India's Largest Lending Platform | Fibe (formerly EarlySalary

With millennials’ increasing dependence on credit options in order to live their life, financial education is more critical than ever. While financial literacy has of course, a directly positive impact on employees, it also benefits employers is more ways than you may imagine. Strong financial education and better financial management skills result in employees less likely to end up with financial woes and stress – or in other words – more likely to end up as increasingly productive parts of the workforce. Lower attritions are a consequence as well if there are fewer financial hardships and fewer requests for salary advances to deal with. Financial stress can affect the workplace in many negative ways, by directly impacting productivity and causing more anxiety at the workplace.

Educating employees about their finances is also a good way to exhibit a truly people centric organisation culture – the organisation moves forward if its people move forward.

New Joinees: The Basics

Companies are often seen hiring new employees during a certain time of the year (and sometimes even throughout the year), be it through on-campus hiring, or off-campus drives.

As the business scales, manpower needs obviously increase. When a percentage of the workers retire or graduate to managerial positions, young graduate students are often recruited to fill this gap. Younger employees tend to be more enthusiastic, with stronger learning ability and are more up to date with current technology. They also have fresh ideas and newer perspectives that can bring an added value to the organisation. They also do not tend to cost the company as much.

Sometimes, employers hire a certain group of people due to their unique skill, such as a cloud computing specialist, or a web developer. Their ability to do the work in a short amount of time with great efficiency reduces the overall cost to company and increases their profits.

Thanks to the digital age, recruitments are not as tedious for the employers as they used to be. With job roles becoming more specific even at the lowest level, candidates are screened out automatically. While online recruiting is very effective, it is also important that your new hires transition into their workplace effortlessly.

The Criticality of Financial Wellness For Employees

Employees spend a third of their day at their workplace. Naturally then, it is critical that they look forward to it – and that is accomplished when the organisation is careful to cater to their needs – physically, mentally and financially. The three are often very closely connected, however, employers are often significantly responsible for financial wellness:

• Funds play a very important role in their lives and a lack of them is likely cause a number of problems, including disruption of physical and mental health.
• With increasing stress and workload at workplaces, employers are now taking the financial wellness of their employees more seriously. The average worker today, before even starting their job, typically brings with them significant debt in terms of college loans and personal loans that need to be paid off.

• Organisations have fortunately begun taking an active interest in improving the everyday financial situation for their employees. This need not be directly in the form of money. Food vouchers, sponsored trips or even simple spa and movie tickets are given out regularly as morale boosters.

A Good Financial Start

Benefits and bonuses are a lot more regular and simple now with the onset of the digital era.

• Employers have tried to lighten any financial burden through tie ups with online loan apps or extending personal loans and salary advances themselves.
• Companies are also issuing corporate credit cards to reimburse any excess expenses carried out by the employee for the organisation. This could include travel expenses and client meals.
• Several banks, including State Bank of India, and ICICI Bank have extended their support to a prepaid card model. Expense management brands have also created prepaid cards for business purposes, so employers can get their money reimbursed easily.

Companies have come a long way as far as financial wellness is concerned, from team outings to regular bonuses and festival gifts, employers are going out of their way to ease the financial stress of their employees by fulfilling experiences. Tie ups with leading salary advance apps, such as EarlySalary also ensure that workers can obtain salary advances and personal loans at an affordable interest rate without much hassle and paperwork. It’s a good time to be part of an active workforce!

Employees today increasingly look beyond money and job satisfaction – they look for additional benefits, too. A generous employee benefits package is an essential component in attracting and retaining the industry’s top talent. Glassdoor’s Employment Confidence Survey in 2015 found that about 60% of people consider benefits and perks a significant part of deciding whether to accept the job, while 80% of the employees would prefer to get additional benefits from their employers rather than a pay raise. While multi-billion-dollar organisations like Google and Twitter offer the most attractive perks including yoga classes, massages, etc., not all can afford them. For such companies, the good news is that not all benefits are expensive. The benefits that make employees happiest come at relatively low cost to the employers, like flexible hours, more paid vacation time, and work-from-home options.

The digital revolution has made everything evolve vastly from the situation just a decade or two ago. So it comes as no surprise that employee expectations and benefits have also evolved and are markedly different in today’s digital age than they were before. For instance, working-from-home was practically not an option, and neither were flexible work hours, with no secure means of communication to manage either. Other aspects are different now too – like the fact that medical expenses and college tuition costs are hitting the roof, making related benefits attractive to employees. With the increasing significance benefits have, even over a higher salary, it is becoming essential for employers to understand employees and their issues and give them attractive benefits and retain a skilled workforce.

