Are your beliefs ‘protected’ in law?

03 Nov
by Donna Obstfeld, posted in Business, Discrimination, employent law, HR   |  4 Comments

I’m sure many of you do not follow the employment case law. However, when it makes the six o’clock BBC news, it may be worth paying attention to.

Firstly, in case any of you have missed it, here are links to two articles about the said Employment Appeal Tribunal decision handed down today. The actual EAT judgement and a BBC article summarising it.

So, what are the implication for employers?

Well since the introduction of the Employment Equality (Religion and Belief) Regulations 2003 discimination of any employee on the basis of “any religion, religious belief, or philosophical belief” has been illegal. Religion and religious belief have been widely understood and consistently interpreteted, but philosophical belief is harder to define; and if you can’t define something, how can you prevent discrimination on the basis of it?

When the law was first introduced there were concerns about office banter over many a passionate belief – football teams for example. Employee A supports Local Team United and all other employees (and the boss) support Local Team City. Can office banter be deemed discriminatory if employee A is not promoted, not offered the same opportunities etc?

When is a political belief or a deep rooted way of life a philosophical belief protected in law?

How does this affect company policy on discrimination, bullying, harrassment and equality of opportunity?

This is a case which we should all now be watching.

Thoughts and experiences please.

Do we need a high pay commission

17 Aug
by Donna Obstfeld, posted in bonuses, Business, high pay commission, Human Resources, pay   |  5 Comments

When you hear that 100 key figures have come out in support of a ‘high pay’ commission, it does make you stop and reconsider your view, re-evaluate your thoughts and do I want to change my gut reaction? ……….. No. Why do we need a high pay commission? Is it shutting the door after the horse has bolted? Probably. Is it going to stop the same thing happening again? Probably not! Is it going to decrease our ability to attract top talent from around the world? Yes. Will it lead to our top talent leaving in search of their fortune? Absolutely.

By restricting pay settlements, imposing excessive taxes on top earners and smothering an employers ability to attract and retain top talent, a high pay commission has the ability to destroy exactly that which it is trying to build – a strong economy.

There are very good arguments for controlling remuneration. Linking pay and bonuses to both long term and short term performance is essential. Defining good performance and distinguishing exceptional performance plays a vital role in incentivising and rewarding top performers, but equally employers must not be scared to say, “you weren’t good enough this year, there is no bonus, no pay rise etc.”

We do not need a ‘high pay’ commission. We do need employers to look at what they pay, how they pay and when they pay. It must be appropriate, motivational, performance and time bound.

Childcare Vouchers

04 Aug
by Donna Obstfeld, posted in Benefits, childcare vouchers, HR, Human Resources   |  No Comments

If I told you that as an employer you could make a financial saving by offering your employees something that many of them would really value, would you want to hear more?

Well, by introducing childcare vouchers and offering them to all your employees through a tax efficient salary sacrifice scheme, you could do just that.

Employees can opt for up to £243 per month in childcare vouchers instead of £243 of their salary – they sacrifice money for vouchers. As a result employees pay no tax or NI on this money and the employer pays no NI.

The vouchers can then be used to pay nurseries, after school clubs, summer schemes and other recognised childcare providers.

Unfortunately, they can not yet be used to pay relatives (such as grandparents) who care for your children while you are at work, but the Government are thinking about it – slowly!

Childcare voucher schemes can be introduced in conjunction with other benefits or in isolation. They must be offered to everyone to be eligible for their tax free status and certain contractual changes are required, but savings can be made even if only one employee takes up the benefit.

Is there an alternative to redundancies?

08 May
by Donna Obstfeld, posted in pay cut, people management, reduced hours, redundancy   |  No Comments

Recession and redundancies, two big ‘R’ words on many people’s lips. But when times get tough and employers have to tighten their belts, is redundancy the only options, or indeed the best option…….

Thinking about one of my clients, things were financially bad, very bad – so bad that if immediate action was not taken to cut costs, the business would have folded within three months. 15 years of hard work, dedication and achievement down the pan in the period of least than 12 months – unimaginable, but a harsh reality.

So what were the options?
Firstly, move the offices to a smaller, less a prestigious location – a real possibility until the costs were really assessed, with 6 month break clause fees, the cost of finding new premises, the cost of having them made fit for purpose, the cost of informing everyone of the move and updating all company paper, cards, marketing etc…… the savings required would take far too long to achieve, if in fact they could be achieved at all.

And so, cut marketing spend…… this was done to some degree, but then how do you generate new business to keep the business going – not the ideal solution and again not going to achieve the results needed in the timescale required.

So then lets look at the biggest cost – oh yes, people – lets get rid of some of them and then we will make a ton of savings – right? WRONG.

