Most employees think of salary-plus-benefits as payment for services rendered when they think of compensation. They’re correct of course, but it’s much more than that.
What most employees don’t realize is that compensation is always evolving. The package they received upon getting hired won’t always stay that way. Employers must keep them abreast with any updates on benefits required by law, as well as with any changes in the metrics for competitive benchmarking. They should also be aware of new workplace trends that can affect benefits, like the rising popularity of remote work which gives way to more flexible scheduling options, or the increasing automation of tasks which gives more time for learning and training. Aside from that, employers should also adjust compensation for employees who moved up the corporate ladder, or who showed exceptional performance worthy of recognition.
It’s for these reasons why using benefit statement software is important for the compensations and benefits (C&B) department of any company with employees on its payroll. C&B administration is a continuous process, not a one-time implementation. Because it’s a process, records should be kept and archived, ready to be referred to whenever necessary. Reports should also be easily generated for analysis and other purposes.
But it’s not the C&B department who stands to gain the most when a company decides to use benefit statement software. The biggest winners are the employees who are most likely not aware of the full extent of the perks they’re entitled to for various reasons. These can include:
- They were not informed.
- They were informed but they forgot.
- They misunderstood what they had been told.
- They didn’t know some benefits are opt-in.
- They planned to opt-in for said benefits but never got around to it.
- And so on.
And even if they are aware of all the perks they’re getting, they may not necessarily be aware of the actual monetary value. For example, an employee making $60,000 a year may jump at a chance to move to a competitor offering $70,000 – if they fail to factor in the monetary value of their benefits. If their current company offers perks equivalent to 50% of their salary, their total compensation package is worth $90,000. If the competitor offers perks equivalent to 25% of the proposed salary, the total compensation package is worth $87,500, which is lower than what the current company already gives. Here, the current company wins. But of course, without knowing the value of their benefits, the employee will simply see that $60,000 is lower than $70,000, and therefore not worth staying for.
Companies lose top talent this way. With only partial information, employees can make hasty decisions that have a negative impact on their career without realizing it right away. Fortunately, the use of benefit statement software can put together the complete big picture along with the little details so that employees can not only make informed decisions, but also appreciate much more what they’re already receiving. It will make them change the way they view compensation.