On October 12th, Julia Hoggett made a statement concerning the Financial Services industry, and the need to monitoring employees working from home. As the Director of Market Oversight at the Financial Conduct Authority, her words rightly carry a lot of weight, and the FCA’s concerns surrounding security when working remotely are valid. However, they’re only part of the picture.
The COVID-19 pandemic has meant working from home isn’t just a potential option — it’s the new norm. Nowhere has remote working had a greater impact than in the finance industry. Of all the sectors polled by Peakon from January to July in 2020 in our COVID-19 Impact Report, employees in the Financial Services saw the biggest spike in employee engagement, increasing by 4% overall. That’s double the 2% increase in the global average.
This improvement raises the question: why are Financial Services employees feeling more engaged, and what does that have to do with privacy concerns?
Employee engagement and autonomy
The spike in scores in the Financial Services industry was mostly driven by one major breakthrough: the capability to work from home. Employees in the Financial sector scored their organisations 17% higher on autonomy and flexible working in July than they did in January. For an industry which historically ranks as one of the worst for work-life separation, the pandemic went some way towards redressing the balance.
There’s no denying that data security is important, but that’s where corporate monitoring should begin and end. Some Finance employers are introducing monitoring tools above and beyond this remit, aiming to police productivity rather than privacy. Our data shows that this would be a mistake.
People work best when they feel trusted, and when they feel trusted, they feel engaged. To ensure that these new security measures don’t undo the higher employee engagement scores driven by greater autonomy, we need to first understand why the Financial Services industry has struggled with employee engagement in the past.
The issue of engagement in Financial Services
The Finance industry is gargantuan. Its influence stretches to every corner of the globe. And historically it has one of the poorest relationships between its employee’s home lives and their work routine. With over 1.1 million employees in the UK alone, and a projected global market value of $26.5 trillion in 2022, understanding how to improve the engagement of Financial services employees is essential.
Where does the reputation of employee burnout and high stress levels stem from? Well, 93% of Banking industry employees admit to always, mostly or sometimes working beyond their contracted hours. 92% of these say they work beyond those hours for no extra compensation. That lack of recognition and understanding is at the root of why the Financial sector has one of the highest rates of employee absence due to poor mental health.
Solving these issues isn’t a matter of more scrutiny, or solely reducing working hours. It’s a matter of empathy, and a matter of engagement.
This Total Economic Impact™ Study conducted by Forrester Consulting on behalf of Peakon estimated Peakon clients achieved a reduction in employee absenteeism of 1 day in Year 2, and 2 days in Year 3. What this reveals is that absenteeism isn’t solvable by any one action. Rather, it’s symptomatic of wider issues with employee engagement, issues which need a more nuanced approach than increased scrutiny on productivity.
Improving employee engagement during COVID-19
At Peakon, we’ve identified 14 workplace factors that drive employee engagement. Each of these drivers reflect an aspect of your working life, whether it’s your relationships with your peers, or your opportunity for personal growth. But which factors contributed most to the 4% improvement in employee engagement scores for Financial Services employees?
Productivity isn’t measurable based on hours on a project, or hours on a screen, and monitoring such factors risks turning adults into children.Peakon
The main driver in that improvement, as previously mentioned, came from responses on the ability to work remotely. While scores across every industry rose by an average of 10%, the Financial Services industry saw a remarkable 17% climb. Even before the pandemic working from home had become a hot button topic — our Employee Expectations report 2020 found that 99% of employees would choose to work remotely some of the time.
The impact of COVID-19 was also felt elsewhere. Scores surrounding the positive impact of each employee’s working environment on their productivity increased by 7% (versus a 6% global increase). This is strong evidence in itself of the impact remote working options have had. Not only were people more positive about working from home, but that positivity led directly into their ability to perform their work.
Given that employees now have even less home-life separation, often working out of makeshift home offices or hastily-repurposed bedrooms, the fact that those scores have improved so drastically indicates how much that freedom means to them. Considering the value this autonomy represents to employees in the Financial industry is essential for framing how employers tackle employee monitoring.
The FCA recommendations for monitoring
At a time where data is more easy to access than ever, and just as easily lost with the click of a button, safeguarding is important. That’s the basis for the recent statements made by Julia Hoggett, Director of Market Oversight at the Financial Conduct Authority:
“Our expectation is that going forward, office and working from home arrangements should be equivalent — this is not a market for information that we wish to see be arbitraged. New challenges, including controlling inside information moving within a firm and leaving a firm may also manifest at times like these.
“In initially instituting social distancing in the office some firms were challenged in terms of supporting the appropriate physical distance to maintain information barriers. At home, this is equally important, where inside information may need to be kept from partners or flatmates.”
Hoggett’s concerns are ones shared by many businesses with a need for tight security, especially in the Banking industry where cyberattacks cost each company $18.3 million annually. While there has been greater leeway following the unprecedented circumstances this year, understandably greater safety checks have now been put into place. The danger comes from prioritising surveillance over employee engagement.
Monitoring employees versus employee engagement
While there is a need to ensure employees are complicit in maintaining privacy, there’s also a need to rethink the entire problem — from a standpoint of trust. The concerns around monitoring employees arise later in the statements by the FCA, where Hoggett states:
“While scenarios emerged early in the pandemic where the usual levels of recording and surveillance were not possible, our experience suggests firms have now overcome these challenges.”
This reliance on recording and surveillance doesn’t only serve to improve internal security measures. It also creates a culture of distrust. Encouraging companies to adopt monitoring tools risks undoing the positive steps forward taken this year regarding employee engagement, especially when those tools are often used well beyond the remit outlined by the FCA.
Regardless, in certain circumstances monitoring will be necessary in order to remain complicit with the FCA, so what should companies do? The answer lies in transparency. Tracking tools are good for logistics, but bad for employee morale — you should clearly communicate what each tool’s purpose is, and how these new safeguarding measures don’t negate each employee’s individual autonomy. Trusted employees are a much stronger asset for your team than any data set.
It’s essential that monitoring doesn’t become a means to scrutinise, but only a means to safeguard. Productivity isn’t measurable based on hours on a project, or hours on a screen, and monitoring such factors risks turning adults into children. Instead, the most reliable metric for sustained productivity is employee engagement. To see how Peakon can help your business improve engagement today, book a Peakon demo.