Return to work: Your window of opportunity to help employees recover

Employees who have been working remotely for the past year may begin returning to the office soon as COVID-19 restrictions begin to loosen across the country. This shift in the work environment is an ideal time for employers to begin thinking about how they want to work with employees to help them recover financially and emotionally from the disruptions and stress of the pandemic.

The pandemic affected employees in dramatically different ways, with half of the large employer workforce expressing a change in their financial situation in only one year — just as many improving as deteriorating — according to Willis Towers Watson’s 2020 Global Benefits Attitudes Survey (GBAS).

“Retirement savings jumped to the top priority across almost all segments of employees who held onto their jobs, and employees are asking for better financial resources and services from their employers,” said Shane Bartling, senior director, retirement, at WTW. “Now is a window of opportunity to engage employees in healthy financial behaviors using improved resources and building support around these resources.”

A chance for employers to be proactive

John McFarland, senior vice president of client development for Vensure HR, said offering debt counseling and incentives around savings will become a mainstay for employers who are focused on helping their employees recover from the financial strains of the pandemic. In some cases, employees had to use retirement dollars or emergency savings to get through the crisis. The resulting financial instability can cause a strain on employees that can impact productivity especially at a time when they are transitioning back to work.

“Employers can help their employees by being proactive and offering financial wellness programs or even emergency savings benefits, including split direct deposits to increase how much is put into retirement,” McFarland said. “Discussing personal finances can be taboo at times. However, embracing a culture that discusses financial wellness can help those employees that are less financially savvy glean valuable information from those that are.”

Employees bring their financial worries to work

Why should employers care about an employee’s personal emergency savings accounts? According to a recent Bankrate report, only 31 percent of Americans could afford an unexpected bill of $1,000. When a trip to the emergency room, a leaky roof or an unexpected car repair comes up, people often have to go into debt to pay for them, McFarland said.

Stan Milovancev, executive vice president of CBIZ Retirement Plan Services, said these types of worries can lead to a situation called ‘presenteeism,’ physically the opposite of absenteeism but with the same results.

“Employees are there, but they are worried about their mortgage. They are worried about how they are going to make their next payment, where they can borrow and who they can call,” said Milovancev. “That’s not a productive employee.”

He noted that in the past, employees have generally resisted having conversations about financial issues in the workplace, but thanks to fear and anxiety triggered by the pandemic, many employees now are seeking a partnership with their employer on financial wellness. Employees don’t want to discuss personal financial issues with their supervisor or boss, but they do want their employer to vet third-party providers who can help them with their finances and secure institutional pricing for those services, he said.

Short window of time

Time may be of the essence for employers to help some of their employees. Bartling cautioned that employees who struggled financially during the pandemic have signaled that they plan to spend big once the pandemic ends rather than buckling down on rebuilding emergency savings and retirement plans.

“This is understandable when we look at the mental toll this same group indicates they have suffered,” Bartling said. “Employers have a short window of time to engage employees in resources to support financial and mental health, as well as supportive social connections, to restore resilience before the big spending happens.”

Helping employees focus on paying off 401(k) loans, re-starting contributions to retirement plans and re-building retirement savings is another area of importance for employers as the immediate financial stressors of the pandemic begin to wane. McFarland said employers can encourage employees to just start somewhere and know that every bit of savings made into a 401(k) or retirement fund will help them get on track, especially if there is an employer match.

Milovancev also pointed to strategies like positive peer pressure and gamification that can help motivate employees to participate in retirement savings plans and financial wellness programs.

The return to work shift is an ideal time for employers to capitalize on strong sentiment in favor of retirement savings. According to WTW’s 2020 GBAS data, employees who retained their jobs, across all segments, are strongly focused on retirement savings.

“Retirement jumped to the No. 1 priority in nearly all segments, possibly connected to the widespread mental stress seen in the same survey,” said Bartling. “Now is a perfect opportunity to engage employees in resources to support financial and mental health, as well as supportive social connections to restore tightly connected mental and financial resilience and help employees balance financial priorities while spending habits reset.”

Proven connection between financial health and mental health

As employers engage with employees during what will be another big transition in their lives, it is important to keep the connection between financial and mental health top of mind. Bartling noted that half of generations Y and Z express struggling with mental issues, and nearly half of those also indicate financial struggles, with high tendencies toward addictive behaviors including overspending.

Bartling added that we must not “underemphasize the importance of jointly addressing the highly connected mental and financial health of employees, and the importance of building supportive social connections using data-driven behavioral science and techniques.”

McFarland also noted the strong connection between financial stress and mental health, both of which have been significantly impacted by the pandemic and other events during the past year.

“According to Gallup, employee engagement fluctuated during 2020 due to a number of factors related to the pandemic, politics, and civil unrest, while the percentage of actively disengaged employees remained unchanged,” said McFarland. “As we transition back into our respective workspaces, an active approach toward mental health and employee engagement will pay dividends to those employers that champion it.”

Kristen Beckman is a freelance writer based in Colorado. She previously was a writer and editor for ALM’s Retirement Advisor magazine and LifeHealthPro online channel. She also was a reporter for Business Insurance magazine covering workers compensation topics. Kristen graduated from the University of Missouri with a degree in journalism.