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Business Development & Marketing Cash Flow & Forecasting Debt Collection & Credit Management Finance HR, Redundancy & Trade Unions

Maintaining a positive mindset about your business during the current crisis

maintain a positive mindsetNobody would deny that the current pandemic-induced situation is a worrying time for SME business owners but they should do everything they can to maintain a positive mindset.
It helps to see if there are potential opportunities for either new ways of working or new services that you can adopt, especially if the changes you make demonstrate a concern for the needs of others.
There have been some excellent examples among the smaller micro-businesses that have been remarkably agile in doing this very quickly. Many of these are likely to fall into the category of sole trader/self-employed for whom there does not yet appear to any Government financial help, so hats off to them for their agility.
Examples we have seen is the numbers of exercise and fitness, yoga, Zumba and other classes that have set up to carry on via video in response to the closure of their usual physical venues.  Not only does this mean that they are able to maintain the link with their clients but they have found a way for people to maintain a level of fitness if they do find themselves having to self-isolate.
The same applies to other types of coaching and mentoring, which can be done one to one via Skype and other platforms or can offer training sessions via video for people.
One independent brewery in Scotland has started making hand sanitiser at its distillery and is giving the product free to anyone who needs it. Perhaps not profitable but a good piece of marketing its social responsibility, which may lead to more people trying its main product!
Local pubs and restaurants, too, are demonstrating a positive mindset despite a drop in customers or actually having to close. Many independent restaurants, for example, have switched to producing and delivering ready-meals. Some local retailers have set up outside their shops and others are offering home deliveries of staple supplies such as bread, eggs, fresh meat, fruit and veg.
At the other end of the scale the Co-op has announced that it will create 5,000 store-based posts which will provide temporary employment for hospitality workers who have lost their jobs because of the coronavirus crisis and is simplifying its recruitment process so successful candidates can start work within days.
Of course, many SMEs have more immediate and pressing concerns keeping them awake at night, like how they are going to pay staff if they have suffered a catastrophic drop in customer orders given that there is as yet no sign of when the promised Government grants and loans will be available. In the meantime, staff expect their wages to be paid and most other overheads are having to be paid.
One example of the lack of understanding among many large firms is Funding Circle who were contacted on behalf of a client to discuss a short-term suspension of payments or at least interest only payments, they were not interested and said that they would issue demands on the personal guarantees they hold if ongoing payments were not made in full.
It doesn’t help that many firms have suspended all trading with the stopping of all payments to suppliers and placing new orders.
In these circumstances it will help to talk to an experienced turnaround and rescue adviser who can help SMEs manage their cash flow and assist with the urgent measures necessary to survive.
Remember, a problem shared is a problem halved!

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Business Development & Marketing General HR, Redundancy & Trade Unions

Employing millennials should not be a problem

employing millennialsEmploying millennials should not be seen as a problem but according to some reports in the business press many employers would prefer not to.
The reasons given range from this generation having a poorer grasp of language to being less loyal than older workers, and allegedly having higher absence rates.
Quite apart from the fact that age discrimination is outlawed under equal opportunities legislation, millennials (the generation born between 1980 and 2000) now make up the bulk of the workforce.
While it would be fair to say that employing millennials means bosses need to understand that this age group may view their careers rather differently from previous generations, it is also true that each generation comes with skills and attitudes that are a benefit to their employers. It is also true for many employers that they are customers who need to be understood.
Approximately 10 years ago PwC produced a report that focused on the millennial generation, examining their career aspirations, attitudes about work and level of comfort with new technologies. It predicted that they would make up 50% of the global workforce by 2020.
It also examined the key features that employers would need to understand about this generation: “Millennials’ use of technology clearly sets them apart. This generation has grown up with broadband, smartphones, laptops and social media being the norm, and expect instant access to information”.
This is clearly a benefit for 21st Century businesses.
However, the report continues that employers need to understand that it is a generation whose “behaviour is coloured by their experience of the global economic crisis and this generation places much more emphasis on their personal needs than on those of the organisation for which they work”.
This should be no surprise given that it has been a long time since employees of any age have been able to rely on the “one job for life” career model.
Couple this with having had to make compromises due to the 2008 global financial crisis, such as having to do work that is beneath their skill and education level. Indeed, they are often better educated than previous generations who tend to be more senior people in organisations and they are living with high levels of rent and living costs while at the same time they have been burdened with university debts that were not imposed on those who complain about them. It is hardly surprising therefore that many of them consider their income as derisory when compared to the income of others. Loyalty works both ways.
In addition, they are aware of other factors such as quality of life, environmental concerns, diversity, ethical business and equal opportunities which are becoming more important factors when deciding who to work for.
As older employees reach retirement and the likely restrictions on immigration, employing millennials is not going to be a choice and indeed employers should be looking for the best available skills for their businesses – or the potential to develop them.
It may mean that employers will need to re-think their rigid, hierarchical structures and use a more cohesive, mentoring approach to their management style.
They will need to pay more attention to employees’ training needs and careers aspirations, and to accommodate their increasing focus on environmental and social concerns.
Good workers know when they are being treated well and young people tend to be well able to adapt to a fast-changing world, accordingly employers should focus on helping young people to become good workers as a demonstration that they valued. Employees should no longer be regarded as a burden or treated as being lucky to have a job. It is now the other way round.
Survival in the 21st Century will involve businesses having to adapt rather than expecting their people to adapt.
While most businesses claim that their people are their greatest asset, the reality is only true when their people claim their business is the greatest employer.

