Internal Affairs for Adactus500 Scrutiny Panel Staff Retention: Final Report 15 September 2015
Internal Affairs for Adactus500 Scrutiny Panel
Scrutiny Review: Staff Retention Final Report The Project Key risk from the Risk Register: Inability to retain good staff. The Risk Register reflects an assessment of key risks facing the organisation which could impact on operational capacity, effective service delivery, and the ability to maintain or improve performance.
Background The inability to retain staff is a business risk; staff turnover can have a negative impact on the business, especially if those leaving are key to its success and continuity. In human resource terms, employee or staff turnover is a measure of how long an employee stays with the company and how often they have to be replaced. Staff retention is an effort to target valuable, contributing employees in remaining with the company. Employee retention policies are aimed at addressing the various needs of employees to enhance their job satisfaction and reduce the substantial costs involved in recruiting and training new staff. The aim is to decrease employee turnover, thereby decreasing training costs, recruitment costs, and loss of talent and organisational knowledge.
What we wanted to know • • •
Does the Group have in place a structured staff management programme? Is the Group effective in minimising the risk of the inability to retain good staff? What are the factors affecting staff turnover?
What we looked at • • •
The effectiveness of controls to retain good staff (reward and incentive schemes). How information gathered through exit interviews is put to use in recruiting, selecting and retaining employees. The arrangements for recruiting/providing cover when an employee leaves.
What we found The Group employs a human resources team to provide managers with support in employment administration and advice, recruitment of new staff, employee issues, and staff training. The Group has six controls in place in order to minimise staff turnover: 1. Staff Retention Scheme a. Financial incentives Shehnaz Akhtar
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The first aspect of retaining employees involves providing equitable payment and benefits. The HR department plays a part in ensuring employee retention by ensuring pay is commensurate with salaries available in other housing associations and organisations. The start salary for a new employee will be based on their educational background, level of work experience, and skills. No Adactus employee (apart from apprentices) is paid below the ‘Living wage’. The 2015 Living Wage is £7.85 per hour (£9.15 for London) and is 21% higher than the national minimum wage of £6.50 per hour. It is an independent calculation by the Living Wage Foundation which considers what income is needed to provide an adequate standard of living reflecting the real cost of living and rewarding a hard day’s work with a fair day’s pay. The Group operates a system of annual salary increments. Increments are awarded on performance, which is determined by the line manager and/or the performance matrix score for some staff for example, front line staff in Asset Management.
b. Financial rewards • A one-off payment of £150 and an invitation to lunch with the Chief Executive is made to employees who achieve twenty five years continuous employment with the Group. Two employees received this reward in the last financial year. Twenty-seven employees have worked for the Group for twenty-five years or more. c. Bonus structure • The Group does not operate a specific scheme where employees can earn an annual bonus if they meet pre-specified performance goals. However, a Christmas goodwill gesture payment is paid to employees in December on achievement of Group Business Plan objectives. The amount of payment is determined by the employee’s length of service and contractual hours. d. Key Staff • A review could not be carried out on how ‘key staff’ are identified as this is classified as confidential information. 2. Terms and Conditions: a. Work/Life Balance These benefits are designed to help staff to maintain a healthy work/life balance: o Flexi-time (flexible working hours) - allowing employees to work earlier in the day or later in the day (but still covering core hours of 10-12am and 2-4pm) - one hundred and eighty-four staff work full time flexi hours. o Compressed hours - allowing an employee to work their full number of hours in four days - sixty employees work compressed hours (excluding Group Directors).
