Pay and benefits: Only 21% of employers used COLA for pay raises in 2015

COLA has been commonplace practice for a while now, but the title really sums it up.

No, I do not mean that 21% of employers used a sugary beverage to help them calculate their employee pay raises last year. I mean Cost of Living Adjustments of course…

You can download a report by PayScale on compensation best practices to find out more.

The adjustments to employee pay are based on the everyday costs of living such as housing, transportation and utilities that have gone up over the years.

The problem is that these costs do not consider the external value of the job in the market or the internal value that an employee brings to a business. And that is not all.

• In hindsight, the cost of living increases are simply too little too late – By that, I mean that by measuring and awarding COLA at the end of the year (which is when it is typically done) it is always a year behind. With prices upping and lowering more commonly than the sun, waiting for the cost of living to be calculated and then the COLA pay increase to come out is simply a waste of time.

• Everyone is rewarded the same – While this is an unintended outcome, it doesn’t change the simple fact that everyone in the business gets the same pay rise regardless of their actual performance. Performance related pay can be a much better practise for a businesses pay and benefits scheme.

• Cost of Labour – COLA does not take into account the cost of labour, which essentially means that even if the cost of living is low in a particular area, there may be a particularly high demand for a specific role, increasing the job roles market value. In other words, the cost of living is not aligned with the cost of labour.

So what is the answer?

Because the cost of living is calculated after the fact and it does not include the cost of labour or other “goods”, it is not the best pay and benefits scheme. A market-based pay structure and performance based pay increase could be a much better option for your business as a whole.

At Reality HR, we always take a bespoke approach to our HR advice, which includes our pay and benefits toolkit. In other words, we tailor a pay and benefits scheme to suit what your business needs.

To see the improvements you could make to your business with Reality HR on your side, give us a call on 01256 328 428 or fill out the form below to arrange a callback at your convenience.

 

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Recruitment technology – do we need HR people anymore?

The recurring worry of “technology will replace humans in the workplace” has been rearing its ugly head for quite some time, and recruitment is its most recent victim.

You can even find calculators now that will tell you how likely it is that your job will be replaced by technology, including one created by NPR, based on a study by the University of Oxford. Give it a try here!

A study, by the National Bureau of Economic Research, looked at the employment records of 300,000 low-skill workers in the service sector, across 15 companies. They found that workers chosen by a computer algorithm stayed in their role 15% longer than those chosen by human employees…The question is could this same algorithm be applied to recruitment agents or any other workforce?

This report didn’t go unnoticed. You can read more about it here.

My verdict? It is just as likely that my name is Sarah Connor and I am being pursued by a time travelling, homicidal, robot that looks like Arnold Swarzennegger…I know you’re thinking that I would think that. HR is my bag after all!

But it is more than that. Like with any statistical report, it is difficult to apply this one selection to an entire workforce. This report specifically looked at jobs with low retention rates for a start, where the average employee only stayed for 99 days.

Furthermore, they only looked at low-skill jobs and so the same cannot be said about whether computers can be used to recruit for more specialised roles. There is also nothing to suggest that computers are capable of considering a candidates happiness, motivation, productivity and overall cultural fit. In some roles, a cultural fit is more important than their years of experience for example.

Not to mention that there is no accounting for qualitative data which only a human can consider, for example, a personal recommendation or referral.

There are however some more basic but incredibly time-consuming jobs that can be done confidently by technology quicker and more efficiently than us mere humans, for example trawling through the talent pool or searching through CV’s and professional or social networks for candidates.

There is a lot of recruitment technology out there that can support humans in their attempts to find their perfect cultural fit. We use one such platform in our recruitment project management service, which you can read more about here.

You can read about it in more depth in our case study here.

For now, I can confidently say that although there are elements of recruitment that can be assisted with technology, recruiters and HR consultants alike are safe for now. Any company that relies on technology alone is taking a big risk.

If you want to find out what you could be achieving with Reality HR supporting your recruitment, give us a call on 01256 328 428 or fill out the form below to organise a callback at your convenience:

 

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from Reality HR Limited http://www.realityhr.co.uk/blog/recruitment-technology/

BV Dairy hits the magic 100!

24 February 2016

The management team at Dorset-based BV Dairy can now boast that their business employs 100 people following the support it has received over the last eight years from HR Consultancy, Reality HR.

Back in 2008 BV Dairy employed 60 staff, with the HR function being one of the director’s jobs.

However, to enable the firm to grow, it soon became obvious that the business needed a greater level of HR support. An internal resource was discussed, but was considered too expensive for the level of expertise required. BV Dairy therefore researched the HR consultancy market, looking for a partner who would see them as a significant customer ……Reality HR fitted the bill perfectly.

A Reality HR director carried out a full audit of BV Dairy’s general HR processes and HR administration, covering employment contracts, job specifications, terms and conditions of employment and the employee handbook.

Reality HR then helped to restructure the team leader function to support the higher throughput needed for business growth. It also trained staff in management and supervisory leadership skills, including motivation, recruitment, disciplinary action and appraisals.

