Employment Law Update

‘IN-WORK POVERTY: WHAT IS IT AND HOW CAN EMPLOYERS SUPPORT THEIR EMPLOYEES?

By Ruth Gladwell

Navigator Employment Law

Concerns about affordability surround us daily; from the news stories regarding the cost of living and the pressure on the government to offer solutions. It seems we all feel that there is an ominous dark cloud that will shroud the sunshine and the autumn of angst will creep in before we know it.

With ‘in work poverty’ increasing, concern starts to manifest itself in the workplace in a number of ways. In work poverty is defined when an employee’s income, after housing costs, is less than 60% of the national average, they don’t earn enough to meet the cost of living and are living in poverty.1 Factors that make it difficult for many employees to escape poverty can include: • A pay rise that has not matched the rising cost of living. • Domestic circumstances, relationship breakdown, bereavement or illness leading to financial hardship. • Job insecurity that is either present or perceived and people becoming trapped in low paid jobs.

Interestingly, in relation to this last factor, a PwC Employee Financial Wellness Survey2 indicated that financially stressed employees in the US are twice as likely to look elsewhere for work and a key factor they’re looking for is an organisation that would care more about their financial well-being. With US statistics usually being seen as an indicator of future UK trends this could be a factor to consider in recruitment strategies, focussing on the wider employee value proposition. With the economic environment affecting employers as well as their employees, employers may be wondering what they can do or whether they should do anything at all? Doing nothing is of course an option, but with the background of the pandemic, we have now all experienced the increased awareness of the duty of care an employer has towards employees’ needs. There has been significant investment in understanding and implementing programmes that surround the wellbeing of employees. An overarching Employee Assistance Programme (EAP) could go some way to help employee’s navigate financial wellbeing. These programmes have been a heavily highlighted benefit during the pandemic for wellbeing, counselling, and there’s a likelihood that there’ll be an ‘arm’ of financial coaching to tap into. If you have an EAP – call the provider, find out what the service offering is, and establish whether it could be enhanced within your organisation’s affordability zone. Don’t assume that everyone is the same and one size fits all; engage with staff. If you operate a survey to support this, then be sure to keep expectations aligned with any options to which you may wish to signpost staff. Of course, include an open question to ask what they may be looking for. If they are indeed looking at what other employers are offering, they may have more research information on the matter than you do. Early engagement will help to highlight the issue before periods of unplanned absence start cropping up. Along with any survey that you are undertaking ensure that there is attention being paid to delivering the outputs of the survey. For example, some renewed management training on communication and empathy would be ideal. Reward and benefit packages need to be crafted with an underlying strategy that includes attention to your ever changing diverse populous. Many employers review benefits in the new tax year, so considering what the budget for the package is likely to be now will help form solutions. Salary exchange programmes are effective and minimally burdensome to implement. Another option is to consider contributions and subsidies rather than full membership to some of those more expensive benefit schemes that may better fit your affordability criteria. In the challenging recruitment market, retention of an employee with aptitude and potential can be preferable to recruitment of an entirely new candidate. Investing in skills – some that can be developed and learnt internally through cross training, shadowing of a leader or colleague along with a sustained external programme can provide a holistic and tangible return on investment. Long term relationships and loyalty can be effectively built when an employee can really see how the employer is looking to the future with them in mind. It is crucial to keep expectations in check and develop your management team in achieving this to avoid employee relation challenges down the line. Those who do follow the do-nothing approach may find themselves mending a roof when the sun isn’t shining.

1 ONS households below average income statistics 2 2022 PwC Employee Financial Wellness Survey

Moving Moving mountains mountains

THROUGH THE POWER OF HR influence HR influence

HR can move mountains when it influences well. The new world of work is transforming how practitioners influence colleagues, peers, leadership and industry. Andy Moore discovers how HR is in a powerful position to be a leading light in organisations…

Wind the clock back three years. Few would have predicted how HR’s function as a key influencer would change beyond recognition in the modern, international workplace.

