Recognise economic harm

Economic harm is behaviour towards a person that controls, restricts or removes their access to money, economic resources or participation in financial decisions.

What is economic harm?

Economic harm, often called financial or economic abuse, is recognised as a form of psychological abuse within the Family Violence Act 2018. 

It is experienced in many close personal relationships, particularly intimate partner relationships. It may also include forms of elder abuse. Unlike physical violence, economic harm is less visible and does not leave marks. The impact can be debilitating and can affect financial security well into the future. 

In situations where demands are refused, what begins as economic abuse can lead to other forms of abuse such as yelling, threats and more violent behaviour.

Read more about the Family Violence Act 2018.

“It was like he had an image of a perfect girlfriend. He would decide what I wore, where I went, who I saw and give me as much money as he thought I needed for the things he agreed that I could do”.

Why does it happen?

Economic harm can impact all ages, socio-economic groups, cultures, ethnicities and genders. It may also present differently in some cultures due to traditions and beliefs, or the systemic experience of colonisation.

Economic harm is experienced in the context of power and control and is often intentional, but not always. Like other forms of violence, it can be subtle, beginning with the smallest breach of trust, and then build over time.

Economic harm can also be a product of intergenerational learning, role modelling, previous trauma, belief systems, limited knowledge, traditions etc.

It is most evident when a specific pattern of behaviour is occurring – such as coercion, withholding financial access or support, deceptive behaviour or unreasonable control that limits another persons’ economic or financial involvement – including resources such as accommodation, transport, employment and clothing.

It may also involve limited or no participation in decisions or actions relating to financial and economic wellbeing.

Listen to Susan’s story:

“I was afraid to get clothes for the kids”.

What it looks like

Other behaviour may be occurring, particularly if a person is trying to leave the relationship, which can be the most dangerous time.  

This could be such things as:

• Child support isn’t being paid
• The car is damaged so you can’t go anywhere
• Court process intentionally dragged out
• Money or resources being withheld to prevent you from leaving the relationship
• Your employment situation becomes difficult due to constant harassment

Human relationships are complex. There are many things to navigate in a close personal relationship, and one of the most common challenges is money and finances. 

Discussions about money will surface at some point and are not only necessary but can be difficult regardless of how healthy a relationship is. 

However, there is a difference between “money problems” that a couple works on together to resolve, and financial controlling behaviour that can lead to economic harm.

Listen to Michele’s story:

“I didn’t associate myself, my situation, with family violence.”

If you are an employer, you might notice some potential red flags 

Identifying economic harm isn’t so easy, or even possible in some cases, due to its lack of visibility. There are some potential red flags that have been identified by people with their own experience of economic harm.

Individually these indicators may mean very little, however several together can show a pattern. This does not necessarily mean economic harm is being experienced. 

These red flags are a starting point to let you know some difficulty could be occurring, and a conversation with the employee could be useful.

• Withdrawing from social interaction – unable to participate in social or work activities that cost money – acting awkwardly or not wanting to talk about why
• Seeming guilty and defensive when talking about spending money on everyday items
• Partner ringing a lot, texting or showing up – checking up or asking about pay details
• Presentism – regularly working late, not wanting to go home or asking for extra shifts
• A change in appearance, or behaviour, or drop in work performance – usually competent, professional and proficient – now a lack of concentration or preoccupied
• Asking for annual leave to be paid out without explanation
• Having no money for necessities, yet having an income that should cover it
• The employer being contacted by government departments regarding redirection, fines or other debts not paid
• Appearing uncomfortable or fearful when talking about their partner
• Hearing concerns from other colleagues that things aren’t good at home
• Anxiety about getting paid on time, or needing pay in advance
• Asking work to pay bills or redirect money to a different account
• Not having access to their own or joint bank account
• Using a shared email account
• Ongoing transport issues getting to work – or being picked up and dropped off
• Absenteeism – regularly late to work, not coming at all (sick) or other things happening at home
• Change in employment status within the family such as job loss or reduced hours- leading to comments about extreme financial strain
• Seeming emotional or irrational – all over the place with their thinking or behaviour
• Forced to sign immigration papers or other documentation.

