The link between Financial wellbeing and employee performance
The UK is in the throes of a cost of living crisis with families struggling to make ends meet. There are reports of food banks running low on donations, people skipping meals, and households taking desperate measures to avoid using their heating systems at home.
This financial pressure is not only affecting life at home but also life in the office with recent research finding that poor financial wellbeing has a detrimental effect on work performance.
The YuLife Employee Health and Wellbeing Survey found that 80% of workers believe that stress around their financial wellbeing would negatively impact their performance in the workplace. And, with 80% admitting they currently feel under financial pressure and expect their concerns to grow, this should be a warning sign to employers and HR departments to take action.
The question is… what can you do?
Back in February, we wrote a piece on this blog about how you can support your staff during the cost of living crisis even if your wage bill cannot increase. This looked specifically at the financial support you can offer but in light of the recent research about financial concerns affecting work performance, this requires some extra effort.
So, what can you do to help your employees at this time and in turn, improve performance at work?
Meet to review targets
With increased pressure at home, it’s likely that employees will be distracted or less committed to their roles. This is not to apply more pressure. Instead, sit down with each member of your team to discuss priorities and set new, more realistic goals for the next six months. While this will reduce productivity, you should be able to prevent a drastic drop in performance and open a channel for communication should new issues arise.
Keep a closer eye on performance
Now is not the time to set new goals and leave employees to their own devices. By giving them some slack with less challenging targets, you have shown that you trust them to repay this favour, but some will take advantage. Check in with them on a regular basis, either through one-to-ones or team meetings, and be alert for any changes in behaviour which could indicate that they are struggling or abusing your trust.
Short term changes in output could lead to long term problems so it’s important to catch any early warning signs and address them quickly.
Communicate openly about money and concerns
Don’t let anyone suffer in silence. Give your staff a channel to have an open conversation about money. This can be difficult for some people and according to the survey, just 21% would be comfortable discussing their finances with their employer.
If staff do not feel comfortable talking to you about their finances, then the alternative would be to signpost them to external sources of support and advice. There are a number of debt charities and non-profit organisations that can provide free and impartial advice, such as National Debtline, StepChange Debt Charity, and PayPlan.
Be more transparent about what you offer
A quarter of workers feel that their workplace does not clearly explain the financial support it can offer them. Even if you cannot offer wage increases, it may be that you can still give your staff a financial boost by making them more aware of the financial support already available to them. This could be in the form of salary advances, access to employee discounts, or interest-free loans.
Review your mental well-being support
Even though the impact of COVID is settling down, employers must still maintain the well-being support they offer their staff to keep them motivated, help them feel supported, and reduce the chance of burnout.
Train your managers
This doesn’t all need to fall on you. Provide training for managers on how to effectively support employees with mental wellbeing issues to ensure you can engage with your entire workforce more quickly. It could also be that, as well as mental wellbeing training, they could benefit from Emotional Intelligence coaching too.
Offer more flexible working arrangements
Consider how financial difficulty affects staff in practical terms. Do they need to visit a food bank? Can they no longer afford to send their children to wrap-around or holiday childcare? By giving your employees the flexibility and responsibility to manage their schedules to accommodate these new challenges, you could make a significant difference to their mental health and ability to cope, and earn their long-term loyalty and commitment.
As an employer, there are a number of things that you can do to support your employees during this difficult time. If you’d like further advice on putting these into practice, Lodge Court can help you. Contact us to get started.