Just before merit pay increases are being decided a company (that will not be named) sent out a “Total Compensation Statement”. This statement is lists base pay (wages), bonus pay (OT, bonuses, vacation), employer provided benefits (medical/dental/life), and retirement benefits (Medicare, social security, 401k, 401k match). The statement adds them all up and calls this the “total rewards”.
In this case, they appear to have inflated the numbers.
The retirement benefit category includes not only the employer FICA matched Medicare, social security, and 401k, but the amounts the employee had deducted from their own paycheck. The formula used to calculate total rewards is completely additive, meaning these deductions are being counted twice.
e.g. In effect, someone making $100k and having $30k of that chopped off from Medicare, social security is being presented as receiving $160k in compensation from the company ($100k + $30 from taxes + $30 from employer FICA match)
Do you think they made a mistake or this is intentional? Is this even lawful? I understand they presented the statement to increase employee retention, but this seems to cross the line.