Cost of living crisis: are you missing out on help from your employer?

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Many employers are stepping in to help workers with the rising cost of living, with some firms offering a one-off bonus or other assistance ranging from improved employee discounts to free food.

Some big-name companies are giving lower-paid workers extra cash to help combat the impact of soaring inflation and higher bills.

Meanwhile, there may be employee benefits you have not utilised that could help you balance your budget even if your boss is not giving you a pay rise.

For example, many firms offer perks such as discounts at local businesses, cycle to work schemes, season ticket loans, free eye tests and the option to sell back unused annual leave.

Jonathan Watts-Lay, the director of Wealth at Work, a financial wellbeing and retirement specialist, says that if you are struggling with your finances, speak to your employer to find out what help they have available. “Even if they don’t offer anything at the moment, sharing the challenges you are facing may encourage them to put support in place.”

Equally, your trade union – if you are a member of one – will often have deals and other help available, so take the time to see what’s on offer.

Cost of living payments

View image in fullscreenWealth at Work says if you are struggling with your finances, speak to your employer. Photograph: Dominic Lipinski/PA

Big employers including HSBC, John Lewis and Virgin Media O2 are giving some workers extra payments to help with the rising cost of living.

Virgin Media O2 earlier this month announced it will give payments totalling £1,400 to employees earning £35,000 and under.

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The first payment of £400 will be issued next month, followed by another £400 in January 2023, and then six payments of £100 a month until July 2023.

Meanwhile, John Lewis recently revealed that full-time staff will get a one-off cost of living payment of £500 – with part-time staff eligible for a lower amount.

Banks including HSBC and Nationwide are giving the lowest-paid members of staff bonuses of £1,500 and £1,200 respectively.

Pay rises

Other firms say they are giving staff a pay rise to combat rising living costs rather than handing out lump-sum payments. However, there will often be different reasons why businesses increase pay – for example, in sectors such as hospitality and retail, it is arguably staff shortages and firms competing to recruit and retain workers that are the biggest factors behind some of the recent pay rises.

That said, some businesses are targeting pay rises towards lower-paid staff members.

View image in fullscreenSome companies are offering free food to workers during shifts.
Photograph: Sergii Koval/Alamy

Free food and help with bills

Some employers are giving out free meals and snacks to help workers with the cost of living crisis, while others have hardship funds to support staff who are struggling to pay their bills.

For example, John Lewis and Waitrose will offer free food over the winter, and are also doubling their financial assistance fund to help workers with bills.

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Sainsbury’s says it will give workers access to “basic food items” during their shifts from this month.

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Hybrid working and expenses

Allowing staff to work flexibly between home and the office allows people to weigh up the cost benefits of, for example, saving money on your commute versus using more gas and electricity while working from home.

You should also make sure you are claiming back any expenses you are entitled to. For example, your employer may agree to pay a certain amount of fuel costs or cover food and drink if you need to be out of the office.

Discounts

Check if your company offers any discounts as part of your benefits package.

Some supermarkets are increasing their employee discounts

For example, they may have arrangements with local shops or other businesses such as salons and gyms, to give employees money off.

Some supermarkets are increasing their employee discounts as part of their package to help workers cope with the cost of living crisis.

As well as a pay rise for staff, Tesco has raised its employee Clubcard discount allowance from £1,000 to £1,500, meaning workers can get 10% off – jumping to 15% off every payday weekend.

Asda has removed the 12-week qualifying period for workers to access the 10% staff discount. The grocer says there is no cap on how much employees can spend using their card, and that it saves workers about £400 a year.

Meanwhile, Iceland has upped its money-off offer for staff from 10% off to 15% off.

Sell back annual leave

Some firms give workers the option to buy or sell annual leave days at a certain point in the year.

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If you don’t think you need all of your holiday allowance, you may be able to sell some back to the company and get paid for it instead.

Debt support

You may be able to get help with your debts through your workplace. Many companies offer financial education seminars on debt management to help employees understand how to manage and pay off debt, and what help is available, Wealth at Work says. Some also offer loan consolidation via payroll, to support those who need help paying off their debts.

Check with the HR department to see what your company offers. If there is not a specific debt support service available, they should signpost you to the appropriate support. For example, a charity such as StepChange or the government’s MoneyHelper service.

Salary sacrifice, etc

View image in fullscreenDoes your company offer a cycle to work scheme? Photograph: Jacob King/PA

Many companies offer “salary sacrifice” options such as cycle to work schemes, or things such as season ticket loans.

With salary sacrifice, the payments for the bike, car or whatever are taken off your gross income.

These schemes will often allow you to spread the cost of expensive items over several months and can help you manage your money.

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