This week’s HR Bitesize is a little bit different as I am combining thoughts from both my HR business and the business coaching that I do.
Following the budget, we were contact by a couple of our clients asking us to start preparing them for redundancies.
Now, while this isn’t an uncommon occurrence, as we support clients with restructures all the time, the reason was very different.
As you will by now be aware, there are some significant changes coming to Employers National Insurance from April of next year. For most employers, this is going to result in higher ‘on-costs’.
The businesses which have contacted us now about making redundancies in January / February have already decided they can’t afford the cost of their staff and that they want to make some of them redundant.
Over the 17 years I’ve been running DOHR, we’ve been through a couple of big recessions, as well as some minor dips and bumps and I’ve learnt a thing or two about survival:
- There will always be people in your industry to thrive, while others go out of business
- As the business owner, your mindset plays a massive role in ensuring your business thrives
- You need to take control of your business and use the wider economic situation to your advantage
Many years ago, a PR agency came to me and told me they needed to make 35% of their staff redundant.
As I started to dig into this and looked at their business holistically, what they were asking us to help them do would have destroyed their business entirely, resulting in all staff being unemployed, defaulting on a massive personal guarantee and therefore losing not only the business, but the family home.
Each employee did a specific language-based role, each employee having a unique set of language skills. To remove just one of those people meant pulling out of the market which they served.
We looked at their employment contracts, we looked at their business costs and we looked at their clients.
The result was:
- They gave notice as soon as they could to come out of their expensive City offices (there were some downsides to this, but economically it still made sense);
- They asked all staff to start half an hour later, finish half an hour earlier and take an hour for lunch – that saved them 1.5 hours per employee per day, 7.5 hours per employee per week and over 300 hours of staff costs per month;
- They reduced company pension contributions for a 6 month period (this was at a time when you could do this);
- The Directors came clean with their staff that they had not taken a personal salary for over 6 months – this was the hardest bit of the process. It took a lot of persuading for us to convince the Directors to open up about what they had been doing to keep the business going. However, if asking all staff to take a pay cut, it was important to show what other steps had been taken and that everyone was being asked to compromise.
The result was that the business weathered the storm and came out of the recession stronger than their competitors.
There is always a way to deal with an issue, you may just need some help finding it.
If you have a successful, profitable business, then take some time to reflect on the business. Carve out time every single day to think properly about your business.
You may need an accountability buddy.
You may need a business coach.
You may need a mentor.
You may need a business minded accountant (not all accountants have a head for business)
You may just need a clearly polished mirror to hold up to your face.
Do not come up with the first idea of cutting jobs or shutting down your business, look for alternatives.
Look for lots of alternatives.
Work each option through properly, financially and logically.
Take steps to ensure you are the business in your sector which survives and thrives, whatever the outside world throws at you.
Planning for 2025
Our last live training of the year will take place on 12th December. It will be a little bit different to our usual sessions as it will be an ‘Ask Donna’ session.
As you put your HR plans in place for 2025, I’m sure that you will have questions.
They may be based on the new Employment Rights Bill and the changes which will take effect in April 2025. They may be based on the budget and how you can mitigate the impact on your business. They may be based on your business aims and goals for 2025.
Whatever it is, if it is to do with your people, you are welcome to join us for this ‘surgery style’ live training on 12th December.
Register now to book your place.
PS. This is the first time I’ve run a surgery format, so please don’t leave me alone!
Group Coaching
Each year I start a new group coaching cohort.
In February 2025, the next cohort will be coming together to drive their businesses forward for 2025 and beyond.
There will be a maximum of 8 people, meeting face to face for 3 hours, for 8 sessions over 4 months.
The cost is £699 for all 8 sessions. To find out more and to book a discovery call, visit my website
That’s it from me this week.
Have a great week and remember, if you need me, hit reply, call me on 01923 504100 or email [email protected]
Donna
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