Cost of living crisis: how can employers help?

Rising,Cost,Of,Living.,Inflation,Financial,Crisis,Background

Financial wellbeing is more important than ever, given the cost of living crisis facing many of us today.

While it’s not a legal requirement for employers to promote employee financial wellbeing, 49% of workers perceive that it should be on their radar, according to a YuLife/YouGov survey.

This perception is particularly true for younger generations. This means that in the fight for the top young talent, employers that do nurture financial wellbeing will gain competitive advantage.

There can be a kneejerk assumption that what employees want most is a pay rise. But, particularly in the current economic climate, there are many other ways that employers can help, that could actually make more of an impact and generate more goodwill.

We’ve summarised a few for inspiration here:

1. Make sure your employees know what’s already available 

Research shows that engagement in financial products that employers offer is low and also that many employees feel their employers don’t explain what they are offering clearly. This, coupled with the fact that there’s still a stigma attached to talking about money, means that employees often don’t ask questions if they don’t understand.

Get over this by finding new ways to display and convey information about financial products like simple, summarising infographics, face to face workshops, FAQs sheets or even lighter hearted internal competitions to get the conversation going – pushing complex information out on the intranet or newsletter is not enough.

2. Shake the stigma

As we learnt in this webinar and article, there is still much stigma attached to talking about money and this is the biggest barrier to employees seeking help. Anything you can do to open up the conversation at work, such as getting people to talk about their money journey, or creating a network of Financial Wellbeing Allies or Ambassadors, will help break down these barriers.

3. Make use of EAPs

An EAP can be a valuable and, importantly, anonymous way employees can access financial resources. Again, communication is key here to ensure workers know that they can go to an EAP for this type of support.

4. Provide financial coaching so employees can make their money work harder

With money still being a taboo subject, coaching can make a huge impact (see this article and webinar for more on the impact, according to Octopus Money Coach).

There are ways that employers can make this option available affordably, for example, via salary sacrifice, or can be scaled for as little as £14 per month per employee according to Octopus Money Coach.

5. Introduce a salary sacrifice scheme

These enable workers to buy goods or services via the company payroll to avoid paying as much tax. Pensions commonly work this way but they can also be applied to many other payments such as travel, gym passes and mobile phone bills.

6. Give employees access to a money management app

There are apps like Moneyhub which can help workers manage their finances. Feeling more in control of their money will enhance financial wellbeing and confidence.

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7. Give your employees a one-off lump sum

Some companies are giving their employees a one-off payment of £1000 (beyond their annual salary reviews) to help them immediately with the rising cost of living, as a gesture of goodwill.

8. Help with their travel to work

In our webinar with the Money and Pensions Service, it was suggested that employers should think about whether they are costing their employees any money. For instance, now people are back in the office employees are also faced with increasing travel costs, both if they’re commuting by car or public transport. Employers can ensure they give employees the opportunity to work from home to save on travel, or create discount schemes including travel.

9. Let them shower without shame!

A suggestion which came out of one of our roundtables was to allow employees to shower at work, if possible, if they’re worried about their utilities bill. People can feel self-conscious about doing this at work, so it’s essential that you destigmatise it in your communications and encourage them to take advantage of this power-saving benefit.

10. Power them up at work

Similarly, take away any shame around employees using the workplace to charge up their phones or laptops by encouraging and normalising this behaviour in the workplace.

11. And more…

Our post of this article on LinkedIn generated many comments – including this from Jamie Broadley, Group Head of Health & Wellbeing Serco:

“I would add the importance of highlighting and packaging discounts from benefits platforms. Easy to find 5-10% discounts on groceries, insurances & some utilities which can offset price rises & make pay go further. Making these obvious & easy to access for frontline staff is crucial”.

This from Paul Caudwell, Wellbeing Manager, Co-op (and MAD Media Advisory Board member):

“For those that earn at or close to National Living Wage, things like salary sacrifice simply don’t offer the incentive as they don’t benefit from the tax/NI savings because of the way the tax rules work”.

And this from Josephina Smith, Reward and HR Thought Leader & Speaker:

“I’d add – get leaders and line managers to talk about how they have successfully used the financial wellbeing tools available to help normalise the conversation. Organisations can also set up a special fund to help employees who are on low incomes and are really struggling”.

Other useful links to resources for those in financial crisis have been collated by Champion Health here.

You might also be interested in:

Breaking the taboo around speaking about money

Lunch & Learn Webinar: How Employers Can Accelerate Their Financial Wellbeing Initiatives

The Cost of Living Crisis: Insights into the HR risks of rising global prices

 

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