The State of Electronic Communications in Compensation and HR
The State of Electronic
Communications in Compensation and HR May 2003
A Survey of WorldatWork
members by WorldatWork and Buck Consultants
Methodology
This report summarizes the
results of a survey of WorldatWork members conducted jointly by WorldatWork
and Buck Consultants in February 2003. The goal of the survey was to gain perspectives
on common practices and usage among companies of electronic communication of
compensation, benefits, total rewards and other human resources information
to employees. Additionally, Buck alone conducted a similar survey in 2001 (with
208 HR and benefits managers and communications). This recent survey shows some
interesting trends since the earlier one.
In February 2003, surveys
were sent electronically to a representative sample of 5,554 members of WorldatWork,
the Scottsdale, Arizona-based global association of compensation, benefits and
total rewards professionals. A total of 676 responses were received, a 12% response
rate.
Both the survey sample and
survey respondents are very similar to the WorldatWork membership as a whole,
and therefore, the responses can be considered statistically representative
of the membership. The WorldatWork membership generally consists of persons
at the manager level and higher, working in the headquarters of a large company
in North America.
Summary of Findings
Workplaces today are
“wired” for information. Nine in ten responding organizations
report that more than half of their workforce has access to the Internet or
intranet. This figure is up from 80% in the 2001 Buck survey.
Public access to total
rewards information at companies and other organizations is limited. While
nearly half of respondents report having some general benefits information
on their public web site, less than 20% have compensation information.
Within their own organization,
most employees have electronic access to employee benefits information. More
than half of responding organizations report some form of benefits information
-- 401(k) provider information, online healthcare enrollment, online SPDs,
etc. -- is available on their web site. Many of these items have appeared
since 2001, information that was “in development” two years ago
is now in place in responding organizations.
Online total rewards
statements are not as common as online access to information. Only 16%
of respondents currently offer statements electronically. Of those who do
have electronic total rewards statements, the most common elements are base
pay information and health and wellness information.
A majority of organizations
today are recruiting electronically, a significant increase from two years
ago. In 2003, more than 80% post jobs on their organization web site, an internal
intranet and on commercial job boards, compared to 2001 where less than 30%
reported posting opportunities on their intranets. Two in five organizations
post 100% of their openings online.
Online hiring success
is mixed. While most organizations post job openings online, less than
30% report that more than 75% of online postings result in a hire.
The most important objectives
of an organization’s online HR communication are to:
Foster better understanding
of the organization
Improve administrative
efficiency
Reduce costs
While reducing costs
is a main objective of an online HR communications program, just one in five
respondents indicate a clear savings from their online communications program.
An additional 26% report reducing some costs.
Detailed Findings
Websites, Intranets
and What’s On Them
Virtually all respondents
(95%) reported that their organization currently has a publicly- accessible
Website, up and running. A slightly smaller percentage (84%) reported the presence
of an organizational Intranet, frequently used to distribute information within
an organization to employees only. Almost half (47%) reported that their organization
has an Extranet, a site from which customers, suppliers and/or mobile workers
can access certain organization data and applications via the World Wide Web.
Only 3% respondents reported “none of the above,” and these respondents
then discontinued the survey.
Figure 1: Which of the following
does your organization have? (Check all that apply.)
According to survey respondents,
broad information such as organizational mission and history are commonly available
on Websites (88% and 91%, respectively). Far less commonly available on Websites,
however, at least at this time, is shareholder information (55%) and business
goals (48%).
More than half of all respondents
(52%) report having “general” employee benefits information available
to the general public on their web site. This contrasts with the less than one
in five who report having “general” compensation information (14%),
or compensation philosophy (18%). More than three-quarters of respondents indicated
their organization has no plans to make even general compensation information
available to the public.
Figure 2: Which of the following
is now (or will be) available to the public through your organization’s
web site?
