The True Costs of Redundancy

In this article, I want to explore the true costs of redundancy. You may be facing the difficult decision to make some of your staff redundant. If so, then you might want to take time to so some careful calculations. This is not always the best way to cut costs and keep your business alive.

Redundancy is, sadly, a business norm in these days.  Many people have faced redundancy one or more times in their working lives and it is always damaging for them.  But it is often very damaging for their employer as well.  It is really expensive and rarely brings the desired cost savings.

The benefits for business

The immediate benefits for any employer are obvious.  Salaries no longer have to be paid to those people.  You don’t have any employment costs such as tax and national insurance for them. You save on their pension costs.

There might also be a saving on management costs.  If there are fewer people to manage, then you might be able to reduce your management team.  You might find that managers need to spend less time managing the people who are left (although this is debateable).

Some employers think that redundancy is a painless way to dismiss someone who might be “difficult”.  Maybe someone is not performing very well. Or an employee might have a huge amount of time off sick.  You may even have a disruptive employee, or someone whose attitude is not what you would like.   Redundancy can seem an easy way to part company.

But this is not what redundancy is for and there are strict legal constraints which might prevent you parting with the “right” person.

So what are the true costs of redundancy?

There are some very obvious costs of making someone redundant.  For example, if they have over two years of service you have to pay Statutory Redundancy Pay of up to 30 weeks of pay, depending on their age and length of service.  And there may be some enhanced redundancy payment if there is such a clause in their contract of employment.

Of course you also have to continue to pay them whilst the consultation is ongoing and during their notice period.  Or you might pay them in lieu of notice pay if you want them to leave sooner.

If they have accrued any holiday entitlement and not used it, then you have to either give them that time off before they leave (on full pay) or pay them in lieu of their unused holiday pay.

There are other small costs, such as allowing them reasonable time off to seek alternative employment, which has to be on full pay.

The Hidden Costs

Then there are many hidden costs as well.  This may be where you find that the true costs of redundancy start to mount up.

Things like your own and your managers’ time to prepare for redundancy come under this heading.  And your time to do any scoring which is needed for selection.  Then there is the time needed for consultation and to plan the remaining workload.  The managers who are doing this work are likely to be amongst your highest paid people. They will not be productive on other things whilst they are involved in a redundancy process.

In addition, there is the time that your payroll staff will take to do all of the redundancy and other payment calculations, and to make the payments.  Again, while they are doing this, they are not working on more productive things for your business.

If you recognise Trade Unions, then your TU representatives will not be doing much other work during this time.  If you don’t recognise Trade Unions, and you are planning more than 20 redundancies, then you will have to appoint employee representatives so that you can do collective consultation.  And, however many redundancies you are planning, TU representatives or other colleagues might be asked to accompany individuals in any consultation meetings.  All of that costs their time and productivity on other things.

There are many other small things – time to write references, time to answer questions, time to consider suggestions.  A redundancy process leads to a huge loss in productivity, however well it is managed and handled. And productivity levels take time to build up again to pre-redundancy levels.

Potential Extra Costs

There are also many more potential costs in a well-managed redundancy programme.

If you want to get people out of the work place before their notice period ends, then you may need to pay garden leave.  This might be the case if the reason for the redundancy is a lack of work.

Some companies provide outplacement services for their redundant employees, to help them to find alternative work or to do some training for a career change.  This, of course, has a cost attached to it.

You may want to provide counselling services to help your employees and their families come to terms with their redundancy.  Or you may want to provide financial advice to help them manage their redundancy pay, pensions, etc.

Counselling may not be enough to prevent some sickness absence, where individuals have anxiety, depression or other stress related illnesses due to pending redundancy.  So your sick pay bill might well go up during this time.  And this may not just affect those facing redundancy, but their colleagues who remain in the workplace after they leave.

On the subject of those who are left behind, you may well need to provide some training in unfamiliar skills for people who have had to move into different jobs or pick up unfamiliar work.