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Business Development & Marketing General HR, Redundancy & Trade Unions Turnaround

Emotional Honesty at work – mutual respect turns a negative into a positive

emotional honesty and conflict resolution There are many situations in our working life that have the potential to damage relationships with colleagues and managers and it takes emotional honesty to confront them.
Disagreements are inevitable especially where individuals are ambitious and want the best for the business and its goals. There are often many solutions to problems and teams need to learn how to share differing ideas without disagreements being seen as confrontation and in particular avoiding individuals being afraid of others in such a way that they don’t contribute.
Team decision making doesn’t necessarily mean agreement but is should be positive, especially when the team is needed to implement the decision. Sophisticated teams may explore decision making as a form of idea meritocracy by considering the knowledge and expertise of each contributor rather than team democracy where everyone is equal, or worse, where overconfident individuals, bullies or HiPPOs (Highest Paid Person’s Opinion) make the decisions.
Conflicts at work are often rooted in a lack of respect among colleagues. Conflicts are different to disagreements and can make the atmosphere toxic leading ultimately to bullying and other serious issues that damage a team’s ability to work together.
Another area of discomfort is giving feedback on someone’s behaviour or during an appraisal when the appraisee is under-performing. The intention is normally to invite a change in behaviour that leads to a positive outcome. But receiving such messages can promote rejection of the message or even anger hence the need to deliver such messages with both honesty and with emotional understanding.
Dealing with disagreements, a loss of respect and giving feedback all require a level of emotional honesty to confront the issue in a sympathetic way. In addition to individuals learning how to deal with difficult messages the culture of the company is also important. Culture can help avoid individuals being defensive and feeling victimised by removing blame and promoting honest engagement such that everyone moves on after the decision has been made or after a matter has been dealt with.
In an ideal world everyone at work respects each other and values the contributions of others. However, we all have quirks of character and mannerisms that can grate, which is why we need a level of emotional honesty to both acknowledge this to ourselves and to others. This acknowledgement allows us to be constructive when confronting issues. The key is to actively listen and seek to understand others and avoid letting our own emotion get in the way.
If it is necessary to resolve a problem with a colleague or manager, the first step is to remind ourselves and them of their good points and qualities and to start with these at the opening of any discussion.
Emotion should be firmly kept out of the discussion. Expressing anger or frustration makes it hard to really hear the feedback being given. So, an essential element when dealing with disagreement or a loss of respect is to maintain courtesy.
Equally, aggression, both active and passive, during a confrontation gets in the way by becoming a form of bullying; even disengaging from a difficult situation can be done in a way that is construed as emotional bullying when one party gives in or walks away without resolving the underlying issue. This is often how family members deal with conflict and is seen at work when people don’t know how to deal with issues.
It can be effective to establish a connection by sharing a situation where you may have made a similar mistake and not talking down to the person on the receiving end.
Humour and displacement topics can be useful tools for lightening the mood or changing the topic when dealing with awkward situations but it is often necessary to get back to resolving serious issues as burying them tends to fuel resentment.
It is important to remember, too, that people have personal lives outside of work and their circumstances may be a contributing factor where they may be concealing a personal or family situation that is affecting their behaviour or performance at work.
It is not unusual for people to keep outside problems to themselves, believing they have to conform, to be “professional” or to fit in with a so-called “macho” culture.
Whatever the situation or problem, time should be allowed for the person on the receiving end to digest and think about what has been said.
When on the receiving end we need to listen, take notes if necessary and may need time to consider the points made before responding.
Emotional honesty rather than confrontation is the best way to resolve workplace problems. Feedback should be constructive and dealing with disagreements and conflicts should be done in a way that looks for a positive outcomes.
Respect for others is key and if maintained then everyone can benefit from the experience.
 