And the results are that BV Dairy has retained a flat structure by training and developing its own talent and this has created a culture of loyalty and smart working. The whole operation of the dairy is running more efficiently and effectively with more structure, as well as defined processes and procedures in place.

Reality HR has become an integral part of the BV Dairy team with a director advising the board as and when required.

Jim Highnam, Managing Director at BV Dairy, commented: “When selecting an HR Consultancy, the last thing we wanted was someone who said ‘you can’t do this and you can’t do that’, which is what we had been accustomed to hearing from employment solicitors.  We were delighted to find in Reality HR a whole team of HR professionals who always respond with, ‘we can find a way of doing that’, and whose people are focused on commercially sound outcomes.”

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Tips and examples for giving feedback

Giving feedback is something we do all the time, even if we don’t realise it.

Sometimes it might be more obvious, in a formal setting like a 121 meeting. Other times we might not be aware that we are giving feedback at all through the way we approach and talk to people.

It should be seen and approached as a positive experience and learning opportunity so it’s very important to be mindful of how we go about giving feedback, whether consciously or unconsciously.

So how can you make sure feedback is effective?

• Feedback doesn’t have to be all doom and gloom – Make sure to highlight positives as well and recognise work that has been done well. Focussing on just the negatives will disengage and demotivate your team.
• Even though the above is important do not fall into the Feedback Sandwich trap – Starting and ending on a high with all the tricky stuff in the middle is confusing and can make people feel patronised. Being honest and straight forward with clear non-evasive comments. It will be received much better and will build trust.
• Don’t leave employees hanging – if you give them specific criticisms set some specific goals as well and then review it again in your next 121.

So it’s pretty simple, right?

Well no. If it was that simple, I wouldn’t be sitting here writing a blog about it! Even keeping the points above in mind, you still need to apply these effectively to real situations. Like they say, it is easier said than done.

So here are a few practical examples for you:

1. If an employee is struggling with their time management

Time management is difficult for most of us but sometimes it can become enough of an issue that you need to discuss it with an employee.

• A good way to approach it is to explain why it has become an issue – like what impacts their time management has had on other employees work for example.
• Then you can offer some useful tips – make it more relaxed by talking about how you personally deal with time management.

2. Tension between employees

It is not uncommon for there to be some tension between employees and the occasional rude comment to slip out. This is something that you need to address quickly before it becomes a bigger issue.

• Don’t finger point but ask for their version of events – This is really important because there are always two sides to every story but mainly because you are speaking to them and not the other person/ people involved. This needs to be explained clearly without assigning blame.
• After finding out what happened from their perspective – Explain how they could have handled it differently and more appropriately.
• Offer some advice for how they can resolve the issue by talking to the other employee and maybe suggest they go for coffee together for example.

3. A missed deadline

Don’t let it get to you, these things happen. But the key is making sure that you provide the correct support and advice so that it doesn’t happen again.

• Make sure they understand why deadlines are important – Explain why projects need to be delivered on time and find out what the specific reasons were for them not achieving the deadline.
• Go through how it will be better next time – Explain that you will ensure they have the tools they need to achieve the next deadline.
• Then you can offer your own ideas – Share how you make sure you achieve your own deadlines.

4. An employee seems disengaged

It’s important to make sure that all employees are engaged and happy at work, so if you spot some signs that this isn’t the case, you need to figure out what is wrong.

• Explain that you are concerned for them – You want to resolve the issue so just be honest and tell them how if makes you feel.
• Offer them some help – Think of a way to provide more support, for example by offering them a weekly 1-1 meeting.

Read our case study to see how we helped our client with their feedback here.

To find out about the improvements you could make to your business with Reality HR on your side then give us a call on 01256 328 428 for a free 15-minute phone consultation or fill out the form below to request a callback.

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Managing performance: Are your managers getting the feedback they need?

We shared a post not long ago about new joiners not getting appraisals in their first year of employment and its effects on managing performance.

Well, senior people need some love and honesty too, even if the thought is a little scary. For the sake of managing performance, it needs to become common place.

In many businesses, it is still considered taboo to tell managers exactly what we think but it is vital for managing performance. The last thing you want is people discussing managers behind their backs instead of providing direct constructive criticism as this will make them less emotionally intelligent and they may start to see themselves very differently to how they are actually perceived. You could end up with a Darth Vader in your business!

Ultimately, what all great leaders have in common is trust, and much of that trust is created through transparency. That’s a two-way process – you sharing with your people, and in return them sharing with you. You can find more tips about transparency here.

You may be familiar with something called 360 feedback. We tend to use this for clients that need help with managing performance. You can read a case study about this here.

Getting into the habit of using 360 feedback for your managers may involve some cultural changes but ultimately, it will benefit your business as a whole.

So what can you do to get honest 360 feedback?

