Engage Your Workforce by Explaining Their Total Compensation

Do Staff Know How Much They Make?

Pay may not be the only reason employees change jobs, but it’s creeping up the list as a top factor. According to recent data from WeCare Connect, a leading provider of employee surveys in the U.S. and Canada, “Pay” was the 4th out of 5 top reasons why staff left their jobs in the past 3 months.

Employees may be leaving jobs because they think they’re underpaid, but oftentimes they may simply misunderstand what their total compensation is. That’s why it is so important for employers to educate their staff on the total investment they are making in them.

Don’t assume that your hourly workers understand the difference between being a W2 employee or a 1099 contractor. For example, many hourly workers are unaware of all the taxes, PTO costs, insurance fees, worker’s comp, retirement contributions, etc. that their company is contributing towards in each paycheck – they just see their net pay.

If employees don’t understand all the “unseen” benefits they’re getting, they may naively be drawn to a competitor who simply offers a higher hourly rate. In that situation, a W2 employee may leave a job making $15/hr job to take a $17/hr contractor role, not realizing they’re actually losing money in that transition.

Strategy: Give an Annual Total Compensation Statement

Sharing a Total Compensation Statement at least once a year can be eye-opening for employees. When they realize the investment their company makes in them day in and day out, they may be more likely to stick around longer.

When creating your statement, in addition to listing direct and indirect compensations (such as taxes and other employer-paid benefits) given to employees, also consider including hidden costs for onboarding, uniforms and equipment, training and development, bonuses, and holiday gifts.

Leadership may understand all the compensation factors connected with their staff, but it would be a mistake to assume the new workforce thinks the same way. Here again, is an opportunity to bridge a gap between senior leaders and today’s front-line workers.

To slow the revolving door of turnover, consider how you can better communicate the substantial annual investment you make in your employees. By clearly defining the full scope of their benefits and compensation, you’re also communicating how much you value them and appreciate their work.

You may not be able to pay your staff more, but you might be able to show them they’re making better pay than they realized!


Cara Silletto, MBA, CSP, is a workforce thought leader, keynote speaker, and author of the book, Staying Power: Why Your Employees Leave & How to Keep Them Longer

WeCare Connect is a leading provider of employee surveys with clients in over 1,300 locations throughout the U.S. and Canada. We provide real-time notifications and robust dashboards driving down turnover and increasing engagement.

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