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Business Development & Marketing Finance General HR, Redundancy & Trade Unions

The Good Business Charter may be the dawn of a new era

Good Business Charter for new decadeA new form of accreditation launched at the CBI conference in November, the Good Business Charter aims to promote a more responsible way forward for capitalism, business and the economy as the new decade begins.
Businesses can sign up to the new voluntary code, but they will have to provide evidence that they are following the ten principles enshrined in the Good Business Charter.
The Good Business Charter, which is supported by the Confederation of British Industry (CBI), the Trades Union Congress (TUC) and managed by an independent not for profit organisation, has been funded by Julian Richer, the founder of retail chain Richer Sounds.
Early last year Mr Richer handed over control of his company, Richer Sounds, to his employees, transferring 60% of his shares into a trust.
Launching the initiative at the CBI conference, the current Director General, Carolyn Fairbairn, said: “Without successful, responsible, passionate business, creating wealth and opportunity across the country and working in close partnership with government.
“… Business has always been about profit but it’s also been about so much more. It’s about making a difference. Creating jobs, services, products, ideas, opportunities.
“This is a time to talk about and even more importantly — demonstrate – that profit comes with purpose.”
To become accredited, participants in the Good Business Charter Scheme will have to undertake to pay employees the real living wage, give workers a voice in the boardroom, commit to prompt payment of suppliers, treat their customers fairly, agree not to engage in tax avoidance and show efforts to reduce their environmental impact including sourcing materials ethically.
The full list of ten principles can be found on the organisation’s website.
There has been mounting evidence for some time that both customers and investors, not to mention employees, want to see businesses behaving more ethically and in particular paying far greater attention to their environmental impact.
There is no better time for businesses to change their practices than the start of a new decade.
The Good Business Charter offers businesses a way of demonstrating their social responsibility and may be the dawn of a new era.
I wish you a happy new year and good fortune for the coming decade.

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Business Development & Marketing General HR, Redundancy & Trade Unions

Fair treatment of employees is a cornerstone for improving productivity

fair treatment equals improved productivityImproving productivity is a concern for all businesses but it is harder to achieve if employees do not believe they are receiving fair treatment.
As I have said in many previous blogs, a motivated workforce is more likely to go the extra mile if they feel valued as people, this means managers treating them with respect, listening to them, showing consideration to them, recognising their contribution, rewarding their contribution and protecting them from inappropriate behaviour by others at work. In summary treating them with respect and showing them that their effort is valued.
Recognition can simply be saying “thank you” for a job well done, it is not just about money.
However, money can become an issue when there is a clear disparity in pay. While discrimination is illegal and applies to any disparity of remuneration on grounds of gender, race, religion or ethnicity, this is not about legislating for staff motivation.
To be motivated staff need to feel they are treated equally which means people doing the same job expecting the same pay and other benefits albeit they will acknowledge any adjustment to pay scales based on valid reasons such as experience, length of service, sickness record, additional responsibilities or other factors. The key is that the reasons for any difference in pay are legal, explicit and understood by everyone.
Two years ago, in April 2017, the government made some efforts to address unequal pay treatment with the introduction of mandatory gender pay gap reporting (GPGR) for both the private and public sectors employing 250-plus people.
It then launched an inquiry into whether organisations should also be required to report on the pay differentials between people from different ethnic backgrounds, although as yet no decision has been reached largely, it is argued, because ethnicity is a very complex subject.
GPGR is regulated by the Equality and Human Rights Commission, and while it can take businesses to court for non-compliance and obtain an order to force them to, it has no enforcement powers beyond “naming and shaming” them.
So recent reports on the situation two years on are not encouraging reading.
The BBC cited figures from the ONS (Office for National Statistics) for the year to April 2019, saying that the gender pay gap for full-time workers rose to 8.9% – up from 8.6% the previous year.
Quoted in the article is TUC general secretary Frances O’Grady:  “Government must pick up the pace. It’s clear that publishing gender pay gaps isn’t enough on its own. Companies must also be legally required to explain how they’ll close them.”
Andy Haldane, a member of the Bank of England’s Monetary Policy Committee, has recently said that the GPGR obligation should be widened to include SMEs with 30 or more employees, something that was dismissed by FSB chairman Mike Cherry because there would be a number of practical difficulties in businesses with such small work forces.
The BoE (Bank of England) has also recently analysed its data and found that ethnic minorities in the UK earn around 10% less than white workers. Andy Haldane said the gap is “strikingly” persistent, having narrowed far less the than the pay disparity between genders over the past 25 years.
But fair treatment extends beyond disparities on pay.  It is also about such issues as bullying and harassment and again, recent findings show some concerns.
According to a CityAM report investigations by Business in the Community found that as many as a quarter of all ethnic minority employees at British businesses are having to put up with bullying and harassment, despite 97% of businesses having a zero tolerance policy to bullying and harassment.
A study by Equileap, which researches corporate gender equality, has found that almost six out of 10 global companies do not have an anti-sexual harassment policy.
Clearly, there is a long way to go before there is fair treatment for all workers, but if businesses want to survive and prosper in a difficult global and domestic economic climate, amid skills shortages and the uncertainties of Brexit, they would be well advised to put it much higher up their agenda than it seems many currently do.

