It's not just salary: Do your employees know the total value of their benefits and compensation package?
It's a scenario that has caused havoc in the day for many human resource professionals. An employee walks into your office and says they have accepted a position at another company. In this case, the employee is a pharmacist at a major grocery chain, and the new job offers a modest salary increase. You know that the job market for pharmacists is extremely competitive right now, which means that you need to start your search "yesterday" and expect to pay out one and a half to two times the employee's annual salary in the process. But wait -- there is another option.
You suggest taking a minute to sit down with the employee and review their current total compensation, including all non-cash items. By using the projection and modeling tools in the online total compensation statement that has just been introduced at your company, you show the employee the true value of their total rewards. The pharmacist would be walking away from a good deal more than the new employer is offering in salary. Plus, through the use of the solution's stock option calculator, the employee understands the current and future potential value of the unvested stock options that would be left on the table. The employee decides to stay.In this true case, the manager said that the new online total compensation statements had already delivered a return on investment (ROI) just weeks after being made available to the employees. The manager knew the company offered a competitive package and was able to leverage the online tool to demonstrate to the employee the full value of their compensation. Likewise, the employee was able to see an overview of their compensation, compare current benefits to the new job offer, and make an informed decision. Beyond the pay stub
Your organization can communicate the full value of each employee's compensation package with Ceridian Total Compensation Statements powered by Enwisen. This can be an invaluable tool to hire new employees and retain current ones. For example, with the use of a guest account, a job candidate can go online and look at different income scenarios, including information on what the potential new employer contributes to compensation, such as health care supplements, matching 401(k) funds, etc. The total compensation statement provides a comprehensive view of potential earnings which can add up to an additional 30 percent above annual salary -- the estimated value of typical non-cash compensation. When employees have access to total compensation statements, they gain a better understanding of their benefits packages, which goes far beyond what they see on a pay stub that only shows deductions. In addition, with the projection and modeling tools, employees can see what their total compensation would be based on stock value, 401(k) contributions, estimated bonuses and other variable items. This capability can help support employees as they plan for life events such as retirement, which they can do online and with the click of a mouse. It also provides a greater incentive to stay with their current employer, especially if anniversaries are tied to variable compensation items. A personalized approach
Managers can access their employees' total compensation statements (without the HIPAA information) to have valuable and meaningful conversations regarding performance objectives and career paths. The statements offer an opportunity for positive communications about tuition reimbursement, additional insurance, health insurance discounts for a healthy lifestyle, etc. The communications opportunities available with these statements can also increase goodwill while it supports your company's branding efforts. Ceridian Total Compensation Statements can be customized with the company logo and a letter from your executive. You can also insert reminders about some of the benefits that the employee may have overlooked. These messages and reminders can be customized for groups of employees down to the individual level. For example, one company that included tailored messages about how much money individual employees were losing by not contributing to their 401(k) contributions, saw a large spike in 401(k) participation, a trend that has continued in the second year using the statements. Results like these have contributed to the growth in the use of online total compensations statements. Enwisen, Ceridian's Total Compensation Statements partner, reports the number of customers who purchased the online tool has grown by more than 200 percent every year since it was introduced in 2004. It is likely that the growth will continue. In the world of new media, even workers who don't use a computer at work are likely to have access to one at home, the library or Internet cafes. And, younger employees who have virtually no memory of life without the Internet have come to expect access to personalized information on demand. (1) Understanding the total value
While benefits are becoming increasingly important in determining job satisfaction, most employees do not understand their total rewards. (2) The Ceridian Total Compensation Module is an online, up-to-date accurate tool that helps employees understand the true value of their compensation and benefits, which can help reduce the risk of losing your best employees. Ceridian will be making it easier for our HR/Payroll Web customers to offer total compensation statements to their employees. More information about new data extract tools for HR/Payroll Web customers who want to help educate employees and candidates about the true value of their total compensation and benefits will be available early in 2007. For more information on Ceridian Total Compensation Statements powered by Enwisen, contact your Ceridian representative. Sources:
- "New Media Offer Options for Benefits (and Other) Communications," www.shrm.org, Stephen Miller, September 2006.
- SHRM Employee Job Satisfaction Survey, 2005.
