Recent years have seen unprecedented global challenges in the form of the COVID-19 pandemic, followed by a ‘great resignation’ and sharply rising prices, driven by global supply chain problems and the war in Ukraine. The cumulative impact has affected households across the world.
Behind the headlines of continuing falls in unemployment, there is a participation crisis in the UK, with over a million fewer people in the workforce than pre-pandemic, largely because of the higher economic inactivity of older workers and those with ill-health. This is contributing to low growth through labour and skills shortages, alongside vacancy numbers that are almost at a record high.
This economic climate has caused numerous risks to the financial wellbeing of the workforce. So, as the UK enters a recession predicted to be the worst in a generation, managing employee financial wellbeing is rapidly being pushed up the social, political and business agendas, as the potential for significant financial distress and the very real risks and growth of in-work poverty – which is already experienced by one in eight workers – means many more employees will almost certainly be struggling to cope.
While more employers are becoming aware and are recognising that financial wellbeing is more than just paying employees and providing a few benefits, it is still the least common area included in HR wellbeing strategies.
This guide provides practical advice to HR practitioners and employers of all sizes and sectors on how to take action to promote and support their employees’ financial wellbeing, including the five critical steps to developing an effective policy:
- Build support and set strategic direction
- Assess and diagnose employee needs
- Actions and designs
- Implement and embed
- Evaluate and evolve
5 steps for developing employee financial wellbeing policy
What is employee financial wellbeing (EFW)?
How can you develop an effective employee financial wellbeing policy?
The five key steps to developing a policy to help your employees
Case studies: Employee financial wellbeing initiatives in practice
To supplement this guidance, the CIPD is collating examples of excellent, practical employee financial wellbeing initiatives from different organisations to support your practice. Check back regularly to see the latest case studies.
Our grateful thanks to the participating organisations for sharing their experience and insight.
Resources, example questions and suggested actions
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In November, the CIPD published a new report and guide on women’s health at work. Authors Rachel Suff and Claire McCartney provide a summary of the key learning points
What this practice is, why you should avoid it, and how to approach it if no other options are available
Guidance and practical recommendations for supporting employees experiencing domestic abuse