What is a total reward statement?
It is a document that outlines the full benefits package an employee is entitled to receive, including salary, pension and shares. It can highlight less conventional perks, such as health and wellbeing, and training provisions.
Where can employers get more information?
Employers can contact their existing benefits or HR and payroll provider to see if they offer an integrated package. All benefits consultancies provide information on total reward statements. Read more articles on the topic.
Who are the main providers?
It is a service offered by reward consultants and most benefits administration providers, including: Benefex, Buck Consultants, Ceridian, Hay Group, Jelf Group, Edenred, Northgate Arinso, Staffcare, Thomsons Online Benefits and Vebnet. Specialists such as Straitlogics offer a dedicated TRS service.
Total reward statements require careful communication, but can be an economical and powerful method of showing staff what they are worth to their employer, says Georgina Fuller
A total reward statement (TRS) is, essentially, a document that outlines the full benefits package to which an employee is entitled, including salary, pension and share schemes. It can also highlight less traditional perks, such as health and wellbeing initiatives and training. Total reward statements are usually produced once a year in a hard-copy format or placed online to tie in with the annual pay review or the introduction of a new benefit.
A TRS should be tied to an organisation’s overall reward objectives and be effectively communicated to all staff. Working out how best to do this, and when, is an important matter. Matt Duffy, partnerships manager at Lorica, says: “There are many communication tools – online, booklet, interactive – but choosing the right ones will help motivate employees whether they are office or manufacturing based, young or old.”
A TRS should be tailored to each employee because, for example, if they included a benefit certain employees were not entitled to, such as extra annual leave, it could damage morale and create bad feeling.
Online statements are becoming increasingly popular because they enable staff to see what benefits they are entitled to at any time. An online system can also be updated quickly and is more environmentally friendly to fit with an organisation’s corporate social responsibility aims. But paper statements can create more of a ‘wow’ factor if they are issued annually as part of a pay review.
But how do the costs of online and paper statements compare? Both involve fixed costs or implementation fees, but it can be difficult to ascertain which is more economical. Julia Turney, head of benefits management at Jelf Group, says it is hard to put a cost-per-head fee on paper-based TRS because there is no direct correlation between costs and the number of employees. Employees and employers are not liable to pay tax on TRS.
“Some of the work involves fixed costs [such as concept design and artwork] and so this part of the project may cost the same if [employers] have 200 employees or 2,000,” says Turney. “Ballpark figures for an offline statement for 300 staff are £5,000-£6,000.”
For online statements, there will also be a one-off implementation fee, which is usually based on the complexity or design of the site rather than on staff numbers. Employers will have to pay a licence fee of up to £5 a year per employee.
Andrew Morris, director at NorthgateArinso, says that, ultimately, total reward statements will be the single most important document they can give staff during the working year. “It is not just about base salary,” he says. “A total reward statement tells the employee what they are really worth to their employer.”
Read more buyer’s guides