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o Part time – helps employees to balance work and life priorities for example, collecting children from school or caring for a relative – sixty-eight employees work part time. o Job Share - Having two qualified employees share the duties and tasks of one position. There is one recorded job share (in Lettings). o Homeworking - allowing an employee to work from their home location instead of work premises. A small number of employees work from home for one or two days per week depending on their duties for that particular week. Employees are encouraged to attend work at one of the three main offices rather than working from home on a regular or basis. b. Annual leave • Employees (salaried and working a five day week) are entitled to twenty-four days annual leave per annum plus bank holidays, and three concessionary days for the Christmas period. After two years employment employees are awarded one extra day’s leave up to a maximum of five service days. • Adactus operates a flexible holiday scheme whereby employees can buy or sell one week of their holiday entitlement on an annual basis in March. Ninety-five requests to buy and sell annual leave were actioned in the last financial year (sixty-nine employees bought leave and twenty-six sold). Details of why staff buy and sell leave are not recorded. c. Sickness leave • Salaried employees receive two weeks full pay during their probationary period and thirteen weeks full pay after they have completed it. • If salaried employees are absent from work for more than thirteen weeks due to sickness, they can make a claim under the Permanent Health Insurance. If a claim is accepted, employees can receive up to half pay for the remainder of the time they are absent. • Employees without sickness leave in the last financial year are rewarded with one extra day’s holiday in their entitlement for the following year. Two hundred and thirty employees (40%) were awarded an extra day’s annual leave in April 2015. • A recent survey by the Office for National Statistics shows that nationally the highest levels of sickness are amongst those in the “Caring/health” sector however, within Adactus the sickness rates for Sheltered & Supported are below the company average of 4.4 days • A review of sickness levels by department revealed that Asset Management and Corporate Services had the highest level of sickness. Within Asset Management the section with the highest sickness was responsive DLO. • While an employee is on sickness leave then generally cover is provided by colleagues, and managers (depending on the role). d. Company Car
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Employees who are above a certain pay scale level qualify for a company car or cash equivalent for example, directors and senior managers. As at July 2015 forty employees were entitled to a company car, of those twenty-one chose to have the cash equivalent and nineteen opted for a company car.
e. Essential Car User Allowance • Employees whose role requires them to use their own vehicle for business purposes for example, to travel from one place of work to another, are entitled to an essential car user allowance as per the rates set by Inland Revenue. As at July 2015 eighty-five employees were entitled to this allowance. f. Maternity/paternity leave • Adactus pays both maternity and paternity leave. Thirteen employees had taken maternity leave and thirteen had taken paternity leave in the last financial year. The total cost of maternity leave was £137,958 and paternity leave was £14,795. g. Pension/Life assurance • Adactus operates a Defined Contribution pension scheme whereby employees can contribute a minimum of three percent of their salary into a Pension Fund and Adactus will also contribute three percent. h. Career Break (Sabbatical) • Employees have the opportunity to take a career break (without pay) after a minimum of two years service. This can be for a minimum of three months to a maximum of twelve. Two employees had taken a career break in the last financial year; one had three months and the other twelve months. i. Health and wellbeing: • A free eye test is offered to all employees who use a computer, a hand held personal digital assistance device (PDA), or drive a vehicle as part of their role. A recent change in law (Cassie’s law) gives the Police powers to revoke a driving license through the DVLA where they feel the safety of others is at risk (after taking a roadside eye test). Although it is mandatory for drivers to take an eye test, the onus is on the employee to complete it and provide the necessary information to HR. Fifteen employees had claimed the cost of an eye test in the last financial year totalling £289.45. Staff had been reminded to take an eye test in June 2015. • Employees are also entitled to claim a contribution of up to £25 towards the purchase of spectacles or contact lenses. Twenty-three employees claimed this contribution in the last financial year totalling £575.00. (A number of opticians offer a free eye test to the public hence the difference in the number of employees (fifteen) claiming a contribution towards spectacles/contact lenses compared to those (twenty-three) requesting the cost of an eye test).
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Employees have access to a 24 hour helpline (Employee Assistance Program (EAP)) which offers health, medical and legal advice as well as counselling. Twenty-nine employees used this service in the last financial year. A free annual healthcare check facility is provided for employees. The assessment includes a diabetes, cholesterol, and blood pressure check. At the end of the assessment employees receive a report with medical information based on the results of the tests and guidance on how to improve their health if necessary. Two hundred and ten employees received a health check in the last financial year. Employees have access to ‘Best Doctors’ who can provide independent and objective advice and recommendations. Best Doctors is a suite of services that enables them to draw on the knowledge of medical experts to ensure the individual has the right diagnosis, treatment and care. They can help: o Confirm a diagnosis or treatment plan through a review of medical records. o Get expert answers to questions about a medical condition. o Get answers to basic medical questions from UK General Practitioners The Group provides free gym facilities at Turner House, Chorley, and the Miles Platting offices to encourage the well being of employees. A Healthy Living Welfare Fund of £3,000 is set up for employees who can apply for a contribution (up to a maximum of £100) towards regular and exercise based activities for example, swimming. A ‘Simply Health’ cash plan provides employees with access to affordable private healthcare so they can claim for dental, optician, and health treatment. Contributions to the scheme are paid via salary.
