Canadian HR Reporter

CANADIAN HR REPORTER SEPTEMBER 2018 NEWS 19 e importance of including fi nancial health in the Total Health Index Employers committed to mental health should include fi nancial health programs too BY BILL HOWATT WHAT'S the average amount of consumer debt employees are carrying? $15,473, according to a 2017 Ipsos poll conducted for Global News. Considering the average salary in Canada is about $50,000, this level of debt is quite signifi - cant when compared to income. Not surprisingly, 42 per cent of Canadians rank money as their greatest source of stress, causing them to lose sleep and to have increased anxiety, according to a 2014 survey by the Financial Plan- ning Standards Council. is is signifi cant when compared to 23 per cent of employees who ranked work as their number one source of stress. Because of these kinds of dra- matic numbers, the Total Health Index (THI) includes financial health in the life pillar. Employee productivity is impacted not only by workplace experience and mental and physical health but by fi nancial health. If someone is worried about money, it's understandable to feel stressed about how to pay bills to obtain the essentials for healthy living, such as food and medicine. Organizations that support and implement mental health strate- gies and programs typically do so to support two key imperatives: prevent mental injuries and pro- mote mental health. For employers committed to employees' mental health, based on THI research fi ndings, it's rec- ommended to include fi nancial health. THI research shows that about 55 per cent of employees report good fi nancial health, 34 per cent strained fi nancial health and 11 per cent poor fi nancial health. Cutting the data by the three categories reveals notable diff er- ences in employees' THI scores. e mental health pillar is the number one driver in relative im- portance for predicting employ- ees' fi nancial health. e table to the right provides examples of how employees in each of the three fi nancial catego- ries compare in several areas that can predict health, engagement and productivity. Note: e high- er the percentage score, the better. Employees who have lower fi - nancial health report lower men- tal health than those who report good fi nancial health. What employers can do to support employees' fi nancial health: • Evaluate the benefi ts of measur- ing employees' fi nancial health. It can be helpful to not only mea- sure what the average employee is doing to promote their fi nancial health (such as saving strategy, debt management and cash fl ow management) but also percep- tions of their fi nancial health and its infl uence on overall engage- ment and productivity. is in- formation can assist in evaluating the eff ectiveness of current pro- grams and identifying opportuni- ties to support employees in need. • Include financial health pro- grams as a part of your mental health strategy (for example, prevention). is is one tactic to help employees with fi nancial health concerns to acquire the knowledge and skills to make better decisions. Financial health issues may be due to ineff ective decision-making (such as life- style shopping decisions) that can put employees at risk but if changed, could have a positive impact on their fi nancial situa- tion. Financial health issues may not be due to just a lack of money — they can result from ineff ec- tive spending and poor budget- ing. Like with mental health, em- ployees must learn how to own fi nancial health to take charge of it. • Educate employees on the kind of programs the employer has in place to support employees experiencing financial health issues (such as employee family assistance programs (EFAPs)). Don't just tell employees about these programs through emails or the like — provide specifi c communications and examples that employees can relate to that capture their attention. As well, explain how fi nancial health pro- grams work, with respect to the kinds of experience employees can expect, and the tools avail- able to assist with fi nancial deci- sions (such as a budget). • Don't assume all employees have basic budgeting skills. ere are three elements to budgeting: bills, future saving and discre- tionary spending. One eff ective way for employees to learn to take control of fi nancial health is to put in place more controls around their daily decision- making, especially discretionary spending. • Consider adding a short fi nancial health module when onboarding new employees. Use this mod- ule to assist new employees who may not yet have developed the knowledge and skills to under- stand how to make a budget, how to leverage a tax-free savings ac- count (TFSA) and how to make wise benefi t decisions based on their current financial needs. Some new employees may not understand the real value of de- fi ned contribution (DC) match- ing contributions, for example. Don't assume all new employees can navigate or will read and learn all the information that can help them make the best de- cisions when starting a new role. Bill Howatt, Ph.D., Ed.D., is the Toronto-based chief of research and development, workforce productiv- ity, at Morneau Shepell. For more information and education about the company's Total Health Index (THI), please visit www.morneaushepell. com. 12-PART SERIES This is the eighth of a 12- part series on total health that will explore the links between employees' health, engagement and productivity: 1. The total health framework 2. The 4 pillars of the Total Health Index 3. Senior leadership 4. Resiliency 5. Alcohol consumption 6. A respectful workplace 7. Manager effectiveness 8. Financial health 9. Going beyond traditional engagement 10. Productivity 11. Mental health 12. Physical activity, nutrition, sleep JOINT VENTURE BY: Predicting employees' fi nancial health 74% 81% 70% 88% 78% 22 69% 76% 68% 83% 75% 31 62% 68% 63% 77% 70% 52 Categories Favourable fi nancial health Neutral fi nancial health Unfavourable fi nancial health Total Health Index Workplace experience Attendance Coping skills Average number of days came to work feeling unwell General mental health

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