Falling headcounts may be an inevitable part of the recession agenda, but the quickest way to haemorrhage the employees you do want to keep is to treat them as though they’re little more than a number.
So says Sheila Sheldon, director of European operations at the employee reward and recognition firm Michael C Fina Worldwide. Sheldon believes that the task of making each individual staff member feel rewarded, engaged and culturally included is even more crucial in an economic downturn.
“Whether it’s ensuring staff know where to go for lunch, maintaining annual staff surveys or paying close attention to exit interviews, early engagement with staff is critical when it comes to job-hopping younger employees, yet is all too often neglected,” she says.
While training and career development are vital areas of investment for firms hoping to survive a recession, Sheldon argues that there are other ways of making staff feel valued, such as picking out those with particular aptitudes for special projects. “Companies should be spending more on training in a period of slowdown, but that doesn’t mean the only way to build team loyalty is to bring in expensive external consultants and fancy flipcharts,” she says.
“If you have a manager with fantastic people skills, why not set them to work on an inexpensive but significant programme of internal mentoring and training. You may not be able to afford a pay rise for that person, but by picking them out as great communicators, they will feel valued and more motivated to give their best.”
If a hire freeze is indeed on the horizon – and the latest CIPD/KPMG Labour Market Outlook found that less than a third (29%) of employers are looking to recruit new staff this quarter – then the prospects of new, big-money benefits being handed out to HR teams are slim.
Yet by taking the time to explain the complex menu of benefits and rewards already on the table for many staff, employers are less likely to be deafened by mutterings over static pay rates, argues Andy Philpott, marketing director at Accor Services.
“Salary sacrifice schemes that allow you to choose childcare vouchers instead of part of your pay are not only very cost-effective for employers, but they can be beneficial for those staff who opt for them.
“But the trouble is that relatively few employees understand how they work in practice and unless the HR and perhaps the marketing team can get together to spell out the benefits more clearly, these often very innovative rewards will never fulfil their enormous potential.”
When it comes to staff development, Philpott advocates cheaper techniques, such as directed reading and subscriptions to the better industry publications, and believes that well-organised internal mentoring and coaching schemes can pay dividends when it comes to times of fierce budget restraint.
With Accor’s research on employee engagement suggesting that in the past three years, overall disenchantment with employers has risen, Philpott says that the attention given to customer satisfaction must now be replicated with more focus on staff. “New customers are routinely wooed and courted and are asked about their perceptions of a brand after only a couple of months. If they leave, care and time is taken to find out why they are dissatisfied.”
“Exactly the same trouble should be taken over the people who really matter and without whom, there would be no customer service in the first place – your staff.”
While fears of an economic recession are already leading to job cuts in many industries, employment law and workplace consultancy Croner is warning employers that redundancy is not always the easy solution that they seek.
Jp Pitts, employment law consultant at Croner, says: “Many clients are taking the knee-jerk reaction of reacting to bad economic news with a programme of job cuts, but it’s important to check people’s employment contracts before you do anything so drastic.
“Short-term or lay-off clauses are common in contracts and as a short-term measure, can be far more straightforward than getting rid of people altogether. We urge employers to look for alternatives to redundancy because of the possibility of unfair dismissal cases and negative PR.”
Although periods of recession can lead some staff to take more time off, Pitts adds that arrangements for sickness absence management (SAM) need to be more flexible, not less, even if HR suspects the sickness is not genuine.
“Soaring absence rates can seriously affect productivity and overall team performance and morale, but they need to be handled with pragmatism. We would argue that a carrot approach is more appropriate than a stick in the current climate, particularly if there is an element of extra stress being caused by a period of downsizing.”
When times are tough, staff may decide to stay with employers that appear to care about their welfare, but fully-fledged employee assistance programmes can be expensive.
Yet according to Russ Piper, sales and marketing director at Sovereign Health Care, whose one-year-old corporate plan is dubbed Go-active, being caring isn’t as expensive as it may look. “For £16 per employee, staff get unlimited access to telephone counselling on anything from debt counselling to problems with relationships. This keeps staff moral high without costing the firm a great deal,” he says.
It goes without saying that in both good times and bad, employees are more likely to stick with a firm that pays them properly, offers them a stimulating job, provides a good working environment and fulfils their emotional and practical needs – particularly the need for stability perhaps – on many different levels.
But where does sheer fun fit into the equation? Sheldon believes that fostering a spirit of camaraderie in your organisation can work wonders – even if the pay rise this year is going to be 1%, not 4%.
“Encouraging the team to do something outside work on a regular basis can build up team spirit and with it, commitment to a common organisational goal,” she says, “but it’s got to be kept fairly light-hearted if staff aren’t going to feel pressurised.”
So whether it’s a pub quiz, an inexpensive trip to the coast or a game of bowling this autumn, the team that plays together may be more likely to stay together when the economic gloom descends.
- According to research from Accor, only 20% of employees, including a high percentage of managers, say they fully understand the value of the benefits on offer at their firm. As many as a third mostly non-managers, say they do not.
- Employees in smaller firms (employing less than 100 people) think they have the greatest influence over the choice of benefits and incentives on offer (22%) compared with only 11% of those working in the organisations employing more than 5,000 people.
- Exit interviews conducted in-house leave staff fearful of speaking up in case it affects their reference and job prospects. An outside consultancy is more likely to get to the truth of why people are leaving, but firms who fail to take note of, and act on, their findings may be wasting their money.
- With Christmas on the horizon, voucher rewards are inexpensive and versatile and when presented properly, in front of an audience of colleagues, a £20, £50 or £100 voucher for the Idea of the Month or Performance of the Week can offer a genuine fillip to staff.
- If you want staff to feel energised and engaged in 2009, budget for some sort of Christmas party, however modest.