Check if it’s happening to you

If your answer is yes to one or more of the questions below, you could be experiencing economic harm.

If your answer is no to one or more of these questions below, you could be experiencing economic harm.

Other useful resources

There are a number of resources and research reports that you can read for more information.

Resources

Rights for employees affected by domestic violence – Employment New Zealand

• Protecting yourself from financial abuse – New Zealand Banking Association
• Disrupting the cycle of relationship abuse – Allstate Corporation (USA)
• Transforming responses to economic abuse – Surviving Economic Abuse (UK)
• Safer Homes Booklet – Shine (NZ).

Research

• What’s his is his and what’s mine is his: Financial power and economic abuse in Aotearoa, Jury, A., Thorburn, N and Weatherall, R. (2017) – Aotearoa New Zealand Social Work
• Have you caught a sexually transmitted debt? Scott, A. (2018) – Informed Investor.

It came to our attention that a member of staff was experiencing several forms of abuse, one of which was economic abuse.

The head of her department came to us concerned after noticing the member of staff going to the bathroom to cry, making comments about not having enough credit on her phone or bus money to get home.

In the workplace, there’s a social element within colleague relationships, so when the team became aware of how much stress she was under they were really concerned, and this impacted staff productivity and morale.

The first thing we did was have a conversation with the staff member. We wanted to make sure we weren’t making her uncomfortable and that we weren’t interfering where we weren’t wanted.

However, as employers we have an obligation to address wellbeing issues with our employees – so it wasn’t appropriate to ignore it either.

This member of staff faced real challenges too. She was relatively young, with limited English and had little knowledge of what her legal rights were as a working visa holder in New Zealand.

While we had been paying wages directly into her bank account, an account that was in her name, it turned out she didn’t have access to that account.

Effectively she had no access to her full time wage and was being given $20/week for the bus.

We knew that we couldn’t provide appropriate support by ourselves so we started by helping her access services that could help her understand her rights and find out support was available.

Supporting from start to finish

Supporting her from start to finish was really important as she had very little support in the way of friends or family in New Zealand.

We took her to appointments, to find emergency accommodation, and we took her to the bank to set up a new bank account – because she was not equipped to navigate these services herself.

She was also receiving a lot of pressure from the person perpetrating the abuse, which was emotionally challenging for her. Because she had so much to deal with, we couldn’t just say “Let’s introduce her to a support agency” and then wash our hands of it. We had to be available every day for a few weeks until she felt like she had a plan.

Despite being told what was happening to her was normal, she instinctively understood that she was being treated badly and that she wanted to leave her living situation. Eventually she was relocated to safe accommodation, she had a new bank account, her own money and new passwords – whilst everything else had been cancelled.

Her liability and name were removed from the mortgage where she was living – she hadn’t understood that she was listed as personally liable for the mortgage of the family home she was living in.

Alongside all of this, was our staff, who were being hugely impacted by what was going on.

The right thing to do

When people ask us “why did you go above and beyond?”, they expect you to say “because it was the right thing to do” – and of course it was the right thing to do, but it was also the business smart thing to do.

If you’ve got a staff member who is experiencing abuse, it can be very triggering for other staff, which impacts productivity, staff retention and morale.

There were probably four or five days where our staff were only thinking about this and what was going to happen.

Therefore, in terms of our business, being proactive in this scenario far outweighed the inconvenience of dealing with it.

It’s all very well to have HR strategies in place, to tell staff to come talk to you and to tell staff you’ll be there if they need you – but to actually do it and in the most serious of cases – well the impact was that our staff thought they worked for the best company in the world.

Moving forward we have implemented training for our HR staff so they can encourage staff to talk to them when they need help and respond to concerns appropriately.

We’ve also put together information about what the legal obligations are around the rights to your own money, privacy over your own money management and what agencies are available should you need help with anything.

It’s been important to remind ourselves that our member of staff that we supported, initially didn’t understand that she was being treated illegally. We can’t sit back and wait for them to come to us. How can they if they don’t know something is wrong?

* The name and any identifying details have been changed to protect the privacy of the person involved.