History of Benefits

Employee benefits first came into the picture in 1636, when the first pension law was enacted in Plymouth (part of what is now Massachusetts).

• This was followed by the first profit-sharing plan proposed in the US Marine Hospital Service more than a century later, in 1797.
• The 1800s saw notable developments like the first private pension plan, the first group insurance policy and the first wage payment law.
• The 1900s saw many new benefits plans, where employers became more proactive in giving their employees incentive to work with them. This, combined with separate government initiatives including health and retirement programs and other incentives, resulted in a new era of employee benefits.
• Notable developments in the 1900s include the introduction of workers’ compensation and the minimum wage law. Other benefits in the earlier days include employee stock purchase plans, paid leaves, severance pay and services like canteen, transport, accommodation, healthcare, etc.  

While some of these benefits continue in today’s digital age, some are now obsolete and do not offer the same value. Employee benefits are essentially meant to attract and retain employees, and employers will need to keep up with the times and offer employees the benefits they desire if they wish to retain talent.

Importance of Attractive Benefits

source: Patriot Software

Multiple studies and surveys have indicated that a majority of salaried employees prefer better benefits and perks over a pay raise:

• A 2016 survey by Aflac found that having a benefits package is extremely or very important to their employer loyalty for 60% of employees. According to the same survey, 36% of employees say improving their benefits package is one thing their employers can do to keep them in their jobs.
• Another survey by MetLife in 2017 indicated that 72% of employees said that the ability to customize benefits increases their loyalty – meaning that employees prefer to choose benefits to match their lifestyles.

Of course, this leads to lower attrition, amongst many other business advantages – such as better productivity, and better attendance. Finances, family commitments, and health issues are the major reasons for absenteeism, and these can be taken care of via benefits like flexible work hours and health benefit plans.

Benefits Desirable in Today’s Age

While some benefits of earlier times are no longer popular, some are given a great deal of importance. These benefits include:

Medical Insurance

With medical costs skyrocketing globally, health insurance and medical benefits are becoming increasingly important to many. These are one of the most expensive benefits to provide, but they remain the most desired for employees.

Retirement Plans

The youth of today are increasingly aware of their future and wish to start their retirement plan as soon as possible, understanding that it is important to ensure survival when they can’t earn anymore. So attractive retirement plans are quite important as benefits go.

Paid Leaves

Increased vacation time and more paid leaves per year are certainly desirable to employees, with breaks a necessity rather than a benefit due to increased stress at the workplace. Of course, a lot of executives end up leaving vacation days unused. In such cases, employees can either carry forward their leave days into the next year or opt to cash-in on their leaves, depending on the company policy.

The above benefits have been around for a while, and are still important to employees. However, with the changing times, many new benefits have been introduced, the most desirable among them including:

Flexible Work Arrangements

Flexible work arrangements have only become feasible due to recent tech advances. With meetings possible through video conferences and clients just a call away, it’s become possible to only turn up for work when needed and spend unproductive work time doing something productive at home. Similarly, working from home is also possible in some professions, and these are the benefits many employees look for and even prefer over a higher salary package.

Fitness-related Benefits

With increasing importance accorded to stress relief and relaxation, workplaces have become more interesting and colourful, with places for fun and games, and even full-fledged gyms. As part of stress relieving initiates at workplaces, many employees desire yoga or fitness sessions, or well-equipped gyms at the office.

Student Loan Assistance

Education costs are now hitting the roof, and most students try to meet these costs by taking loans. While a high salary would definitely help to pay off these loans, freshers prefer loan or tuition assistance over a higher paying job. Providing such benefits might be costly, but companies can use it to their advantage and avail tax benefits on tuition fee provided to employees. Services like School FeEs from Fibe are tuned to meet exactly these needs.

Financial Wellness

Investment is an significant factor in building one’s savings, and the youth of today is realising this fact faster than previous generations. However, a large number of people remain financially unaware and have no clear ideas as to where to invest or what kind of investment would bring them the best returns. In this situation, a benefits package which includes financial advice, investment assistance and help in financial management is highly desirable.

In today’s fast-paced digital age, employers making work easy for them is accorded a higher priority rather than a higher salary, although good pay certainly remains desirable. Work-life-balance, as well as the reduction of some of its related stress through financial benefits plans,  are coveted perks in the markets. Further, employees also like to be cared for, and attractive benefits packages show that the employers care. Employee benefits are, therefore, very important to attract and retain a skilled workforce.