Workplace financial wellbeing services are becoming ever more popular with employers throughout the UK, and it’s easy to see why. Money worries are one of the greatest causes of stress; and stress is one of the biggest causes of employee absence. Helping employees to better understand and manage their money can therefore deliver significant value back to a business. However, as highlighted by one of the speakers at REBA’s recent wellbeing conference, to be effective, financial education needs to be an ongoing process – not a one-night stand!
I recently revisited the excellent Barclay’s report, ‘Financial Wellbeing: The Last Taboo in the Workplace’ (September 2014), and was struck by some of the statistics they quoted. When segmented by their level of ‘financial wellness’, they described four types of employee:
This means that 70% of us are in, or close to, financial trouble. It is therefore no great surprise that the same report highlighted that for every £1million of payroll cost, 4% – or £40,000 – is lost in productivity due to poor employee financial wellbeing. Bingo! That is a big number for managers to put into a board report to build a business case for adding financial wellbeing to the company’s wellness strategy.
That said, I would question whether the business case for financial wellbeing should be based entirely on the monetary return on investment (ROI). Using ROI as the only measurement implies that employee motivators are purely logical.
For many people, the decision about whether or not they stay with their employer is rarely a logical one. Logic may form part of the process, but emotions typically play a far greater role.
Employees need to feel loved every now and again. Not the oozing and unctuous stuff of some annual conferences or singing the company song. I mean the personal moments when their line manager demonstrates that he or she really cares; when they are shown that their wellbeing is important to the company; that the business provides access to tools and activities that make a difference. This includes financial aspects, but financial wellbeing is about far more than just salary. Our sense of financial wellbeing is more related to our ability to withstand a monetary crisis, and very much linked to how much of a savings buffer we have.
Research tells us that financially happier employees are more productive, less likely to take unscheduled time off, more engaged, less likely to cause loss or reputational damage and, ultimately, more loyal. It is also really clear that the reason most quoted by employees about why they leave relates to line management. So rather than focusing on return on investment, why not consider a different form of ROI; respect our individuals. Empower line managers to encourage employees to embrace the company’s financial wellbeing benefits. Then ensure the financial benefits you offer are clearly communicated, without baffling people with jargon or unnecessary complexities. By combining clear, easy-to-understand information with the warm and fuzzy element that comes from great people management, you can achieve huge improvements in both retention and engagement. Which in turn, of course, should mean a measurable return on investment – so even the accountants are happy.