The ongoing cost of living crisis has put significant pressure on household incomes, with many turning to their employer to facilitate higher wages to offset soaring expenses. Whilst a pay rise is, undoubtedly, the best solution to this problem, in many cases, your clients will be experiencing equal struggles and concerns, so not be in a position to offer financial assistance. However, there are still ways in which your clients can provide support by keeping the financial wellbeing of their workforce at the top of their priority list.
Where possible, a salary increase or bonus payment will likely provide the most relief and benefit to employees. Should this be given, it’s useful to specify how and when the increase will apply. Similarly, your clients should be clear that it is a one-off payment in recognition of the financial struggles employees have, but does not form a contractual, nor a recurring, arrangement.
Should there already be a contractual entitlement to a regular pay review or pay increase period, your clients should ensure this is adhered to. The same should apply where the contract includes a non-discretionary bonus payment. Failure to abide by the contractual terms can lead to claims for breach of contract and will likely hinder employee relations, and could lead to costly court proceedings. This can also lead to a reduction in productivity and higher turnover rates, causing further troubles for businesses.
Your clients may be able to renegotiate contractual terms and conditions, to remove or delay a scheduled pay increase or bonus payment. However, to do so, they must ensure they complete a full consultation period with affected employees and exhaust all other cost saving measures.
The cost benefits to working from home were amongst the reasons employees enjoyed doing so throughout the Covid pandemic; they were able to save on commuting expenses, reduce childcare fees and live in cheaper areas. Many also believed it provided a better work-life balance. However, as household bills now climb, homeworking may no longer be an attractive prospect.
For some homeworkers, returning to the office may be a useful way to save on energy bills. Where this isn’t possible, your clients might want to consider providing a homeworking allowance, to ease the financial pressures associated with working from home, especially through the winter months. For other on-site workers, commuting expenses may be more of an issue. In these circumstances, providing travel ticket loans or free parking can help reduce their overall outgoings. The introduction of hybrid or flexible working can also reduce overall expenses. This may be done through the offering of flexi-hours, compressed hours, reducing working time or changing start and finish times to fall outside of peak hours.
Further initiatives your clients may wish to consider to ensure they are providing adequate support to employees is offering an employee assistance programme (EAP), introducing rewards and benefits programmes, providing free on-site meals and refreshments, and providing financial literacy and education sessions.
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