Supporting your employees with the rise in costs and preventing in-work poverty
You can support your employees during this cost-of-living crisis with various different tools at your disposal. We'd recommend a blended approach of these techniques to maximise the benefits.
The real Living Wage is based on the cost of living and is paid by nearly 10,000 UK employers.
Currently, the real Living Wage is £9.90 in the UK and £11.05 in London. By point of comparison, the minimum wage is £9.18 and the national living wage is £9.50.
There are significant business benefits to paying the real Living Wage. For the employees, a fair and liveable wage gives them a chance to lead a dignified life, with access to the opportunities and choices needed to fully participate in society.
For businesses, the benefits include improving the reputation of your organisation, employee retention, and it helps employee relations.
A recent survey by Glassdoor found that 79% of British employees would prefer new benefits to a pay rise.
Employee benefits can support employees with their everyday spending. Through signing up with a benefits and discounts provider, you can give your employees access to desirable perks and help them make their net pay go further.
For example, our benefits provider and sister company Wrkit enables employees to purchase shopping cards for mainstream supermarkets. On the basis that the average household spends £5,000 a year on groceries, using this they can save over £250 per year, which offsets the average cost of the national insurance increase.
Using Moorepay's benefits, employees can save enough money to offset the cost of the national insurance increase.
Employee benefits often include things like:
Discounts can also be a great way to support budgeting, including:
The Money Advice Service reported that 39% of adults in the UK don’t feel confident managing their money. So, how can businesses support the financial wellbeing of their staff?
You could start by implementing a financial wellbeing policy. This can be as simple as committing to signpost your employees to independent money and debt guidance, making sure your staff are aware of all the benefits you currently offer and normalising conversations about money worries at work.
Letting your workforce know where they can access free, confidential and independent money advice could help some of them make savings and better long-term decisions.
Going one step further and offering training programmes in how to better manage one’s finances might cover areas such as understanding financial abuse, financial fundamentals and mastering credit, and approaches to budgeting and saving.
The CIPD recommends that a financial wellbeing policy should include:
Enabling people to “work their way up the career ladder” at your company is not only good for your employee retention, it means employees are closer towards getting to their financial goals.
In 2020, the Department for Work and Pensions set up the In-Work Progression Commission, which outlines the steps employers can take to develop their workforce’s skills.
People professionals are instrumental in putting in place – and measuring – progression plans for low-paid employees. Draw up a clear progression pathway for each employee, with regular reviews.
Giving staff the opportunity to learn from their peers is invaluable and can help boost their confidence and ambition.
Schemes aimed at low-paid workers that offer individuals a taste of all areas of the business – from the shop floor to the boardroom – can help expose them to different roles and opportunities. Experiencing what greater responsibility looks and feels like first-hand can address any attitudinal barriers to progression.
For someone living on the bread line, a route to progress out of a low-paying job can be a light at the end of the tunnel. Pay for and/or provide paid time off for employees to work towards a professional qualification or develop the skills they need to progress.
Progression doesn’t just happen naturally – people need a clear path to follow, access to the right training and a supportive line manager. Plus this process needs to be tracked by the organisation.
With competition for well-qualified talent increasing, it’s perhaps no surprise that a third of organisations say they are developing more talent in-house. It's often easier than recruiting new people to plug your organisation’s skills gaps. Businesses that invest in their workforce also enjoy improved staff retention, loyalty and engagement.
Interestingly, this year’s Future of Payroll Report revealed 55% of respondents predicted the future will see payroll professionals having more involvement in employee financial wellbeing.
So, whilst most of the points raised may currently sit under the HR umbrella of your organisation, we could see increased synergies between HR and payroll teams going forward.
The current crisis may be taking a toll on your employees’ mental health. As such, they may be suffering increased anxiety, especially when it comes to making decisions over their benefits, pension, and managing their salary more generally.
Although the tools we've outlined will no doubt help this, there are some other ways you can support them:
Giving your employees more flexibility over how, when and where they work may ease any conflicts between their work and home responsibilities, helping to reduce anxiety overall. It may also help cut costs, such as childcare or commuting costs, if they can work to their own schedule.
An EAP is a completely confidential service that helps employees and their families deal with issues both negative and positive in their home or work life, that might impact their work performance, health and wellbeing. It gives employees access to a confidential telephone helpline.
Every company will have a physical first aider but what about a mental health first aider? Mental Health First Aid is a training course that teaches employees how to identify, understand and help someone who might be experiencing a mental health issue.
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