Pay

Why Corporate Jargon And Nonsense Stops Businesses Taking HR Seriously

10 Jan
by Donna Obstfeld, posted in Blog, Compensation, Contract of employment, Employees, Employment, Human Resources, people manaagment, Policies and Procedures, Recruitment, training   |  No Comments

(And The Four Processes That Most Business Owners  Need To Go Through When Dealing With Staff)

I’ve been studying and practicing HR for over 25 years. 

Which means that I ‘get it’.  I ‘understand’ it.  However ludicrously worded something is, or however jargonny a contract sounds, I can usually root out the genuine meaning, and what it means in the real world.

However, use the term HR or Human Resources in front of your common or garden business owner and you’ll often get a blank look, especially if they have never worked in large organisations or corporations that have had a whole HR department dedicated to looking after the staff, employees, and contractors.

But here’s the thing, whether you’re Mickey the Butcher or Microsoft, you still need to be able to practice HR correctly – failure to do so puts your business under significant risk from an employment tribunal.

With that in mind, this article is designed to help you to do exactly that, by cutting through the jargon and breaking down the four processes that you’ll need to go through, whether you’ve got two employees or 20,000.

So the first area is recruitment: the hiring of the right staff. 

Make sure that you know the skills that you need and that the people that you are hiring have the ability to do the job, but don’t forget that attitude and aptitude are also really, really important. 

Making sure that somebody has the right attitude, is going to fit in with your business and your culture will engage with your goals and has the ability to learn the rest of the skills that you need to give them is absolutely vital. 

Why?  Nobody is going to come fully formed, so you need employees who can be moulded, and moulding is all about attitude. 

And, as a plus point, when employees are not fully formed, they are generally easier to work with – they don’t have the same fixed ideas about things that someone who has ‘been there and done it’ has.

In addition, it is also really good idea to hire people who are better than you at key elements of the business. You shouldn’t be sweating over the books when someone else will be able to do them quicker, easier and more effectively than you.

Similarly, you may be good and able to type your letters up yourself, but actually having a VA or an in-house PA is going to drive your business forward much quicker for you as they are freeing up your time. 

 

The second element is Employee Relations

Now, this is a big area for HR!

At the most basic level, it means giving all of the staff that you hire a contract of employment. 

It means making sure that you have made decisions about:

  • How much holiday they are going to have
  • What you are going to do in the event of sick pay
  • What dress code you want within your business
  • What time you want people at work
  • What time they work till
  • How long their breaks are

Sound extreme?  Perhaps.  But by documenting all of these from day one, there is absolute clarity for you and for your staff, and no one can pretend that they didn’t know what was expected of them.

 

The third element is training, development and learning. 

Now, all three of these take time and happen in multiple phases, but all business owners need to be mindful of them; otherwise, they generally don’t happen.

Generally, the first phase is known as “induction” and when you first bring somebody into the business, the best way to get them to hit the ground running is to induct them properly. 

Once they know what they should be doing, it is all about monitoring and managing their performance so they are performing at the best possible level that they can.

And again it takes practice and they will improve over time, which is why regular documented progress meetings are a really, really useful tool.  No matter what size your business, whether you have one employee, five employees, or 25 employees, sitting down with your staff on a regular basis, sharing your vision, sharing the goals and asking them to deliver key elements of those goals is essential to moving the business forward. 

 

And then there is reward. 

Reward can come in multiple formats. 

Pay is the most obvious but there is also commission, bonus and other incentives which you give to your staff to encourage them to reach the targets that you set or to reward them for achieving certain outcomes. 

However, reward is also about the environment in which people work. 

It’s about the way in which you treat them, the pizza in the office on a Friday or giving people a day off to go and deal with an emergency because you know that they have been in the office late working on projects for the last three or four weeks.  

Reward is also about the culture and the corporate social responsibility that the business shows. 

Many youngsters nowadays are choosing to work or not work for companies based on the ethos of those companies. 

People are becoming more picky and people want to work for great bosses and brands that they believe in. 

Consequently, positioning your business (no matter how big or small) as an employer of choice will really help you to recruit and to retain the right staff for your business. 

So, as a business owner, the next time you think about your role within the business, you are not only the finance person, the marketing person and the salesperson – you are also the HR person. 

You are responsible for the recruitment and retention, the training and development, the reward and the frameworks within which your staff work and operate. You are also responsible for the way in which your staff are going to help you to achieve business success, by making sure that you are an effective manager.  That takes practice, but as they say, practice makes perfect.

Is it a Duck?

28 Oct
by Donna Obstfeld, posted in Annual Leave, Blog, employee rights, employent law, pay   |  No Comments

uber

The Employment Tribunal has ruled that two drivers are infact ‘workers’ under the definition in the Employment Rights Act 1996 and therefore are afforded protections not available to genuine freelancers.

This case will be appealed by Uber, they can’t afford not to because of the implications for their global business model. Uber have also looked at the use of driverless cars and this may well speed up that development as ‘engaging workers’ is more expensive than ‘using freelancers / contractors’.

We are often asked by our clients what alternatives there are to having someone working as an employee, especially for new or small businesses, the thought of having employees and all the implications of employment law is enough to prevent them growing their business. The use of contractors, freelancers and gig workers has made business growth possible for many business who would just not have taken the risk with employing staff.

As employment law becomes more and more constraining for businesses, business owners seek ‘new and innovative’ ways of working. Until it is tested in the courts and deemed to be illegal, they will take their chances and that is exactly what has happened here.

In short, with our clients we apply the duck test:duck

If it quacks like a duck, waddles like a duck and looks like a duck, then it is a DUCK, no matter whether you call it a hen, a bird a chicken or a goose!

In this case the courts have decided that Uber has workers who are DUCKS and nothing else.

