Showing employees the true value of their package can pay off when budgets are tight
Total reward statements (TRSs) are a simple and effective way to help staff understand the value of their employment package. But research conducted by the Chartered Institute of Personnel and Development (CIPD) shows a significant number of employers do not use them.
The CIPD/Benefex Reward management survey 2012, published last May, showed that although more than one-third of the 455 respondents made plans to increase their benefits spend last year, only 17.8% provided TRSs, which means the majority are overlooking an easy way to promote the value of their benefits package to employees.
No benefit is too small to be included on a TRS, so free breakfasts, enhanced maternity or paternity leave and access to employee assistance programmes (EAPs) should be considered.
That said, quantifying the value of less traditional benefits, such as workplace training, holiday entitlement and savings made through voluntary benefits plans and salary sacrifice arrangements, may not be straightforward.
TRSs are available in paper and electronic formats. Historically, they have been posted to staff as paper documents at certain times of the year, but employers seeking a more integrated approach may offer both formats.
The low-cost and wide-reaching nature of online communication makes it increasingly attractive as a means through which employers can relay TRSs to staff in a timely manner.
But the biggest attraction of this format is the ease with which online TRSs can be integrated into organisations’ online benefits platforms. This enables employees to access as little or as much information as they require, and to access modelling tools to track, for example, their projected retirement income or the investment performance of their share plan.
The latest trend in the TRS market is the delivery of statements via smartphone applications. Online statements are also being developed to be accessible via social media, allowing employees to rate and ‘favourite’ benefits.
Despite the tough economic climate, TRS costs remain competitive. Simple paper statements can cost as little as £2, whereas more sophisticated online arrangements can cost as much as £100 per employee per year. Prices vary according to the size of an organisation and the complexity of its requirements.
Timing remains a critical factor when delivering TRSs. A key consideration is using statements as a tool with which to counter the effects of negative news, such as pay freezes. The beginning of the year, when staff may be budgeting for the 12 months ahead, can also be a good time for employers to consider introducing TRSs.
What is a total reward statement?
This is a document outlining the full benefits package that an employee is entitled to receive, including salary, pension and shares. It can also include data on less conventional benefits, such as health and wellbeing and workplace training provisions.
Where can employers get more information?
Read more on TRS.
Who are the main providers?
Most reward consultants and benefits providers offer a TRS service, including: Aon Hewitt, Asperity Employee Benefits, Benefex, Buck Consultants, Ceridian, Fair Care, Grass Roots, Hay Group, Jelf Group, Edenred, Mercer Marsh Benefits, Motivano, NorthgateArinso, Personal Group, Staffcare, Strait Logics, Thomsons Online Benefits and Vebnet.
29% of employers offer total reward/remuneration statements to communicate benefits to employees
Source: Employee Benefits/Alexander Forbes benefits research 2012, May 2012.
17.8% of employers provided total reward statements for their employees in 2012
Source: CIPD/Benefex Reward management survey 2012, May 2012