Employers should not be shy about telling staff exactly what they are receiving – and the TRS is a perfect opportunity to remind them of their wider benefit offering, says Peter Crush
It’s not often that a piece of employee communication is just about pleasure. But, with most staff underestimating the value of their total remuneration package – that’s exactly what total reward statements (TRS) do.
When businesses secure more: “Wow, I didn’t realise my employer gives me a £10,000 pa more!”, and fewer: “Why’s my pot only worth this?”(a frequent reaction to a pension statement) it’s no wonder a TRS can be a powerful tool. And, with 2017 likely to be the year pay awards fall behind inflation, communicating the wider offering will only become more important.
But just because employers may be on to a winner, that doesn’t mean rules for communicating them should be forgotten.
“A TRS gives employers the opportunity to present all the information staff might get at different times of the year, at once – but this creates challenges,” says Matt Frost, business development & director of communications at reward consultancy Gallagher Shilling. “Deciding what to add and, more specifically, what to define as a benefit with a ‘financial’ value is crucial.”
For while salary and specific things paid for on employees’ behalf (such as life assurance and gym membership, etc) are easy to quantify in terms of cash, Frost says things start to get complicated when other aspects are considered.
“Corporate social responsibility, volunteering, culture elements, even tea and biscuits – knowing where to draw the line is difficult,” he says. Evidence for this comes from AON, whose own data shows that 96% of total reward statements include salary, 91% include pension details and 85% include bonuses. But after that it’s where firms have trouble. Few, it seems, know how to convert training into a ‘value’ (just 12% do), while fewer still (10%) include ‘career development’.
“The best way to think about comms is that it needs to be a piece of marketing; be upfront about what you offer, but don’t put everything. Staff see through it,” he says.
Nick Throp, founder of reward communications agency Like Minds, adds: “Marketing is intrusive – don’t be shy, tell people what you have – but if you’re trying to find a monetary value for something, that in itself is a sign you might be trying too hard.”
Throp, whose clients include Disney and HP, says that more recently employers have asked him to include the cost that buying a perk on the open market might cost – as a way of putting a price on benefits like employer-negotiated cash plans that individuals could buy themselves but would cost more.
Frost says: “We’ve also started categorising things into a ‘workplace cultural benefits’ box, which hoovers up more miscellaneous benefits.”
While other techniques include making the statement much less wordy and far more graphical – giving staff just enough information for an initial glance – both argue two key trends are also emerging: that TRS needs to be more regular, but also they should be much more than passive statements, and actually contain proper, marketing-style, calls to action.
There are certainly moves to prevent TRS being annual, forgotten-about pieces of paper. For instance, the NHS first introduced total reward in 2014, but last year it decided to up the frequency, to turn them into ‘mid-year refreshes’ to remind staff about what they had.
A spokesman said: “Refreshed statements were released in November 2016 and include any updates or changes to data made between June-October 2016.”
The main update is a pensions one – which sits alongside employees’ pay and allowances and, according to the NHS, 80% of staff say they feel their statements are comprehensive, with 88% saying they were useful.
It’s the changes to how TRS are presented that could be most significant communications change of recent years. “There’s a perception it’s no good just to deliver facts alone,” argues Frost. “What people need is reasons to engage with these benefits, and more ‘what to do next?’-type advice.”
Throp adds: “Good TRS communication is moving much more into the financial wellbeing agenda. Whereas a traditional TRS was all about ‘how fantastic we are’, now we believe it should be more about which monetary benefits can make the most difference, and how employees should maximise each £1 spent on them.
This is a subtle change from saying what reward is worth now, to what reward could be worth by changing how they alter their mix: bringing it into the flex area.”
Today, Gallagher Shilling says it has begun to routinely include information about where staff can go to change their benefits mix – and that this should almost be as prominent as the data showing the value of an employees’ package.
Frost says he’s even experimented with different treatments – such as giving much more detailed TRS information to certain employee groups (such as managers) – because a single, simple, catch-all document may not give each audience exactly what they need.
The message seems to be clear: total reward will always be a good story to tell staff, but there are good and then there are great stories. Why be mediocre, when with a little more thought you could really shout great messages instead?