Available
now
Will
be available in 12 months
Will
be available in >12 months
Not
available; no plans to make available
Corporate
vision/mission
88%
3%
1%
8%
Corporate
history
91%
2%
0%
7%
Business
goals, progress reports
48%
3%
2%
47%
Annual
& quarterly reports; shareholder information
55%
2%
2%
42%
Organization
charts
16%
3%
1%
80%
General
employee benefits information
52%
5%
3%
41%
General
base/incentive pay information
14%
3%
2%
82%
Compensation
philosophy
18%
4%
2%
76%
About two out of three respondents
reported that their organization has community-access computers (kiosks or workstations)
available to employees who do not have a personal computer at their workstation.
An additional 17% plan to make the Internet available to employees in the future
in this way, while the remaining 18% have no current plans for providing these
employees with Internet access.
Figure 3: For employees
who do not have a computer at their workstations, do you provide kiosks or workstations
in common areas with community-access computers?
Nearly half (46%) of responding
organizations’ entire workforce has access to the Internet/Intranet. Only
about 10% of organizations have less than half of their workforce online (see
Figure 4).
Figure 4: What percentage
of your organization’s workforce currently has Internet/Intranet access
on the job – either at their workstation or through a kiosk/community-access
computer?
Benefits
information makes up the majority of online employee-accessible information.
From general benefits information to online healthcare enrollment, more than
half of respondents report some form of benefits information access for employees.
Another 10-20% of respondents have plans to make this information available
in the future.
In contrast, compensation
information from incentives to personal pay stub information is available in
fewer organizations and nearly half of those without this information online
have no plans to make it available. Figure 5 contains detailed information from
both this year’s survey and Buck’s 2001 survey. It seems that many
features that were “in development” in 2001 are “currently
available” in 2003.
Figure
5: Which of the following information is now (or will be) available to employees
through your organization’s website?
Currently
Available
In
Development
(WorldatWork 2003 Survey)
In
Development (Buck 2001 Survey)
Not
Available
No Plans to Make Available
2003
2001
Within
12 months
12+
months
2003
2001
General
benefits information
81%
24%
6%
5%
38%
9%
39%
401(k)
provider information
80%
3%
3%
14%
Links
to benefits vendors (401k, prescriptions, savings plan, etc.)
76%
18%
5%
5%
40%
15%
42%
Ability
to make 401(k) plan changes
70%
8%
4%
5%
46%
21%
46%
Retirement
planning information, tools or links
69%
7%
5%
19%
Links
to other resources (financial planning, investment advice, travel)
55%
14%
6%
7%
42%
32%
44%
SPDs
on line
52%
24%
12%
9%
38%
28%
39%
Employee
on-line training
52%
17%
9%
12%
41%
27%
43%
On-line
work groups or information sharing
51%
12%
4%
6%
43%
39%
45%
Organization
charts
50%
7%
5%
38%
On-line
healthcare enrollment
50%
8%
11%
17%
46%
23%
46%
Organizational
performance goals
48%
19%
8%
5%
40%
38%
41%
Personal
benefits information
47%
11%
10%
14%
43%
30%
46%
Employee
orientation information
45%
5%
14%
12%
47%
29%
47%
Employee
benefits transactions or self service
41%
8%
13%
20%
46%
26%
46%
General
base/incentive information
40%
22%
5%
6%
38%
49%
41%
Compensation
philosophy
39%
9%
6%
45%
Ability
to complete routine employee record updates
38%
8%
16%
20%
46%
26%
46%
Personal
pay stub data
31%
9%
14%
47%
Department
or unit performance goals
27%
8%
7%
58%
Detailed
base/incentive information
22%
3%
6%
70%
Individual
performance goals
13%
4%
6%
77%
Recruiting on the
Internet
More than eight in ten respondents
post job openings electronically. Organizations use commercial job boards (such
as Monster, Hot Jobs or other local listing services), their own public web
site, and the internal intranet almost interchangeably. Seventy percent post
jobs internally before going external.
