HR

Reforming around the edges

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Yesterday saw the government propose slight changes to the Employment Tribunal service in the UK with the introduction of a £250 fee to lodge a case, refundable if you win but not if you lose.  Heralded by Chancellor George Osborne as,

“….ending the one way bet against small businesses”

There is some sense in the intention behind the proposals.   Throughout my career I’ve seen a number of employees and ex-employees lodge Tribunal claims when there was little if any merit in them.  In some cases, there was simply two “views” of the events that took place and in these cases I would find it hard to see any way in which you could eradicate the proceedings.  If an employee feels aggrieved then they feel aggrieved, a £250 fee will hardly change their behaviour and the rights and wrongs of the events need to be assessed by an independent third-party. ACAS have often played a valuable part in these proceeding in the past.

On the other hand, however, a number of complaints that I have seen in the past that can only be described as vexatious. It brings to mind the conversation that was had with a “legal advisor” to an employee who during a disciplinary investigation had gone onto long-term sick leave.  The advisor approached us in a very aggressive manner and said that they had a case for unfair dismissal and that we would need to settle RIGHT NOW.  This of course led us to point out (calmly) that,

  1. There hadn’t been a dismissal
  2. As we hadn’t concluded the investigation, we couldn’t know whether it would lead to dismissal, and
  3. Even if it did, unless he was Mystic Meg it would be hard to tell whether that dismissal was unfair (given points 1 and 2 above)

But we’re experienced HR professionals and new a line when we saw one.  But, for me, this highlights a bigger area that needs to be tackled if we are going to get a sensible even-handed approach to employment relations: shoddy legal practice and shady employment lawyers.  The individual in this case was working for a charitable organisation that received Lottery funding in order to operate, the website at the time boasted about how much money he had made for various clients (some of which I’m sure were deserved).

As a company, in such circumstances you’re left with a choice.  If the individual proceeds then you need to engage lawyers or spend a lot of time working on the case yourself.  This incurs either direct cost or indirect through time, cost and time that many organisations just don’t need to incur.  So the natural inclination in many cases is to get the cheque book out and settle. Job done.  Everyone is a winner…..almost.

If the Government really wants to tackle the problem of vexatious claims then it needs to tackle the legal advisors that pursue them.  They are the people who can change and challenge the compensation culture, but of course it is a really hard thing to tackle.  People have the right to legal support and whilst there are many reputable legal advisors out there, how do you sort the wheat from the chaff? The bullying, threatening, inappropriate behaviour of a few, who know that the chance of winning is slim, but know that if they push employers enough, it becomes financially impractical to defend.

The whole thing is a bit of a mess, there are far too many Tribunal cases taking place and far too many claims being made that never reach Tribunal because the cases have been settled beforehand.  Nothing, sadly, is going to change soon and these proposals won’t make much of a difference. What is really needed is a review of the whole tribunal system and the way in which employees are represented.  Until that time, just expect £250 to be added to the demands for settlement.

Business will bear the cost. Again.

How little are you worth? Pay, the economy and a living wage

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It is very rare that I hear something on the radio in the morning that makes my blood boil. Mainly because it is normally so early that I’m still half asleep and more interested on getting to the train on time than getting aggrieved at an inanimate object.  I made an exception this morning to the views being expressed by Mark Littlewood from the Institute of Economic Affairs on the National Minimum Wage.

The argument goes, and I should add that it isn’t only Mr. Littlewood that makes this argument; the minimum wage is stifling job creation. Put simply if it was lowered then people would hire more, there are bosses out there who have work that needs doing but don’t think it is worth £6.08 per hour to get it done.  It is, in his mind and many others, a simple economic argument: business will pay the least for labour that it can.  He even went on in the interview to connect the level of the minimum wage with the youth unemployment figures.

The argument is infuriating in its simplicity and appeal. It is also completely facile and ill-conceived.

So what is the problem with this?

Before we deal with the moral arguments (which are a matter of opinion) let us have a look at the more practical business arguments.  First the argument assumes a homogeneity of skills and ability, that labour is universally transferable therefore the only market determinant is price. And of course this just isn’t true.  There isn’t one labour market, there are several interlinking labour markets and massive differentials in skills and abilities.  Companies compete with one another for labour and that is why there are wage differentials.  John Lewis will pay vastly different wage rates to the likes of Argos for example, but they are both employing retail workers.  If businesses only employed at the lowest possible level, then this simply wouldn’t happen, they would all pay at the £6.08 level.

Next let us look at the youth unemployment argument.  Unless I am massively mistaken and there has been emergency legislation over night, the 16-17 year old rate and the 18-20 year old rate of the National Minimum wage are lower (at £3.68 and £4.98). So IF businesses have all of these jobs that need doing but don’t think that they are worth £6.08 an hour and IF the labour market is purely financially driven, then surely we should be seeing unemployment in these age groups dropping? Of course a flick through the recent unemployment statistics shows that not to be the case.  Tuition fees, education and skills gaps? No. The reason these guys are unemployed is the adult  national minimum wage rate being set too high.

I worked in the business services sector before the National Minimum Wage.  We employed a lot of people in very labour intensive low skilled roles for a variety of clients from big private sector names to government departments.  I can tell you that the hourly rates that were paid by some of these businesses were shocking (less than a pound an hour in some cases).  And this is where we come to the root of Littlewood’s argument, because in this labour market there is a homogeneity of skills and transferability of labour and very often there is greater supply than demand.  This is where wage rates can be pushed down.

But this is also exactly why the National Minimum Wage was introduced back in 1999, to protect the most vulnerable and to afford everyone the right to a living wage.  We’re talking about £6 per hour here – for a forty hour week that would equate to less than £12,500 before tax and National Insurance. Does that sound too much to pay someone to clean your floors, to pick your fruit, to bring you your Caramel Macchiato?

