“Have you cleaned your teeth? Eaten your breakfast? Are you getting enough water?” You might say this to your children – but should you be doing the same with your employees?
What your employees eat, drink or otherwise do with their bodies is entirely their own business, provided it doesn’t have a negative impact on their ability to function at work. So the idea that employers ‘should’ involve themselves in the financial business of their workforce is one that I find at best patronising, and at worst a risk to the company.
Let me tell you why. Firstly, I try to employ adults. They might be young adults and come from all backgrounds but nonetheless they are adults, and I expect that they are able to take care of themselves and make their own decisions about what is best for them and their families.
Secondly, and importantly, we are not regulated by the Financial Conduct Authority to give financial advice. We trust our pension provider to give pension advice – that is what we pay them for. If one of your employees was looking for replacement windows would you advise them on the best company to use? Or a garage? No you wouldn’t – you might have a passing conversation and share experience as colleagues do, but it’s not your responsibility or place to tell them what they should be spending their salary on, or how. The same goes for bank accounts, credit cards and mortgages.
The trouble is that HR departments frequently view themselves as carers and social workers, rather than a business centre that exists to ensure the organisation runs smoothly and profitably. This is often why HR is seen negatively. You can care about the workforce – most of us wouldn’t be in the role if we didn’t – but ultimately we run businesses not charities. If the business thrives so do its employees.
If an employee gets into financial difficulty there is advice to be had – Citizens Advice is probably the most notable and there is nothing wrong with pointing the employee in the right direction. However, again, we are not debt counsellors and cannot and should not be negotiating on behalf of workers.
Don’t get me wrong. I believe we should be educating young people on financial decisions while they’re still at school, and before they get their first grant or payslip and spend it all on new shoes or at the student union bar; or worse, are inundated with offers of credit cards with massive interest rates. (I once spent an entire week’s wages on a pair of trousers. I was very well presented but quite hungry for a week. Lesson duly learned.)
When my company looked at employee benefits we quickly came to the conclusion that not everyone wanted – or could use – a gym membership or private dental care. We made the decision to create a reward system that gave every employee an extra amount in their monthly pay packet that they could choose to spend on whatever they like.
It works well: some employees do purchase gym memberships, others decide to fund a new car, or add to their holiday savings. Some choose to top up their pension contributions… it’s all about choice. And we’ve had no complaints yet.
If an employee comes to me with a financial question I am happy to recommend a professional adviser, the same way that I would suggest a solicitor for a legal problem.
I was once asked to create a policy regarding the age-old tradition of bringing cakes into work to share on an employee’s birthday. The employer in question wanted to create a rule that only fruit was brought in because it was healthier. The expression ‘fun sponge’ springs to mind. HR should stick to parenting their children not their employees; when we expect people to behave as adults they generally do. And if they don’t, we have processes for that.
Press harder for financial education when it most matters: in secondary school and in the home. And let the grown-ups get on with living their lives as they choose.
Kate Foreman is chairman and director of people and learning at RWA Business Consultancy