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Banks, Lenders & Investors Business Development & Marketing Finance HR, Redundancy & Trade Unions

What kinds of jobs will be taken over by automation?

automation of unskilled jobsIn late March, the ONS (Office for National Statistics) published its latest findings on the effects of automation on the jobs market.
It found that some 1.5 million jobs were at high risk from automation, but, tellingly, 70% of these roles were currently held by women. The next most at risk groups were part timers and young people.
The ONS calculates that around 710,000 jobs in the City may be taken over by automated technology, with around 39% of jobs in the accounting, legal and financial services sectors most likely to be automated and that 34% of roles in tax advice could be affected..
Waiters and waitresses, shelf fillers and elementary sales occupations, are most likely to go, all roles defined as low-skilled or routine. Increasing numbers of factory workers are also at risk of being replaced by machines.
Least endangered are medical practitioners, higher education teaching professionals, and senior professionals in education although many of their support functions such as data capture and preliminary assessments are already being done by computers.
Deeper analysis suggests that automation has already dispensed with some lower-skilled work because although the overall number of available jobs has increased, according to the ONS, these are in low or medium risk occupations.
According to Maja Korica, associate professor of organisation at Warwick Business School, 20% of the Amazon workforce, for example, may already be made up of robots.

Are the economy, employers and businesses prepared for the risk from automation?

While it seems that manufacturing is already moving ahead with automation, the question is whether there will be enough higher-skilled people available for the future.
The take-up of apprenticeships by business has repeatedly failed to hit targets set by the Government.
While the future for the economy is still so uncertain, many employers will continue to delay investment in the long term productivity benefits that automation offers.
In the short term, therefore, there continues to be a need for lower-skilled workers with demographic groups being overlooked by employers, according to Pawel Adrjan, a former Goldman Sachs economist who now works at the jobs group, Indeed.
He argues that employers will need to search across underemployed demographic groups (young people, single parents, ethnic minorities, people with disabilities) at least in the short term as more and more EU workers either leave the UK or decide not to come and work here.
Clearly, the economy and various sectors are still in a state of transition, so it may be that relatively low-skilled work will be around for a while yet. But when automation ramps up there will be a need for more skilled workers as operators. Despite the loss of some jobs, automation offers scope for everyone involved to benefit.

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Cash Flow & Forecasting Finance General HR, Redundancy & Trade Unions

