Money induced stress has been reported to affect the performance of employees in the workplace. Employers should, therefore, not take the back seat when it comes to guiding and providing relevant information to, particularly, young employees. With the current global economic meltdown and uncertainty, it behoves employers to support in whatever way they can. Equipping employees with the knowledge and skills they need to manage their finances effectively is one way of providing support.
While one is free to spend their hard-earned money, however, they want, an employer can provide general information on the ideal dos and don'ts when it comes to money management. This could even help reduce the spiking incidents where staff regularly take up salary advances, a sign of poor financial planning. So what are some of the ways employers can help enact financial literacy in the workplace?
Develop a pension plan for your employees
With most pension plans in Kenya, a certain percentage is deducted from the employee's gross income with the employer matching this percentage. In some instances, the employer can offer a higher percentage, the sum of which is invested in a pension program for the employee.
Developing a pension plan for your employees improves the commitment of employees to the firm and enables them to save up for their retirement. A pension package is also attractive to prospective employees. Additionally, employees end up understanding that if they perform well at work and get a salary raise, their pension contributions along with that of the employers’ will rise. This will in turn increase their future financial security.
Offer flexible work schedules
In the wake of the COVID-19, firms have realised that they can allow employees to work from home and still get results delivered. A work from home policy is a win-win financial saving strategy for both the firm and the employee.
The employer saves on the cost of leasing office space every month while also benefiting from improved productivity from the employees who now work from home and avoid the hustle of commuting. Employees get to save on transport and lunch costs that they would have otherwise spent if they were at the office every day. Spending more time at home and with families has been proven to improve productivity, especially among young mothers who spend less time worrying about the wellbeing and safety of their young ones.
Provide Internal price discounts on your sales
Some firms dealing with fast-moving consumer goods and household items allow their staff to purchase these goods at a lower price. This is a popular trend and has been there in practice for a long time. You will find a firm that produces flour for example allowing its staff to purchase it at discounted prices. This saves an employee huge costs, especially if the commodity being purchased is an item that is regularly used. In 2020, some firms went as far as allowing their staff to purchase items in bulk, at discounted prices, and then deducted the money over the course of a period of months.
Personal finance training
This is one of the best ways that an employer can empower its employees. Employers can engage in personal finance and investments specialists to interact with their staff on a regular basis. There are numerous investment experts and personal finance coaches and programs that can help employees gain financial literacy. Some are free and some charge a fee. When employees feel that their employer is devoted to their personal financial well being, this will boost their morale and enhance their overall performance at work.
All too often, we have heard the familiar story of retirees being swindled of their retirement fortunes as soon as they retire. In this case, it would help for employers to organise for retirement specialists to come and give their employees advise on the best ways to handle their retirement benefits.
Encourage the formation and joining of a company SACCO
Some employers have SACCOs that employees can join. This is ideal more so for young employees who have just recently started working. Saving consistently in a Sacco enables one to benefit from dividend income and cheap loans. Some firms have a fund where donations from staff members go towards assisting their colleagues who have suffered an unfortunate loss or accident.
Every firm should identify one or numerous strategies where they can contribute to the wellbeing of their staff through the dissemination of empowering information. The rewards of investing in financial literacy programmes at the workplace are tellingly great.
