More than two-thirds of UK employers are failing to provide the financial support and guidance required by employees in the workplace, according to new research.
The UK Employee Benefits Watch report released by employee benefits company Thomsons Online Benefits found that while auto-enrolment means that most companies now provide a pension, there is little focus on addressing employees’ short and medium-term financial needs.
The research, which involved 450 UK employers representing approximately 1.8 million employees, found that 67 per cent of organisations did not offer any form of financial guidance.
An overwhelming majority (70 per cent) of businesses neither provided employees with debt counselling nor assistance with debt consolidation (81 per cent).
There was also little help for employees keen to save or get onto the property ladder. Eighty per cent of employers reported that they did not offer workplace ISAs and 79 per cent failed to provide any mortgage broking services.
While companies have intensified efforts to support employees’ physical wellbeing, with 40 per cent more employers now offering private or virtual GP services, they remain reluctant to address employees’ financial health with equal support.
Almost one in four (22 per cent) employers expressed concern over the risk of getting too involved with the financial lives of their staff; 20 per cent believed that it was not their role to do so, while 24 per cent worried about the cost of getting involved.
“This year’s research paints a mixed picture,” commented David Dodd, consulting director at Thomsons Online Benefits.
“Employers are making clear strides when it comes to caring for the physical health of their employees. However, the gap in financial and mental health support means that they’re failing to deliver a holistic wellbeing strategy.
“At a time when employees are struggling financially, and the top talent is in higher demand than ever, it’s paramount employers work to help employees with their financial health, or risk losing them to competitors.”
Providing adequate financial guidance is not only important for employees but is also beneficial for employers, according to Ian Williams from financial consultant Gregory Pennington. This ultimately results in a workforce that is not hampered by the myriad effects of poor financial health.
“We’d certainly like to see more employers providing access to debt advice for their staff,” Williams told People Management. “The links between problem debt and poor sleep, stress and broader mental and physical ill-health are well established. Firms that support staff experiencing financial difficulties by signposting them to professional debt advice are not only doing the right thing for their people, but are likely to benefit from doing so.”
According to the research, while only 10 per cent of UK employers currently have a financial wellness strategy in place, more than 50 per cent plan to implement one, indicating their growing recognition of the importance of financial wellness for their employees.
This recognition of financial wellness is a growing trend for businesses across all industries. Debt charity StepChange is tasked with helping its clients tackle problem debt, so it is fitting that the organisation is keen to ensure that its own employees are given adequate financial support.
Melanie Manners, people services director at StepChange, told People Management: “Problem debt is estimated to cost the UK billions of pounds through the damage it causes to family life, mental and physical health, productivity and employment prospects, and costs to the welfare state, the NHS, local government and other agencies.
“[At StepChange] we strive to provide the highest levels of service to clients struggling with, or at risk of, problem debt and also take seriously our duty as an employer to look after our 1,500-plus colleagues’ financial wellbeing.
“This summer we are looking forward to launching a colleague engagement programme, which will be focused on driving physical, mental and financial wellbeing” to build a “comprehensive wellbeing strategy that will enable everyone at the charity to work smarter rather than harder, proactively manage their health, finances and wellbeing and provide the best possible service to our colleagues.”
Employers keen to implement a comprehensive financial wellness strategy face an easier task if they already have an integrated, online approach to delivering and administering benefits.
The Thomsons report indicates that digitally enabled companies are not just leading the way in terms of their use of technology to deliver benefits strategies, but also in their approach to employees’ financial wellbeing.
Nearly double the number of tech-enabled employers have implemented financial wellness schemes (15 per cent of tech-enabled companies, versus 9 per cent of non-tech enabled) or are in the process of doing so (26 per cent compared to 15 per cent ). In terms of mental health support, 26 per cent of tech-enabled employers are implementing schemes compared to only 13 per cent of those yet to digitalise employee benefits.
“Digitally enabled HR and benefits teams are already leading the way when it comes to making the case for changing benefits to better support their employees’ personal goals,” said Dodd.
“The data generated from benefits technology provides employers with unprecedented insight into their workforce, enabling them to track take-up, identify trends and determine how they can better support their employees at the moments that matter.”