Soaring energy bills, increased fuel prices and skyrocketing grocery costs have left the UK in a cost of living crisis. A crisis that is affecting the vast majority of people. According to recent data from the ONS, 83 per cent of adults reported a rise in their cost of living in March 2022, compared to 63 per cent in November 2021.
Worryingly things seem to be only getting worse. From October 2022, according to the BBC, the average UK household can expect their electricity bills alone to increase by a further 26 per cent. For those already living on the breadline this will be a cost they cannot bear.
This is a very real problem. People are struggling already and need help. But what can you do as an employer to help your employees through this difficult time?
We know money worries top the list of why people are stressed and that stress can lead to poor mental health. As an employer you can look at implementing benefits that help to counteract this. In fact, your range of employee benefits can improve financial and mental wellbeing.
With that in mind, which employee benefits can help with the cost of living?
Start a discounts platform
Employee discount schemes are an easy way to help your staff make huge savings on everyday costs. In the current economy, a scheme can help an employee’s pay go much further. Staff can get discounts on shopping and receive cash back at many stores. Some retailers offer up to 20 per cent off!
According to employee benefits consultancy, Drewberry, 40 per cent of workers want to be offered gifts and rewards to use outside of work. Speaking to an independent expert like Drewberry can help you pick the best platform.
Increase your employee pension contributions
The Scottish Widows Retirement Report revealed that one in ten UK adults has stopped, or is considering stopping, their pension contributions because of the cost of living crisis. While this is a temporary solution, over time it will affect retirement savings.
To deter staff from opting out of their workplace pension scheme, you could increase your employer contributions. Drewberry notes that 58 per cent of staff want their employer to increase pension contributions. Doing so shows your investment in their financial wellbeing and may encourage employees to stay in the scheme. It can also have a knock-on effect, improving employee engagement and productivity.
Provide financial wellbeing services
Money can be a significant source of stress and anxiety. With the issue likely to worsen during the crisis, it’s more important than ever to provide financial support. Being a supportive employer in these times is a no-brainer. You can empower staff to make informed decisions and gain financial knowledge.
Businesses can help staff by supplying useful resources and guidance on finance management. Webinars are a fantastic educational medium for this. You can teach staff about budgeting, savings, financial products and more. For example, tips on how to reduce energy consumption at home will be useful.
Introduce salary sacrifice schemes
The cost of living crisis is making it harder for everyone to afford the everyday essentials. Setting up a salary sacrifice scheme can help to reduce the financial strain that your employees are experiencing. Salary sacrifice schemes offer staff non-cash benefits in which they pay less Income Tax and National Insurance (NI).
You could offer:
- A cycle to work scheme
- Childcare vouchers
- An electric car scheme
- A technology scheme
Employees can get themselves a brand-new bicycle, car or the latest technology at a cheaper rate. As salary deductions occur before taxation, staff don’t have to pay Income Tax or NI on the payments.
Consider Earned Wage Access
Earned Wage Access is a payroll scheme allowing staff to access wages before payday. It’s helpful for those experiencing financial stress and difficulties. It’s also a way to prevent employees from taking out a high-interest payday loan when cash runs low. The interest on payday loans is high, whereas earned wage access has no risk.
The only problem is the money they access is deducted from their upcoming payday. You’ll need to provide education on money management when you introduce this benefit. Otherwise, workers may cause unnecessary money issues. You can set a cap on how much is accessible to prevent this from happening.
Offer a health cash plan
A simple and affordable way for companies to look after their employees’ physical health. A health cash plan is easy for employers to set up and gives workers access to a wide range of treatments. It provides financial help for routine check-ups, dental care, unexpected problems and more.
During the cost of living crisis, this employee benefit is invaluable. Everyday health costs such as dental and optical appointments can all add up. Having the ability to claim these costs back can make a huge difference to an employee’s monthly budget.