The tide may be turning to improve workers’ rights

demonstration for workers' rightsIn December Christina Blacklaws, the president of the Law Society, warned in a letter to the Financial Times that employment law on workers’ rights had not kept pace with the changes in the way people work nowadays.
Her concerns were primarily for people working in the so-called ‘gig’ economy after the High Court ruled that Deliveroo riders had no right to bargain collectively.
Her letter said: “Case after case highlights concerns about how the workplace rights of employees, workers and contractors are affected by a law not fit for purpose and not easily understood. The lack of certainty means people are having to go to court to clarify their rights.”
Perhaps in some areas the situation is being clarified by case law such as the recent Supreme Court ruling re Pimlico Plumbers that a sub-contractor cannot be classed as an independent self-employed contractor for employment law purposes and should be treated as a “worker” who is entitled to holiday pay and other basic workers’ rights. This was similar to the Appeal Court ruling re Uber that its drivers should be classed as workers with access to the minimum wage and paid holidays.
The Government has published its proposals for employment law reform, which included giving workers the right to request more predictable hours, as well as offering enhanced protections for agency workers and heavier fines for malicious employers.
Not surprisingly, the more predictable hours proposal was dismissed by TUC leader Frances O’Grady as likely to give workers on zero hours contracts “no more leverage than Oliver Twist”.
No doubt, SME owners will say that the burdens placed on them by the living wage, work-place pension legislation and existing rules governing how they can and cannot treat employees are already onerous enough.
However, given the uncertainty surrounding a post-Brexit future and the fact that much of existing law protecting UK workers is EU law, it is understandable that employees are concerned about their future position.
In an effort to alleviate their concerns, the Government earlier this month issued guarantees on workers’ rights after Brexit, although this was quickly dismissed by an EU and employment law barrister as “meaningless” because there was no guarantee that a future UK Government would enact any future EU legislation protecting workers.
Certainly, the Labour party is offering the prospect of improved workers’ rights and a significant improvement in the power of Unions with a view to reversing the demise of the Unions and the lack of collective bargaining.
Independent of new legislation, the current low level of unemployment and large number of job vacancies would suggest that workers may regain some of their lost power and rights through their right to provide or withdraw their labour and more pertinently their confidence that they can offer it to another employer.
Given that many UK business sectors are already struggling with a skills shortage, particularly in engineering, construction and IT, and that any business that wishes to thrive and grow relies very heavily on its employees feeling valued and engaged with their employer’s future progress, this would seem to be one time when it is in the interests of both to ensure that workers’ legal protection is robust and secure.

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Business Development & Marketing General HR, Redundancy & Trade Unions Uncategorized

Are you undermining your business by ignoring equal pay?

equal pay how far have we progressed since this old suffragette posterDespite years of campaigning and even legislation it seems that many businesses are still ignoring the rights of women to have equal pay for work of equal value.
Tomorrow, April 4, marks the deadline for the UK Government’s legal requirement for businesses and public sector organisations employing more than 250 people to publish their gender pay rates.
As of April 1, approximately 7,000 of the estimated 9,000 businesses and organisations required to do so had complied and the results so far have made depressing reading.
According to the ONS, the median pay gap between men and women revealed so far is 18.4% in favour of men and the mean (average) gap is 17.4%.  The median gap, based on the difference between those employees in the middle of the range, is thought to be more accurate because the mean can be skewed by a small proportion of very highly paid employees.
The Equal Pay Act 1970 prohibited any less favourable treatment between men and women in terms of pay and conditions of employment and was replaced in 2010 by the Equality Act.
Yet it seems that many employers have continued to consistently ignore the law or found ways to circumvent it.
According to the ONS top of the list for ignoring equal pay are in businesses in the Finance and Insurance, Power, Education, Professional and Academic, Manufacturing and Communications sectors.
Perhaps given greater impetus by the #MeToo movement following the revelations of the Harvey Weinstein and other similar scandals, this may be a moment where the situation can no longer be ignored. High profile voices, such as the resignation of the BBC’s China correspondent Carrie Gracie in protest against her own pay disparity compared with male colleagues, have also put the situation under the spotlight.

Equal pay is about respect and valuing employees

Any number of excuses will be put forward for the disparity, such as the effect on career progression of women taking time out for pregnancy or the preponderance of women in relatively low-skilled or part time work.
However, as I have argued many times, crucial to a successful business is showing respect for employees.
There is plenty of evidence that those who feel valued, who are consulted about business developments or who are given opportunities for further training to improve their skills and progress their careers can make all the difference to productivity and to a business achieving its goals.
It makes no sense at all, especially in times of near-full employment, for a business to ignore or undervalue half the potential pool of recruits, i.e. women, who could be available.
Perhaps, 100 years after the birth of the suffragist movement began, we have finally reached a tipping point where there will be some real action on equal pay for work of equal value.

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Cash Flow & Forecasting General HR, Redundancy & Trade Unions

Businesses should not withdraw employee rights after Brexit

employee rights are importantAs negotiations between the EU and UK on Brexit resume this week, yet another business organisation, The British Chambers of Commerce, has warned that business patience is “wearing thin” over the lack of clarity about the kind of deal being pursued.
In an open letter the BCC’s president Francis Martin and director general Adam Marshall wrote: “Businesses need those elected to govern our country to make choices – and to deliver a clear, unequivocal statement of intent.”
While the focus at the moment may be on the transition period and the eventual trade deal the legal protections for employees are another area of uncertainty for businesses.
In January an article in the Independent warned that many of these rights were enshrined in EU law and could be at risk after Brexit.
They include restrictions on hours worked imposed by the EU Working Time Directive, time off from work, rights to paid holiday and unpaid parental leave, and anti-discrimination laws.
Most vulnerable will be low-paid and “gig” economy workers on zero hours contracts, but there are implications for all employees.