Before considering redundancies, you are likely to have had to end any contractors or agency temporary staff. This may involve payment of some fees to employment agencies.

And then, of course, you may face legal challenges and end up having to pay costs to defend any such challenge, or a settlement agreement to prevent a court case.  Not to mention staff time to work on such cases, and potential legal advice.

Delayed  Costs of Redundancy

When you are calculating the true costs of redundancy, there are some costs later down the line which will crop up as a result of your redundancy programme.  These must be included in the overall cost of redundancy, as they  only arise as a direct result.

This includes things like future recruitment costs if there is an upturn.  You may end up trying to recruit the very skills you let go during your redundancy programme.  You might have to then pay to train people up into these roles, because you have lost your investment in your redundant employees.

Depending on how well your redundancy programme was handled, you may find that your company reputation has suffered and that you find it harder to recruit in future as you have a bad name as an employer.

The disruption during the redundancy programme will have an incalculable effect on cost and you will definitely have to spend time and money to support your remaining employees (survivors).   They will have lost productivity and will need time to settle.  You may even find you face some resignations as people search for potentially more stable employment.

One final potential cost is in your client base.  If the reputation of your business has suffered due to the redundancy, then you may lose clients, or find it hard to attract new clients.

In Conclusion…

I am not saying that you should not embark on redundancies, if that is what your business needs to to, but I am suggesting that you should look very carefully at the true costs of redundancy and how long it will take your business to recover from such a move.  It is worth giving serious consideration to alternatives to making people redundant as a cost-cutting exercise.   It rarely cuts costs!

If you think this article is useful and you would like more advice on dealing with this  – or any other people-related issue in your business – please join our mailing list, or contact us for further guidance.

Flexible Working At Christmas – A Gift For Your Staff And Business

Flexible Working at Christmas can be such a huge benefit. You may already embrace flexible working within your organisation. But if you don’t, then Christmas is a time of year when you might think again.

In general, there are many good reasons to allow flexible working.  It can increase productivity, retention, improve trust and wellbeing.  But at this time of year, above all others, the gift of flexible working can make a massive difference in your workplace.

This article will look at a few of the reasons why your employees will thank you for allowing flexible working.  If you ask them, they will probably come up with things I haven’t listed here.  But they are not the only ones to gain from flexibility.  Your business will benefit too.

School Holidays and Caring Responsibilities

School holidays are among the most obvious issues which arise at this time of year.  Schools close for the holiday period and parents have to make alternative arrangements for childcare.  This may mean using up their own hard-earned holiday allowance.  Or it may be the additional cost of paid childcare.  Either way, many parents will be very grateful for some flexibility which allows them to be there for their kids.

And it is not just those with children.  Many of us have caring responsibilities and they don’t all involve children.  Day centres for the elderly or disabled also close at this time of year, or have staff shortages.  The additional burden falls on the nominated carers. Paid carers also want time off to be with their own loved ones.  It can help enormously if you can allow flexibility in how and where your employees do their work for you.

Nativity Plays and Carol Services

While we are thinking about parents, we should consider that they are likely to want to take time out for various activities.  Schools put on nativity plays and carol services, or even just Christmas parties.  It is only natural that parents want to attend and support their children.

Again, it is not just those with children.  It is the time of year for parties and celebrations. It is a time for short break trips to visit Christmas markets, or see various tourist sites with Christmas lights.  Whether or not people actively celebrate Christmas, many want to be with their families.  For some, that can mean extensive travel.

If you can give the flexibility to allow people to fit all these arrangements around their work, you will make huge strides towards a culture of trust and mutual benefit.

Driving Home For Christmas

Driving, or any other form of travel, can be incredibly stressful at Christmas.  Rail and bus timetables are often disrupted.  In the northern hemisphere,  the winter days are shorter.  So travel to and from work is done in the dark.  The roads are busy.  Often the weather can be bad, wet or snow, or both.  And there is always a concern that someone may have had too much to drink.

