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12 Oct 2017

What benefits can you offer employees who have low levels of financial wellness?

Wellness is the active process of becoming aware and making a choice towards a healthy and fulfilling life. It is holistic, and incorporates financial, emotional and physical wellbeing. And with a working week on average lasting more than 37.5 hours and total pay for UK employees on average falling by 0.4% in real terms (UK labour market: September 2017), all three are needed to make a meaningful difference to the employees' overall happiness and wellbeing.

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The impact that emotional and physical wellbeing has on employees and business performance is well documented but more must be done to raise awareness of the benefits of financial wellness as part of an integrated employee engagement strategy.

In 2015/16, stress accounted for 37% of work related ill health cases and 45% of all working days lost due to ill health. This is a frightening statistic for business owners and leaders, specifically as it doesn't even allow for those who do come into work when they're feeling unwell: presenteeism-associated mental ill health costs the UK economy as much as £15.1bn a year, and has been proven to cause a reduction in productivity by as much as 12%. Combined, this demonstrates that wellness is no longer a "nice to have", but a business-critical issue which must be given boardroom attention.

Employees' financial worries and the associated stress has an unfathomable impact on workplace productivity. It's also worth noting that this is an issue which isn't going to go away: unsecured debt, rising house costs, spiralling childcare costs, the decline of real wages over the past ten years and rising inflation, are coming together in a perfect storm and consumers are beginning to feel the squeeze.

Financial worries, notably amongst low paid staff and those who typically cannot access favourable bank rates or who are refused credit, are going to come under increasing pressure and this will take its toll on workplace performance.

In a survey of 10,000 employees, 33% said financial worries are their biggest concern, with health and work life balance not far behind (The DNA of Financial Wellbeing 2017 by Neyber). There is an urgent need for organisations to build a business case for employer driven financial wellbeing to help their workforce.

We recently started working with organisations such as Neyber and SalaryFinance, whose solutions allow staff to borrow money and pay it back direct from salary. We support employees to consolidate their existing debt and provide affordable loans that help employees to better manage their money. This can make a real difference to employee finances and stress levels.

Here are our five steps to address better financial wellbeing as part of your engagement strategy:

1) Communication

Communicate your financial benefits in a way that resonates with your workforce. There is no point having a benefits programme in place which helps your employees' salaries stretch further if your employees do not know where or how to access it. Employees are consumers: they want information to be available to them, when and where they want it.

Benefit apps are the perfect solution for this and can help encourage participation - employees can turn on push notifications to receive information in the palm of their hand, no matter where they are. A platform or app that can be accessed on the go, can also form a discreet and secure way for employees to make use of their benefits at their own convenience - including contact details for helplines and useful information guides.

2) EAP

Introduce an Employee Assistance Programme (EAP) which offers counselling and valuable information to employees to help them deal with any personal problems that may adversely impact their work performance, health and wellbeing. This service offers free and confidential advice and access to follow up services, both for employees and their household members.

3) Go beyond the norm

Go beyond the norm and offer your employees access to fairer finance and financial wellbeing solutions, including financial education, savings products or more affordable borrowing rates taken directly from salary. This can help reduce debt stress and help staff to consolidate their debt into one manageable monthly repayment, deducted directly from their salary.

4) Provide discounts

Help their current salary go further with everyday discounts from leading retailers and salary sacrifice schemes, from home technology and cycle to work schemes. The discounts alone can save an employee more than £1,000 a year, based on the average UK salary and ONS average household spend statistics.

5) Be there for staff

Offer help when your employees need it most, including hospital cash plans, convalescence plans and death benefits to provide employees and their families complete peace of mind.

These steps will help staff to feel more financially confident and in control of their finances. The solution isn't always more pay or just encouraging staff to save more and spend less. Helping employees to understand, take control and proactively think about their finances can have a much greater impact on their financial wellbeing.

Staff who feel valued and recognised in the workforce, with the right culture and tangible benefits will be happier and therefore more productive. A win-win solution for all.

This article was provided by Personal Group.  

 

 

 

 

 

 

 

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