There are good reasons for businesses to maintain employee rights after Brexit

Some employers might see Brexit as an opportunity to reduce employment rights and get more for less from their staff, especially given the likelihood that overseas trade is likely to become even more competitive and costly.
However, there are two major considerations for not following this route.
Firstly, there is already a well-known skills shortage in some sectors, notably Engineering, IT, construction and health care. To at least partially fill the gap businesses have been relying on EU migrant labour, while others have got the message that training existing employees and embarking on apprenticeships is important for the future but this will take time to feed through into a skilled workforce.
Secondly, the UK has been enjoying record levels of employment, which means the pool of available labour is very limited.
But businesses need to plan their staffing needs and in particular how they will recruit and retain staff in a competitive labour market. This might also encourage them to think more about how employees are truly valued. “My people are my greatest asset” might yet become a reality rather than a hollow phrase trotted out by companies that don’t make the effort in a way that is appreciated by their staff.
There is ample evidence that job security is a prerequisite for employee engagement. Job insecurity usually leads to increased absenteeism and staff turnover, decreased productivity and lower levels of trust in employers.
If employees are uncertain about their security, their employment conditions and their rights after Brexit they are unlikely to be committed to their employer.
Communicating and reassuring employees is the key to keeping them involved and feeling valued where failure to do so leads to reduction in productivity.
They really are your greatest asset.

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Business Development & Marketing General HR, Redundancy & Trade Unions

What is the purpose of a staff appraisal?

appraisal?For many businesses the usually-annual staff appraisal is seen as an opportunity for managers to review an employee’s performance, provide feedback on areas for improvement, agree trading needs, set targets for the coming year and address any problems that may have arisen in their behaviour.
As a result, too often employees view the annual appraisal with dread.  It depends heavily on their relationship with their manager and his or her ability to be objective.
Yet the appraisal can be of benefit to both employee and business if structured and handled in the right way.
Ideally, it will be seen as a constructive opportunity for an exchange their views, not simply as a tool for management to assess and, if necessary, improve the employee’s performance.

The constituents of a constructive appraisal

There needs to be a culture of trust and openness in the business and ideally, managers who are appropriately skilled, for example in asking good questions and active listening.
Ideally employees should be receptive, prepared to align with business objectives, learn and take responsibility for their performance.
The appraisal is an opportunity to recognise achievements and find out about an individual’s career objectives. It should recognise their achievements and be a genuine two-way conversation.
It should cover the whole period under review not just recent or isolated events and the result should be an agreed set of actions.
By the same token, it should also offer the employee an opportunity to feed back suggestions for improvement in company processes, ideas for the future development of the business and to highlight any processes that are clearly not working.

Set out and document clear appraisal objectives and purpose

The appraisal purpose, structure and process should be clearly defined and written down so that all parties are clear about what to expect. The aims, frequency and process should be clearly and simply outlined in the staff handbook.
It is helpful for both parties to have done some preparation for the meeting, ideally both should attend having completed the same questionnaire but from their own perspective. The completed documents can be compared and provide a framework for the meeting and its outcomes.
An appraisal is hardly likely to be seen as a constructive opportunity to all involved unless it is seen as a fair process. This could include appraisals always being carried out in the presence of a neutral third party, usually someone from the HR department or from the company to which HR is outsourced, whichever is applicable.
It should be clear that the business has made every effort to eliminate the danger of bias in an appraisal, perhaps because there is a clash of personalities between a manager and an employee.
Far too often the structure of an appraisal is seen as an occasion to be dreaded when properly defined and constructed it can be an opportunity for both individuals and the business to move forward.
I believe that appraisals should always be carried out by the employee’s line manager since their role is normally one of pastoral leadership. While there are many types of leadership, managers should consciously develop their own skills and style with the aim of getting the best out of their team. The appraisal is an opportunity to reinforce the relationship and improve everyone’s performance.

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Business Development & Marketing Cash Flow & Forecasting General HR, Redundancy & Trade Unions Rescue, Restructuring & Recovery

Uncertainty and change may be a feature of the business future for a while

managers hiding after announcing changeIn so-called “normal” times no business can afford to stand still and hope to survive.
In the current economic climate following the UK’s general election, a precariously-balanced parliament with no party having a majority, and with the negotiations on leaving the EU yet to start, business will be facing additional pressures and uncertainties.
However, regardless the prevailing circumstances, change is likely to be a constant feature in business survival.
Change can be unsettling, especially for employees and therefore has to be managed effectively if it is not to cause disruption, lack of focus, worry and a consequent drop in productivity.