If we can adjust the times at which we travel, then it can be such a relief.  Or maybe even cut out the commute to work completely.

And on the subject of alcohol, what about last night’s party? How many of us can say we have never been to work with a hangover?  The effects of alcohol hang about a lot longer than we think.  Even if we don’t feel ill, we may be slow to react – or less alert.  Certainly, we are not safe behind the wheel of a car.   Even if we make it safely in to work, then how productive will we be?  If we could have a later start and finish later, or make the time up another day, then that could really help.  It might also mean we produce better results.

Preparations for Christmas

For many of us, Christmas is a really busy time of year at home.  There is extra cooking to do.  Making a cake or preparing party food.  There are extra beds to make up for all those visitors.  Not to mention the shopping.  And wrapping up the Christmas presents.  Writing cards and letters and decorating the house.  All of it is great fun, of course, but it all takes time and adds to the stress.

If our employer is flexible  we can work at home, or adjust our hours.  This helps us to plan better and achieve all those extra things without so much anxiety.

Which means that flexible working is also good for our wellbeing.

Business benefits of flexible working at Christmas

As an employer, you may think that this is all about your employees.  And, of course, it is a huge benefit for them.

But you will reap the rewards as well.  When you allow flexible working, your staff will be less stressed.  They will be able to concentrate properly at work and their productivity levels will be higher.   They will be happy and more healthy and that will affect their dealings with their colleagues, and your customers and suppliers.

The biggest benefit for you as an employer will be the increased trust between you and your employees.  Your reputation as a good employer will be enhanced.  That can only improve retention and recruitment, as well as giving a happier workplace.

So give your employees the gift of flexible working this Christmas, and see what gifts it brings for your business in return.

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Is Being “Always On” Good For Productivity?

What impact does technology and the “always on” culture have on productivity?

Technology allows us to work when and where we want to.  But is the “always on” culture good or bad news for productivity in UK business?

A recent article in HR News discusses a recent survey by Aviva. The findings are that 72% of UK workers are checking their emails outside of work hours. On average we spend up to two and a half hours per week working outside our usual hours.  This equates to an extra 16 days at work per year.

Employers may feel this is good for productivity.  Additionally, in these days of flexible working, we like to be able to work at times to suit our lifestyles.  Technology allows us to do this, so where is the problem?

Is it bad to be able to work outside normal hours?

Many people like the freedom to catch up with some work in the evenings or at weekends.  If we work flexibly, it gives us the chance to take time out of work during normal hours.  Then we can make up the time missed when it suits us to do so.

But the downside is that we never really leave work behind for the day.  It is too easy to keep in touch remotely, which means managers can (and do) send emails outside working hours.  That is fine and they probably don’t expect an answer there and then.  But many of us see an email from the boss and think we need to be working because our manager is working.  It doesn’t matter how much a manager says “do as I say, not as I do”, it is human nature to want to please.  Particularly, we want to please the boss. So if we see them working we automatically feel guilty if we aren’t working too.

There is emerging evidence that this is having a detrimental effect on mental and physical well-being. We want to please the boss, but we also want to spend quality time with family and friends.  And we need to have a break from work.  Research by the Chartered Institute of Personnel and Development (CIPD) in 2019 found that 87% of organisations reported the inability to switch off after hours as the biggest negative effect on employee well-being.

What can employers do?

Have you thought of banning email at weekends or after certain hours? American healthcare company, Vynamic, have banned people from sending emails between 10pm and 6am and any time at the weekend.

You may think that this policy is a backward step for flexible working.  But the ban is only on hitting “send”.  Managers and employees are free to work whenever they please and to draft emails, but they are not able to send the emails.  If the matter is urgent, they can text or telephone the other party.  Vynamic have found that this ban is really effective.  Because there is no danger of getting emails, employees don’t feel the need to check for any and so they are free to enjoy their downtime.  And the sender of an email has to stop and think if the matter is so urgent that they need to send a text or pick up the phone.  Mostly it is not that urgent.

