Whether you agreed with the mini-budget or not, there’s no doubt that many of us across the UK will be left feeling confused, anxious and let-down in the wake of this week’s Government’s U-turn. Without a clear vision of what support will now be on offer to help ease the effects of the cost-of-living crisis, it might seem that the chink of light at the end of the tunnel has dimmed somewhat.
We all know that if you look after your people, they’ll look after your customers. But with 1 in 8 UK workers living in poverty[1], and the cost of living rising, a percentage of your workforce could be struggling to cope. Research has shown that people experiencing money worries will either have more time off work sick or will continue to show up for work but will be less productive than normal[2]. Both are scenarios that you’ll wish to avoid, meaning there’s a clear business case for supporting the financial wellbeing of your people.
There are several ways you can support your people during the cost-of-living crisis and many of you will already have taken steps to do so. Here are 3 key areas to consider[3]:
- Paying a fair and liveable wage
The national living wage, set by the Government, is based on a target to reach 66% of median earnings by 2024 – it is not calculated according to what people need to live. This is where the real Living Wage (RLW) comes in. The RLW is independently calculated each year based on what people need to earn to get by. Employers paying the RLW, where they can afford to do so, ensure that their people earn a wage that meets the cost of living. The LWF reports that 93% of Living Wage businesses have benefitted since signing up with them[4]. The latest RLW rate, announced at the end of September, is £10.90 (for our area) per hour – £1.40 higher than the national living wage for those aged 23 and over. You can find out more from the Living Wage Foundation.
If you can’t afford to pay the RLW, there may be other options available to you such as paying a one-off cost of living bonus or reimbursing peoples’ expenses (such as business mileage) on a weekly as opposed to monthly basis.
- Providing financial wellbeing support
Firstly, you can’t underestimate the power of a good, old-fashioned conversation. Being sensitive to how your people are feeling, listening to them with empathy and signposting to relevant external support are some of the most effective ways you can help. There’s lots of local and national support available – signpost people based in Herefordshire to the Talk Community website or to Worcestershire County Council’s website if they live over the county border.
If you’re able to do so, you could also look at providing benefits like an Employee Assistance Programme, financial wellbeing sessions and salary sacrifice schemes for your people.
- Supporting in-work progression
A route to progress into a higher-paying job can bring a sense of hope. Progression doesn’t just happen though – people need a clear path to follow, access to the right training and a supportive employer. Could you do more to support in-work progression?
If the answer is “no” or “not at the moment” but you’re keen to retain and support your people through the coming months, another option might be to consider how you could flex any existing policies to make it easier for people to take on second jobs to boost their income, whilst continuing to protect your business interests.
Times are tough for everyone right now: businesses and their workforces alike. Above all else, showing empathy and human kindness to your people – even during the most challenging situations – is the best way you can show that you value them and that you care.
[2] Financial wellbeing: an evidence review | CIPD
[3] What’s it like to live and work in poverty? | CIPD
[4] The Living Wage is Good for Business | Living Wage Foundation
Article by Lorna Simpson, Director at Marches HR (www.marcheshr.co.uk).