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Total Rewards Statements

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Question:

I’ve always heard that Total Rewards Statements were a great tool to provide to employees the ones I have seen seem very difficult to understand.  How can I provide a Total Reward Statement that is valuable, easy to understand, and will help my employees truly understand what their total compensation is?

Answer:

While knocking off socks is a lofty goal, a well-designed total rewards statement can have that level of positive impact. When an employee with a $50,000 base wage sees their actual total compensation (pay + benefits) is closer to $71,000, it can be a socks-knocking experience.

The power of a total rewards statement comes from the personal and detailed picture it gives employees of the full value of their work. In addition to pay and benefits, total rewards statements can also convey the value of non-monetary rewards such as work-life balance, opportunities for growth, and a great company culture.

A Brilliant Total Rewards Statement has Pizzazz
If your total rewards statements are cold, boring, or greeted with skepticism, these five tips can help give them some zing:

1. Put Employees First
Think not what a total rewards statement can do for your company . . . but what it can do for individual employees. Put your company’s strategic goals on the shelf for the moment, and get a clear vision of how your statements can help employees. When you put employees first, your statements will ultimately also yield the greatest return for your company.

2. Deliver Statements with Fanfare
Print, online, PDF, microsites—there are many options for formatting and delivering your statements. One consideration is paramount: how many of your employees will actually see their statement? How many spouses will see it?

Your statements may be masterpieces of design and marvels of technology, but if employees don’t rip open the envelope or login to view them, they’re utterly worthless.

Let employees know their statements are coming. Give managers advance notice, and reinforce the message—a job with your company is much more than just a paycheck! Consider tying the release of the statements to a special event. Include employee testimonials to heighten interest. If you deliver online statements, think about how you can encourage employees to view their statements and share them with spouses.

3. Make it Personal
Tell employees a story that’s all about them. The more personalized a total rewards statement, the more powerful its message will be. Put the value of total compensation front and center. Provide helpful information about benefits coverage and retirement savings. Use variable text to eliminate generalities so that every piece of information is relevant to the recipient.

In addition, tell your company’s story. Brand statements so they are unmistakably your own. Communicate what makes your company a great place to work, and why employees should choose to stay. Keeping quiet and letting employees draw their own conclusions is a disservice to both the company and employees.

4. Happiness is a Total Rewards Statement
By their very nature, total rewards statements send an upbeat message that the company values employees, respects them, and is focused on rewarding and retaining them. Leave the somber tone and legal language to the SPDs. Use color and graphics to create a friendly tone. Show pride in your company, your employees, and the work you do together to serve customers.

5. Don’t Get Cold Feet
Total rewards programs represent substantial investments in employees’ well-being. They are key factors for job satisfaction and retention. In a survey by WorldatWork, HR professionals judged total rewards statements to be the single most effective method for communicating the employee value proposition. So make a bold statement! Tell your company’s total rewards story with pride, and socks-knocking pizzazz.

Rita Verderber is founder and President of Insight Benefit Communications Inc. Her company has been creating sock-knockin’ total rewards statements for over 19 years. You can reach her at rita@insightben.com.

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When to Offer a Part-Time Employee Company Benefits

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Question:

How quickly do we need to offer benefits once a part-time employee is working 40 or more hours per week? The employee is regularly scheduled to work 30 hours per week and is ineligible for coverage. However, the employee is currently working on a major project where the hours worked tend to often exceed the full-time threshold. Our company policy manual states there may be periods when a part-time employee is permitted to work more than 40 hours but does not alter an employee’s part-time status.

Answer:

This situation can be looked at in many ways. Depending on how you’ve handled it in the past and what’s in your summary plan description or company policies really determines what you need to do.

In a nutshell, the individual is a part-time employee regularly scheduled 30 hours per week and, according to your plan, is ineligible for insurance. There are occasions when the individual is asked to work 40 hours, but as long as it is not a ‘regular’ occurrence, it does not change the employee’s eligibility for benefits.

Your company has the task of defining the term ‘regularly’. If the employee is not pursuing the issue of not receiving benefits, there really is no “hours policy” trying to determine whether the employee is eligible or not. One suggestion is that your company take a stance that, for example, an employee who works 40 hours or more per week for over 50% of the weeks in the previous year, would be deemed eligible for benefits coverage.

Keep in mind that there may be a problem if, or when, the employee comes back and DOES have an issue because benefits were not offered but the employee feels like he/she should be eligible. If that is not the case right now, it would be wise to take action and define what you consider to be ‘regularly.’ If you do start working the employee for 40+ hours regularly, then make that employee full time. It’s the right thing to do. And when the Healthcare Reform is active in 2014, the answer will be entirely different.

Strategic HR has the answers to all of your tough Benefits and Compensation related questions. Whether you need an audit of your exemption statuses or a job analysis of your positions, Strategic HR can do the job. Please visit our Benefits & Compensation page for more information.