Employers were split fifty-fifty over whether it is their responsibility to offer financial education or advice to staff in a poll at the Employee Benefits Summit in Jerez.
Only 37% of employers at the summit currently offer financial education or advice to employees.
Harper Wright, financial capability manager for Bank of America argued that it was in employers’ interests to offer financial education and referred to research in America which had shown a link between the financial wellness of employees and profitability and productivity of businesses.
“It’s trying to put people in a position where they are concerned with their job and not worrying about that the next phone call which could be from the bailiff,” he said.
He added that in providing financial education around pensions, employers “should go back to basics” and should not “assume employees know everything”.
Debra Corey, director of compensation and benefits EMEA at Honeywell, suggested that the cost of employee pension contributions should be explained in “relative terms” by equating them to the price of everyday items. She also suggested that financial education had to be diverse to reflect the age and lifestyle of staff as not everyone would be in the same financial position. She added that it would be inappropriate to use line managers to deliver financial education, in particular around pensions, as the subject was complex and very personal.
However, Sir John Butterfill MP and chairman of the all party Parliamentary Group on occupational pensions warned employers that they should not themselves give financial advice, as opposed to financial education, as it would be “unlawful” and only regulated bodies or individuals could do so.