Total compensation statements begin arriving at employees' homes
By Michael Weinbeck
From Brief, June 17, 2008
For the first time in the University of Minnesota's history, staff and faculty will receive statements that account for the total dollar value of their pay and benefits. Total compensation statements, which will begin arriving at employees' homes this week, reflect the University's strategy to become as transparent as possible about its funding and salary philosophy.
Total compensation statements are part of a national trend among employers to present compensation packages more holistically. In the U's case, take-home pay is only one part of a big picture. The U's benefits, career opportunities, and diverse work environments are all becoming key elements in helping it compete to attract and retain top employees.
As the U develops its strategic plan, it is placing greater emphasis on its most essential resource: faculty and staff. Seventy percent of the University's budget is invested in its workforce. University administrators are working to have open conversations about what makes the U one of Minnesota's most desirable employers. Moreover, given close budget scrutiny from the public and elected officials, the U is increasing the transparency of its funding and salary philosophy, working to clearly articulate how much it spends on additional benefits.
While many of the features of working at the U can't be calculated in dollars and cents, the total compensation statements address some of the more concrete benefits. Health care, tuition, retirement, and other benefits all get added to the U?s bottom line, but few employees ever see how much the institution invests in them individually.
"I think that most of us use only one figure to calculate our compensation: what we take home in our paycheck every two weeks," says Jackie Singer, director of retirement programs for the University's Office of Human Resources and the head of the total compensation statement project. "Most U of M employees make a lot more than their take-home pay, but the U hasn't always done a good job talking about that."
"Our employees deserve to know, in very clear terms, how much they're making," says Singer. "We're one of the state's biggest employers. There are a lot of great things about working here and I think these statements show a good slice of that."
Diana Booth, an employee at the Carlson School on Management, sees the statements as a way of understanding how the U stacks up. "I work in marketing, which is a rather competitive industry," says Booth. "It can be hard to compare what I make as a U employee with what a peer makes somewhere else. You can't just compare annual salary to annual salary. I'm getting my MBA through a Regents Scholarship, and that alone is a generous benefit."
According to Singer, the average U employee receives about 30 percent more than the value of his or her annual salary in other benefits. Although the University has a reputation for having a generous benefits package, most employees have never been told its actual value.
Sara Smuk, an administrative assistant in Facilities Management's St. Paul district, thinks the statement will give a better picture of how much her benefits are worth. "My bi-weekly pay statement shows a lot of information about what the U kicks in for my health benefits," she says. "It will be good to get a sense of what all of that totals up to at the end of the year."
The statements were prepared for the University by TotalRewards Software, a California company that specializes in calculating total compensation. In addition to paper statements, the company is also providing employees with an on-line version of the statement with more detailed information about each of the types of benefits. Login instructions for the Web version are printed on the paper statements.
The Office of Human Resources employee benefits staff will be available to answer questions about the contents of the statements. They can be reached by phone at 800-756-2363 (612-624-9090 in the Twin Cities).