Is your communication to employees not all it could be? Then read on...

ERB: Total reward statements look great, make common sense and are fairly cheap but do they actually work?

Talking People managing director Tim Roberts: Let's start by picking the question apart. Total rewards statements don't always look great. One of the disadvantages to a lot of approaches that companies take is they don't know anything about the audience, yet bizarrely, they do generally work irrespective of the content because they are still a very popular means of confirming the deal that employees get. I mean the sad thing is they are not usually very interactive. It is a fait accompli - this is your total raw deal. That is the shame.

Thomsons Online Benefits account director Chris Wakely: Total reward statements can mean many different things to many different people, but if you are just delivering a piece of information to somebody without any interactivity, it is not actually part of a communications campaign. It might work in terms of telling someone the deal they have got, but there is a lot more value that can be got out of them. It is almost like getting a pensions statement once a year, you receive your total rewards statement, you might read it and then it goes in the filing cabinet. But if it is part of a campaign, then I think you can make it much more effective.

Tim Roberts: Who can remember what performance score they got last year? And what bonus or extra base pay that resulted in? That is the thing that should go into these kinds of documents. They should be broader than just the reward - they should actually communicate the individual's performance. But they are relatively cheap. A number of employees have come to me lately who have actually used them in an interview. They have said that is my total reward, what have you got to match? I think there you have enormous value, whether you are doing a comparison statement or a before and after statement, that is when these things are really incredibly valuable.

JPMorgan Invest director Jonathan Watts-Lay: Total reward is the wrong name. It should be called the reward you have chosen, as opposed to what your total reward could be. We know that most people can maximise their pensions and if they did then that would actually give them more rewards. We also know that companies don't talk about share incentive plans and the way you can transfer shares into a pension in a very tax efficient way. Companies that offer these could enhance benefits, as the transfer from one to another gives the employee two lots of tax relief on the same money. Not only is this the only example I can think of where two lots of tax relief on the same money can be achieved but it also helps employees get closer to total reward. The statements actually understate, in a lot of cases, what the true reward could be without there being any additional cost to the employer, such as getting two lots of tax relief as described above. You have got to talk to people about it, educate them. Unless you actually interact with employees you are not going to change their behaviour. Too many companies rely on brochures and intranet sites to explain rewards. This may be fine for simple benefits but pensions and shares are often complex, so they need to be explained in an interactive way to gain real understanding, which will encourage benefits to be maximised.

Thomsons Online Benefits head of benefits consulting team Judith Inglis: I think that in order for them to work they have to connect with the value that the employee actually sees in the organisation. When we are out talking to the employees of our clients, quite often the things that will be high on their list of importance are the intangible things that rarely get valued in the reward package. We had one example where one of the most valued rewards was the shop that was available onsite, because our client was based on an industrial estate.

CIPD reward adviser Charles Cotton: I don't yet see many organisations where individuals are able to access on the intranet what they are not telling you about on their pay statements, such as opportunities for career development, training courses, flexible working arrangement.

ERB: Is tailoring communication (the process of splitting employees into age groups and then targeting each group with different communication) only the preserve of large employers?

Chris Wakely: If you are creating a communication campaign that needs to be segmented into different areas, that is probably going to be quite expensive, so then, the budget brings it into the realm of the large employer. But we have a lot of smaller organisations that segment their communication because we are able, through technology, to target people by age, those who have just come back from maternity leave and so forth.

Jonathan Watts-Lay: We do a lot of work on big companies that have sales people, people in head office, people in the manufacturing plant, the way you communicate to these people has to be completely different. For example, you can provide an interactive webcast for employees in head office, who sit in front of a computer, but for those working shifts in the manufacturing plant, group sessions are more effective. What we found is that a lot of companies spent a lot of money on what we would call passive communication. They would go and produce very expensive glossy brochures, send them out and of course very few read them, let alone understand them. If companies transferred the money they spent on glossy brochures to true financial education they would have better take-up of benefits, employees would be better off and the cost of communicating benefits stays the same. So do away with those glossy brochures.

ERB: Encouraging employees to interact with benefits in fun ways, such as competitions, is a popular trend.

Chris Wakely: What you want to do is get people to interact with their benefits. And you want to be able to do that by not necessarily talking to them in normal corporate speak. If you produce a glossy corporate brochure around what your benefits are, and what your pensions are in particular, that is detailed in a very serious way; well it is not necessarily going to engage someone's attention, because it is a corporate style brochure. Introducing something that not everyone is going to enjoy. The cynical people in an organisation might think 'well I am not going to engage in this', but is a good way to get people talking.

Tim Roberts: I don't like it. I think it demeans what you are trying to do. It is far better to go for the serious meat of the issue, like dealing with debt. If something is really that important and you do it in a really clever, below the line, marketing way, you will get employees engaged anyhow.

Chris Wakely: But I am talking about making people aware of the fact that you want to talk to them about serious issues, by doing something that is not just simply a boring corporate communication. The creative and fun engagement is a way of getting people to the meat of the issue.

Judith Inglis: A good brand launch acts as a signpost to all benefit information. It gives the organisation somewhere to pin their benefits to, rather than having that dark corner of the intranet no one ever visits.

