We’ve all seen the research data documenting the positive effects that benefits have on employee morale. However, in today’s age of shrinking benefits and rising premiums, employees are likely missing the forest for the trees.
During last year’s open enrollment, most employers likely had to raise their employee cost-share, increase their medical deductible, offer a new CDHP or all of the above. Employees can perceive these types of changes as takeaways and/or benefit reductions, resulting in lowered morale.
That’s why it’s important for employers to show their employees that they are not alone in this. The employer is also making a substantial investment in their employees’ health and well-being with their medical plan, as well as their entire benefits package (dental, life, disability, PTO, etc.).
That’s where a Total Compensation Statement comes in.
Total Compensation Statements are a relatively easy and cost-effective tool that illustrates the complete value of an employee’s compensation package – salary, benefits, PTO programs, etc. On one document, employees can quickly see all of their programs, including the contributions made to each by themselves and their employer. This allows employees to better understand just how much their benefits are truly worth.
For example, an employee may be surprised – and very pleased – to see that their employer’s share of the costs of their benefits, including medical, dental, vision, 401(k) match, etc., can increase their total compensation by nearly 30-40%.
We have created Total Compensation Statements for a number of our clients’ employees with very positive results. These documents can be a real eye-opener, as many employees do not see the true cost of their benefits until they see a COBRA statement.
Doug Mantz is Vice President of Sales at The Farmington Company, a national provider of benefits communication and voluntary benefits services. He has over 20 years of industry experience, including on the carrier side. Doug is a published author and has spoken on a variety of industry topics. He is a graduate of Boston College with degrees in Economics and Sociology. He can be contacted at firstname.lastname@example.org or 1-800-621-0067, x6703. For more information about The Farmington Company, please visit www.farmingtonco.com.
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