13 Jan Using Data Feeds, Interfaces, and Computations in Your Total Rewards Strategy
In many cases, most of the data presented for employees in your total rewards communication strategy will come directly from your organization. However, because your goal is to make it as simple as possible for employees to retrieve pertinent information, you may also want to include certain data fed into the system from third party sources, such as the 401(k) Plan Administrator.
Below, we’ve provided a step-by-step guide to make this process easier.
Step 1: Choose A Layout & Date
Either you or your vendor will work with the third party company to agree on a common data file layout and schedule for the transfer. Then, the data is uploaded into the system. There are specifics to consider here, such as: Do you want to show the total value of contributions to the associate’s 401(k) account for a relevant period? Or, do you prefer to show a break-down of the amounts contributed to specific mutual funds within the account along with the total?
Step 2: Analyze Data Transfer Method Options
There are two basic data transfer methods: First is a batch process. This is where the vendor sends an updated batch of relevant data pertaining to associates on a set schedule to your Total Rewards (TR) Communication system – usually a secure File Transfer Protocol (FTP) site. The data is then uploaded to the TR Communication system for associates. With this method, the data viewed by associates is recent as of close of business on the prior day.
An alternative is to have a dynamic connection with the vendor so the data presented is virtually real time. In this scenario, an associate is accessing the vendor’s system with the employer’s system as the gateway.
The batch method is generally preferred because there are fewer connectivity and monitoring issues.
Step 3: Consider Computations
With some items, a formula to calculate the value to present on the TR Communication may be the right approach. Consider a company that offers certain employees a transportation allowance equal to 2% of annual base salary. This amount can be determined with a simple computation and shown as a monthly, quarterly or annual amount.
Estimates can also be included as part of TR Communication. Of course, when estimates are used it should be clearly stated. For example, say an employer offers an on-site café where employees can purchase breakfast and lunch. An assumption can be made that the typical employee who uses this benefit will save $3 per meal compared with going to a local restaurant. If an employee uses the on-site café 4 times per week the savings = $12/week. ($12/week x 50 weeks/year = $600 annual benefit.)
Now that you know how to complete this component of a total rewards strategy, feel free to visit the HRsoft blog for more information, including a total rewards statement example and best practices for implementing total reward statement software.
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