The implications are as workers:

  • they have to be given paid annual leave
  • they are subject to the working time directive regulations
  • they are entitled to National Minimum and Living wages and
  • they are protected against whistle blowing.

They are not employees, therefore there are other benefits they are not entitled to, but even the above will cause Uber and other companies to have to rethink their financial models.

More ……. You want More?

30 Jul
by Donna Obstfeld, posted in Blog   |  No Comments

Easier to dump your partner than ask for a payrise

 

 

 

 

Discussing a pay rise can make for a pretty tricky conversation, whether you’re the one doing the asking or you’re the one being asked.

In fact, recent research shows that British people actually dread it more than any other conversation, including breaking up with a partner!

Well, that’s what this article from the CMI shows…

http://www.managers.org.uk/insights/news/2015/july/the-10-most-difficult-conversations-new-surprising-research

Now, the fact that staff find it difficult to ask for a pay rise doesn’t surprise me at all, but the fact that they would rather split with their partner than have the conversation with their boss ….. well, that’s a lesson for us all.

Yesterday, I spoke with Roberto Perrone on the BBC three counties radio drive time show and we discussed how an employee should ask for a pay rise

Here’s a 6 minute snippet of the show for you to listen to…

Click here!
More…. You want more?

But as employers, you may now find yourself on the receiving end of a request for a pay increase and how you respond to that request will say a lot about you and your business. Here are some quick tips:

  • Don’t let a request catch you off guard – have a plan in case an employee makes the request
  • Don’t shut the door in their face – If you don’t have time for the discussion there and then, book them into the diary so they know you will make time for them
  • Don’t just say no
    • if they have done their research, tell them you will look at it and come back to them
    • if they haven’t done their research, ask them to go away and build a case to convince you
  • If you say no to the pay increase, make sure they understand why
  • Provide a timeframe in which to review the situation, especially if they deserve it and you just can’t afford it
  • You do not want good staff to leave just because of a couple of thousand pounds, the recruitment costs may cost you more than that to refill the vacancy

 Here’s the link again if you need it More…. You want more?

And remember, if you need any help with difficult conversations, or want some impartial advice, we offer training and support to line managers and business owners, so just give me a call

David Cameron and the 19.1% hot potato

16 Jul
by Donna Obstfeld, posted in Audit, Blog, pay   |  No Comments

It just seems like it’s one HR hot potato after another right now!

On Tuesday, David Cameron announced plans to bring forward a rule that will mean that companies with more than 250 staff will have to disclose the pay gap between their male and female employees.

As things currently stand, for full and part-time workers, there is a 19.1% difference between what men and women get paid, meaning that for every 80p earned by a woman, a man is earning £1.

Whilst you might not employ 250 staff, the news has relevance for every business, regardless of their size, as it outlines the government’s determination to stamp out ‘gender inequality’.

Can you be sure that you’re treating male and female employees as they’re legally obliged to be treated?  Are there any cracks in your policies and procedures, pay or otherwise?

If you’re not sure, I’d be happy to have a chat with you to talk it through – call me on 01923 504100

I can’t afford to give pay increases!!

04 Jan
by Donna Obstfeld, posted in Annual Leave, Benefits, Blog, pay, Reward, Total Reward, Voluntary Benefits   |  No Comments

As I speak to my clients, I pick up on general trends. Sometimes it is based on stuff they have heard in the news, sometimes it is the fear of forthcoming legislation; but recently there is one trend which is repeated by almost all of my clients – pay increases! Staff are asking for them because the cost of living is on the increase, but companies can’t afford to give them as the economic future is so uncertain.

Going back five and even ten years, pay increases were generally given by small companies at about 5% and by large companies at 5 – 10% depending on the industry, company and individual performance. In these instances, the pay increase was above inflation and employees generally felt valued.

Today, with RPI at 5.4% and CPI at 5% these sorts of pay increases, if even possible, are barely covering Cost of Living increases. In many cases employees really do understand the pressure their management is under and would prefer to have a job with a low pay rather than no job at all, should the company go out of business. However, employees still need to be able to live: feed and cloth their families, put their children in childcare to enable them to work and to provide an adequate standard of living. As inflation increases and pay rises are not achievable, employers are having to look to alternative ways of motivating staff, ensuring they feel valued and remain engaged in the company, helping it to achieve its aims and objectives.

So, how are companies doing this? The answers vary based on size, industry and performance, but here are some ideas which can be adopted.
Communication and expectation setting
Talk to your staff. Be open and honest with them. If company performance is good, tell them, if it is bad – tell them. If you have to make changes to their compensation packages, tell them why and tell them when you will review the situation and what changes you need to see to provide a platform for restoration of their package. If there are decisions you are making to save costs, consult with staff – they may have useful insights and ideas. Try to put bad news with good news messages, but don’t lie and don’t ‘spin’ – you will loose their trust.
Other Rewards
Good performance does not mean you have to give pay increases. If the performance is due to a one off successful sale or project, providing a one off bonus to show your appreciation is an ideal way to demonstrate how much you value staff. It won’t add to the long term fixed financial commitments of the company, but will enable a set amount of money to be shared among employees.
Access to voluntary benefits is another way of showing staff that you are thinking of them, even in these stretched times. The employer usually pays a small amount per person and this enables the employees to access all sorts of discounts making their existing pay packet go a bit further. Choosing the right benefits programme is important, but it can be a very cost effective way of rewarding staff.
Time off
Providing staff with extra time off can be another cost effective way of rewarding them. This may not work for every business and certainly won’t work if you have a workforce who are too busy to take the annual leave they normally have, but for many extra time off goes a long way.

Getting reward right is hard at the best of times. Getting it right in the current economic climate is even harder.
What has your experience been with recent pay reviews? What alternative approaches have you adopted?

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