Tim Brook
Head of Engagement & Platforms, EQ HR Solutions.
But furlough payments are no guarantee of job security. According to the think tank Resolution Foundation, in its Jobs, Jobs, Jobs report, almost one in 10 of those furloughed earlier this year had lost their jobs by September. And the harsh reality for many businesses is that reducing hours and pay packets is the only way to survive the current situation.
Consultant McKinsey & Company’s “Covid-19 in the United Kingdom research” (May 2020) suggests 40% of the working population have had to accept changes to their jobs due to the pandemic. The Resolution Foundation research echoed this with 12% of respondents in work saying their pay had fallen since February.
As we enter the ninth month of the “new normal”, it’s not hard to see why employees’ motivation may be flagging – especially if they are being asked to take a pay cut or work longer hours.
So, let’s look at some of the ways you could adapt your employee benefits programme to provide the financial wellbeing support needed by people during this extended health crisis.
The value of financial education
When money is tight, it’s even more important to take control of your finances and make every pound count. So, offering your employees access to advice designed to help them make the right decisions is central to improving their financial wellbeing in the current situation.
For example, an explanation of the various Covid-19 schemes might help. As could targeted articles and communications around the potentially damaging behaviours we could all be susceptible to. Boredom shopping – making pointless purchases online to pass the time – is one such habit that could be explored. Clear guidance is one way to help employees manage their “coronanxiety”, whilst nipping damaging behaviours in the bud to help keep heads above water.
As Lauren Muir at on-demand pay specialist Earnd says: “Little things such as putting off paying bills can take a toll on our finances, leading to penalty fees, interest charges, and potentially an impacted credit score. So, financial education can really help.”
If you are asking workers to manage on a lower salary, tailored budgeting advice based on the income they will be receiving is also likely to prove pertinent.
“Providing an accurate view of what the reduced income will be could help people to modify their budgets,” Muir adds. “Another step would be to provide access to on-demand pay so they have a safety net available if necessary.”
The importance of knowing your workforce
Financial education is undoubtedly one of the most important building blocks of financial wellbeing. It is, however, best used in combination with benefits that people can take advantage of, to cut their costs.
To work out which benefits will resonate with your workforce, you need to understand how they behave as consumers. Let’s think about this now.
Say you’re keen to help staff ease the financial strain of their household bills, one option would be to give them the opportunity to switch to an energy plan offering preferential rates. But if most of your employees have stuck with the same supplier for years, you might find discounts at a supermarket chain prove more popular – especially if your data indicates which chain your workforce prefers.
Tools are available that can provide this level of insight. Such tools combine your proprietary workplace benefits engagement data with third party intelligence from sources such as consumer-marketing databases.
So, you can get a much clearer picture of how you can revise your benefits programme to help your employees through these extraordinary times.
So, you can get a much clearer picture of how you can revise your benefits programme to help your employees through these extraordinary times. It’s those companies that provide much-needed support that will be remembered, not only by the employees concerned but also by their customers. So, put your employees first, treat them well, treat them like individuals and watch them and your business reap the rewards.
*This article was written for, and features in REBA, November 2020.
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