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21 Apr 2021
by Dr Duncan Brown

Building back better welfare and wellbeing for all at work

“Even before the [Covid-19] crisis, employers were concerned at how hard organisational change was hitting employees’ wellbeing…we need (now) to radically rethink the role of wellbeing in the workplace. To humanise the workplace is to acknowledge differences between people, be inclusive and fair to all,” commented REBA’s director and co-founder Debi O’Donovan, in the Future of HR supplement published in The Times and Sunday Times (2020).

 

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The history of employee wellbeing

When Robert Owen took over his famous cotton mill at New Lanark near Glasgow in the early 19th century, competing mill-owners reportedly visited in large numbers. They were trying to fathom how he could possibly afford his, to-their-eyes, ruinously-expensive worker benefits, including good housing, free schools, and a sick fund to which workers contributed 1/60th of their wages. The answer lay in the fact that his objective, and the basis of the mill’s high productivity, was to establish a community where everyone ‘forms part of the establishment, all united and working together’ behind a common purpose.

Many business leaders have never learned this lesson. The Chartered Institute of Personnel and Development (CIPD) was formed 100 years later in 1913 as the Institute of (mostly female) Welfare Workers (IWW) by a group of 34 like-minded philanthropic industrialists from firms such as Boots, Cadbury and Rowntree, largely in response to the appalling working conditions that still prevailed.

When he travelled the country in the depression-ravaged late 1920’s, the playwright and anti-industrialist J.B. Priestly wrote in his 1934 book An English Journey that he couldn’t but be impressed by his visit to Cadbury’s Bourneville village near Birmingham and their treatment of their employees.

The sceptical dramatist was amazed by the ‘magnificent recreation grounds, dining rooms, schools and facilities for singing, medical attention, with works councils and pensions’. His correct conclusion was that ‘if you strike a balance of ordinary human happiness, then here is a definite and enormous gain’ for all involved – directors, investors, managers and workers and their families and children.

It’s a lesson that we seem to keep needing to relearn. By 1931 the IWW had been renamed and taken over by the Taylorist (and male-dominated) Institute of Labour Management. Workers’ welfare and common purpose took a back seat for many employers, forcing the state to intervene and create the modern welfare state in the immediate post-War period.

But in this century, with monetarist economics and shareholder-value maximisation dominating management thinking, and an austerity-dominated approach to government policy, we have seen much of the progress on equality and worker welfare and benefits reversed. There have been real pay declines and growth in child poverty levels over the past decade probably not seen since before Owen’s time.

The current state of employee wellbeing

The past year of the pandemic has been a truly horrendous experience in almost every sense. But perhaps it has at least forced this realisation on us once again: everyone’s wellbeing matters.

As O’Donovan puts it in her wellbeing article: “The crisis has been shown to have unpicked some of the improvements in equality in the workplace that have been hard won: women, minority ethnic groups, the disabled and older workers are most impacted by job losses, the virus and the need to stay home”.

The precarious nature of much of the UK growth in employment over the past decade also came in for criticism by the House of Commons’ Women and Equality Committee inquiry on the unequal impact of the pandemic, to which I gave evidence. It concluded that it was, ‘deeply concerned by the impact of the zero-hours contracts’.

Similarly The COVID-19 Marmot Review (2020) found that the pre-existing and worsening patterns of social and economic inequality it first pointed to in 2010 have almost perfectly predicted the variations in mortality rates by location and socio-economic group from the virus. Sir Michael Marmot’s conclusion is unequivocal: ‘the “normal” that existed in February 2020 is not acceptable. The Covid-19 pandemic must be taken as an opportunity to build a fairer society’.

REBA’s weekly webinars during last year’s lockdown revealed a growing realisation among the attendees that one-way-flexible, cost-driven, unwittingly-unequal, just-in-time employment and benefits policies fell seriously short, not just in coping with the ravages of the virus, but in its aftermath.

We have to as both Prime minister Johnson and President Biden have billed it, ‘build back better’.

The future of employee wellbeing

Reflecting the general rise in working hours through home-working, silicon chip designer ARM gave everyone a ‘Day of Care’, after the first lockdown in Summer 2020, then repeated the move in December. As senior director – reward, Tegwen Smith explained on a REBA webinar: “It is crucial that we all think about how we can look after ourselves and each other on an ongoing basis”.

Zurich, the insurer, already offered family-friendly benefits before the pandemic hit. With staff forced to work at home and parents home-schooling their kids, a range of additional benefits were rapidly introduced. These include a wellbeing hub with a virtual GP provider for all staff and families; and access to Lifeworks, which includes advice and counselling, wellbeing assessments and coaching programmes.

REBA’s regular employer surveys over the past year show that many more are following the trend. The December edition of the survey reported that the crisis has “impacted on reward and benefits thinking in almost every business”. It found 27% of employers plan to review their pay strategies and 20% will restructure their benefits packages and their existing bonus plans over the next 12 months.

A study by benefits provider Personal Group in September 2020, found one fifth of benefits changes involved the move to common provision and “the low-paid gaining access to company benefits”. Employers have realised that what had often been provided previously only as ‘perks’ to senior managers, such as enhanced sick pay and medical cover, if anything were more justified and needed by their lower-paid employees.

Additional factors, such as a renewed focus on responsible business and ESG in reward plans will also be a high priority in 2021 and beyond, according to the REBA survey.

This year we have already seen investor concerns at the ‘social’ aspects of ESG spreading: from opposition to excessive executive bonuses (at Schlumberger and Wynn Resorts for example); to concerns about safety measures and human rights (Amazon, Tyson Foods and Boohoo) and in opposition to the IPO of Deliveroo, based on an Uber-flexible low cost/low responsibility gig economy model ‘that could lead to value destruction and avoidable investor loss’.

No wonder REBA’s 2020 Employee Wellbeing Research found that the share of employers citing organisational change as a risk to wellbeing increased 235% between 2019 and 2020, with more than half of employers (57%) identifying it as an issue.

The power of reward professionals

“The coronavirus pandemic has sharpened the focus on pre-existing inequalities across a range of policy areas. With the possibility of a vaccine and the end in sight, now is the time to tackle these inequalities, now is the time to carve a better, brighter future, now is the time to act,” concluded the Women and Equalities Committee inquiry report (December 2020).

One hundred years after its foundation, the CIPD announced a refocusing back on its core purpose: “to champion better work and working lives by improving practices in people and organisation development…to make a real difference for our members, for businesses, for the economy and society and for all working people.”

Yes, we face an incredibly uncertain and, for many of our organisations, cash-strapped and survival-focused year ahead. Some question the sustainability of the raft of welfare support and health benefits introduced last year. Despite the fact that Gartner’s Support Wellbeing in 2021 and Beyond Survey (March 2021) found nearly half (49%) of employees offered a mental wellbeing programme had participated in it in 2020, only a quarter of employers reported they plan to maintain their wellbeing programmes introduced during the pandemic.

Let’s hope this survey is wrong. REBA’s evidence certainly suggests so.

It’s down to you to make the change.

The author is Dr Duncan Brown, independent adviser and principal associate at the Institute of Employment Studies.

This extended article is also featured in our Employee Wellbeing Research 2021. Download your copy of the report.