j. Flexible benefits • Childcare vouchers are a Government supported scheme designed to make childcare more affordable for working parents. Adactus provides childcare vouchers through salary sacrifice where employees can receive vouchers up to a maximum of £243 a month instead of part of their salary. As at July 2015 thirty-eight members of staff were in receipt of childcare vouchers. • A cycle to work scheme is offered to all employees and works in the same way as childcare vouchers. Employees can sacrifice an amount of their salary to pay for a bicycle over twelve months. Six employees purchased a bicycle through this scheme in the last financial year. • A free car parking facility is available at all offices however, at Turner House there are limited spaces (some spaces are designated to employees based on their role) therefore additional parking spaces are provided at Leigh Miners. • Employees who use their own vehicle for business purposes and receive an Essential Car User allowance are entitled to receive free RAC cover for their vehicle. • The Group does not operate a salary sacrifice scheme for employees to get a car loan. • The Group operates a discount scheme called ‘Adactus Pies’ (Perks in Employment) which offers a wide variety of discounts and benefits ranging from cash back on holidays to weekly Shehnaz Akhtar
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shopping. Employees must register online to become a member of Adactus Pies in order to take advantages of the benefits on offer for example, a saving of 8.5% in store and online at M&S, 15% at Evans Cycles, 10% on a reloadable card at Boots, and 5% on a reloadable card at Morrison’s and Sainsbury’s. As at August 2015, members of Adactus Pies had saved a total £21,430 (since August 2014) with over eight hundred live offers on the site. The Group does not operate a savings scheme for employees to set aside a sum of money from their salary each month. Employees are permitted to take limited paid leave to participate in voluntary activities for example, school governor, magistrate, or fostering duties). Employees are allowed to take time off to attend jury service. Free refreshments are available at all offices. A Christmas party is held for all employees; this offers them the opportunity to interact with colleagues from other departments. An annual ‘Away Day’ is held for employees where senior management provides an update on business progress and employees are presented with awards nominated by fellow employees. Four hundred and seventy-six employees attended the away day in 2014. In addition to the above, staff who are not office based have use of a company vehicle and can opt to use the vehicle for personal use.
3. Training and Development The Group offers a number of training initiatives as part of it's commitment towards developing staff: a. Training programme • Role-specific skills are covered in induction for all new starters and ongoing training needs are met through a range of in-house and external courses. The HR team produces a quarterly training calendar listing the courses available for all employees such as: o Word and Excel o Health & Safety o Equality & Diversity o Management training for managers • Employees are provided with necessary tools and equipment commensurate with their role. • Employees have the opportunity to ‘work shadow’ other employees. Work shadowing is where an employee from one area of the organisation has the opportunity to work alongside and gain experience of the role of another employee and gain an insight into that particular work area (with the approval of respective managers). Work shadowing is usually arranged between departments therefore HR does not hold information on its success or outcome. A review revealed that two employees had work shadowed staff in Internal Affairs, inter-team job shadowing had been carried out within the Contact Centre, and some HR staff had work shadowed in the Contact Centre, Voids & Lettings, Asset Management, Finance, and Marketing. Shehnaz Akhtar
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b. Personal development All employees meet with their manager annually to discuss their personal development plans for the forthcoming year and to identify any training needs. Managers support employees in setting goals and personal objectives, and to provide growth opportunities through development programmes. Employees also have the opportunity to discuss career aspirations, or anything else that may have an impact on their performance at work. Adactus no longer has the Investors in People accreditation; instead, the Group supports employees to achieve professional qualifications specific to their role which will benefit the employee and the business. The following forms of training are considered:o Short courses and seminars o Day release study o Distance/Open learning o College/University Courses • Employees are entitled to paid time off to sit examinations related to the course of study for which they have been granted day release and/or financial support. • Six employees undertook studies for qualifications in the last financial year for example, Inspection and Testing Certificate, BTEC Advanced Award in Neighbourhood Nuisance and ASB, NEBOSH NCC, and National General Certificate in Health & Safety. 4. Staff Promotion •
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When a position becomes vacant, an email is circulated to all employees informing them of the vacancy and the opportunity to express an interest. Promotions are generally from within the company unless a job requires skills that are not available internally. Whether there is time for an internal candidate to get up-to-speed on the skills needed also plays a role in whether an internal candidate is considered for a promotion. The annual appraisal provides employees with an opportunity to discuss their career aspirations. HR advised that twenty-nine employees had received promotions within the last twelve months from a variety of roles and departments across the organisation.
