Two-thirds of employees see finances impact mental health
Nearly half of UK employees say they have missed a bill payment as a direct result of inaccurate payroll, according to a new study. With 65% of workers having felt their mental health was impacted by their finances, this is an issue that businesses cannot afford to overlook.
A huge body of evidence shows that employees feel inadequate pay and financial anxieties are the biggest stressor in their working lives. In the majority of cases, however, not only have employers not kept pay in line with inflation – particularly amid the cost-of-living crisis of the last two years – exacerbating money concerns for their staff, but many have also failed to ensure timely and accurate payment of the wages they owe.
A new report from HR, payroll, and finance software provider MHR reinforces this. Polling workers across the UK, MHR found that 46% had missed a bill payment as a direct result of their employer’s inaccurate payroll practices. Either this has left them underpaid, or not paid at all, and unable to keep up with important financial deadlines as a result.
The impact of sloppy internal processes like this is clear to see. A 67% portion of staff told MHR that financial stress was making it difficult for them to concentrate at work, while 65% said the situation had had a notable impact on their mental health in the last year. In the long run, this will have an impact on their performance for their employer – meaning that by failing to tackle this now, businesses are creating larger problems for themselves in the long-term.
Anton Roe, CEO at MHR, said, “Organisations have a duty of care for employees that they must uphold, especially during challenging economic climates like the one the country currently finds itself in. Being confident they are going to be paid accurately, on time, should be the bare minimum an employee can expect from their employer.”
In terms of what firms can do to improve their payroll efforts, MHR pointed to its own recent partnership with software provider Wagestream. The alliance enabled MHR to integrate a financial wellbeing solution as an extension of its payroll service currently available through the People First and iTrent platforms. Building upon People First’s real-time capability – which allows employees to see how much money they are earning as they are earning it – the solution now enables employees to access money from their pay-packet early, up to a maximum of twice a month.
According to MHR’s research, one-third of employees said having this kind of visibility and control over their payroll would help to reduce stress about their finances. In turn, this can increase productivity at work, improve job satisfaction and increase employee retention over the long-term. Failing to do so, meanwhile, could have dire consequences.
Roe added, “If organisations do not address the financial wellbeing of individual employees, soon enough the financial wellbeing of the entire business will be in doubt. Our research draws a direct link between employees’ financial wellbeing and engagement at work, which naturally impacts productivity and ultimately a company’s bottom line. This is only compounded by the increased flight risk of employees who feel they are not supported by their employer, which may lead to them looking for new opportunities elsewhere."