Of those who post any jobs
electronically, a large percentage (41%) report posting all of their job openings
electronically. Of those who attempted to estimate the percentage of hires resulting
from posting jobs electronically, 29% report more than three-quarters of all
hires last year were the result of electronic postings.
Figure 6: Does your organization
post job openings electronically?
In 2001, Buck found that 29% of responders
posted career opportunity information on their intranets, compared to 81% in
2003. Thirty-seven percent had a posting system in development and 38% were
not planning one.
Figure 7: Do you post open
positions internally before posting them on the public site or commercial job
boards?
Figure 8: What percentage
of your job openings were posted electronically in 2002?
Figure 9: Please estimate
the percentage of 2002 hires resulting from electronic job postings
Electronic Total
Rewards Statements
The majority of respondents
(84%) do not provide electronic “total rewards” statements to employees.
However, 11% plan to make them available in the next 12 months and another 15%
have plans further into the future for electronic total rewards statements.
Figure 10: Does your organization
provide online total compensation or total rewards statements to employees?
The 2001 Buck survey found that 11%
of participating employers offered statements and another 43% reported that
they were in development. It may be that on-line employee statements suffered
in recent cost-cutting initiatives.
Of those who do currently
provide electronic total rewards statements (n=102), 8 in 10 provide base pay
information and health and welfare benefits information on these statements.
Slightly more than 60% provide information on other aspects of benefits including:
flexible spending account(s), paid time off, retirement benefit to date, retirement
account match and EAP information. Incentive pay also is included in 60% of
responding organization’s total rewards statements. Offered much less
frequently on total reward statements is information about stock/equity plans,
retiree medical and employer-sponsored professional development. Figure 11 details
the information included in organization’s electronic total rewards statements.
Figure
11: For those currently with electronic total rewards statements, which of the
following are included in your organization’s online total rewards or
total compensation statement?
Not
applicable
Available
now
Will
be available in 12 months
Will
be available in 12+ months
Not
available;
no plans
to make available
Base
pay
15%
80%
1%
1%
3%
Health
and well being benefits
14%
80%
2%
3%
1%
Flexible spending
account(s)
16%
69%
0%
3%
12%
Paid
time off
15%
69%
2%
4%
7%
Retirement
benefit to date
16%
67%
1%
3%
13%
Retirement
account match
18%
66%
1%
5%
10%
Incentive
pay
22%
65%
2%
2%
9%
EAP
12%
63%
1%
5%
20%
Life/work offerings
19%
57%
2%
3%
20%
Tuition
reimbursement
17%
55%
3%
3%
21%
Retirement
benefit projected to retirement
19%
47%
3%
2%
29%
Stock
options
38%
44%
2%
1%
15%
Stock purchase
43%
41%
1%
1%
14%
Employer-paid
training
17%
36%
2%
3%
42%
Retiree
benefits
33%
35%
3%
1%
28%
Employer-paid
seminars, conferences
21%
25%
4%
3%
47%
Sixty-one percent of responding
organizations provide an electronic means for managers to calculate merit pay
increases and 43% provide electronic means for bonus pay calculations. Among
those who do not currently have these tools, most are not planning to develop
them.
Figure 12: Does your organization
provide managers with electronic information or worksheets for calculating these
salary actions?
E-communications Policies
Less than 5% of all respondents
actively discourage employee use of work-time for online personal benefits administration,
while large percentages report no official policy or a policy that is silent
on this issue. Buck’s earlier survey found that 32% of responding organizations
favored such use, 12% discouraged it, and 57% were neutral or had no policy.
Figure 13: What is your
organization’s policy, if any, on employees using work time for the following
activities?
Organizations use electronic
communication tools in the HR realm for a variety of reasons. According to respondents,
the most important objectives are to foster a better understanding of the organization,
to improve administrative efficiency and to reduce costs. Low on the list of
importance are to improve employee understanding of total rewards and to keep
up with competitors.
In the Buck survey, goals
sorted out a bit differently. Clearly, the new results reflect the downturn
in the economy.
