UK - Workers underestimate the value of their total pay and benefits package by as much as 25%, KPMG People Services claims.
But it believes firms can solve the problem by giving employees total reward statements to show the true cost of benefits, such as pensions, share schemes and health insurance.
KPMG People Services senior consultant Tony Morgan said one of the key dangers for employers with generous benefits packages was that employees were not aware of the value of the total reward when considering other job offers.
He estimated that employees generally underestimate their total reward package by as much as 25%.
He said: “Total reward statements give employees a clearer benchmark when considering alternative employment and can therefore act as a retention tool because employees value the total package and not just the salary.”
Some employers are now also using total reward statements to show employees what they could have received if full bonus targets had been met.
Morgan says total reward statements are growing in popularity because new technology has made them far cheaper to produce.
In July HBOS introduced total reward statements to its 65,000 staff in an effort to show that their benefit packages were often worth around 25% of their pay.
One of the key objectives for HBOS was to boost employees’ perceptions of their pensions and share schemes.
Its total reward statements will show the value by which shares held by employees have appreciated over the last year.
HBOS reward director Jacqui Anderson said: “If you are not issuing total reward statements you are missing a great opportunity, especially if you do have a varied package where it is not always obvious what the monetary value and cost is of these benefits.”
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