We are living in difficult times, every time we switch on the television, turn on the radio, open a newspaper or flip the cover on our iPad, there are forecasts of doom and gloom. And in these times there are people who will push ideological messages under the cover of economic messages. Littlewood has his views and I have mine, that is the wonderful thing about a democracy. But when you hear people talking about the removal of this right or that right, the reform of this or that and basing it on an economic imperative, take a moment to look under the surface of the argument and examine whether it really is as simple as it seems, or whether there is something else lurking within.

UPDATE: In the UK, you can now listen to the original interview here (the interview starts at 28m 15s in).

Introvert HR

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I’m not a huge fan of personality assessments.  Whether that harps back to my early days as a psychology student and lecturer, or an understandable fatigue through my career in HR, I don’t know.  It isn’t that I think that they’re entirely worthless, just that I think for those that are self-aware they add little new and for those that aren’t, there are multiple reasons to disregard any potential insight.

But I digress.  Earlier this week I received some feedback after completing the Dimensions Personality Assessment from Talent Q.  I won’t dwell on the actual tool, because for this post it is neither here nor there.  The fact is that in the large part it was information that I was pretty well aware of.  There was one aspect, however, that made me think more about myself and my career…and whilst it wasn’t new to me, it was highlighted in technicolour (which reluctantly I accept must show some value to the tool and the process!).

You see, I’m an introvert.  Not in the Myers Briggs sense – drawing my energy from within. But as the Dimensions profile terms it, “Socially Confident” or more precisely….socially “unconfident”.  Now it isn’t as bad as it seems….I don’t cry in the corner….in fact I have a strong sense of self belief, but my work based exhibitionist tendencies aren’t at the fore (does that make it sound more intellectual?).

And, what’s more,  I don’t think I’m alone in the profession.

So much of the work of HR is done in the shadows.  I’m sure that there are people out there reading this thinking, “How can a ‘people person’ not be……a people person” but it isn’t as simple as that.  People like me build relationships based on one to one individual contact, not on standing on stage.  We build trust because people know that we will keep our counsel and through that we develop influence.  We are quite happy to work with others and for them to take the credit, if we get the right result for the organisation.  We don’t need to be the centre of attention and we don’t think we should be the centre of attention.

Personally I’d rather been the oil in the cogs than the badge on the front of the motor.

The downside of course is sometimes that we can struggle to get our voices heard.  In a world where the loudest can be seen as the brightest and most relevant, the introverts amongst us need to develop the skills and the confidence throughout our careers to hold our own and demonstrate our capabilities.  As always there is the ying and the yang, the light and the dark, the good and the…..well ok maybe the analogy stops there…..nonetheless, hopefully you get the point?

And that point is that we shouldn’t be afraid to make our views heard (read my post on Unconscious Immunity) but at the same time we shouldn’t be afraid to make our voices heard in OUR way.  Diverse organisations are the best organisations.  We need the extroverts and the introverts, the talkers and the reflectors, the speakers and the listeners.

So if you’re like me and your preference isn’t to be the centre of attention, then be the wise counsel, be the trusted advisor, be the critical friend.  But don’t be afraid to be you and don’t be afraid to speak up. Your organisation needs you to do so.

It’s your money I’m after baby

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So most of us go to work because we need the money.  We can put lots of wonderfully worded, good intentioned arguments together about how money is not the motivator, but let’s be honest job satisfaction doesn’t cut it when it comes to paying the mortgage.  We may choose one job or one type of work because we prefer it and trade-off some money, but essentially we are all there because we have something that we need to pay; food, shelter, energy bills, addiction to Coco Pops etc.

Which is why pay is such a sensitive issue within organisations.  Ask any compensation related questions in a survey and you will get significantly lower results than for environment or leadership for example.  I’ve worked in organisations with very defined pay structures, I’ve worked in organisations with broad pay bands and I’ve worked in organisations where there was little if any structure at all.  And I’ve heard the dissatisfaction from employees in each different scenario.

But there are two specific things that are on my mind at the moment, which I think are interrelated: negotiating salary increases on internal moves and counter offering to defend against poaching. Both are event-based situations that occur outside of the normal salary management process and require both a strategic and tactical approach, because invariably they also involve your organisational talent.

I know that decisions in either case will depend on a number of factors, the employee’s current salary, their “demands”, internal comparators, affordability etc. However, those are the mechanisms, I’m interested more in the moral/emotional arguments that are expressed in these circumstances. Is it ok to negotiate a bigger increase when you are promoted internally or should you just get what you’re given? Is it right to counter offer or should you accept that people will leave and move on?

I’ve worked in cultures where if you were being offered a promotion and you tried to argue for more money it would be seen as a black mark on your career.  You were expected to answer the call of duty and THEN get rewarded when you delivered (although funnily enough, that was always after the next milestone….). But I know in other organisations it is run of the mill stuff.  Similarly, I know organisations that see resignations as the quick route to ex-communication, with no thought for trying to retain people, and others that will fight tooth and nail for their “talent” regardless of whether they are really…..talented.

So, more questions than answers I guess. Am I making too much of this and getting confused? I know the theory, but does anyone really operate like that or are we all in the quagmire of uncertainty when it comes to pay and talent.  Is it fair game for employees to use their skills to negotiate more if they can? After all they need to feed their families and over the past few years we have hardly done much as organisations to bolster the psychological contract.

Do we need to accept as employers that this is fair game? Work is part of a transaction for money and any opportunity that arises to improve your lot, you’re in your right to take.