The CEO of Vynamic says it is the best benefit they have ever introduced – and at no cost.  Employee well-being has improved hugely.  What is more, the retention rate has increased as well as people want to continue to work for a company where they are valued and truly get a break at the end of the working day or week.

Do you want your employees to be well and happy?

Of course you do.  We all want that for our employees. It makes great business sense.  Well and happy employees are loyal and want to continue to work for you.  They are your advocates and tell your clients and the world that they work for a great company.

Then there is the financial aspect.  The cost of implementing this rule is fairly negligible, yet it has a huge impact.  The other financial benefits include reduced absence and a lesser need for recruitment.  How would you like to be the CEO of a company where everyone wants to work for you?

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How To Change Your Corporate Culture So Your Profits Increase

Do you think you need to change your corporate culture?  If nothing is wrong, you may not think you need to change.  But just because nothing seems wrong, it doesn’t mean a change is not necessary.

Some time ago I worked with a company of about 300 employees who were spread across a number of different sites.

The Company had grown from a family owned and run small business and had built up a reputation for quality and innovation.  Sadly, to a certain extent, they were still relying on their good name and the culture had slipped in to one where people were just jogging along.  There was no innovation and productivity was getting lower.   Nothing was particularly wrong, but there was a general air of boredom and a lack of enthusiasm.

Additionally, there were petty squabbles among staff and people were quick to raise a grievance.  The rate of sickness absence increased for minor ailments.

Taking Action

The Board of Directors decided to combine the work done at the various sites.  Consequently they would move everybody to one site.  This was intended to decrease the overheads.  Additionally, productivity might be increased by bringing everyone under one roof.  Such was the thinking.

I was brought in to facilitate the site moves. I soon realised that these moves, in themselves, would not solve the productivity problem.  In fact, initially, things were likely to get worse.  Rebuilding teams from people who had worked in separate physical sites was a challenge.  Particularly as each site had its own, slightly different, culture.

Deciding to change your corporate culture

If you think you might need to change your corporate culture, then where do you start?

For us, the first step was for the Board to recognise that a change was needed. They could see that the different site managers had each had a different approach.  This had led to a stricter, slightly stifled regime at one site, whilst a couple of others had become lax and mistakes were creeping in.   The first need was to establish what the desired culture should look like.  Then we had to build a roadmap of how to achieve that, with milestones along the way.

Collaborating with employees

If you want to change your corporate culture, it is really important to talk to the employees.

We wanted to know what worked and what did not (and why).   The organisation was unionised and we worked with the Trade Unions.  But additionally, at each site, we set up a working group of volunteers to plan the site moves.  We sent out a survey, to be completed anonymously.  This was to gauge what worked and what did not.  We also used the Trade Unions to speak to their members and line managers to speak to their teams.

One critical factor was to communicate the plans and proposals.  We also provided some training on managing change.  Where individuals had specific concerns and issues, we held individual consultation meetings.  Along with practical issues about the move, we also communicated our desire to build a new, collaborative, culture.  We asked employees to work with us to outline our future direction.  Their suggestions contributed largely to our plans.

Accepting casualties

We found that not every employee shared our vision of collaboration and engagement.  Some decided that they did not want to move sites; some decided that they did not like the new “feel” to the Company.  We provided training and support, where applicable, to help people to adjust, but we also accepted that some would never settle and agreed to an amicable parting.

There were also a number of people who were content to continue jogging along at their steady pace.  They were doing a good job, but not an excellent one.  They were not disengaged from the Company, but were not actively engaged either.  We approached this by giving every opportunity for them to voice their opinions, give their ideas, get involved.

For many, we accepted that “a good job” was good enough and that these were the backbone of the company. We trained our line managers in spotting signs of disengagement.  We gave them the tools to engage with their teams.