Post-pandemic, the seismic shift in organisations and workforces has moved HR ever closer to playing a strategic business partner role with leadership. Their more traditional role of focussing solely on people management is now being revolutionised.

Dr Arlene Egan, interim CEO of Roffey Park

International, believes that practitioners must continue to influence senior teams, and forge an almost egalitarian partnership.

“HR must now have a seat at the leadership table, figuratively and literally. They must be able to inform the board about the reality of what it’s like to work in an organisation,” she explains. “The decisions we make, whether at board or executive level, must be bound in reality or they will not work, leading to higher staff turnover and a poor work culture.”

From a staff influencing perspective, practitioners are now reinventing themselves and returning to their role of championing employees, believes Arlene. In her past experience, whether working as a leader or employee,

HR sometimes used to function purely for staff and not leadership.

“There is an alliance piece in understanding how true organisational change brings about transformation.

There are many real live change projects that cannot happen without HR,” she advises. “HR must be involved from a perspective of the whole staff context, representing the views and values of both front line teams and leadership.”

The impact of mobile, international multi-generational teams, together with diversity and inclusion - all underline how HR can influence an organisation and its governance.

These are factors where HR influence plays a key role.

People look to practitioners as mentors, and for them to have a finger firmly on the pulse of organisational strategy, trends, demographics and data.

Arlene adds: “HR should be the ones people look to.

They shouldn’t be looking to CEOs or managers. HR’s power in influence is being experts in their domain and being able to influence the decision making of the rest of the leadership team.”

Ultimately, influence is all down to people. She believes that fostering a less hierarchical ethos depends on organisation culture. Employee perception of HR can still be viewed with trepidation, with some people still viewing practitioners as only there to enforce discipline or to fight fires. But what about industry influence? “Networking is key for HR influencing. Through industry bodies, they can really bring value to the industry and by developing networks of HR experts,” Arlene comments. “HR can influence through having a wider pool of peers to draw from to help themselves solve problems they face, and to get fresh perspectives. In terms of raising the profile of the sector and profession, industry bodies and networks are imperative.” Importantly, she believes that many modern organisations are still inward facing. And this is why member bodies can help to develop skills, plus build and support the networks of the professionals themselves. She adds: “The question we must ask is, how proactive can practitioners be? What level of initiative should they take to be heard? Effective influencing can lead to major transformation and change projects across organisations.” For HR, knowledge is power: it is incumbent on every practitioner to know the challenges, issues and solutions facing the profession, she believes. For this to happen, it’s about “shifting the dial on accessibility”. Practitioners must convey the message that, without them, organisations will not make the progress they need to make.

“How can practitioners carve out a space, step forward and move into that space themselves?” Arlene asks. “It is essential that other leaders listen and are convinced by what HR has to say and be educated. Ultimately, HR’s true value is being able to ask the right questions that other leaders may not ask.” Increasingly, there is an important relationship between HR advising, shaping and steering an organisation’s direction and growth. And, while many organisations may strive to become as digitalised as possible they are still governed and controlled by people. Influencing is also vital for professionals to enrich their own CPD and career through the power of networking. Importantly, it can be very inspiring to know the career paths and aspirations of other practitioners. So, what is the future for HR influencing? Dr Egan sums up: “It now has the chance to rise in prominence. There is always massive potential for practitioners to be a strategic business partner. The biggest challenge is helping managers to manage an ever-global diverse workplace with greater inclusion across multiple demographics and skillsets. HR will have to be listened to more than ever.” HR influencing tips • HR must play a more strategic business partner role with leadership • Practitioners must have a seat at the top table • Decisions must be bound in reality • Effective influencing can achieve major transformation • People look to practitioners as mentors • Fostering a less hierarchical ethos depends on organisational culture • Many modern organisations are still inward facing • Influencing is also vital for HR to enrich its own CPD

“Networking is key for HR influencing. Through industry bodies, they can really bring value to the industry and by developing networks of HR experts.”