REWARD
How can employers support the financial wellbeing of their staff?
Danny Done, Managing Director of Portfolio Payroll, considers ways in which employers can ensure the financial wellbeing of their staff in a sensitive manner
S upporting employee wellbeing should be a focal point for all businesses. It’s not only the right thing to do, but if you think about it pragmatically, an employee facing challenges in their life is likely to see it impact their ability to complete their role to the fullest. And no business wants to see a decrease in productivity, especially during a time of increased costs. Employees may require support for a wide variety of reasons, some more obvious than others. These could include: l mental health issues l financial worries l addiction l divorce
a decrease in confidence around job security, as businesses face the additional costs of increased employer National Insurance contributions and higher national minimum wage rates. Those increases in business costs, among other challenges, mean businesses are fighting extra hard to protect their bottom line. So, that begs the question, how do you support your employees without breaking the bank yourself? Is a pay rise the only solution? It could be easy to jump straight to the conclusion that paying an employee more is the best way to support their financial wellbeing. However, this may not be possible. After all, if increasing employee salaries leads to extra pressure on the business to cut costs in other areas, or increases the expectations placed on employees, this could result in a more stressful work environment for staff. Instead, it could be a good idea to ensure any pay review schemes are transparent and clearly communicated. This way, employees will know exactly what they need to do, if anything, to increase their income. There are many other low-cost ways that as an employer, you can support your employees’ financial wellbeing. This could start with placing a focus on providing information, guidance and coaching on how to manage and maximise their finances. This may be done internally or with the support of an external organisation. You could hold workshops or sessions on budgeting and saving or provide signposting to debt support services. There’s even the option of holding ‘swap shops’ and encouraging the re-use of items such as clothes or furniture with colleagues. If you have a budget for supporting employees which doesn’t quite stretch to
pay rises, you could consider incentives such as free or discounted food, or discounted train tickets or car parking. Anything that may alleviate some of the financial burden for your employees. Although whatever you decide to offer in the way of support will be individual to your business, all organisations should consider outlining the support available in a financial wellbeing policy. This will give employees the reassurance and confidence they need to access the support if required. Having it communicated in a policy may eliminate the need for a potentially uncomfortable conversation for the employee who is seeking support. Sensitivity is crucial Whatever you look to introduce, you should remember that an individual’s financial circumstances can be personal and sensitive. Creating a safe environment where employees feel they can come and talk to you about their situation without fear of judgment will be key to being able to provide the best support. However, not all employees will be comfortable talking about or sharing their own situation. Taking advantage of an employee assistance programme could provide these individuals with personal, confidential and tailored support for their own needs at no cost to them. Ultimately, supporting employee financial wellbeing is just one strand of support you can offer. Any financial wellbeing policy or support mechanisms should be used in conjunction with wider packages, which aim to provide employees with an environment that supports their physical and mental wellbeing. It’s important to remember that a one size fits all approach is unlikely to work, and where an employee raises any concerns regarding their wellbeing, this should be dealt with sensitively on a case-by-case basis. n
l fertility issues l menopause
l domestic abuse l health concerns l family problems l much more. While the law may influence how employees are supported in some of these areas, for others, it’s down to the individual business. There’s an argument that the wellbeing of employees has never been more important than is it now. Over the past few years, the aftermath of the pandemic, a cost-of-living crisis and major societal and political events such as the war in Ukraine, have left many people feeling drained mentally, physically and financially. In fact, in a recent study by City AM, only 30% said they were comfortable or confident in their financial situation. Financial wellbeing April saw a further exacerbation of the financial pressures employees may be feeling, with household bills increasing across the board for most. Add to this
43
| Professional in Payroll, Pensions and Reward |
Issue 111 | May 2025
Made with FlippingBook - Online magazine maker