Employers voice fear about abolition of the default retirement ageThe UK Government's review of the UK's default retirement age (DRA) is now anticipated to result in its abolition rather than an increase. Harriet Harman has voiced her support for abolition and yesterday The Equality Commission backed Ms Harman stating that, in its view, the DRA is obsolete and discriminatory. However, abolition is unpopular with businesses, with 70 per cent of employers recently surveyed by law firm Davies Arnold Cooper in opposition. In contrast, opinion was almost equally divided when asked about support for an increased DRA - 45 per cent in favour and 55 per cent against.
"The message from UK businesses is that abolition of the DRA concerns them. They are worried that the implications haven't been properly considered," said Wendy Trehy, partner and employment law specialist at Davies Arnold Cooper.
Employers expressed a number of concerns – many respondents were concerned about the potential performance of employees past 65 and what they would need to do in order to manage this. A further concern was that without a DRA,
employers will have to put their older employees through a formal performance review procedure and ultimately terminate their employment on grounds of poor performance or capability, which would mark a sour end to the employment relationship. Employers are also concerned about the implications for workforce planning and the impact on development and promotion opportunities.
The survey found that almost 85% of businesses currently use the DRA as their contractual retirement age. Employers with a lower retirement age primarily do so for health and safety reasons, but interestingly a small number already have no retirement age. The majority of employers have received requests from employees to work beyond their contractual retirement age and have approved the majority of those requests. Only 12 per cent have refused all requests while most have approved all or most of the requests received. In the vast majority of cases, the reasons given by employees for requesting to work on were because they still enjoyed their job (79 per cent) and for financial reasons (75 per cent) - reasons that mirror the arguments put forward both by Ms Harman and the Equality Commission.
"The responses also show that many employees beyond the age of 65 retain the desire to work and can provide a valuable contribution in doing so," said Trehy. "However, while many employers recognise the need for change and accept that the DRA is out of date, many are concerned that abolition is a step too far and will have negative consequences for both them and their workforce."
Increase in employee confidence in the fourth quarter 2009 UK employee confidence increased 2.6 percent in the fourth quarter 2009 and showed an increase of 5.3 per cent since the first quarter, according to a quarterly measure of worker opinions from Kenexa, a global provider of business solutions for human resources.
Employee confidence has been found to relate to multiple economic and business performance outcomes at the individual, organisational, industry and country levels as well as being predictive of consumer confidence.
A high level of employee confidence is achieved when employees perceive their organisation as being effectively managed and competitively positioned, and believe they have a promising future with their organisation, as well as job security and skills that are attractive to other employers. Employee confidence influences individual behaviour and has implications for organisational performance and economic conditions.
Kenexa's quarterly study, which measures the degree of confidence employees have in their employers' marketplace competiveness and their own careers, involves over 15,500 employees in 12 countries (Brazil, Canada, China, France, Germany, India, Italy, Japan, Russia, Spain, the UK and the United States).
In December 2009, the global employee confidence index score was 98.0, a very slight improvement from the third quarter (97.9). Brazil (107.5), China (105.6) and India (101.3) reported the highest levels of employee confidence, while France (94.9), Japan (94.0) and Spain (92.4) reported the lowest levels. The UK's employee confidence index score was 99.8 (an increase from 97.2 in the third quarter).
For the year ending 31 December 2009, the 12 largest economies reported an increase in employee confidence index scores, with the exception of Japan, which reported a slight decrease for the year. The global employee confidence index score for the fourth quarter of 2009 increased approximately 4 points, from 93.8 in the first quarter. Countries that reported the most improvement in employee confidence index scores throughout 2009 were China (15.8 point increase), Italy (8.1) and Brazil (7.1).
Anne Herman, research consultant at the Kenexa Research Institute, said: "Employee confidence fluctuated throughout 2009, with the majority of the countries reporting both increases and decreases. India and China were the only two surveyed countries that had an increase in scores, quarter over quarter."
She continued: "We enter 2010 on a positive note. Our studies have linked employee confidence to higher country-level GDP and stronger organisation performance, among other metrics. Therefore, this indicates that as employee confidence increases, GDP and organisation performance should both improve, indicating that we appear to be in a state of resurgence."
HR gets engaged for the upturn
Human resources director survey discovers organisations’ priorities for the next 12 months. Improving employee engagement will be the top priority for HR directors in 2010, according to a recent survey carried out by HR software and services provider, NorthgateArinso.
Almost two-thirds (59 per cent) of HR directors questioned picked out employee engagement as key for their business over the next year, suggesting it will play a major part in driving businesses out of the recession.
“Many directors will want to prevent talent leaving the business for other opportunities as confidence returns to the job market,” said Steve Foster, manager, business consulting at NorthgateArinso. “We predict there will be an increased emphasis on employee interaction to help minimise the numbers of resignations.”
Return on investment was voted the second most important in 2010 by 23 per cent of HR directors. “As cost is now under more scrutiny, and projects more difficult to get approved, the business case, or ROI, for any HR project has to be clear,” added Foster.
