Estimates show that benefits, such as healthinsurance, paid time off, pension plans and disability insurance,make up approximately 30 percent to 40 percent of an employee’stotal compensation package. However, according to the Societyfor Human Resource Management, employees have little, if any,understanding as to the value of their benefits as part of overallcompensation.

Benefits are considered the “hidden paycheck” of compensation.Unlike salary, which can be put into a bank or spent, benefitsdon’t provide liquidity. They are, however, importantnonetheless.

"A solid benefits package is a plus—but only if employees knowand understand what their employer makes available to them,"Marianne Adams, assistant vice president of enrollment services atColonial Life & Accident Insurance Co. told SHRM.

Then what’s an employer to do to communicate this type ofinformation to employees? "Benefits statements are helping manyemployers today get greater value from the benefits they provide,"Adams said.

A benefits statement provides employees with information abouttheir total compensation such as health coverage, vacation time,parking, wellness center memberships and just about everythingelse. SHRM pointed out that another positive to benefits statementsis they also offer information as when the employer is footing part– or all – of the benefits’ costs.

Such a statement doesn’t need to be complicated – even a listshowing benefits, along with the costs and employer pay-in can go along way toward educating employees that there is more to theircompensation than the paycheck they receive.

This information can be enormously valuable to employees as theyweigh their career and compensation options. After seeing benefitsstatements, employees might understand that, for example, notworrying about paying higher premiums for health coverage or havingfree parking is worth receiving a little less in a paycheck.

Meanwhile, on the employer side, benefits statements provide agood communication tool between management and workers.

"Employers find benefits statements tremendously valuable inhelping their employees better understand and appreciate everythingthey provide," Adams commented. "We strongly encourage companies totake advantage of benefits statements to help with the increasinglyimportant task of benefits education and communication."