation this year versus what you paid for it last year.
- Make a statement: To summarize your investment, include a single line that tallies up all of the expenses and label it as “total compensation.”
HR Morning News recommends that the total compensation statement be issued separately from an employee’s regular pay stub and that it should also be accompanied by a letter describing what it is, why you’re providing it and how employees should use it.