The cost of redundancy was high due to the age and service of the employees, paying that out was not going to save money within three months. In addition, everyone in the company has an area of expertise and as with many small companies there is not a lot of overlap, so by getting rid of one person, the company loses the ability to service those clients, lose the business and end up no better off than if they had kep the employee in the first place.

So what are the options?
The ideal solution is actually a combination of measures and the exact combination can be achieved by identifying exactly what the business needs now, what it might require in the future as business returns to ‘normal’ and what it can sustain in the interim.

By introduing a combination of the following measures the company achieved it’s aims:

  • Reducing hours for some employees
  • The 2 business owners took a 50% pay cut
  • Reducing pay for all senior staff by 20%
  • Reducing pay of 4 junior staff by 10%
  • Placing one employee on a zero hours contract and using him to deliver to a specific client base as and when there was work in his area of expertise
  • Stopping company pension contributions which was up to 10% depending on service
  • Introduing a bonus pay system directly related to new clients and specific targets

A proper consultation process was entered into with all employees. They were given a very clear picture of the company’s financial situation, they were presented with the options and the company’s proposal and asked to respond with their thoughts but also with alternative ideas for cost savings.

The outcome was that all employees agreed to the proposed changes and were given reassurances that the situation would be reviewed every three months with a view to improving the terms and conditions as soon as feasible, even if it was in stages.

Retaining quality employees who have been loyal over the years, understand the company and their clients and have the skills and experience to consistently deliver to a high standard will play a vital role in the company’s ability to survive and then thrive into the future. The recession will not continue forever and companies have to focus on how they want to come out the other side.

Managing employees within the law and in a morally sensitive way is vital to company survival.

How are you preparing your business for swine flu?

29 Apr
by Donna Obstfeld, posted in Business, Human Resources, people manaagment, policy, sickness, swine flu   |  No Comments

Do you and your client have a strategy for managing an outbreak of swine flu?

Does your sickness policy encourage people to stay at home and work from there rather than come into the office if they are feeling ill?

Do you pay for the first 3 days of sickness absence before SSP kicks in? If not, you are encouraging people to come to work even when they are not feeling well.

Take a look at your policy now. Make amendments to protect your staff and your business. It is possible to put in place emergency measures on a temporary basis.

Think about your people, think about your business and have a contingency plan…. don’t put it off, the government are preparing and you must prepare your business NOW!

Rights for agency workers

27 May
by Donna Obstfeld, posted in Agency workers, Benefits, employee rights   |  No Comments

It’s in the news on a daily basis at the moment. The proposal to give agency workers the same rights as permanent workers. Good idea? Well, as with everything else in life, that depends on which side of the fence you analyse the situation from…….

The agency worker plays many different roles within organisations including:

  • sickness cover
  • holiday cover
  • maternity / adoption cover
  • peak season resourcing
  • special project resourcing
  • getting around recruitment freezes
  • getting around having no headcount
  • actively managing the workforce to provide a lean core operation and a flexible peripheral operation
  • Lower cost model as no benefits are due from the company

At the moment, agency workers are paid by their agency and the agency invoices the company for a service. The agencies tend to fix the rate depending on the skills, experience and the nature of the role to be performed. The agency also charge a % fee on top of the hourly rate that the agency worker gets. Part of this fee is to provide sickness and holiday pay to the agency worker.

Under the proposal, after 12 weeks working for a single employer, the agency workers will be entitled to the same pay and benefits as the permanent members of staff. I believe that in some cases this is absolutely right. In the case of a recent client, one secretary had been an agency secretary for the client for 10 years – without a break. She was not entitled to the same holidays, pension, notice periods etc. For 10 + years of loyalty….. that is just not right! It also costs the company a fortune in agency fees – where is the business sense in that?

For a short period of sickness or holiday cover, I fully accept that it is more practical to use an agency worker, but on long term assignments agency workers are not the solution. Recruit employees on fixed term contracts if necessary, move them around as they are needed within the business, multi-skill the workforce to reduce costs and improve motivation – think laterally and respect the human resources which are fundamental to the business success.

If an organisation does use agency workers, the model needs to be changed. Agency workers need to work for one agency and be employed by that agency. If they want to work for another agency they should resign, just like an employee would have to do from their job if they want to work elsewhere. The agency should commit to certain levels of work, pay and benefits in line with an industry standard. The like for like comparison should be with other agency workers operating in the same environment, not with permanent members of staff at the client organisation.

It is not just a piece of legislation which is needed, it is a change in attitude and buying behaviour of organisations and the supplier behaviour of agencies.

Public Sector pay deals

20 May
by Donna Obstfeld, posted in employee rights, inflation, pay, public sector, strikes, unions   |  No Comments

I have primarily worked in the private sector, although a couple of assignments have been with ex public sector organisations (Transport and Education). If we, as reward professionals, tried to get away with the kind of pay settlements that are being offered to our public servants, then we would be loosing all our top talent and we would be kissing goodbye to our business success.

