TRAINING

Upskilling employees – The cost-benefit to your business

Timothy Clark Outreach & Pathways Manager

In the building and construction industry, one thing commonly proven yet often under-acknowledged by employers is the benefit of upskilling employees within your business. Sometimes the view in our industry is that upskilling doesn’t necessarily result in a cost-benefit; however, this view couldn’t be further from the truth.

Some of the significant gains of investing in training for employees include:

• Retention of talent within your business.

• Increased compliance from staff. • Management and succession planning options. • Improved processes and procedures. • Reduced supervision and errors. Let’s look at just two of the above benefits in more detail, as you’ll very quickly find just how beneficial the employee upskilling process can be for your business. Remember, we are looking at only two reasons, certainly not listing all the benefits of investing in staff training.

Retention of Talent

One of the most frustrating events in business is losing talented employees to your competitors. This leaves a huge void that needs to be filled, generally immediately, but further to this, many of the internal processes and sensitive workings of your business may now be in the hands of your competitor thanks to a former employee. Restraints of trade can be considered, but how effective – or enforceable – they are is questionable, certainly when it comes to the prevention of one having the ability to earn a living. The first thing to consider when trying to retain your top talent is the cost of hiring and re-training a new employee. Studies have shown that recruiting and training a new employee could be as high as 150 per cent of their annual base salary! Take an experienced residential site manager earning $135k per annum. To replace them, the cost to your business would be around $100k. If you don’t believe me, let’s look at what needs to be factored in.

• In-house recruitment costs. Yours and your staff’s time to recruit the new position. • Termination costs including administration, entitlements, uniforms, tools, and technology. • Loss of productivity during the final stages of employment from the leaving employee. • Loss of productivity during the early stages of employment for the replacement employee. • Loss of productivity from other employees who may be unhappy a team member has left.

• Significant risk of other employees following suit. In our industry, we see that when a senior staff member leaves a business, many other less senior staff will soon follow.

The above explores some of the direct costs from employee turnover and doesn’t even factor in the more hidden costs, such as losing valuable subcontractors to your competitor (i.e., they have followed your site manger to the new builder). A final point regarding employee retention is that many courses, such as the Certificate IV in Building and Construction (CPC40120), run for over a year (two evenings a week). By enrolling an employee into one of our courses, there is almost a de facto commitment to you that they will

remain an employee with you during this period.

Compliance and Processes

Another example of how investing in the training of your employees will positively impact your company financially is by way of increased compliance and improved business processes. Any business owner will tell you that one of the things that cause more sleepless nights than anything is the risk posed to your business – and your financial security – at the hands of those you employ. This is known as vicarious liability, which in effect means how you as an employer can be held legally responsible for the actions and mistakes of your employees. A way to mitigate the risk of employee error is by having them undertake specialised training, which could focus on the following areas of great risk to construction companies: • Cost estimation and administration of tender packages. • Building contracts, including legal obligations and dispute resolution. • Occupational health and safety regulations and compliances. • Supervision of trades and planning of on-site construction.

For example, let’s again take our Certificate IV in Building and Construction (CPC40120). This course outlines what is required of a builder in all of the above situations.

From how you must work in compliance with the relevant legislation and statutory laws or how to present and administer a legally compliant building contract with a client.

Further, the course teaches effective cost estimation techniques and then outlines how to turn this estimation into a formal tender for your client. We commonly hear from members that it’s hard enough in the industry already, with price rises, labour shortages and supply issues, let alone learning all the ins and outs of best practices and mandatory compliances. Or that there are not enough hours in the day to run your projects, let alone attend formal training to benefit your business. We get it, the industry has many challenges at present, and the idea of training is furthest from your mind. However, with so many challenges, can you afford to have more headaches stemming from non-compliances? The last thing you need is a formal dispute with a client or an OHS incident on-site, which may have been compounded by not following the correct process or procedure. That’s where the importance of investing in your employees comes in. We also regularly hear from our members that they have learned something from their employees who have undertaken one of our programs. The training they received has been brought back to the business and is now implemented for wider use within the company. We appreciate you may not have the time, but if an employee is worth keeping, it’s worth investing the training in them, as it will ultimately benefit your business when they learn new skills. As you can see, the benefits to your business that upskilling your employees can achieve are both numerous and significant. By investing in training for your employees, you are more likely to retain them within your organisation. Sometimes you may not be able to match a salary offer from a competitor; however, you can offer something that your competitor is not, knowledge. This could not be more crucial in the current environment of skilled labour shortages our industry finds itself in. The reality is that some employees will always chase a higher paycheque. Good, reliable, loyal employees will often seriously consider paid training instead of a pay rise. Suppose you have an employee in mind that you think could benefit from training who will benefit your business with new skills and knowledge. In that case, we encourage you to explore our training options, including the very popular Certificate IV in Building and Construction (CPC40120) and our industry-leading Builder Registration Program. A full list of training options is outlined on our website at www.mbavtraining.com.au, and our Outreach and Pathways team will happily assist you in finding the right training option for your team. Give them a call on (03) 9411 4555.

Building and Construction Lawyers

Andrew Whitelaw - Director hitelaw - Director awhitelaw@wflawyers.com.au

www.wflawyers.com.au Level 12/533 Little Lonsdale St Melbourne (03) 9090 6700 Volume 77 Issue 02 Master Builders Victoria | 41