Further to yesterday’s news that Ofgem are set to increase the energy price cap (again), we thought we’d share some ideas on how you can support your staff through this cost of living crisis.
Employee money worries cost UK employers an estimated £1.56bn every year through increased absenteeism and a decline in productivity due to increased stress levels and sleepless nights.
There are, however, some things a business can do to help their employee’s financial situation, which doesn’t involve increasing their monthly payroll bill…
Top tip #1 – Encourage open discussions about finances. Don’t let it be a taboo subject. Ask the question in your weekly 1-2-1 catch up’s. Make it part of the ‘How are you?’ conversation. Empathise with your employee’s situation – let them know you are aware of the current economic situation and that you understand how it can be a major cause for concern. Ask them what you can do to help and most importantly, listen to understand.
Top tip #2 – Review your Employee Assistance Programme (EAP). Often, EAP packages include Financial Health support that many of us don’t even know about. There can be some useful tools to assist with budgeting and debt consolidation and some providers even offer free counselling sessions with professional advisors. Reach out to your EAP provider and find out what Financial Health support your package offers and then promote it! Make your staff aware that it is there and encourage them to use it.
Top tip #3 – Invite a qualified, credible expert to talk to your people. A Financial Advisor, Tax Expert or Pensions Advisor could come into your office (in-person or virtually) and talk to your people about their finances. You could make a day of it and open the afternoon up into a ‘Financial health check’ with private drop-in sessions with your expert speaker. Employees can book a slot to attend and receive free 1-2-1 advice and support on how to manage their finances.
Top tip #4 – Review your current ways of working. Can you make any changes to relieve some financial pressure? For example, if you are currently office-based, could you introduce hybrid working to allow your employees to work from home a couple of days a week to help reduce their travel to work costs? Could you adapt your working hours, allowing the working day to start a little earlier/later, so your staff don’t have to pay the ‘peak time’ train/tram fares? Bear in mind that such changes may involve changing terms and conditions of employment (their contract) and so it is always advisable to seek advice before implementing any changes to working hours/location. However, if it is viable for your business operation, it could really help your employees financially.
Top tip #5 – Provide clear career paths. Show your staff where they can progress to and what they need to do to get there. Inevitably, a promotion will come hand-in-hand with a pay rise and so identify those who are keen to progress (and earn more money) and highlight the skills gaps which they need to fill, in order to get there. Can you offer to fund any training they may require? Internal growth is key to business success, as the experience retained gives you competitive advantage, so it will also benefit the business to invest in employee development. Having a plan in place for when staff move on (a succession plan) is also a crucial part of resource planning, as it ensures there are contingencies in place, so your customers feel no detriment. The return on investment from employee development is therefore extremely worthwhile and whilst this forms part of a longer-term strategy (as climbing the ladder doesn’t happen overnight), it can help your employees remain focussed in a time of uncertainty; it can show them that there is light at the end of the tunnel, in the form of financial reward.
Top tip #6 – Explore flexible pay. Also known as ‘Earned Wage Access’, there are software companies you can invest in which allow employees to withdraw money they have earned as and when they accrue it, so they don’t have to wait until payday. This can help employees avoid late payments or taking out high-interest payday loans. You must however ensure your employees understand exactly how it works and that it means they won’t receive a full wage at the end of the month if they choose to withdraw some of their earnings early. You could work with the software provider to set a limit on how much they can withdraw, such as no more than 50%, or perhaps a cap in terms of how many times per year they can withdraw their wages early, so they don’t end up in financial difficulty. If implemented correctly and used responsibly, flexible pay can be a great employee benefit in emergency situations. For example, if they receive an unexpected bill if their boiler breaks down, or if they need to claim on their car insurance, not everyone has savings they can rely on (in fact, research suggests that around 15% of the UK population have no savings!).
These are just some ideas, there is no one-size-fits-all.
If you would like to have a more detailed discussion regarding your employee’s financial wellbeing and how to action these tips for your business, please contact our HR Specialist Lydia:
? Direct message – LinkedIn – Lydia Gosling (Assoc CIPD) | LinkedIn
? 07342884261
