Financial worries are front of mind for many employees amid slowing but high remaining inflation rates, rising energy costs, and rising interest rates. Recent research found, in the face of the cost-of-living crisis, more than half of employees (51%) claim that their wage doesn’t cover their outgoings amid the ongoing cost-of-living crisis, and 41% say they aren’t able to save for retirement.
It’s not surprising then that financial worries are hard to ignore, with over half saying that financial concerns distract from day-to-day work – and over four-in-ten report that long-term financial planning is causing them stress.
Although many businesses have wellness programmes, they frequently concentrate on physical and mental health. Programmes for financial well-being are often disregarded. However, there is solid evidence connecting money problems and poor mental health.
And yet, increasing salaries are not necessarily the solution for businesses, particularly in the current environment. In order to help employees gain more financial control, it is crucial to link tactics to pay and benefit policies while creating financial wellbeing programmes. Employees have a variety of options for this at their feet.
- Make sure your employees are paid
It might seem obvious, but the first step of any financial wellbeing strategy must be ensuring that employees get paid the right amount at the right time. A missed payday or miscalculated payment can result in worry and broken trust. However, ensuring perfect payroll is challenging, especially if employers have an international workforce or differing pay legislation and structures. Delivering multi-country payroll is no easy task.
Many businesses still use spreadsheets to manage payroll. It is therefore no surprise that payroll failure is an issue but there is no reason that this should still be the case.
Today’s payroll solutions, integrated with HR and finance systems, can streamline payroll processes, control costs, and improve payment accuracy. Ensuring a continuous flow of business intelligence between systems can automate employee bank data verification, enabling accurate, compliant, and secure payment delivery. It can also reduce the administrative burden of global bank transaction management with reliable, fast payments across multiple currencies.
Centralising systems allows organisations to embrace automation and avoid costly payroll process failure while also allowing for greater flexibility for employees.
- Adaptable pay for changing employee needs
Waiting until the end of the month to access salaries leaves many employees facing financial pressure, with the last of the week ramping up the pressure to make last month’s wage stretch. Instead, flexible pay models such as Earned Wage Access (EWA) puts employees in control of when and how they access their pay.
EWA echoes the digital experiences that employees are used to as consumers, and for employers can provide an essential point of differentiation in a tough labour market. It demonstrates employees are valued for their work, empowered, and supported in their workplace.
The traditional weekly or monthly pay run does not always meet the needs of today’s employees but has continued to be the dominant method of remuneration. This is mainly due to the rigidity of employers’ payroll processes, a lack of digital integration, and wariness from payroll practitioners.
However, systems such as this not only provide employees with rich benefits, but on-demand pay solutions provide payroll with an integrated technology to quickly resolve common issues with greater speed and efficiency.
- Be there for your employees
Alongside the practical solutions that can support flexible and faultless payroll, employers can also support their employees with information and resources. Crucially, they should also consider how they can communicate with empathy and understand employees’ financial pressures.
Many employees are also often intimidated by financial worries and employers should consider how they support access to information and advice. Almost half of employees would appreciate a ‘bit of help’ or specific advice regarding financial matters. Whether partnering with a suitable charity or money advice service, creating a digital information hub or empowering managers to signpost employees more effectively, much can be done to show employees you recognise their worries. Helping people take control of their financial future is a powerful way to build trust and loyalty.
Of course, this also requires employers to truly understand their workforce. Two-way empathetic communication is essential to building a picture of your workforce, so you can tailor your approach to financial wellbeing to their needs.
A brand-new era of financial security
We are all affected by the current economic crisis, and it is not right for organisations to do nothing while their workers suffer. New strategies are needed to support improved financial wellbeing, which today’s cutting-edge HR and payroll technologies can help deliver efficiently and cost-effectively. These methods meet the requirements of both employers and employees, and the businesses that will succeed will be the ones that put employee wellbeing first.
Marcus heads up UK&I at Alight Solutions and has 20 years' experience in cloud ERP, HCM, CX and Analytics (SaaS), implementation, management consulting, outsourcing and managed services. He is an experienced Sales & Marketing Director for digital transformation, applications and technology.