A Report on State Employee Benefits as a Percentage of Total Compensation
April 2014
Report Number 14-704
Overall Conclusion
The State of Texas provides a comprehensive total compensation package to employees working in state agencies. The average value of the total compensation package for a classified, full-time employee for fiscal year 2013 was $60,871, or $29.26 per hour, an increase of 1.4 percent from fiscal year 2012, when the average hourly rate was $28.87. The two components of the average total compensation package that had the largest percentage increase between fiscal year 2012 and fiscal year 2013 were retirement contributions and health insurance costs paid by the State.
The total compensation package for fiscal year 2013 was composed of $40,398 (66.4 percent) in average annual salary and $20,473 (33.6 percent) in average benefits for a classified, full-time employee. In comparison, other state and local governments' compensation packages average 64.4 percent salary and 35.6 percent benefits, according to the U.S. Bureau of Labor Statistics.
As part of the total compensation package, State of Texas employees receive both direct compensation, or pay, for time worked, as well as indirect compensation, which includes benefits. (See Appendix 2 for a detailed list of the items in the total compensation package.) Quantifiable benefits included in the calculation of the compensation package were:
- Employer payroll expenses—includes Social Security and Medicare taxes, unemployment compensation, and workers' compensation.
- Paid time off—includes holidays, sick leave, and vacation leave.
- Health insurance.
- Retirement contributions.
- Longevity pay.
The State offered other benefits that were not included in the calculation of the compensation package. Examples of those benefits were state-paid or state-sponsored professional development and training, state compensatory time, military leave, emergency leave, parent-teacher conference leave, volunteer firefighters and emergency medical services training leave, court-appointed special advocates volunteer leave, wellness leave, and extended sick leave. While the use of those benefits may vary depending upon employee circumstances, they are real and valuable benefits to employees at all levels.
In addition to salary and benefit costs, the State provides employees with other rewards that cannot be easily quantified but provide indirect, real, and valuable benefits. Examples of those rewards include flexible work schedules and employee recognition programs.