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Work-related stress and health issues are on the rise. Recent research by health insurer Vitality and the Financial Times has revealed a surge in mental illness and anxiety in comparison with previous years. This may be attributed to the culmination of consecutive crises following the pandemic, including the Ukraine war, climate change pressures and the growing financial worries associated with the cost of living crisis.

Here we outline how a long-term and rounded approach to wellbeing is fundamental for employers taking an employee-centric approach to their reward and benefits strategy.

Workplace wellbeing

Wellbeing is increasingly acknowledged as being more than physical, as traditional benefits packages used to address. With 75 per cent of respondents offering private medical insurance and 83 per cent offering occupational sick pay in our autumn UK Reward Management Survey, benefits that support the physical health of employees remain at the top of employers’ agendas. Healthcare cash plans are also popular, and pension and life assurance schemes were amongst the top benefits reported by employers.

However, employers are increasingly understanding how wellbeing is interconnected. Financial wellbeing has a direct impact on mental health and employees are looking for their employer to go beyond paying lip service to this – they are looking at how this is supported across the business. Financial wellbeing is a priority given the cost of living crisis, with many employers offering greater access to financial tools and webinars, and some providing hardship funds to support those most impacted.

One in four employers reported considering offering a one-off cost of living payment to ease the financial impact of the economic climate, with an average reported lump sum of £750 per employee. One in three offer this to all staff, whilst 40 per cent are providing this to lower paid/level employees only. This has a direct link with the mental health of employees as employers seek to reduce the anxiety that financial pressures can introduce.

Other employers are providing access to mental health first aiders to provide immediate support to employees struggling with their mental health. 93 per cent of employers offer an Employee Assistance Programme, illustrating how a rounded approach to employee wellbeing is crucial. This all goes beyond the traditional cash benefits that employers are used to offering, to encompass a greater focus on the individual and their own priorities.

Many employers are reviewing their approach to employee benefits, considering how flexible benefits enable the individual to tailor their reward package to their own preferences and priorities – ensuring that employees can cherry pick the ones that they value most. Whilst this can drive employee satisfaction from the reward package, done right it can also drive cost savings for employers who can offer a ‘menu’ of options that can appeal to different demographics across the workforce and the wellbeing support they require. 27 per cent of UK Reward Management Survey respondents currently offer flexible benefits; half do not offer flexible benefits and while 23 per cent do not offer this yet, it is under consideration.

woman and man discussing over a laptop

Long-term mental health

The pandemic took its toll on many frontline workers who were under sustained pressure over the course of this period. From health workers to retail workers, who were all considered key workers to keep vital services open, the potential stress of going into work during lockdown was flagged by employers at the time as something that could have an impact further down the line.

Employers feel a sense of responsibility in supporting employees to look after and protect their mental health in the workplace. Greater training and support can come in preparing line managers for these conversations too, to truly embed this within a workplace’s culture. Anecdotally, we are hearing that employers are relaunching their benefits packages, particularly in light of the cost of living, to ensure that employees understand the true range of benefits on offer to them to support them in their mental, physical and financial wellbeing.

Reiterating channels of support and coaching leaders of the future are key pillars in this strategy. Total Reward Statements can also complement this, whereby the full investment in each employee is set out to strengthen the relationship between employee and employer. By focusing on the individual and what they need for their wellbeing, employers are also considering greater kinds of leave that employees may require.

In addition to annual leave, employers are recognising major milestones in employees’ lives and the impact these times can have. 75 per cent offer enhanced maternity leave and 62 per cent offer enhanced paternity leave, while others offer time off to support fertility treatments and the menopause. This is in direct recognition of the impact these can have on an individual’s wellbeing.

New ways of working

New government legislation gives employees the right to request flexible working from day one of a new job. The Department for Business, Energy and Industrial Strategy (BEIS) says that if they cannot accommodate the initial request, employers must discuss ‘alternative options’ with the employee before rejecting it.

Following the pandemic, which was the biggest experiment in working from home as millions of people across the UK worked from home, this has continued in various forms. Working remotely, job sharing, compressed hours, flexitime and part time working were all on the rise in the wake of the disruption caused by consecutive lockdowns.

With companies reporting a chronic shortage of workers and the growing war for talent, employers offering these working patterns can strengthen their approach to recruit and retain. Even though the levels of employee turnover are expected to plateau since the elevated levels reported in spring 2022 when the labour market was particularly buoyant, 24 per cent of respondents expect turnover to increase generally and the skills shortage is making recruitment and retention particularly challenging in certain sectors, such as care and technology.

The government has also said that this would benefit the 1.5 million low-paid workers, including gig economy employees, students and carers, who would benefit from greater flexibility and undertake a second job to boost their income if they required this. This would reduce the financial burdens facing many as fuel costs rise over the winter period and the cost of living crisis sees prices rise across the board for staple items.

Get in touch

As employers look towards how they will support employees through the forecast recession in 2023, ensuring the right pay and reward framework is in place will be crucial to demonstrating the support on offer for employees and their individual circumstances. Get in touch to discuss how to bolster the wellbeing support you offer to employees.

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