Jonathan Watts-Lay: A client of mine was running an SAYE scheme, and because there was so much gain, lots of people sold their shares and got a tax bill, and the company told us that certain employees turned round, some months later, and said, 'Oh, I sold those shares from that scheme and I ended up getting a tax bill. Why didn't you tell me?' So a scheme that employees had been saving into for five years, something that should be a really positive thing, turned into this less than positive experience. So, the following year we did this quite creative e-mail communication and the key message was 'you are going to be getting a big gain on your SAYE scheme in a month's time and some of this may go to the taxman, unless you learn how to manage the potential taxability'. We were inundated. Because all of a sudden it is 'I don't want to pay tax'. Whereas what they had done in the previous year was say 'your scheme is coming up to maturity, if you want any information about this let us know'.

Tim Roberts: Employees are very sceptical when they start getting big glossy booklets. They know there is trouble. If a company is going to spend money on it, it has got be serious.

Charles Cotton: If you have a predominantly young workforce, which is into fun and socialising, then possibly these games may be one way of raising the prominence of the launch. In other instances I am sure it will just fall flat. A lot of benefit communication I see is quite bland and doesn't focus on what is in it for the employee, what is in it for the worker, and why is the organisation providing it in the first place.

ERB: When is it better to go for a big expensive benefits campaign, and where is it better to stick to more regular communication?

Chris Wakely: Regular, targeted communication is going to work better than expensive and glossy. The people in the business, where it really counts, just think here is another example of management wasting money.

Tim Roberts: You want to see how many people are subscribing, how much you are spending on it, what is your return, how many people are taking up the offer.

Chris Wakely: We run this concept called 'intelligent reward', which makes sure that you are spending your reward in an intelligent fashion; not just doing things because they are fashionable. We are able to tell you at the push of a button, how many people have taken up their maximum matching, how many people haven't. We then analyse and deliver that data back to our customers to truly bring out the value and the concept of rewards to management.

Charles Cotton: Many organisations look at the uptake of pensions and share plans, but not many know the impact on the organisation. Does it actually help recruit employees? Does it help us retain them? There doesn't seem to be that link.

Jonathan Watts-Lay: Communication has to be regular and segmented, but it also has to be engaging. If you can't have those three things, then it is not going to work. But those three things do not make it expensive. It can make it just as cost-effective. We are increasingly finding that younger people say, 'I am 25 years of age, I cannot actually draw a pension for 30 years, so I don't want to pay into it because I want to save a deposit on a house.' This is where companies miss a trick because now it can be just as tax-efficient to say to that person, 'rather than paying 100 pounds into your pension, why don't you pay your 100 pounds into your SAYE scheme, or your company's share incentive plan?' Often share incentive plans are matched, the same as a pension. You get full tax relief and at some point in the future you can use it to put a deposit on a house if you wish or, indeed, eventually pay it into your pension. The key here is that employees have flexibility based on their life stage.

ERB: Letting employees view benefits communications at home, either by post or through the internet, is a growing trend. Can this really boost benefits take up?

Charles Cotton: It depends how they are accessing it. There may be issues about using company laptops at home, especially if it has confidential information.

Chris Wakely: By allowing people to view their benefits communications at home, we are coming back to the fact that benefits are not just about your employment, they are about your life.

Tim Roberts: But on the other hand, there is no substitute for seeing the pensions expert, and the share expert at the company.

Chris Wakely: No, but if you get someone thinking about their pension on a Sunday night, you can make the pension advisor available to them in work on the Monday. Some employees do not like to be communicated with at home, because they feel it is an invasion of their privacy, even to the point of getting a letter. This needs to come back to the culture of the organisation and the type of people that you are dealing with.

ERB: Axa allows its employees one hour a month to access a budget planning website. They are marketing it as a general financial education tool, but the big win is for people who are in debt to manage their finances.

Jonathan Watts-Lay: Personal debt levels are the highest they have ever been in this country and this is really affecting other benefits. We have got two or three companies that take on significant numbers of graduates every year, and they cannot run our induction programmes the way we used to because people are asking 'should I be making my pension contribution before I pay off my 20,000 pound student loan?' We had one example where a company offered preferential loan rates to employees, but a valued employee didn't realise. She had bad personal debt problems and could have consolidated that within her benefits programme, but did not understand it. Another person asked to take voluntary redundancy, and when the head of compensation asked why she said: 'I see it as the easiest way to pay off my debt.'

Judith Inglis: If you have a debt problem that is an important and valuable benefit to you. If you become sick, critical illness cover is the most important. If you are approaching retirement, your pension is. It is about segmenting communication to the people who it is most relevant to.

Tim Roberts: About 12 years ago, we were doing a lot of work introducing stress management modules to companies. One CEO said 'we are not doing this, because if we implement a stress management programme, people will know we have a stress problem in our organisation'. Debt is a similar thing. The first time it really came up with a client, they said 'the perception will be that we are not paying employees enough'.

ERB: Can we just mention something about communicating by text?

Chris Wakely: We have got a number of customers whose people are travelling all the time and to announce or communicate something via a text message is quite a quick and efficient way of doing so. Typically speaking, people will still always read a text message; whereas, a lot of e-mails go unread, letters go unopened.

Tim Roberts: A lot of companies are very sceptical of actually going to employees' private mobile phones. If it is a corporate mobile phone, provided by the organisation, then they feel happier.

Charles Cotton: It is the intrusion of privacy. We have not had a campaign where we are actually communicating to someone's private mobile phone. Maybe to a very small organisation you could potentially do it.

Tim Roberts: It does smack a bit of 'you've been fired', doesn't it?

Jonathan Watts Lay: If it is right, and it is helpful, and it is meaningful, then great. There is no reason why you should not use it; it just depends on the audience and the importance of the message.