06 May 2020
Don’t overlook employees’ financial concerns during Covid-19
Covid-19 is putting a lot of pressure on many aspects of employees’ lives, and financial worries are often at the core. Whether managing with less money whilst furloughed, considering a big life change such as divorce as a result of self-isolation1 or just dealing with a financially uncertain time, not knowing where to begin with sorting finances are just some of the realities people are facing during the pandemic.
Brett Hill, Distribution Director at Towergate Employee Benefits says: “We have seen a spike in calls to employee assistance programmes (EAPs) during the Coronavirus outbreak, as staff seek real and practical support for challenges they are facing during the lockdown. It is important for employers to remember that EAPs don’t just offer support for emotional issues - they can be an excellent resource to support financial issues too. Money problems and mental health are often intricately linked, creating a vicious cycle of one feeding the other that can be difficult to break”.
It’s a major issue for businesses, as poor mental health costs the UK economy £74-£99 billion per year,2 with 1.5 million people experiencing both problem debt and mental health concerns at the same time.3 It is a costly conundrum for organisations and employees alike, so being able to access support - through an EAP for example - can provide a real solution to getting employees the support they need to break the cycle. With the pandemic placing additional stress on daily life, from finances to mental health, it’s important that employers support staff where they can during this challenging time – both emotionally and practically.
Everyone affected
It is a common misconception that financial hardship is the preserve of those on lower incomes. Pandemic or not, all income groups can be affected by financial worries. It can happen at any age too, from worrying about how to pay off university debts to affording retirement in a climate of falling stock markets and pension fund values. EAPs can support with financial planning - from budgeting and managing debt, to planning for retirement – helping employees through their financial situation regardless of age or income.
Addressing addiction
Financial problems may be as a result of addiction, such as online gambling, which may be worsening during lockdown. EAPs can support employees in tackling the financial side of their addiction, including offering advice to cut up credit cards, cancel overdraft features or tackle debts with the highest interest first. Where needed, EAPs may direct employees to more specialist support services and charities, who can provide tailored advice for their addiction.
Staff may feel too embarrassed to share information about their addiction with their employer, so EAPs can provide them with a confidential outlet to discuss their issues. Equally, erratic behaviour may be going unnoticed – due to working from home during isolation, with management not being able to witness changes in an office – so EAPs can continue to provide support in the background, helping employees work through their issues.
Tackling absence and productivity
Financial concerns can negatively impact productivity and absence rates at work, with employees struggling to concentrate or attend work due to the weight of their worries. EAPs can not only support employees in tackling their personal finances, helping to plan and in turn alleviate stress, but potentially improve productivity and absence rates as a result within businesses too.
Debt management
Employees who contact EAPs for support with their finances may be offered debt management to help them regain control. Setting a goal to be out of debt as soon as possible helps employees to work towards something – creating positivity in change and helping to reduce stress. Tracking expenditure, working out what must be paid (such as a mortgage) and what is a nice to have (for example, a new outfit) helps staff to clearly see how their money is being spent. This is an important step to working out budgets and setting an achievable savings plan – to either get out of debt or save for the future. EAPs can help employees through this process, getting them back in charge of their finances and managing associated stress more effectively.
Emotional impact
EAPs provide employees with fast access to professional counselling services, should emotional support be required as a result of financial problems. Concerns about not being able to provide for a family, make next month’s payments or anxiety around receiving bills in the post can be addressed. Managing finances is one aspect of the issue, but managing the emotional fallout is another.
During lockdown, employees may feel as though they have more opportunity to utilise an EAP, so employers should consider reminding staff how it can support them during the pandemic. As EAPs are often accessible 24/7 too, support can be provided at a time that suits them – as many may be struggling to juggle working from home, eldercare or childcare and home-schooling at once.
Brett Hill concludes: “Financial concerns are a common worry to keep employees awake at night. With the pressure that Coronavirus is adding as well, staff may benefit from an outlet where they can air their concerns confidentially. EAPs can be hugely beneficial for those struggling financially: potentially providing debt management, helping individuals to understand their current financial situation and budget accordingly. Employees need to remember that not only do EAPs provide emotional support, but also practical guidance – which is especially important when managing finances and debt. Taking action with financial health can significantly reduce stress, personally helping the individual whilst also creating a more supported and productive workforce.”
References
1. https://www.express.co.uk/life-style/life/1261503/divorce-rates-coronavirus-uk-why-are-divorces-rates-soaring
2. https://www.gov.uk/government/publications/thriving-at-work-a-review-of-mental-health-and-employers
3. https://www.moneyandmentalhealth.org/wp-content/uploads/2019/03/debt-mental-health-facts-2019.pdf