The UK is in a cost of living crisis because energy bills are going up, gas prices are going up, and grocery prices are going up. A crisis that affects most or all of the people. Recent data from the ONS shows that the cost of living went up for 83% of adults in March 2022, compared to 63% of adults in November 2021.
Things seem to be getting worse, which is scary. The BBC says that the average UK household can expect their electricity bills to go up by another 26% in October 2022. For people who are already barely getting by, this will be a cost they can’t pay.
This is a serious issue. Already, people are having a hard time and need help. But as an employer, what can you do to help your workers get through this tough time?
We know that money worries are the number one reason why people are stressed, and we also know that stress can cause mental health problems. As an employer, you can think about putting in place benefits that help to make up for this. In fact, the range of benefits you offer to your employees can improve their financial and mental health.
So, what employee benefits can help pay for the cost of living?
Start a discounts platform
Employee discount programmes are a simple way to help your employees save a lot of money on everyday costs. In the economy as it is now, a plan can help an employee’s pay go a long way. At many stores, staff can get discounts and cash back when they shop. Some stores offer as much as 20% off!
Drewberry, a consulting firm for employee benefits, says that 40% of workers want to be given gifts and rewards that they can use outside of work. You can choose the best platform by talking to an independent expert like Drewberry.
Increase your employee pension contributions
According to the Scottish Widows Retirement Report, one in ten adults in the UK has stopped or is thinking about stopping their pension payments because of the rising cost of living. Even though this is a temporary fix, it will hurt your retirement savings in the long run.
You could raise your employer contributions if you want to stop employees from leaving their workplace pension plan. Drewberry says that 58% of employees want their employer to pay more into their pensions. By doing this, you show that you care about their financial well-being, which may make employees more likely to stay in the scheme. It can also have a chain reaction that makes employees happier and more productive.
Provide financial wellbeing services
Money problems can cause a lot of stress and worry. During the crisis, the problem is likely to get worse, so it’s more important than ever to give money to help. In these times, it’s a no-brainer for an employer to be helpful. You can give staff the tools they need to make decisions and learn about money.
Businesses can help their employees by giving them useful resources and advice on how to manage their money. Webinars are a great way to learn about this kind of thing. You can teach your staff about budgeting, saving, financial products, and more. For instance, tips on how to use less energy at home would be helpful.
Introduce salary sacrifice schemes
The rising cost of living is making it harder for everyone to buy the things they need every day. Setting up a salary sacrifice plan can help your employees who are having trouble making ends meet. Salary sacrifice plans give employees benefits that aren’t cash, so 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 a brand-new bike, car, or the latest technology for less money. Since salary deductions happen before taxes are taken out, employees don’t have to pay Income Tax or National Insurance on the payments.
Consider Earned Wage Access
Earned Wage Access is a payroll plan that lets workers get their pay early. It helps people who are having trouble with money and are stressed out about it. It also keeps employees from getting high-interest payday loans when they don’t have enough money. There is a lot of risk with payday loans, but there is none with earned wage access.
The only problem is that the money they get is taken out of their next paycheck. When you offer this benefit, you’ll need to teach people how to manage their money. If not, workers may cause money problems that don’t need to happen. You can limit how much can be used to stop this from happening.
Offer a health cash plan
A simple and cheap way for companies to take care of the physical health of their employees. A health cash plan is easy for employers to set up and gives employees access to a wide range of treatments. It helps pay for regular checkups, dental care, problems that come up out of the blue, and more.
During an increase in the cost of living, this employee benefit is very helpful. Everyday health costs, like dentist and eye doctor visits, can add up. If an employee can get these costs back, it can make a big difference in their monthly budget.