Dealing with complex employment laws and union reps can be tricky. But during times of change, hiring a specialist interim to tackle these people issues head on can be the best solution. Sally O'Reilly reports
Industrial relations have always presented problems for HR staff. In the 1970s and early 1980s, strike action was the biggest issue. Now, increasingly complex employment legislation driven by the EU on individual rights, fairness at work and work-life balance, is making this a minefield for the unwary.
For many HR directors, bringing in a specialist interim manager (IM) is the solution. This can make far more sense than struggling with the raft of new employment laws, or trying to negotiate with highly-trained union reps who may well have a better understanding of recent legislation and workers' rights than many managers.
For Raj Tulsiani, managing director of Penna Interim Executive, one of the key advantages of hiring a specialist interim is their breadth of industrial relations experience.
"How they work depends on two things: what they need to deliver for the client, and what the skillset is internally," he says. "In an organisation where the interface with the unions has been mismanaged or difficult, it is useful to use an IM who has dealt with this area before, or who has worked in a unionised environment and is good at building bridges with unions."
Mergers and acquisitions also demand industrial relations expertise. Penna has one client who needed an IM to handle the merger of three organisations in Germany, and therefore needed Tupe expertise and knowledge of change and business strategy.
This is not unusual. Stephanie Campbell, director of Impact Executives - the interim management division of Harvey Nash - says most industrial relations assignments are now likely to involve dealing with Tupe.
"In the past, manufacturing was the main area in which industrial relations interims would work. It was very much about pay and conditions," she says. "Now that Tupe issues are more common, interims are just as likely to be dealing with white-collar jobs as they are with blue-collar jobs."
Although all HR interims will need some knowledge of employee and industrial relations, there is a small group of specialist IMs who have made this field their own. Tulsiani says: "The ideal background does vary depending on the needs of each client, but these are typically people with 12 to 15 years' experience, including international experience."
The serious high-fliers tend to work as both independent consultants and interims, he points out. "People with really good networks and broad industrial relations experience are few and far between."
Impact Executives' Campbell says there is a special breed of IMs who do well in industrial relations.
"An industrial relations IM needs to display leadership qualities and attention to detail," she says. "You also need to have personal sensitivity, and be aware of the effect your decisions might have on other people's lives - emotional intelligence, in other words."
John Lovery is part of this rare breed. Industrial relations has been his specialist area from the beginning of his career - he has a Masters degree in this subject and has also worked as an academic at the Institute of Employment Studies (in the days when it was still known as the Institute of Manpower Studies).
After going back into HR, he worked at the Prudential for 10 years as head of HR for one of its constituent businesses, and later, was group employee relations manager.
"There are a couple of drivers for bringing in an interim," he says. "One is an imminent crisis, such as an acquisition, and another is a need for specialist resources, when you don't have a particular expertise, or enough of an expertise.
"I've seen organisations changing and contracting, and making redundancies. They are looking for expertise and ways of helping the remaining staff as well as the ones that are going."
Currently, Lovery is on assignment with Insight Investment Management, the financial management arm of the Halifax Bank of Scotland Group. Last year, the company acquired a competitor firm with the aim of bringing in high-calibre staff with relevant experience. As the in-house HR team had little experience of mergers and acquisitions, they brought in Lovery to handle the people issues.
It was a sensitive project; there were 600 people in the two organisations and 150 lost their jobs. Insight had more traditional terms and conditions than the firm being acquired, and although the merger did not trigger Tupe legislation, Lovery worked with the HR team to persuade the workers they wanted to keep to buy into the existing terms and conditions, by offering a mix of both financial compensation and the prospect of long- term career development.
The selection process has now been completed - within the 90-day time-scale that Lovery was given - and very few employees have rejected the new employment package.
"The HR team should have much of the credit for that - they are very open to learning from me how you handle these things," he says. "A lot of advances have been made in the past three months."
This willingness to learn from the experience of HR interims is essential, he believes. Otherwise, the expertise of interims may go unrecognised.
"My last project was at Goldman Sachs, and I realised that I hadn't got close enough to my client," he says. "We got on well, but the process would have gone better - and they would have got more out of me - if we'd had had regular one-to-one sessions."
As it was, the HR director didn't realise the extent of Lovery's experience and skills. "I had more to offer than just handling the redundancy project I was initially brought in to oversee, and they just didn't realise that," he says. "So the importance of building relationships is one of the lessons I have learned - and it works both ways."
Interim manager Linda Thorpe also has broad experience in industrial relations, much of it gleaned from her time as HR director for a wholesale travel business that worked in 17 different countries. She finds that employment law is one area HR directors are more than willing to learn about from IMs - but they tend to think this area is more complex than it actually is.