5. Expansion a. Recruitment • The advertising of job vacancies depends on the role; they are usually advertised on-line, at the job centre, on Adactus’ website, and in a variety of publications. • HR advised that all interviewees are informed of the interview outcome. The interviewing manager determines the method of communication; generally it is like for like for example, email for online applications, by post for paper applications, while some are contacted by telephone. • There is no standard process for offering internal only opportunities, the decision to advertise a job internal only, or external only, or both rests with the departmental head based on the department’s requirements and the job market at the time. Shehnaz Akhtar
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The recruitment process takes on average six weeks from receipt of notice from the leaving employee to an offer of employment however, this varies depending on the role. A review of four recent vacancies revealed that although the positions had not been difficult to recruit, in two cases the employees had resigned within a few months (due to personal reasons and not the role itself). While both positions were vacant cover was provided by agency staff and an external contractor to avoid disruption to service. Roles that had been difficult to recruit in the past include Night Workers. These vacancies had previously been advertised in the normal recruitment websites used by Adactus. In July 2015 they were advertised in other websites with a wider reach and this produced favourable results; thirty-five applications were received.
b. Secondment • Employees have the opportunity to request a secondment when a short term vacancy arises. A secondment is where an employee temporarily transfers to another job for a defined period of time for a specific purpose for example, to provide cover for maternity leave. Consideration is given to employees who have appropriate skills, knowledge and experience to undertake particular tasks. Employees without experience will also be considered (with a view to training them) if they have the necessary skills however, this depends on the role. On completion of the secondment the employee will normally return to their original post. Nine secondments had taken place within the last twelve months. c. Apprenticeships • An apprenticeship is a way of learning job specific skills while earning a wage at the same time. They often suit young people who do not want to go into full-time further or higher education but still want to gain work related nationally recognised qualifications. • From October 2015 the national minimum wage rate for apprentices (aged 16 to 18, and those aged 19 or over in their first year) will increase from £2.73 to £3.30 per hour). At Adactus the hourly rates range between £4.67 and £6.73. • Apprentices are appointed for specific roles for example, a trade within Asset Management, or office based within a department. Since the apprenticeship programme was started in 2011 Adactus has employed over forty apprentices. Some apprentices had been successful in securing a permanent or temporary employment with Adactus on completion of their apprenticeship. d. Graduates programme • Graduate programmes are training schemes created by companies to encourage graduates to come and work for them. They enable new recruits to settle quickly into a professional work environment, receive relevant skills development and get hands on experience, either working in a specific role within a team, or through working in different areas of the organisation over the duration of the programme.
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Graduate trainees are recruited following a rigorous recruitment process that includes an application form, an assessment day, and interview. They are appointed on a fixed term contract for three years. Graduate trainees spend approximately three to four months working in each housing related department; rents (in finance), sheltered/supported, tenancy enforcement, customer services, development and neighbourhood development. During their time within each department they are allocated a specific job role and the skills covered include project management, people management, decision making, negotiation, and communication. Since 2011 (following the graduate trainee programme restructure) Adactus has recruited eight graduates; two in development, one in tenancy matters (anti-social behaviour), one in lettings, three in neighbourhood development, and one in asset management new build. Two existing employees from the supported team had been successful in obtaining a placement on a graduate trainee programme and had used this opportunity as career progression. On completion of the programme, Adactus will aim to place graduates in a permanent role that they are most comfortable with dependent upon the individual’s skills and attributes.
