The Complete DIY Guide to Creating Professional Total Compensation Statements

While most companies understand the importance of compensation statements, many struggle with the process of actually creating professional, accurate statements internally each year. Properly collecting and integrating data from multiple sources, designing a clear branded template, validating calculations, and distributing statements securely requires careful coordination and quality processes.

By following the guidance laid out in this DIY guide, HR teams and people managers can streamline the full compensation statement lifecycle - from design through delivery. We'll cover all the crucial steps, checklists, and best practices to produce polished statements that achieve the intended goals of transparency and appreciation.

Introducing the Total Compensation Statement Guide

Benefits of Creating Employee Statements In-House

While partnering with an outside vendor to create pay and benefits statements is an option, there are distinct advantages to handling the full process internally at your organization:

• Total control over branding, messaging, timelines

• Lower costs by leveraging existing resources

• Data is kept fully internal with tighter security

• HR/Payroll team develops technical expertise

• Ability to fully customize every aspect based on your unique needs

While there is an initial lift to define processes and get started, bringing statement creation in-house provides control, cost savings, and peace-of-mind that can't be matched.

The Full Process for Creating In-House Total Comp Statements

Four phases of the total comp statement process

1. Design the branded statement template and layout

2. Prepare and process all required employee data

3. Generate test statements for rigorous review and approvals

4. Print statements, email, or upload for secure distribution

At a high level, the process for creating total comp statements internally involves four overarching phases:

Each phase involves a series of defined steps, procedures, collaboration checkpoints and quality assurance (QA) reviews. We'll dive into more specifics on each of the four phases next.

Phase 1 - Design the Statement Template

The first step is designing and creating the overarching template that your finalized statements will follow. This requires gathering input and aligning on:

• Branding guidelines and approved assets (logos, colors, fonts, etc.)

• The specific compensation components that will be included (salary, bonus, insurance, retirement, equity, PTO, etc.)

• Defining the desired sections, data fields, and layout

• Drafting and refining the statement template design itself

• Routing for stakeholder review and approvals

Example benefits enrollment statement with mock record data

Getting comprehensive input and approvals during this phase is crucial, as it establishes the foundation for everything else. Share draft templates with all relevant stakeholders - HR, executives, legal/compliance, etc. to ensure the design and content fully meets all requirements.

Once a final template has been approved, you can move into acquiring and preparing all of the required employee data that will eventually populate each statement.

Statement template review and approval workflow

Phase 2 - Comprehensive Data Preparation & Processing

This is arguably the most critical and complex component of the entire compensation statement process. Having rigorous, well-defined data preparation and validation procedures is absolutely essential. Any errors or inconsistencies in your data will be reflected across all employee statements, undermining the entire project. Your data process should have these key characteristics:

Once you have confirmed the quality of your data sources, you can start the data preparation workflow:

1. Standardized, documented procedures and processing guidelines to follow

2. Redundancy and checkpoints built-in to minimize disruptions and mitigate risks

3. Flexibility to adapt to changes, variations or new data requirements

4. Involvement from all relevant data owners, process experts and key stakeholders

5. Thorough documentation of data sources, calculations, transformations and lineage

Before you collect and integrate data from your data sources, you need to scrutinize them thoroughly. Considerations for each data source:

• Evaluate the origin and collection methodology for potential biases or issues

• Assess completeness - are all the required data fields and attributes present?

• Verify overall integrity - has the data been manipulated or altered in any way?

• Confirm regency - is the data sufficiently up-to-date and current?

• Identify any anomalies, outliers, or concerning areas requiring remediation

• Review external audits, data complexity and accompanying documentation

• Ensure you have the proper approvals and permissions to use the data source

This can be a highly iterative process, with multiple cycles of data integration, validation, enhancements and reviews required before being confident enough to generate statements. Building in checkpoints with subject matter experts is crucial.

Testing Data Quality & Integrity

With your processed, enriched data set, you need robust testing procedures to validate quality, accuracy and integrity before using the data for statements, including:

• Performing cross-source value validation checks against system reports

• Analyzing statistical distributions to identify outliers and anomalies

• Sampling across various employee populations, locations and segments

• Conducting year-over-year change analysis versus historical data

• Reviewing for data privacy, security or PII compliance issues

• Population and completeness testing

Once your processed data set has completed quality testing you can proceed to merging it with the approved statement template for production.

Example statement data prep and data quality workflow

Phase 3 - Rigorous Testing, Review & Approvals

With test statements generated using your finalized data set and template, you can initiate a rigorous multi-stakeholder review and approvals process to catch any errors before finalizing the full set of statements. Testing should be comprehensive across:

• All variations of employee types, roles, compensation plans etc.

• Each individual compensation component, section and calculation

• Overall designs, branding, formatting and legal/security requirements

Here is an example review workflow:

1. Generate robust test statement samples for all employee variations

2. Conduct in-depth reviews by all stakeholder teams:

3. Iteratively make revisions based on consolidated feedback

4. Obtain final approvals from all required parties to proceed

5. Perform final thorough QA reviews and data audits

The QA checks during this phase should validate all of the following:

• Accurate employee identification and demographic information

• Data values precisely matching source systems (pay, bonus, etc.)

• Calculations are correct with no rounding or total errors

• All required compensation sections are complete and consistent

• Branding, styling, formatting aligns to requirements

• Design meets readability and legal/policy standards

• Proper handling of any sensitive, legally-required information

Once final approvals are obtained on the test statement set, proceed to the delivery and distribution phase.

Phase 4 - Printing & Secure Distribution

With your finalized total compensation statements ready to go, it's time to determine the most effective, secure way to distribute them to your employees. There are several key approaches to consider, each with their own benefits:

1. In-Person Manager 1:1 Meetings

• Print physical copies of statements for managers to hand-deliver

• Schedule 1:1 meetings for managers to walk through statements with each employee

• Allows for in-person Q&A, clarification of details, and personal connection

2. Mail Statements Directly to Employee Homes

• Leverage a secure printing and mailing provider to handle production

• Statements mailed directly to each employee's address on file

• Ensures confidentiality and allows employees to review on their own time

3. Provide Secure Digital PDF Packages

• Generate password-protected PDF statements

• Package individual PDFs for each manager's team

• Managers can securely email PDFs to their direct reports

• Allows for virtual review and discussion of statements

The key is choosing the right mix of distribution methods that aligns with your company culture, employee preferences, and confidentiality considerations.

Key Takeaways and Getting Started

Creating total compensation statements in-house is a multi-phase process that requires careful planning, cross-functional collaboration, and diligent quality assurance every step of the way. However, the payoff in employee engagement, retention, and cost savings can be immense.

By following the guidance and best practices laid out in this DIY guide, your HR team can streamline the full statement lifecycle with confidence:

• Design clear, branded templates with the right components

• Integrate data sources through comprehensive preparation

• Facilitate thorough testing with all stakeholders

• Thoughtfully deliver statements in print or digital formats

The key is defining and documenting your processes, checklists, and accountability points. Start small with a sub-set of statements if needed, then refine and scale up your approach each cycle!

While there is certainly an investment of time and coordination required, particularly for the first cycle, the long-term benefits of providing total compensation transparency cannot be overstated!

Following a rigorous, quality-driven process and learning from past iterations, your organization can turn compensation statements into a yearly engagement powerhouse when fully internalized. The guidance above gives you a proven roadmap to make it happen.

Don't want to do it alone? Atlas Benefits Communication can support or advise on any phase of your statement project.

For a birds-eye view of the statement project process - Download our Project Roadmap PDF