Improved business intelligence was highlighted as the third priority, according to 16 per cent of respondents. NorthgateArinso believes this will involve HR departments practicing data mining - making the best possible use of information they possess about current employees to predict trends and improve business practice.
450 replies were gathered from HR directors from across the UK in order to determine the industry’s priorities for 2010. “Employee engagement is something that is going to be vitally important as HR departments look to retain key staff and avoid loosing talent they have invested in. As we approach the upturn, HR departments will demand information at their fingertips, to support other functions within the company in the most effective manner,” concluded Foster.
One in three UK workers would leave their employer for a new job if they could
A third of UK employees (33%) say they have not felt valued by their employer during the recession and would leave for another job if they could, found a poll of around 950 workers commissioned by PricewaterhouseCoopers LLP (PwC). Of those respondents who said their employer had shown appreciation for them in the downturn, 41% said they had no plans to leave as a consequence of this loyalty while just 23% said they would consider leaving regardless. Only 7% of respondents said they did not understand how their role fits within the big picture of the organisation they work for so lack of engagement seems more strongly linked to feeling appreciated than a lack of belonging.
It is resolution season and as a new decade of work begins and employees set about making career decisions, organisations must resolve to meet their employees’ expectations and needs or risk losing them to a competitor when the job market picks up, according to PwC.
Michael Rendell, partner and leader, human resource services, PricewaterhouseCoopers LLP, commented: "Workers’ ambitions to find new roles could be good news in terms of creating movement and opportunities in a rather stagnant labour market and within companies - organisations will need to strike a balance between enjoying the reduction in employment costs that attrition can bring with the need to avoid overstretching existing staff.
“New Year is clearly a popular time for people to make important decisions. Rather than losing their best people as individuals resolve to make changes to further their careers, organisations need to articulate the internal options available to top performers and remind workers why they chose to work for their employer in the first place – be that a competitive salary, interesting work or operating with values that match their own.
“Some big employer brands fell down at the end of the ‘noughties’ and the impact long-term of people decisions taken during the downturn is now being felt. The ways people are recruited, rewarded, retained, incentivised, trained and retired over the next few years will determine the employers of choice for the new decade and beyond.”
Recent research from PwC also found that more employees would value a free MP3 player, digital camera or similar technology gift (80%) from their boss than would appreciate being ‘fast-tracked’ for promotion (67%). Cash bonuses, gift vouchers and extra annual leave scored highest - with 90%, 89% and 89% of respondents respectively saying they would value these. Extra time off to do charity work was the least favoured non-work reward with just under half valuing this option (49%).
While being fast-tracked for promotion scored below many of the options given, an encouraging two-thirds (67%) of workers would still appreciate this. Additionally, more than one in three (37%) would value a promotion without a pay rise, also known as a ‘no-motion’. And, at the end of a tough year, the majority of workers would still appreciate a work-sponsored drink or lunch with their colleagues (62%).
Jon Terry, partner and head of reward, PricewaterhouseCoopers LLP, commented: “The way UK businesses allocate the millions of pounds they spend on rewarding their employees is largely discretionary and, while not everyone would opt for a MP3 player over getting closer to promotion, the employers that get the best value from their spend are those that align reward with individuals’ wants and needs and the behaviours they want to encourage. With bonus pools shrinking and many workers’ wages frozen, employers need to find lower-cost, tailored ways of showing their staff that good performance is always appreciated. One-off gifts in reward for particularly successful projects work very well if a pay rise is not an option, particularly if employers are flexible in terms of what they offer the recipients.
“Rewarding employees in the right way requires careful workforce segmentation and quality management information, as a big part of this relies on knowing exactly who does what role and who the top performers are.
“Many workers are showing admirable focus on the long-term in their willingness to accept more responsibilities without a pay rise – and while covering their work may be challenging, giving employees time to gain different experiences and access to internal training is mutually beneficial and clearly valued by workers.”
Organisations worldwide focus on contingency planning
as Influenza A (H1N1) continues to spread
The recent emergence of Influenza A (H1N1) has posed a challenge to
employers worldwide, as the threat has not been isolated to a few
locations. Concerned that this virus is going to become more serious
and widespread, employers are taking actions to minimise their risk.
According to a new Mercer survey, employers worldwide are primarily
concerned about hygiene and prevention, health information and advice,
education and communication, and absence management with regard to
H1N1. While more than half (52%) have a local contingency plan that
applies to either some or all functions, only-one quarter (25%) of
companies have integrated contingency plans that apply to all functions
and all locations.
“Organisations around the world are facing the same concerns and issues
with regard to H1N1,” said Russell Robbins, MD, a principal and senior
clinical consultant for Mercer’s health and benefits consulting
business. “Contingency plans are crucial and should define how to
maximise health, safety and productivity in the workplace in the event
of a pandemic. Additionally, HR policies and benefits need to be
assessed as sources of information and communication with employees.”
