Multi-generational workers – getting their benefits right
25 May 2019
This article was featured in the June 2019 issue of the magazine.
John Deacon, head of employee benefits at Buck, discusses issues and solutions
The number of older employees in the workplace continues to rise along with the cost of living, and as a result many staff are no longer able to leave work as they near retirement age. This trend is both a benefit and a challenge to many businesses, as they need to adapt the way they manage employee churn and introduce more innovative business practices to ensure that their day-to-day operations can be maintained.
Before businesses can adequately provide for an ageing workforce, they first need to consider why older employees are staying. For some, older staff are remaining because they are still eager to work and remain part of the organisation or industry. Others will want to take advantage of the skills they have honed over the years and remain a source of support to their employer. Either way, these employees are a valuable asset, as they are able to offer insight, advice and decades of experience to junior members of staff and the business as a whole.
For some staff, however, working into retirement is a necessity rather than a preference. Without adequate savings, these workers are unable to retire and need to continue working in order to maintain their standard of living. It is these employees who the business needs to consider very carefully, as they are likely to be frustrated and demotivated in their role if they are working because they have to, rather than because they want to.
It is here that employers need to review how financial wellbeing is treated in the business, as this area has often been ignored in the past. Some businesses may occasionally offer a more attractive pension scheme or make a higher contribution to the employee’s fund, but more often than not, payments are kept to the industry standard.
However, with a growing focus on wellness in the workplace – both physical and mental – companies are now reviewing staff financial wellbeing as a key part of the employee experience. There are clearly many benefits to ensuring that employees feel positive about their personal finances, but the primary incentive for employers is the way that financial wellness strategies will help futureproof the business.
...employers need to review how financial wellbeing is treated ...
If staff feel positive about their finances, they are more likely to stay a part of the business, since they will feel like their employer is looking after them. As they reach retirement age, staff will also be able to leave work with an adequate pension, meaning that only those who are keen to stay a part of the organisation will continue working. While each employee will have their own understanding of what their own financial wellness looks like, workers are more likely to achieve this goal if they are given the tools they need to get there.
In practice, the support that employers provide for financial wellness will depend on the employee’s age, level and experience within the company. For younger staff, this support may be centred around training that helps them understand pensions, for example, or advice on the ‘right’ amount they should be saving each month.
As employees progress through their career, the business can then increase these benefits in line with each person’s role. This can range from subsidising gym memberships, offering season ticket loans or even giving financial advice on investment and mortgages. Staff can then engage with the initiatives that appeal to them and pursue the benefits that most suit their lifestyle as they get older.
However, for older employees, it is not just about offering support on savings. Staff who are not able to retire still need to have a high quality of living while they continue to work and save. This approach will allow them to remain motivated in their role even as they look to leave the business at some point in the future.
It is here that a wider benefits strategy becomes an important part of employee wellness, whether it aims to provide a better work-life balance by encouraging staff to work from home or by offering the possibility of flexi-time. Doing so will keep these staff engaged in the business beyond the official retirement age.
Managing an ageing workforce will be an ongoing issue for modern businesses. Whether staff are working later in life to maintain a routine or simply need a few more years to save, they will need to be considered very carefully. Businesses should not only be thinking about what these older workers need, but also about how they can better provide for the younger employees who will eventually grow into this staff pool.
Taking time to focus on financial wellbeing – whether through direct contributors such as training and support, to softer benefits like flexi-time – will allow all staff to have a better grasp on their finances and the ability to save more effectively for their future.