What do you spend the most money on for employees? Benefits, right? And I'll bet you they don't have a clue what it's costing you. Have you ever seen or heard of a benefit statement? Yes, they can be a ton of work to produce but they can be worth every bit of it when done right.

A benefit statement is similar to giving each employee a personalized memo that depicts their entire compensation package. If you review your accounting statements each month, you know that a large amount of your annual costs are employee-related. It's time to share that information so your employees have a better understanding of how great it is to work for you.

Since creating these statements can be time-consuming, pick a time during the year when things are slower for you. While it would be fabulous to create these on a quarterly basis to keep reminding employees of their compensation package with you, you'd need to automate this somehow to make it practical. An annualized benefit statement is more common.

What's included? Everything you can possibly think of and put a value on! Start with their annualized salary/wage, then starting adding up the benefits:

• The employer's portion of health, dental, and vision insurance premiums for the year.
• The dollar values of that year's vacation accrual and sick time (or PTO plan).
• The dollar value of the paid holidays you offfer.
• The cost of their portion of your worker's compensation insurance.
• Allocation of each participants portion of any 401(k) plan administration fees you may pay.
• The cost of their employer-paid premium for any other benefit plan you offer, such as an Employee Assistance Plan.
• The value of stock or stock options they may have through your company program.
• The savings they've had thanks to your tax-free programs.
• The cost of temporary help if you always hire temps when that employee takes a vacation.
• And anything else you pay for that benefits the employee!

If you have trouble thinking of everything, talk to your accounting department. They pay the bills and know what items get charged to what accounts. You and your employees will be surprised at the size of each employee's compensation package when you're done.

To make this valuable, remember that each benefit statement must be personalized so it only shows the items and specific amounts related to that employee. That's why this can be a pain. It's worth doing at least once to find out if the benefit the company receives is worth the time it took.

If you do a good job of describing each benefit and its value, you'll gain in two areas. The first is by improving the employee's understanding of his/her compensation package and the value you place on each employee. The second is a better appreciation from employees for the efforts and decisions made each year when reviewing and changing their benefit package. Try it and let me know the results!