Search
Close this search box.

Your employees just got poorer. Here’s how to help them out

Discover proactive strategies for businesses to alleviate financial strain on employees amidst increasing living costs.

It’s been a tough couple of years for our household finances. And budgets are about to get tighter as bill increases come into effect across England.

Mid-contract price hikes for mobile and broadband, council tax rises, TV licence increases and higher water bills all came into effect this week. Research* shows that despite energy savings as a result of the new lower Ofgem price cap, the average UK household will be £72.77 worse off each year.

Bill increases eat into disposable income, impacting morale and exacerbating financial anxiety. This matters for employers: three quarters of HR leaders say cost of living pressures are impacting employee performance. And two in five HR leaders believe employees are doing additional ‘life admin’ on company time specifically due to recent cost of living pressures.

So what can businesses do to make staff better off?

1. Recognise how these changes will impact your staff

Bill increases might not seem like an urgent concern for employers, but they’re yet another hit on employees’ wallets. Even though energy prices are dropping, savings will be swallowed up by bill increases elsewhere. This is a clear source of stress and anxiety, which won’t stop when teams sit down at their desks.

Listen to employees’ specific concerns and make sure support is based on what they’ve told you. A pulse survey focusing on cost-of-living pressures can help you get an insight into their areas where people need help. How might these problems impact employees’ disposable income going forward? What can you do as an employer to ease the burden?

Communicating your understanding of the very real issues employees are grappling with, and finding practical ways to help, signals that you care.

2. Be flexible on pay 

Offering a competitive salary or wage is an obvious first step towards making employees better off. But there are additional things employers can do with pay to improve financial wellbeing.

Pay models that give employees access to their earned income before pay day are gaining traction, as they can give teams greater financial flexibility. This can be invaluable as expenses increase. But it’s always worth offering financial advice and coaching alongside a flexible pay model, to support employees to make informed financial decisions.

Widening the pool of employees who can access performance-based pay opportunities can also be a win-win. It’s a good way of enabling more employees to up their earnings, and can encourage improved performance across the company too. This can’t come at the expense of fair base pay though –  if employees can only make ends meet if they earn their performance-based bonus every quarter, employers should reflect on who this is really helping.

3. Find ways to solve the problems at source

There are smart and impactful things employers can do in addition to pay to improve financial wellbeing.

Look at benefits and support packages which tackle employees’ money worries at source, rather than investing in gimmicks or quick fixes. For example, money-saving tools like Nous can put hundreds of pounds back in employees’ pockets by saving them money on household bills. You could also look at childcare support, subsidised rail fares or season ticket loans.

4. Deliver financial wellbeing support during the working day 

Financial wellbeing support is only effective if people use it. So make sure you’re carving out time for people to engage with what you’re offering during working hours.

You could run financial coaching or investment masterclasses, or offer one-to-ones with a financial coach during the week each quarter. And if you offer access to financial wellbeing tools, set aside time in the working week for your team to engage with the technology and understand how it can help them. Don’t expect people to do this on their own time; it only adds to their mental load.

*Survey from Nous.co

 

    Read more

    Latest News

    Read More

    ​Exploring the people, culture and technology behind the future of work

    12 June 2024

    Newsletter

    Receive the latest HR news and strategic content

    Please note, as per the GDPR Legislation, we need to ensure you are ‘Opted In’ to receive updates from ‘theHRDIRECTOR’. We will NEVER sell, rent, share or give away your data to third parties. We only use it to send information about our products and updates within the HR space To see our Privacy Policy – click here

    Latest HR Jobs

    The University of Edinburgh – CMVM/Institute of Genetics and CancerSalary: £32,982 to £38,205 per annum (Grade 6)

    Collaborate closely with service directors, heads of service, and senior managers to drive transformation initiatives. Job Types: Full-time, Permanent. £54,446 – £57,401 a yearFrom Indeed

    The HR function follows the typical operating model of strategy, expert services, people development, business partnering, recruitment and operations. £75,000 a yearFrom Civil Service –

    Reporting to the Chief People Officer, you will oversee the full employee lifecycle, ensuring the delivery of HR activities that attract, retain, and develop…From PA

    Read the latest digital issue of theHRDIRECTOR for FREE

    Read the latest digital issue of theHRDIRECTOR for FREE