HR’s biggest challenges

According to a new survey, changes in employment law are causing a headache
for HR. Other major problems include growing absenteeism and recruitment and
retention. Quentin Reade reports

Coping with the ever-increasing volume of employment law changes is now one
of the biggest challenges HR has to face, according to new research looking at
the concerns of the profession.

The IRS Employment Review questioned more than 300 senior HR managers about
their hopes, fears and biggest challenges to get a snapshot of the profession.

Released exclusively to Personnel Today, the research shows while most
respondents see bread-and-butter issues such as recruitment, absence management
and delivering what their boards want as priorities, certain legal issues are
of growing concern.

Legal challenges

When questioned over the biggest legal challenges facing HR, practitioners
were most concerned about internal disciplinary and grievance cases, with 61
per cent being affected. A third are affected by employment tribunals.

Spiralling tribunal application numbers have resulted in measures being
incorporated into the Employment Bill designed to reduce this volume – but few
of the respondents thought case numbers would drop.

The Employment Bill before Parliament proposes that employers will have to
introduce disciplinary and grievance procedures, and tribunal claims will be
subject to fixed conciliation. Providing the minimum standards are met,
employees will not be able to bring unfair dismissal claims on the grounds that
their employer did not follow the letter of the dismissal procedures.

When asked about the effect they thought this change would have, 77 per cent
thought there would be the same number of cases. Only 17 per cent thought there
would be fewer, and 7 per cent that there would be more.

The Employment Bill will also allow all working parents with young children
to request flexible working from their employer. Organisations will be allowed
to turn down the request if working flexibly would damage the business. One in
three respondents thought this would push up employment tribunal cases, with 63
per cent expecting no change.

A further proposal in the Bill is that fixed-term employees will have the
right to be paid the same as similar permanent staff working for the same
employer unless the difference can be justified on ‘objective grounds’. Nearly
a quarter believe this will lead to more tribunal cases, with 72 per cent
expecting no change.

Data protection

The second biggest legal challenge for HR concerns data protection – 58 per
cent believe they will be affected.

The research suggests that the data protection code, designed to offer best
practice on the handling of personal data in the workplace, has added to the
confusion. The code gives employers guidance on how to comply with 1998 Data
Protection Act, which came into force in October last year.

Employers and representative bodies recently criticised the data protection
code on monitoring in Personnel Today (News, 16 April). It requires companies
to inform the police if they want to monitor staff covertly.

In the IRS Employment Review report, legal expert Richard Lister of Lewis
Silkin said data protection and privacy has become a hugely contentious area.
"Employees are getting more aware of the information held on them and more
interested in seeing it," he said.

He also warned that if employers are not careful the information they store
could contain things that could give rise to employment claims. "It’s
problematic because the code doesn’t clearly distinguish between what are legal
obligations and what are just recommendations for good practice," he said.

Retention and recruitment

Recruitment is still the biggest non-legal challenge facing HR, despite job
losses during the post-11 September downturn, according to those surveyed.

Three-quarters of HR managers list it as their top priority, citing skills
shortages and a lack of decent job applicants. However, most believe they are
now better at retaining good staff, and expect retention problems to ease over
the next 12 months.

Those from the public sector who took place in the survey faced greater
recruitment problems, probably due to a poor image and non-competitive pay.

Caroline Callan, personnel manager at London Guildhall University, said no
work had been done to counteract the negative image of the public sector, and
the workforce had reinforced this view in the press.


The next biggest concern of HR was absence, with 62 per cent of those
surveyed worried by it.

When asked to list their top five health and safety concerns, HR professionals
listed managing short- and long-term absence as the most pressing priorities.

The report said between 2 per cent and 16 per cent of annual salary bills
may be spent on absence, half of it on direct costs. Long-term absence incurs
higher costs.

Keith Smy, head of HR at Staffordshire Police, commented in the report that
absence management was a high priority because it is easier to show its value.
"HR can demonstrate an impact both on the bottom line and
operationally," he said.

He added that absence needed investigation because it may be a symptom of a
greater business risk, such as a deterioration in the employee relations
process or internal communication.

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