Mercer’s survey, which includes responses from nearly 1,000
organisations worldwide, assesses what companies are doing to plan,
communicate and minimise their risk as H1N1 continues to spread. The
survey, which was conducted inOctober, includes responses from
employers located in the United States, Latin America, Canada, Asia
Pacific and Europe.
“Companies that do not have contingency plans in place should develop
them now as it will be too late when an epidemic or disaster strikes
later,” said Dr Robbins. “The primary objective should be to minimise
the risk for their workforce by avoiding unnecessary threats and
preparing for recovery should they be impacted.”
As companies worldwide look for ways to limit workforce risk as a
result of H1N1, the majority are implementing such workplace services
as distributing hand sanitizers (94%), implementing more frequent or
intensive office cleaning (64%) and providing educational sessions
(54%).
Organisations are also communicating what is expected of their
employees in case the company is affected by the H1N1 virus. Overall,
two-thirds (67%) of organisations globally have done so. Slightly more
organisations in Latin America (77%) and Asia (74%) have done so, most
likely due to more cases being detected earlier on in these regions. In
addition, the majority of companies worldwide who have communicated
with their employees regarding the H1N1 virus have provided information
on personal hygiene, such as washing hands and covering coughs (98%),
as well as flu and health care protocols (88%) that should be enforced.
Moreover, more than half (58%) of companies have addressed how to
access information about possible restrictions or quarantine
provisions.
According to Mercer’s survey, the majority of employers (95%) have
up-to-date contact information for their employees in the event of
illness, as well as up-to-date client information in order to notify
them in case of business interruption. However, only one-third of
organisations worldwide have issued guidance to their employees about
the message that should be given to clients and suppliers should the
business be affected by the spread of the virus.
Finally, more than one-third of organisations worldwide (37%) indicated
that they have met with medical and absence management vendors to
review absence duration and return to work guidelines for their
employees. Employers are less likely to have had discussions with their
vendors about customer service and medical management protocols, or
coordination between health and absent management vendors.
“Communications with vendors is just as important as with your
employees,” said Dr Robbins. “Employers can still be impacted even if
all of their employees are healthy but their supplier is unable to
provide goods or services due to H1N1 or a school closure requires
healthy employees to stay home to provide care to a family member.”
HR “does not expect enough of itself” says top HR think-tank
The HR profession does not expect enough of itself and at the same time
is not taken seriously enough by senior line management because it
“does not speak the language of business.” So says the Ochre House
Network think-tank which includes over 650 major employers such as GE,
IBM, NCR, PwC and Telefonica O2.
At its latest meeting the think-tank concluded that one of the reasons
that HR functions were still not playing a full part in the running of
their host organisations was an underlying lack of faith in their own
capabilities. This in turn often leads to them making their message too
complicated, alienating business managers.
“HR needs to embrace host organisations more effectively and one of the
most effective ways of doing this is by letting go of certain process
driven areas and allowing line managers to become quasi-HR
professionals themselves,” says Ochre House’s Helena Parry, who leads
the think-tank. “If it wants to become truly integrated within the
business it must push this through even if it leaves line managers
feeling that HR is abdicating from its responsibilities in the short
term.”
IT departments under strain to prove value: CIOs face battle to change perceptions of IT function at board levelRecruiters Badenoch & Clark today called on CIOs to face up to the key challenge facing the IT profession in the UK; the lack of faith in IT as a function to deliver real business benefits. It’s long been an issue for IT professionals everywhere, but it seems the need to provide true business and commercial impact has become of critical importance to the long term nature of the IT industry.
The issue was at the head of a debate in London, bringing together many of the UK’s top IT Directors and CIOs working in the public and private sectors. Many of the organisations represented at the event reported that, with such little representation and influence at board level, CIOs have a major challenge on their hands if they want to overturn negative perceptions of IT.
In today’s economic climate, the pressure on understanding and proving the value of IT is stronger than ever. CIOs are too often disconnected with the wider business, focussing entirely on the latest technology developments rather than linking those advances to the true needs of the organisation. Instead, delegates at the debate urged the wider industry to work more closely with all parts of the business to better understand how IT can help everyone deliver.
Delegates also agreed more needs to be done to gain the trust and ‘buy in’ from the board – something that can be achieved by building up a better track record of successful project delivery against time, budget and business objectives.
Matt Gascoigne, Associate Director at Badenoch and Clark, comments: “It’s something we hear of every day when we speak with our clients, but the intensity of the London debate truly brought the issue home.
“As business becomes more sophisticated and faster moving, organisations are identifying more and more areas where IT is needed to streamline business operations. Yet few IT departments have the right skills and level of experience to deliver these projects effectively or understand the business changes that go with them.
“It is an area where external resources such as an interim manger can make a big impact. They have the ability to come into an organisation, quickly get a good grasp of the key issues and clinically resolve the situation without becoming too isolated in any single silo within the organisation.
“IT as a function should not be afraid of implementing change that can help it better demonstrate its worth to an organisation. Only then can IT start to engage and collaborate more closely with the business.”
