Written by Kirsty O'Neill | 26th July 2022

With the pressure of soaring food, petrol and energy costs, you may be struggling to know how to support your people with the rising cost of living.

If your employees are asking for more money, we offer advice on how to respond in our blog. However, increasing your employees’ salaries is not viable for every business.

Here are some alternative ways you can support your people.

Offer financial wellbeing support

One in four employees say money worries affect their ability to do their job – and even those on the highest incomes are not immune. Employers who support financial wellbeing can make a much-valued difference to their workforce, helping to ease stress and anxiety, and it doesn’t matter if you have a limited budget.

One way to help is introduce financial wellbeing workshops which give employees the chance to speak to someone for independent financial advice. This might cover cost of living, understanding tax relief, child benefit rules, benefits available, debt management and more.

You could also include a financial wellbeing element in Employee Action Plans so that employees can use this to get support if they need it.

As part of your wellbeing strategy, you may want to develop a financial wellbeing policy that lets people know what help is on offer to them.

Provide Healthcare cash plans

A Healthcare cash plan can provide employees with funds if they need to attend routine dental or eye check-ups, physiotherapy or other medical appointments. Private medical insurance is often more expensive to provide, so a cash plan might be cheaper for you and valuable to employees struggling to make ends meet.

Remind employees of other benefits

If you can’t afford to give out pay rises, now’s the time to review your benefits packages to make sure they’re working as hard as they can.

Some employees and line managers may have forgotten what is on offer and how to access it, so it’s a good idea to communicate this clearly.

If you provide company cars to some of your employees, you may want to start introducing electric vehicles. There is no taxable benefit on the electricity used to charge electric cars but providing charging stations at work would reduce commuting costs for employees. Other options that may be beneficial to employees are cycle to work schemes and other car sharing initiatives.

Retail vouchers and discounts can also help offset the cost of food/essential shopping. You may want to consider gifting a supermarket voucher to your employees, a value of £50 or less will be considered a trivial benefit and not taxable. The voucher must not be able to be exchanged for cash or exceed £50.

Above all, a wide range of benefits is important – not just tangible perks but also benefits such as flexible working.

Flexible working

If you don’t already offer it, flexible working options can go a long way in helping employees with the cost of living. You might allow someone to work 5 days’ worth of hours in 4 days or change their working hours to support with childcare or commuting costs. You could also be flexible with working days so that employees can move them around to avoid paying for childcare, e.g., if grandparents are looking after the child.

This Autumn and Winter, you might encourage flexible, hybrid or remote workers who live close by, to come into the office more often if the commute is cheaper than paying for electricity or heating the house.

Loans and funds

It’s not uncommon for employees to offer loans to their staff, and you may want to do this to cover the cost of a train season ticket or to meet a welfare expense.

This can be deducted monthly from the employee’s wage so people can benefit from cheaper rates if they do have the money upfront to pay back the full amount.

Instead of a loan scheme, you could start a fund of money that people can apply to for development that they otherwise couldn’t afford, for example to learn how to drive or take training courses.

‘Income streaming’ is another option, that allows employees to draw on some of their already earned wages before payday and therefore avoids them reaching for a pay day loan.

Food bank system

A lot of people see food banks as a last resort for people that can’t afford it. However, they can also benefit people by freeing up income, that employees would otherwise have needed to spend on food.

A ‘food bank’ system could work in the same way at your office, with store cupboard staples such as pasta, rice, tinned tomatoes, and sanitary products. It would be set up for those in need with the encouragement for employees to take from it and donate back to it for others when they can.

Other ways you could support employees with food shopping include providing free breakfast and lunch options such as fruit, cereal and sandwiches or bringing in cooking experts (or savvy employees) to share low cost, healthy recipes that can be made from scratch.

To summarise

Offering staff benefits that reduce the cost of living is a good alternative to making pay rises, especially when you may also be feeling the pinch as a business. Before making any decisions you could ask your employees how best you can support them through the crisis – keep in mind that employees may be reluctant to speak to about their financial problems, so you may want to approach the conversation in a 1:1.

If you have any questions about supporting your employees or reviewing your pay and benefits package, please get in touch with our team at [email protected].