Helping your employees through the cost-of-living crisis

The Chartered Institute of Personnel and Development (CIPD) has put together some practical information for employers to support their employees through the cost-of-living crisis.

From June 2021 to June 2022, domestic gas prices increased by 95% and domestic electricity prices by 54%.1 Against a backdrop of soaring prices for food, energy and other essential goods and services, many employers in the UK are asking what they can do to support their people’s financial wellbeing.

Several UK employers are generously topping up pay packets with a cost-of-living payment. The CIPD’s summer Labour Market Outlook for 2022 finds that 15% of organisations have paid, or are planning to pay, such a payment to some or all their workers, while a further 15% have the matter under review.

Private sector firms are most likely to have paid this bonus (18%) – especially those in the primary and utilities (30%), financial services (26%), and construction (25%) sectors.

At face value, employees will surely welcome this gesture. But for some low-wage employees in receipt of Universal Credit or Tax Credits, a one-off or lump sum bonus could interfere with their benefits payments and leave them struggling to budget and make ends meet.

To make sure your well-intended generosity doesn’t inadvertently cause extra undue stress or financial hardship, it’s worth considering what other options you could offer your workforce.

Even if you cannot afford to offer inflation-beating pay rises, there is still a lot you can do to ease the stress and anxiety your workforce is facing. The CIPD say that now is the time to review your financial wellbeing policies and benefits packages to make sure they are working as hard as they can – especially for those that are most likely to be struggling to make ends meet.

They suggest the following things to consider:

  • Review your reward strategy – if you can afford to offer a cost-of-living bonus, make sure it doesn’t inadvertently do more harm than good for those who claim Universal Credit or Tax Credits.
  • Review your financial wellbeing policy – do your people know what help is on offer and how to get it?
  • Review your benefits package – is it working hard enough for those most in need? Again, does everyone know what’s on offer and how to access it?
  • Train your managers – an empathetic and approachable management style can help normalise conversations about money, and let employees seek the help they need.
  • Examine the CIPD Reward management survey, which looks at the various ways employers are helping with financial wellbeing and tackling in-work poverty.

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Posted by popcreative on 24th Aug 2022 09:40:08