What is the true value of online total comp statements?
Creating and distributing total compensation statements can be a valuable but time-consuming proposition for HR teams. Ben admin and HR software company PlanSource points to the benefits of online statements for an interactive view without the hassle and cost of printing and mailing.
“It showcases the total hidden [benefits] package in an interactive and dynamic way,” says Jessica Foust of PlanSource, noting they can be accessed through different platforms and look compelling on any screen size.
The larger the employer, the greater the potential cost savings, which she says can be reinvested in a more meaningful communications campaign. “I work with some employers who spend $50,000, $100,000 on printing and mailing different communication assets,” Foust says.
A digital platform turns statements into a self-service tool that employees can refer to often, which she says can result in fewer calls and emails to HR professionals who can instead focus on more strategic initiatives.
In terms of content, Foust suggests that online statements always include base pay, bonuses, commissions, salary, insurance benefits, any ancillary coverage, paid time off, retirement savings and other financial security elements such as stock options. It also should be visually appealing and colorful from a design standpoint. Beyond that, she says spotlighting “whatever sets your company apart will reinforce your brand,” which can be used to help recruit and retain top talent.
Foust considers online total comp statements a formidable tool to help elevate the strategic role of brokers and advisers as well.
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With benefit expenditures represent the second largest payroll expense and typically constituting 30% to 40% of an employee’s total compensation package, she believes “showcasing how employees are valued through these benefits is extremely important.”
PlanSource works closely with several broker partners to help get its digital platform in the hands of employers. One such client is Lockton, whose relationship with the vendor dates back about eight years.
Brad Mandacina, who works in the HR technology and outsourcing practice at Lockton Companies, prefers online statements for a number of reasons. Noting how “we are trending as a society this direction,” he says the clear advantage is an ability to frequently refresh the data quarterly, monthly or even more often for a greater impact and deeper value.
An ability to deliver this information electronically “is so much easier,” he adds. “It’s real-time data.”
Real time analytics
Employers that embrace a paperless approach are able to access engagement analytics, as well as update and refresh data as often as they’d like, according to Foust. As for the promotional power of this platform, she says pop-up screens can help employees learn more about a certain benefit and click on a call-to-action link.
For example, she says employees who haven’t signed up for a 401(k) plan can view how an employer matching contribution on whatever amount they choose to defer on a pretax basis would affect their paycheck. They also could do modeling scenarios to show the effect of compound interest over several decades. Ultimately, the year-round accessibility of these online statements can help boost plan participation and benefits appreciation.
Foust says levels of interactivity can be customized to meet the needs or desires of each employer. “Some are integrating what we call parallax scrolling, so different items will move around on the screen as you’re scrolling down through the statement itself,” she explains.
There’s also the potential for a more proactive vs. reactive approach to benefits selection. Whereas annual printed statements that typically have been released early in the first quarter are a retroactive summary of the previous year, Foust says the ease of a digital platform can create a prospective view. Projected earnings for the coming year can be shared prior to open enrollment, which she says can lead to wiser choices.
“There’s value in knowing what you can take advantage of throughout the year,” she says.