Research has shown that many employees are now taking the opportunity of low interest rates to try and pay off as much of their debts as possible. In this respect, further interest rate cuts and income tax relief would relatively ease the severity of problem of financial distress.
Impact of employee financial distress on productivity
Employees burdened by personal financial problem spend time at their place of work worrying about personal finances and dealing with financial issues instead of working. These range from taking calls from creditors, lenders, paying personal bills, talking to co-workers about their financial problems and absenteeism at work etc.
An employee with personal financial problems very often is living from paycheck by paycheck, with numerous micro loans and accounts in arrears. The motivational factor making organisations look at the issue of employee debt is the problem of stress that individuals are facing resulting in low morale and productivity.
Organisations can make it a lifetime responsibility to protect themselves as well as their employees against this problem by investing in programs to help minimize employee debt which include providing easy and quality workplace financial education, allocating 1 hour of working time per month for employees to manage their finances etc.
The benefit of offering such programs is showing employees that the organisation does care about their staff which improves morale. Organisations need to take steps to curb the severity of the personal debt problem and its consequences.
Debt Sage offers budgeting and debt counselling services for corporate employees. If you are an employer and you feel that your employees may benefit from these programs call us today.