"A lot of HR staff do think IMs can help guide them through employment law, and they think there is some magic to it," she says. "But understanding the organisation and how it is structured is equally important. I have to understand the technicalities of employment law, but I also need to be able to relate them to the way that an individual organisation works."
Rather than being the font of all wisdom, Thorpe stresses that interim HRs can act as useful interpreters of employment law for HR directors.
"Knowledge of employment law tends to vary depending on the size of the organisation. Big corporates will tend to use employment lawyers, but the trouble is lawyers will only tell you what the law says," she says. "It is ambiguous until it's tested."
Karen Hodge, who specialises in HR consultancy and interim management, agrees.
"Basically, you can do what you want in terms of employment law, but there is a risk," she says. "For instance, if an HR director wants to get rid of 10 people and wants to include someone he doesn't like, an employment lawyer will say: 'you can only do that if all the procedures are followed'. But there are ways around this."
It is all part of building confidence about industrial relations and understanding when procedures have to be followed to the letter, and when there is room for flexibility. For interim manager Peter Firth, formerly a HR director with food and drink companies Cadbury Schweppes, Nestlé and Maynards, the art of the interim HR is to help personnel staff get this right.
Currently working for the London Borough of Ealing and formerly contracted to the London Borough of Wandsworth and British Airways, Firth says public sector organisations in particular tend to tie themselves in knots when using established procedures to deal with staff disputes and other employee relations issues. It can take someone from outside the organisation with a wide knowledge of best practice elsewhere, to help untangle these processes.
"Often, polices tend to be rather bureaucratic and complex, and there is more focus on making the processes work than on getting a satisfactory outcome," he says. "Understandably, public sector organisations in particular need to be seen to apply procedures fairly, but they also need to have flexibility built in. This is the debate we often have with the unions."
Firth points out that many organisations have highly structured disciplinary hearings, with the order in which each person should speak clearly laid out. But this can actually make it harder to work through the process logically and clearly.
"You need some flexibility, so that if a line manager wants to say something just after the employee has made a response, they can, rather than waiting for their turn as laid down in the procedure," he says.
"I have even heard of one case in which the line manager had to wait so long to say his piece that by the time his turn came, it was the end of the day and the hearing had to be adjourned until the following week."
One of the challenges for IMs specialising in industrial relations is that unions are often very protective of such procedures, and see any movement towards greater flexibility as undermining the rights of staff. But Firth and his colleagues agree there is no need to take an adversarial position with union reps.
"It is still the case that unions tend to be dealt with in a fairly adversarial manner. This stems from the fact that managers are often not well-trained in dealing with unions, and the unions who are very professionally trained are at an advantage," he says.
"They take an adversarial role because they see they are not being dealt with very effectively."
Linda Thorpe says IMs can help in-house HR staff to co-operate with unions.
"Today's union representatives probably have more training than the average business manager," she says. "Partnership deals may be an over-used phrase, but it is not just about HR managers working as business partners with line managers - it is also about working with the unions. It gives HR staff the chance to be creative."
Thorpe has direct experience of making this happen. At aviation ground handling company Groundstar, she spent a year liaising with two unions, the TGWU and GMB, representing two groups of staff with different terms and conditions.
"As an interim, I had to lead the negotiations for transfer under Tupe, feeding back relevant information to the HR and payroll staff," she says. "And I had to change the staff rota - one group were on one shift roster and one-third were on another. I had to negotiate with the unions on significant changes."
So what can HR directors do to make sure they use HR interims who can really help with industrial relations issues? John Lovery emphasises the need to use a good supplier - and not to be impressed by the first interim who comes along with a relevant CV.
"Although this is an area for which you do need relevant expertise, don't take someone on just because they have experience of Tupe, for instance. It is always essential to get the right fit, as well as someone who fills your skills slot," he says.
"Good suppliers know their interims, and don't just have a database of names of people with various skills - those who aren't making the right placements are the ones who will fall away."
It is certainly a challenging area, but interims who have made this their specialist field are enthusiastic about the rewards.
"It may sound wicked to say this, but I absolutely love it," says Karen Hodge.
"You are playing with people's lives. Sometimes you are giving an employee news which seems like the end of the world to them, but there are ways of doing it that allow them to keep their dignity.
"Often when I start an assignment, no one will talk to me, and the room goes quiet when I walk in," she adds.
"But by the time I have been there for a while, that changes. They are
actually asking me questions about employment law, or getting me to look at the
employment contract for their new job. And sometimes, when I hand over the
final cheque, people even say 'thank you'."
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