The key actions for helping employees cope with uncertainty and change

It is surprising how often employees pick up on potential changes in their workplace, especially tension among managers, even if they have not yet been informed.  Watching and listening is important to gauging how unsettled they might be.
Managers demonstrating concern and understanding about people’s feelings can reduce the feeling of powerlessness and that things are going to be imposed on them.
Anxiety among staff can become a source of worry, so a key ingredient in calming employee fears is to give them as much information as possible as soon as possible about any proposed changes the business may be planning.
In fact, it may prove even more productive to consult with and involve employees in what is being proposed.  They are the people who will have to implement and live with the changes and they may well have innovative ideas about how to make them work.
If the changes are going to involve either some redundancies, changes to working conditions or re-deployment consulting with staff representatives or a union may be crucial in ensuring that they are accepted.
Be aware also of the procedures necessary to comply with employment legislation especially as it relates to redundancies or changes to terms of employment. An up to date staff handbook with detailed redundancy and grievance procedures can be a useful source of reference for both staff and managers.
Once the plan for modernisation, restructure, or modification of working conditions has been settled managers can help employees to adapt quickly by arranging briefings.  People are more accepting of change if they understand what is being proposed, why it is necessary, and when it will be implemented.
Finally, training and support will enable employees to feel both involved, valued and competent to handle the new situation.

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Business Development & Marketing General HR, Redundancy & Trade Unions

Do SMEs need an employee handbook?

Many SME owners ask why they need the formality of an employee handbook for their staff.
There are several reasons, in our view. A handbook provides clarity about the company’s expectations and details of additional terms and conditions that form part of the contract of employment but which might need to change from time to time.
It helps cut down on misunderstandings and could provide some legal protection for the company in the event of a dispute with an employee.
When demands on management time are considerable, as they often are in a SME, a handbook saves time and provides clarity about what is expected from new recruits during their induction, when there is a lot of information to digest. It also acts as a useful reference for everyone in the company especially when dealing with employee- related issues.
Well written, in clear and simple English it can offer a welcome and sense of belonging to the nervous new recruit.
Equally importantly it helps a company define what it stands for and can be used to communicate company aims and values.
So what information should be included? The basics are general company policies, rules and regulations (dress code; how people interact with customers; harassment; safety regulations; use of phones and IT for personal purposes), info on reclaiming expenses, booking holidays, sick leave, salary and performance reviews, company benefits etc. Although statutory it is useful to set out the steps for disciplinary and redundancy procedures which can also be used as a checklist by both managers and employees.
An employee handbook does not need to be expensively produced and most of the contents are standard and freely available. It is more important that it contains accurate, correct and easy to understand information.
It is, however, a good idea to have the handbook checked either by an HR or legal professional to ensure everything it contains is clear, accurate and complies with any employment legislation.

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Business Development & Marketing General HR, Redundancy & Trade Unions

A positive induction experience is key to performance and retention of new recruits

Recruiting staff can be a costly and time-consuming process for SMEs and doesn’t finish when someone is given the job. It is worth putting some time and effort into helping them feel welcome and also ensuring they become productive as quickly as possible.
A new recruit is likely to be nervous and apprehensive during their first few weeks and according to ACAS, the highest labour turnover is among new employees. It warns that employers should allow for a period of learning before they can reach peak efficiency.
An effective induction process can make all the difference and it is worth structuring the process to cover the important elements for both the employer and the employee so they settle in as quickly as possible.
Depending on the duties and responsibilities a number of key elements should be covered. Everyone needs general information about the company such as such as its values, employment terms and conditions, holiday entitlements and booking, safety training and any key policies on such things as discipline, sexual harassment, dress code, customer interaction, use of the internet and mobile phones etc.
The new recruit will also need relevant training for doing their job such as introductions to key people, learning about relevant systems, processes paperwork and filing and how to use technology.
It is also necessary to set expectations about performance and what is important and how these will be monitored and reviewed.
The induction process and relevant training should be structured over a period of time that helps the newcomer learn and absorb what they will need to know to do their job effectively.
Two things that can help to ensure an effective and positive induction process are a buddy system, where an existing staff member is paired with the newcomer to help them find their feet, and a feedback session once induction is completed to assess whether the process has been effective or perhaps needs some modification.