e. Leavers • A review of staff turnover revealed that one hundred and two employees (18%) had left the Group in the last financial year. Of those, sixty-six employees had resigned (11%). In relation to the others; the contract had ended, some staff had been made redundant, dismissed, or had retired. • The departments with the highest number of employees who had resigned were supported housing and asset management (caretakers/grounds maintenance). • The cover arrangement for an employee who leaves the Group depends on their role; the duties may be distributed among existing staff for them to cover, or the department may employ agency staff. • In relation to sheltered and supported schemes, cover is provided by scheme co-ordinators for up to a maximum of two weeks; after this time agency staff is appointed. This change in staffing can be disruptive for tenants in getting to know a new member of staff after building relations with the previous staff member. • With regards to the contact centre staff, measures are in place to ensure there is adequate cover arrangements that include limiting the number of staff taking annual leave and lunch breaks at the same time, and scheduling to overlap workers on staggered shifts to ensure optimum coverage at peak business times. Other back-up arrangements include calling on staff in other departments to provide cover, and there is a system in place that allows calls to be diverted to other departments. • A recent Adactus500 survey on staff retention revealed that tenants liked the ‘personal friendly touch’ and valued the rapport they had built up with gas engineers, responsive repairs staff, caretakers, and some staff in other departments including neighbourhood development, and internal affairs. Shehnaz Akhtar
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f. Impact of Right to Buy/Rent Reduction (in relation to jobs) • In 2015 the Government proposed that housing association tenants would be able to buy their homes at an increased discount and that housing associations will be required to reduce their rent charge each year by 1%. With these proposed changes, the HCA (housing regulator) required the Group to revise their business plan and have it approved by the Board to seek assurance that plans are in place for any remedial actions needed. • The Board approved the business plans in August 2015 with no remedial action necessary. The revised plan highlighted that the original plan can be undertaken, including the development programme. • If the government extends or amend further the rent regime, then the Group will review and revise its level of activity across all service areas to prioritise expenditure as part of the on-going business planning cycle. • Staff are usually kept up to date with matters in the Chief Executive’s quarterly briefing sessions, monthly newsletter, and with an article on Pulse (the Group’s intranet). The next round of briefing sessions is scheduled for September/October 2015. 6. Staff Surveys a. Exit interviews • Exit interviews are interviews conducted with departing employees, just before they leave. The aim of the exit interview is to learn reasons for the person's departure, on the basis that criticism is a helpful driver for organisational improvement. The exit interview is carried out by the HR department. HR confirmed that any material issues that arise from the interview are discussed with the leaver’s line manager or the departmental Director so they can be addressed. • A spot check could not be carried out on a sample of exit surveys as this is classified as confidential information. • If an employee has a concern or issue regarding working conditions or relationships with colleagues they can raise this through the company’s grievance procedure. b. Employee surveys • Employee satisfaction surveys provide management with knowledge and tools to build positive employee relations and a positive work environment. The Group carries out an anonymised annual employee satisfaction survey on all its employees. It questions employees feelings on: o Leadership and Communication o Involvement at Adactus o Their Manager/Supervisor o Fair deal (general feeling about Adactus, career advancement/benefits/salary)
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The 2015 employee satisfaction survey revealed that overall employee satisfaction was high at 90% (an increase of 4% compared to 2014). Satisfaction on the general feelings about working at Adactus revealed that: o 90% stated they were treated fairly; o 95% were willing to give extra effort to help Adactus succeed; o 84% planned to continue their career with Adactus for at least two years; o 90% were satisfied with Adactus as an employer; o 55% thought there was room for a career advance; o 68% said their pay was fair for their work; o 84% were satisfied with the benefits package. Specific stay interviews are not conducted on longer tenured employees to establish the reasons why they have stayed however, these types of issues are covered in the annual staff survey. All employees have an annual appraisal with their manager to review their personal performance (PPR). The appraisal ensures that: o Employees are aware of the Group’s objectives and targets; o Individual training needs to improve skills and help with job related development of employees is established; o Employees’ progress is monitored and the Group actively supports them to meet their training and development needs.
What we liked: • • • • • • • • • • •
Flexible working hours that help employees to maintain work/life balance. All Adactus employees (excluding apprentices) are paid at and above the ‘Living Wage’. Terms and conditions of employment; opportunity for staff to sell/buy annual leave and take a career break. Provision of a range of health and wellbeing facilities including; free eye test, 24 hour helpline, annual health check, and free gym facilities. Good range of flexible benefits including; free car park, car user allowance, childcare voucher scheme, cycle to work scheme, free refreshments, Christmas party, and Away Day. Provision of inhouse training and development programmes to improve job skills. Employees are provided with an opportunity to take a sabbatical. Opportunity to undertake charity work, and jury service. Support with distance learning and professional qualifications. Opportunity to work shadow employees in other departments to gain experience in another role and take a secondment. Staff promotions are from within the company whenever possible.
