Staff in financial difficulties: what can you do as an employer? † NOW

People do not like to talk about money, especially when it comes to debt. That while every third household has difficulty paying the bills, surveys conducted by auditing and consulting firm Deloitte show. This financial stress can adversely affect employee performance. What role can an employee play in preventing this?

Almost 8 percent of households in the Netherlands have large debts, according to figures from Statistics Holland. “It is often thought that these families live off benefits,” says Mohamed Bouker, a partner at Deloitte. “But nearly half (40 percent, ed.) Of households with registered debt have a working breadwinner.”

Problem debt is never isolated, Bouker says. “There are always setbacks, such as a serious illness, a divorce or the corona crisis. People get into financial distress and try to solve this themselves through all sorts of new loans. Eventually the problems get bigger and at some point the bailiff stands. On the sidewalk . “

In more than half of the cases, it is also the moment when the employer finds out the debt of his employee. It appears from a survey – conducted by Deloitte, SchuldenlabNL and the employers’ organization VNO-NCW – among three hundred employers.

“The bailiff seizes the salary and reports this immediately to the employer, but then it is already too late and the debt is too large. This despite the fact that 79 percent of employers want to help prevent such a debt on a previous point in time.”

“An employee with debt costs the employer between 13,000 and 18,000 euros.”

Mohamed Bouker, Deloitte partner

Major problems due to inflation

Financial problems are of great importance for the employee’s performance, says Lars Vissers, general manager at De Arbodienst. “Big debt puts a lot of stress, it’s at the expense of mental and physical health.” Vissers also expects the problems to increase due to current inflation. “People still have buffers, but if inflation continues for a long time, they will run dry. If stress increases, absenteeism will also increase.”

Research shows that four out of five employers (80 percent) handle employees who have financial problems. 85 percent have noticed that it has had a negative impact on the organization. Bouker: “An employee with debt costs between 13,000 and 18,000 euros. The employee is less productive, less involved and has a lot of stress. In the end, he or she reports sick more often or eventually drops out altogether.”

Debt is therefore not only the employee’s problem, but also the employer’s problem. “It is a necessity for both parties to invest in the solution to this problem,” Bouker says. It starts with prevention, says Vissers. “Beware of deviant signals from the employee. If he suddenly arrives structurally too early, while in the beginning he often arrived too late, it is striking. The same applies if he suddenly often works overtime or becomes less social.”

To break the taboo around debt

Vissers advises to initiate a conversation with the employee in case of such signals. “The taboo around debt must be broken in the workplace.” Bouker also strives for this. “There must be a culture where you can confidently talk about your finances at work without consequences for your job. We are used to celebrating successes, but it should also become normal to experience the bad sides of life. Discuss . “

Such a working atmosphere can be created by investing in pre- and post-care of employees with debt. Vissers: “For example, arrange class meetings where employees learn more about keeping track of their finances. Or appoint a budget coach for the employee with money problems. Then you keep some distance and the employee is still helped.”

Think about the financial situation

Bouker will even go a step further: “Talk to your employees about their financial situation. Think also of arrears or debt.” One possible solution is to increase wages or temporarily provide more working hours. “But make sure they don’t have problems with supplements. Who knows, they earn too much, so they immediately lose the money on, for example, the rent.”

Does the employer not immerse himself too much in the employee’s privacy in this way? “No, certainly not. We notice that employees nowadays appreciate more and more when the employer shows personal interest. In addition, the employer also has a social duty to fulfill its duty of care for the employee.”

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