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General HR, Redundancy & Trade Unions Rescue, Restructuring & Recovery Turnaround

Can employers expect loyalty from workers on Zero Hours contracts?

Employee consultation and support can, in our view, make a huge difference to success when a company in difficulties is being restructured.
But it has emerged that as many as 90% of Sports Direct employees are employed on part-time, Zero hours contracts, and therefore are unlikely to be eligible for the company’s recently-announced bonus payouts. It has been reported that only full-time employees are eligible for the bonus.
Given that these contracts are now used for about 1 million UK employees we should question them. 
The advantages to the employer are obvious in that they only pay for workers’ time as and when needed and there are reduced, or even no, entitlements to sickness and holiday pay, thus enabling a company to keep its overheads under control.
Despite their flexibility, which may be appropriate for a very few employees, the contracts offer few guarantees or certainties and yet could result in considerable hardship for employees due to them being expected to be available at short notice without guarantee that they will earn enough to provide a living wage.
At the same time employees on Zero Hours contracts are viewed as being in employment and therefore not eligible for any state help in weeks when they have had no work or pay.  Nor can a worker on such a contract take on any other work to supplement their income if they are required to be available at short notice.
We believe they could be abused by employers and support Business Secretary Vince Cable’s initiative for a review of Zero Hours contracts and how they are being used.

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General HR, Redundancy & Trade Unions Rescue, Restructuring & Recovery Turnaround

Will the new Employment Tribunal fees give employers some protection?

On the face of it the new charges on employees seeking redress for workplace issues via tribunals could be good news for employers, particularly SMEs.
In theory, as the FSB has pointed out, the £160-£250 to lodge a claim and the £230 or £950 fee if the case goes ahead ought to deter weak or frivolous claims that businesses have hitherto felt obliged to settle without contesting for fear of huge legal bills.
A client of mine recently had a male employee who, after a couple of warnings, was then made redundant. Despite ample evidence that he had had several recent girlfriends he then took the company to tribunal, encouraged by a solicitor’s no win no fee deal, for unfair dismissal on grounds of his sexual orientation as a gay man! The company settled out of court for £7000 for fear of high legal costs if they contested in court.
When turning around companies I believe in working with the unions or employee representatives when reorganising staff or redundancy. Indeed K2 now has a former union official who as our ‘Employee Liaison Officer’ specialises in managing the process. Equally, it is important that employers follow all the correct procedures when using redundancy.
However, there are some caveats about how effective a deterrent to weak claims the new payments will be.  Firstly, Unison has been granted permission for a judicial review on the introduction of fees. Secondly, costs can be reduced where there are multiple claims of two or more people against the same employer. Similarly fees can be significantly reduced or waived where a claimant cannot pay.  Thirdly will the new fees deter the “ambulance chaser” lawyers offering no win no fee deals?
In our view the jury is still out on whether this new ruling will make life easier for employers. What do others think?

Categories
General HR, Redundancy & Trade Unions Rescue, Restructuring & Recovery Turnaround

Working With Trades Unions to Promote Consensual Turnarounds

I have approached a number of UK trades unions with a view to forging a collaborative approach to dealing with companies in financial difficulties. 
In my view, currently, employees are rarely involved in the decision-making when a company’s survival is threatened, but a successful business turnaround relies very much on the support of its employees.
Unlike formal insolvency procedures, turnarounds are consensual. Leadership, teamwork and communication are key to implementing change. Engaging with staff and involving them in the business introduces accountability and responsibility to a business and is crucial to its success. This is even more so with a turnaround where change is necessary.
Historically turnarounds have been co-ordinated by banks as secured creditors, or by new investors who drive change from a purely financial perspective, oriented towards achieving single stakeholder objectives.  What gets measured, gets managed. 
Many stakeholders have compromised their credibility with employees by this pursuit of short-term objectives of repayment of their investments with little interest in a company’s survival.  
So who is really interested in the employees let alone securing their employment for the future?
The trades unions are still believed to be the true representatives of employees’ interests and while the relationship between management and union representatives has in some instances become polarised this is not helpful when trying to save a fragile business. It is rather like the surgeon fighting with his medical team when a patient’s life hangs in the balance on the operating table.
This new initiative to collaborate with trades unions is based on developing a mutual respect and understanding of each other’s objectives outside the constraints of a turnaround situation.
Union input can be valuable when considering the thorny problem of how to reduce staff costs, where hard choices might have to be made between cutting numbers, wages, hours, or benefits. Their involvement helps remove fear among staff by reassuring them that their interests have been taken into account when developing the turnaround plan.