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Apprenticeship opportunities for young people offering above the national minimum wage for apprentices. Graduate trainee programme to recruit new talent and allow graduates to gain experience in the organisation as a whole. Arrangements to ensure adequate cover is provided in the contact centre. Business plan revised and approved by Board following government proposals on the right to buy and rent reduction. Chief Executives’ briefing sessions in order to keep staff informed of business matters. Exit interviews are carried out with a departing employee before they leave. Staff surveys to establish job satisfaction.
What concerned us? • There is no standard process for offering internal only opportunities. • No records of success or outcome of work shadowing.
Recommendations: • Recognise employees’ start-date anniversaries with an automated email. • Long service awards for five, ten, fifteen, twenty years, and so forth (in addition to twentyfive years long service), with a non financial reward for example, a certificate. • Keep statistics on work shadowing requests and number of employees who complete work shadowing. • Build on the customer service training already provided to encourage front line staff for example, caretakers, repair operatives, and retirement living staff to build a rapport with tenants. • Run a special campaign for hard to recruit posts, e.g. Night Workers. • Conduct a stay interview/survey specifically with long tenured employees to establish what keeps them with Adactus and publicise results to motivate other employees.
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Appendix
Staff Interviews The following interviews were carried out with staff: Name Role Date interviewed
Topics covered
Michelle Grundy
Head of Human Resources (Performance)
28/7/2015
Recruitment Salary Terms & Conditions Staff Development Staff Surveys
Marcia Stock
Head of Retirement Living
28/7/2015
Recruitment Motivating staff Staff Surveys Leavers Cover arrangements
Jayne Allison
Sustainable Neighbourhoods Manager (BREATH)
2/9/15
Apprentices Graduate Trainees
Tracey Adu
Assistant Director of corporate Service (Contact Centre)
2/9/15
Staff turnover Staff Scheduling Cover arrangements
Paul Chisnell
Executive Director of Finance
7/9/15
Impact of Right to buy and rent reduction
Elizabeth Hunter
Head of Supported Housing
9/9/15
Recruitment Cover arrangements Night workers
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Staff Turnover Spot Check What we wanted to check We wanted to find out which department had the highest number of leavers to determine if there was an underlying trend/reason. What we looked at We requested a report from HR detailing staff who left the Group between 1 April 2014 and March 2015.
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The leavers were categorised into departments, then into sections within those departments. A filter was applied to the ‘termination code’ column to identify the main reasons for staff leaving. They revealed that overall 65% of staff had resigned; the contract had come to an end for 15%, 12% had been dismissed, 4% had been made redundant, and 4% had left for other reasons. What this means Turnover levels can vary widely between occupations. Nationally, the highest levels of staff turnover are usually in the hospitality/caring industry and call centres. The Deputy Chief Executives department and Asset Management had the largest number of leavers in supported housing, and caretakers/ grounds maintenance section. The indication is that it could be due to the nature of the work; supported can be very demanding, and grounds maintenance work is seasonal (gardening).
Current Vacancies Spot Check What we wanted to check We wanted to know how long it takes to recruit once an employee hands in their notice and what cover arrangements are provided. What we looked at We reviewed four recent vacancies; Caretaker, Assistant Support Worker, Support Worker, and Repairs Planner. What this means Where roles are advertised can make a difference in attracting applicants for some job roles. A role had been advertised, offered and turned down twice, both for personal reasons rather than the role itself. Where a position had become vacant, a recent applicant for a similar role had been appointed thus avoiding further recruitment costs, time and disruption to service. Agency staff and external contractors were appointed in the interim until the vacancy was filled.
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Acknowledgements Staff Retention Scrutiny Panel Members (Without their effort, the completion of this scrutiny project would not have been possible) Noreen Anwar Victoria Atkinson Martin Goulding June Haydock Simon Jennings Xinjia Li Dorothy Shepherd AN Other
Colleagues Ryan Hague Steve Watts
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