From our archive. This article was published on 3 September 2020. Rules and amounts may have changed since.
Archive, 2020: this article appeared during the coronavirus crisis. The temporary measures it discusses no longer apply. The call on employers to take action on the financial well-being of their staff remains relevant.
Everyone should have a certain degree of financial comfort in order to experience overall well-being. When does someone have enough financial self-assurance or self-confidence to be able to live the life they want, today and in the future?
Financial well-being is defined as a state of being in which a person can fully meet current and ongoing financial obligations, can feel secure in their financial future and is able to make choices that allow enjoyment of life.
Financial health is what we at the FWBA would like to pass on to people. We are thinking, among other things, of the following:
- Having an iron-clad buffer (reserve).
- Being able to build up wealth by acquiring assets.
- Having the ability to defend yourself legally when necessary.
- Stability of your income and its protection.
- Access to a social network that supports prosperity.
By focusing on the financial comfort and financial well-being of employees, companies see a direct ROI. Why is that? A well-being policy with a financial orientation leads to less sickness absence and less absence caused by stress (due to financial problems).
“Employees who feel supported by their employer and colleagues are more productive and feel more connected to the company, and this increases retention.”
An example to clarify and illustrate all this in practice
Many bookkeepers are currently looking for new or additional staff. The job of bookkeeper has long been a shortage occupation. Because the pressure of work is particularly high at certain times of the year and there is zero room for error, the workload and the pressure can become very high. On top of that, there is the need for continuing education and further training to stay up to date and to be able to practise the job as an expert.
Suppose an employee has not been feeling great at work in recent weeks. There may be more bookkeeping errors than usual, and important matters and deadlines may be forgotten or missed. The employee may already have had to take a sick day a few times, or a day to look after the children. Perhaps there is more going on than “being a bit more absent than usual”. If, for example, there were also a financial problem in the personal situation of the employee (and their family), this can cause them to lose their motivation.
For the employer it is a double problem: the employee has a great deal of knowledge and expertise that a newcomer cannot simply acquire, and the employer will have to conduct several job interviews to find a suitable candidate to replace the member of staff who has dropped out. A policy of openness and transparency, making money problems and financial well-being (at work) easy to talk about, might have avoided this “departure” or the burn-out if it had been detected sooner. If you do not discover it, or discover it too late, the economic and human damage can mount up considerably in situations like this.
Employers often struggle to find out what they can concretely do in the context of financial comfort, well-being and prosperity for their employees.
We believe that “being there” for your employees, offering a listening ear (possibly via an external partner), is already a simple step in the right direction. Whatever you do, do not make it too complex.
“How do you decide, as an employer, what you can and will do?”
Well-being is a broad concept. An HR manager who is responsible for the “human resources” of the company might do better to adopt the title of “well-being manager”. Which areas that determine a person’s overall well-being will you support, as a personnel manager or as a direct employer? At most employers, health currently ranks number one among the broader well-being solutions on offer. Perhaps this is the moment to introduce “financial comfort, self-confidence and well-being” in your company too.
So it is more about “well-being” than about “prosperity”
As an employer you pay a salary and many additional benefits within the remuneration package on offer. This is nominal and measurable. The question is this: will a pay rise or an extra contribution to their pension fund or group insurance contribute to the well-being of the employees concerned? Where do the needs lie? Help with budgeting? Or perhaps support with an (impending) separation? Or help with keeping and building up wealth? Once we know what is going on within the organisation and among the employees, tailor-made, concrete proposals can be put forward in order to achieve a positive impact without wasting time, energy or resources.
Opportunities in times of crisis:
- Now that we are in a stock market crisis as a result of COVID-19, many people are worried about their investments. Our position is to tell clients not to react emotionally and to focus on long-term goals.
- In addition, there were many questions about refinancing home loans and other loans, because interest rates were then historically low.
- Finally, now is also a good moment to encourage employees to look at their budget. Because of the crisis, spending on one-off purchases has fallen sharply and holidays have been postponed or cancelled. That offers opportunities to finally start saving.
These are things that employers could communicate to their staff, together with other financial wellness topics. Employers can also offer webinars and articles on financial well-being.
The range of financial well-being solutions must above all be accessible
A low threshold for anyone who feels some fear or reluctance about talking about their situation and getting support. Think of the “availability” of a confidential adviser who will listen without prejudice and, where possible, can offer first-line guidance and suggest concrete solutions. If necessary, the person concerned can be referred to experts who can answer specific questions.
An employer who wants to provide solutions for their staff would therefore do well to give easy, low-threshold access to financial well-being solutions. This is a relatively inexpensive and simple way to contribute to the employee’s financial well-being. A holistic approach to well-being, with a focus on financial well-being. Every employer can come to us for this, within the framework of “Employee Financial Well-Being”. In times of crisis such as with COVID-19, employers have a role to play in this more than ever!
Allowance for working from home
Employers can grant employees who regularly work from home a flat-rate office allowance, free of social security contributions, and in addition reimburse the use of their own PC and internet connection on a flat-rate basis. Other costs, such as a monitor or a printer, can be reimbursed on the basis of actual costs. The maximum amounts are indexed regularly: ask your social secretariat (payroll service provider) for the current amounts or check the website of the RSZ (National Social Security Office).
It is advisable for employers to support their employees so that they can carry out their jobs with as little stress as possible.
Companies provide meals, ironing services, childcare and much more to take the load off people’s shoulders. So it is not so far-fetched to also support employees in their prosperity and well-being. Employees often face financial challenges. It may also be the partner of one of your employees who has lost their job. This has a direct impact on your employee. Paying attention to your employee is important. Try, together with colleagues and HR, to make difficult matters easy to talk about, and try, individually or together, to work out a solution that lies within the company’s means.
Are you an employer or an HR professional? Would you like to build the overall well-being of your employees together with us by focusing on financial comfort and financial health? Then please contact us. We will gladly tell you how to introduce “Employee Financial Well-Being” into your company in a simple way. Our mission is to help employees go through life with more financial self-confidence, through education and empowerment, so that they can focus on what matters in their lives and their jobs.