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A Powerful Employee Retention Tool That You’re Probably Not Using
May 23, 2024
Category: General
by Bill Silverman
In my past life in corporate America, I was the head of employee and market research for Courtyard by Marriott hotels. One year, I did an employee satisfaction survey with all our Courtyard employees to find out how they felt about working for Courtyard. Overall, our employees were happy, but as you might suspect the lowest area of satisfaction was with pay and benefits.
To find out more about what they didn’t like about their pay and benefit package, I interviewed some employees. What I found was driving their dissatisfaction wasn’t that Courtyard was offering terrible pay or bad benefits, but that our employees didn’t understand the total value of the pay and benefits that they were getting.
To respond, HR created a total compensation statement that laid out the value of everything that was included in Courtyard’s pay and benefits package and sent it to all employees.The following year when I repeated the employee survey, satisfaction with pay and benefits went up dramatically!
The moral of the story is that showing your employees the value of their pay and benefits package can be a powerful tool to increase their satisfaction and to reduce the chances that they take a job elsewhere for a couple of dollars per hour.
To create your own total compensation statement, outline all the components of an employee’s compensation package, Including:
- Base Salary: The starting point of the compensation statement is the employee’s base salary or hourly wage.
- Overtime Pay: If applicable, include any overtime pay the employee has earned during the specified period.
- Bonuses and Incentives: Include any bonuses or incentive payments the employee is eligible for, such as performance-based bonuses, sales commissions, or profit-sharing bonuses.
- Benefits:
- Health Insurance: Detail your contribution to health insurance premiums, including medical, dental, and vision coverage.
- Retirement Contributions: Include your contributions to retirement plans such as 401(k) or pension plans.
- Other Benefits: Include your contribution to other benefits such as paid time off (vacation, sick leave) and other insurance, like life insurance.
- Perks and Allowances: Highlight any additional perks or allowances you provided, such as car allowances, vehicle insurance and gas, cell phone reimbursement, or professional development stipends.
- Total Compensation: Calculate the total value of all the components listed above to provide the employee with a clear understanding of their total compensation package.
By including all the components of total compensation that you provide your employees with a comprehensive statement of their total compensation package, you’ll help them understand
the full value of what you provide to them so that they can make more informed decisions.
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