This agency in Leeds is offering staff interest-free loans to combat cost of living crisis
Digital shop Engage is offering all staff a £2,500 advance, while junior staff are set to see an additional bump when salaries are reviewed.
Engage is offering staff a loan, on top of inflation-busting pay rises
As Britain’s cost of living crisis bites, junior agency staff are among the workers in this industry who are most vulnerable.
Full-service digital agency Engage, based in Leeds, has offered its employees a series of measures to help them through the crisis – including an interest-free loan of up to £2,500.
Agency co-founder Alex Willcocks tells The Drum: ”People are at the heart of our business. With the cost of living crisis expected to continue, we wanted to make sure that our employees felt supported and secure.”
Advertisement
What is the agency offering?
Engage has given all employees bonus payments in November, December and January and brought forward its biennial salary reviews, which benchmark staff pay to typical market rates, by a year.
”The benchmark is a much fairer way of doing it,” he says, ”rather than us putting a finger in the air and giving everyone, say, an 8% pay increase, which would be below inflation. [Inflation] impacts everyone, individuals and businesses, and we need to make sure we don’t over-expose ourselves as a business.”
Junior staff – at Engage, around five team members – will receive an additional salary bump. The plans were put in place about six weeks ago, Willcocks says.
The cost of living in Leeds may be less than in Manchester, but Willcocks points out that commuting costs are likely to hit junior staff harder.
They’re more likely to be ”choosing between commuting to the office or working from home because of the cost,” he notes. Engage has access to the Leeds Travel Network, which provides cheaper prices on public transport, to better incentivize commuting into its office in the center of the city.
Advertisement
Interest-free loan
In addition to speeding up pay increases and awarding bonuses, it has offered staff an interest-free loan. According to Willcocks, the business is making the loans to its staff directly. They’ve been available to staff since June, and will be due for repayment in January.
”Look, people are struggling for money and we want to stop them going to high-interest loan companies,” he explains. ”The actual impact on the business is quite light, we just need to make sure we’ve got the cash flow to support it.”
Willcocks says three staff members have so far taken the company up on its offer. ”It’s not a huge amount, but I think it has made an impact. Things are changing every day, but if you had a variable rate mortgage and you’re getting a 2% increase on that, your monthly payments are going to go up and you might appreciate some money in the short-term.”
Suggested newsletters for you
In a message unveiling the offer to staff, Willcocks described the move as ”just a mechanic we’re able to use to support, rather than something we’re encouraging.”
Could the loan arrangement change the agency’s relationship to staff, given it has become their creditor?
”That hasn’t even crossed my mind, actually. I think it comes down to trust and culture. I don’t think it will get abused,” he says.
Though Willcocks hopes his team will appreciate the agency’s support, he tells The Drum the measures aren’t intended to tempt away staff from other career options.
”It wasn’t the leading driver. This was more around just wanting to do the right thing for our team rather than ulterior motives, necessarily, but I’d be lying if I said it probably doesn’t have an impact.”