There is an expression ” If you pay peanuts, you get monkeys”. The public sector organisations are in grave danger of ending up with a team of monkeys. It is only so long that employees will put up with being treated as second class citizens.

As Unite, The Police Federation and Prospect all ballot members on strikes over pay (or the right to strike) we look to be moving back to the 1970’s with a strike looming around every corner.

Organisations, whether private or public have a responsibility to their staff as well as to their customers. There is a moral responsibility to award a pay review in line with inflation. If they fail to do this, then they are in effect decreasing the value of their employee’s pay packet each year as their take home wages will not go as far.

Although many employees work for the public sector for reasons other than pay, pay is a hygiene factor. It needs to be at an acceptable level before the other elements can take effect. If pay is too low and employees can not maintain their standard of living, then no matter how good the pension, training, progression or ethical approach, employees will be faced with no option other than to leave and seek a salary level in the private sector which is more acceptable.

All salary increases have to be paid for, there is no difference between the private and public sectors. If private sector companies can find the money, work to a tighter budget and make the organisation leaner and more efficient, then so can public sector organisations. What is saved on employee turnover, retraining and low productivity as a result of low moral, can be used to fund pay rises in line with inflation.

Flexible working

15 May
by Donna Obstfeld, posted in businesses, Flexible working, HR, war for talent, work life balance   |  No Comments

Today’s news headlines are that 4.5m additional parents will be given the right to ask their employers for flexible working arrangements.

I can hear the groans and the cheers now. Employers will have a mixed reaction, for some the right to request is an administrative nightmare, they don’t have the resources or the knowledge to handle the requests. For others it is welcomed with open arms as it means flexibility in their work force, retention of sills and an increased ability to provide quality service to customers – as with everything, if it is implemented properly.

For parents, well as one myself, flexibility is absolutely essential to ensuring our sanity as we work not only for our employer and our family, but to achieve a balance between the two. I was fortunate, I had good childcare for both the kids from a young age. The problems actually came once my eldest started school. The school day is shorter than a day at full time nursery. Parents are asked to help with outings, fairs and attend meetings and this changes the dynamics significantly. Giving parents of older children the right to request flexible working is ‘the right thing to do’.

But what does this mean in reality?
Well, just because an employee has the right to request flexible working arrangements, doesn’t mean they are going to be able to work flexibly. The business still has the ability to say “no”. There are several reasons why a business may say no and they include the burden of additional costs, inability to recruit to meet the needs of the business and a detrimental impact on performance or quality.

So, what could flexible working ‘look like’?
A flexible working arrangement is a permanent change to an employee’s contract and might involve any of the following:

  • reducing working hours – i.e. work part time
  • a change of work location – i.e. work from home or a company office nearer to home
  • changing working patterns – i.e. start an hour earlier and finish an hour earlier, 9 day fortnights, annualised hours ………
  • job share – 2 people share a full time position

Is it good for business? Yes, as long as the business manages it properly.

Is it good for customers? Yes, because it can be used to improve quality of service.

Is it good for families? Yes, because it enables parents to balance the needs of the family with their desire and need to work.

Could more be done to ensure that this is implemented in a way which supports businesses and their employees?

Yes, while parents and carers have the right to ask to work flexibly, other employees do not. This is detrimental to those without child and elder responsibilities. Flexible working should be a matter of course, available to everyone and one day it will be, but businesses need to make a psychological shift to see the benefits and be bold enough to make the move. Those that do, will win the war for talent.

Reward Strategy – Has your business got one?

14 May
by Donna Obstfeld, posted in Benefits, Business, Compensation, Human Resources, Reward   |  No Comments

29% of companies do not have a reward strategy (Personnel Management, 1 May 2008). Can this really be true? Do you know that l think it probably is. Companies spend anything from 10% to 90% of their turnover on their employees and have no plan for doing so, no idea if they are spending their money in the most cost effective way and no idea if the money spent on compensation and benefits is actually helping their business to succeed.

So what is a reward strategy and how can a company get one?

Like a business strategy, a reward strategy sets out what the business is aiming to achieve and how it intends to achieve it. In this case, the focus is on reward. How can we structure our pay so that it supports our business goals? Do we incentivise individuals or teams? Do we reward performance on an ongoing basis or just once a year with an annual bonus? Do the benefits we offer support our ethical beliefs and our company culture?

A reward strategy sets out the basis on which spend decisions are made. It provides a frame of reference and clear parameters which all transparent and communicated so that employees know what is expected of them and what they receive in return to thank them for the contribution they make to the success of the business.

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