• Remove the stigma – Make feedback part of your everyday company culture for both teams and their leaders. Discuss openly in a group setting to normalise the process
• Be prepared to hear feedback and act on it – Even if it comes from someone less experienced, all feedback is relevant. That might not be easy for your leaders, so provide a balanced assessment that highlights positives as well as rooms for improvements
• Ask for advice rather than feedback – other members of the team might find it easier to offer actionable advice rather than providing constructive criticisms
• Get someone else to gather the feedback for you – by outsourcing to a consultancy you can feel safe in the hands of someone with expertise in gathering 360 feedback and members of the team will also find it easier to open up and be honest with an independent third party

To find out the improvements you could make to your business with Reality HR on your side, give us a call on 01256 328 428 now or fill out the form below to organise a callback at your convenience:

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from Reality HR Limited http://www.realityhr.co.uk/blog/do-your-senior-people-get-the-feedback-they-need-to-improve-their-leadership/

Pay and Benefits: How employee perceptions of pay can affect company culture

Sometimes an employee may approach you and say that they feel underpaid.

The knee-jerk reaction might be to simply increase their salary but this is not always the best option.

Employee’s perceptions of pay are not always accurate and the truth of it is that although they might feel underpaid, there is a chance that they are not.

A survey from PayScale of 71,000 people found that:

• 64% of employees thought they were paid below market value when they were not
• 35% of employees paid above market value thought they are paid below

 

But even if employees only feel underpaid, it will still impact their job satisfaction, their engagement and can also lead to employees wanting to leave your business.

They might also have some strong feelings about overpay. On Twitter recently there was a trending hashtag called #FatCatTuesday. It quickly spread the message that by the first Tuesday of 2016, Britain’s top bosses would have made more money than an average worker can make in an entire year. This kind of topic hits a real nerve, especially after the 2008 economic crisis.

A CIPD survey performed in 2015, found that 71% of employees thought that the CEO of the business was paid too much and 59% were demotivated at work because of high-level CEO pay.

So what can you do?

Talk to them…It can be that simple! It may also be time to review your pay and benefits scheme. There are a few things you need to consider:

• Transparency needs to be planned out carefully – Make sure that the businesses are clearly aligned with your pay and benefits scheme
• Paying people more may not necessarily increase their performance – you need to consider a pay and benefits scheme that goes beyond financial rewards and considers the non-financial aspects as well
• Make sure that you craft your own unique approach – your pay and benefits scheme needs to fit with your company culture, values and aims
• Get support – if you don’t have your own in-house HR team that can help you develop a pay and benefits scheme to fit your needs, consider outsourcing. Find out more here.

To find out what improvements you could be making to your business with Reality HR on your side, give us a call right away on 01256 328 428 for a free fifteen-minute phone consultation. Or you can fill out the form below and organise a callback at your convenience.

 

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from Reality HR Limited http://www.realityhr.co.uk/blog/pay-and-benefits-how-employee-perceptions-of-pay-can-affect-company-culture/

Do you give your new joiners appraisals during their first year?

Apparently a fifth of new joiners didn’t receive an appraisal during their first year of employment.

Not only that but more than a third of managers say that they are ‘too busy’ to offer appraisals.

It is the time of year when managers are starting to think about the annual appraisal…or at least, they should be!

Many find this time full of apprehension…you never know what might come out of it. A Warwickshire police officer, for example, put under ‘Openness to Change’ that, “over the 19 years I have served as a policeman my police costume has changed many times and I have not grumbled once even though I miss my old jumper. PC Smith constantly moans about how tight his trousers are.”

But seriously, there are numbers to suggest that new joiners are not getting the support and feedback that they need.

Research released by Enterprise Study consisting of a survey of  2,168 full-time over 21-year-olds found that 19% didn’t get an appraisal in their first year.  43% of those who had received one needed to request it themselves and 27% had to wait for more than six months.

Why are managers’ not performing appraisals?

• 38% said they did not have enough time
• 35% believed their business was too small to require appraisals
• 19% said their work culture was informal and therefore, did not require appraisal

Shona Fletcher, the CEO of Enterprise Study commented on those key points saying that, “there’s never an excuse not to sit down with your employees and give them an appraisal – it’s a great way to boost staff morale, particularly when you’re giving praise where it’s due.”

Even if those three points may apply to your business it does not mean you have to miss out on the benefits of appraisals. You can get outsourced HR support to help you, for example with our performance appraisal toolkit.

You can read a case study about our toolkit here.

Why should you perform appraisals?

Appraisals can benefit the business and the manager as much as the employee.

Employees can:

• Find out how they’re doing
• Identify and work towards career development and goals
• Receive some recognition for their accomplishments
• Take responsibility for their own performance

Managers can:

• Build their own management skills
• Improve their relationships with the employees
• Improve morale
• Reward high performers
• Improve employee productivity

Benefits to the business:

• Improved overall productivity
• Reinforced business goals
• Stronger working relationships
• Retained talent

To find out what improvements you could make with Reality HR on your side call us now on 01256 328 428 or fill out the form below to organise a callback at your convenience:

 

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