23%
Employee
self-service
23%
Administrative
efficiency
21%
Better
understanding of business, goals, and challenges
19%
More
sharing of business information
16%
Greater
employee satisfaction
10%
Enhanced
employee education
8%
Cost reduction
3%
Better
total compensation understanding
Figure
14: How important to your organization is each of the following in designing
electronic communication tools?
Very
important
Important
Slightly
important
Not
very important
Not
a consideration
Foster
better understanding of the organization
59%
32%
7%
1%
2%
Improve
administrative efficiency
59%
33%
5%
1%
3%
Reduce costs
58%
29%
7%
2%
4%
Enhance
employee satisfaction
51%
39%
7%
1%
3%
Create
24/7 employee self service opportunities
39%
34%
14%
6%
7%
Desire
to be a progressive organization
38%
34%
19%
5%
5%
Reduce
number of calls to HR/ compensation department
32%
32%
24%
7%
6%
Improve
employee understanding of total rewards/ total compensation
30%
35%
15%
8%
11%
Keep
up with competitors
21%
31%
27%
11%
10%
While a main objective of
implementing electronic total rewards communications is to reduce costs (58%
of respondents feel it is very important), only 21% of respondents report that
there have been clear savings as a result of online services. An additional
18% report some modest savings but expect to see more in the future. More than
one-quarter (26%) cannot estimate the savings from online communications.
Figure 15: Has the use of
online services and processes helped your organization save money?
A combined 56% of respondents
say they are either extremely or fairly pleased with the results of their efforts
to provide HR-related information to employees electronically. Less than 5%
report being not at all pleased with the results
Figure 16: In aggregate,
how pleased are you with the results of your organization’s efforts to
provide information electronically to employees?
Finally, about one in three
respondents indicated that the development or enhancement of their online communication
capabilities is one of the highest priorities for their HR department. An additional
59% report it is important, but not the most important of their current priorities.
Figure
17: How would you characterize your HR and/or compensation department’s
priority regarding the development or enhancement of electronic communications?
“It
is important but other needs must come first”
59%
“It
is among our highest priorities”
32%
“It
is not a significant interest for my organization”
9%
Total
100%
Respondent Demographics
Organization Size
Industry
Manufacturing
13%
High
Technology
3%
Finance/Banking
8%
Healthcare
6%
Wholesale/Retail
Trade
4%
Business
Services
9%
Insurance
13%
Service - Non-Profit
4%
Government
8%
Utilities
2%
Communications
5%
Transportation
2%
Oil/Gas/Natural
Resources
2%
Education Services
1%
Construction/Real
Estate
1%
Publishing/Newspaper
3%
Other
17%
About
WorldatWork
WorldatWork is the world's leading not-for-profit professional association dedicated
to knowledge leadership in compensation, benefits and total rewards. Founded
in 1955, WorldatWork focuses on disciplines associated with attracting, retaining
and motivating employees. In addition to providing professional affiliation,
WorldatWork offers highly acclaimed certification (CCP®, CBPTM
and GRP®) and education programs, the monthly workspan®
magazine, online information resources, surveys, publications, conferences,
research and networking opportunities. WorldatWork, 14040 N. Northsight Blvd.,
Scottsdale, AZ 85260, 877/951-9191, customerrelations@worldatwork.org
About Buck Consultants
Buck Consultants, a subsidiary of Mellon Financial Corporation and a global
leader in HR consulting, specializes in the strategy, process, systems, and
finance of human resources. Buck has built and currently maintains more than
3,000 client relationships. Buck has professionals in more than 50 offices in
15 countries that customize consulting services to help ensure the health and
welfare of an estimated 15 million plan participants. Buck’s service areas
include compensation, retirement programs, actuarial services, human resource
management, health and welfare, and communication consulting. With its unique
blend of experience, proven technologies, innovation, and personal service,
Buck Consultants sets a standard in human resources consulting. For more information
on Buck, including details of Buck’s periodic surveys on human resources
issues and related trends, please visit www.buckconsultants.com