For the minority of high-achievers, who were full of innovation and enthusiasm, we had given a chance to shine.   We subsequently found that the number of these high-achievers increased.

Walking the walk

The first step in this change had been to engage with the top team.  This continued to be an important step and is an ongoing need.  The team at the very top of a company needs to be the example they want to set.  The adage “be the change you want to see” is critical in business.

Whether or not it is a conscious decision, employees will always take their lead from managers. If your employees see you working long hours, they will do so too.  They will assume that is what you want from them.

If you fail to take a break, or if you send emails late at night, then that is also what your employees will do.  If you go into work even when you are obviously sick, then your employees will drag themselves in as well – and pass their germs to all and sundry.

Getting it right leads to other benefits

When we are shopping, we want to buy from responsible producers and suppliers. We want to feel comfortable with their ethos and approach.  In the same way,  employees want to work for companies which have a culture which they can fit into.  If you have a good reputation as an employer, then you will find that recruitment is easier for you.  You will be able to retain good employees.  You will have a lower rate of sickness absence.  It is likely that you will have fewer performance issues.  This will also have a positive effect on your marketing and will appeal to customers.

So you might want to change your corporate culture, even if you don’t think it is bad.

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4 Secrets to Stop Your Employees Leaving

A client recently told me he was concerned as his employees don’t want to be at work.  As a result, people go off sick, or they leave.   Sometimes they have not worked for the business very long when they decide to leave.

Another client told me that some of his employees don’t perform their jobs very well.  They just don’t seem to be very interested in being at work. He thought the problem was that the work is boring and he cannot offer much variety.

The reasons why employees become disengaged may not be what you think

The boss often thinks that the reason why people don’t stay long is because they are not paid enough.  Or it may be that the work is boring and mundane and people get bored quickly. Maybe they are just lazy.

Of course, all of those things – and others – could be part of the problem.

But there are some more fundamental reasons why businesses may have trouble in keeping their employees.

The 4 main reasons why people are not interested in their work

1.Our contribution. We all like to believe that we are important.    The need to contribute something to the world is in all of us.  No matter how mundane, “boring”, or repetitive our job may be, it is critical that we can see why we are doing it.

2.Appreciation.  We also want to believe that what we say, think and do is noticed and valued.  We all like to be thanked for things we have done.  It gives a warm feeling.

3.Our voice. Part of being appreciated is being able to give an opinion and knowing that it has been heard.  No matter how mundane the job may be, the person who does it every day is an expert.  They may have a good idea about making it more interesting, or speedier.

4.Trust.  We like to think we can be trusted to “get on with it” without interference or micro-managing.  We want to be able to trust those around us and, particularly, those in a position of authority.  In return, we want them to trust us.

These things are inter-related, but all stand alone as well.  They are the four critical factors if you want to engage with and motivate your employees.

So what should the employer be doing?

1.Vision. You should share the vision for your business with your employees.  All of them.  If your aim is to provide the cheapest Will Writing service in your town, then make sure your employees know that.  Make sure you show each employee that their specific role contributes to that goal.

The work placement student whose job is just to answer the phone needs to know that he/she is a critical part of the operation.  If the phone calls don’t get answered quickly and politely, you risk losing business and credibility.  It doesn’t matter how cheap your service is if you don’t have any customers.

This message should be repeated often.  Make sure your employees know the importance of their part of the business.  Ensure they don’t forget how important you believe they are.

2.Appreciation.  It doesn’t cost anything to thank people for their efforts.  You may think that someone hasn’t actually made much effort.  So thank them for the time they have invested.  Sometimes just an acknowledgement that someone has turned up for work is all that is needed.

One of the most successful managers I know made a point of going to the desk of each of her staff every day and saying “Good Morning”.  She would ask them how they were and have a one or two line conversation, passing the time of day.  It reaped huge benefits for her in terms of loyalty and effort on the part of her staff.

3.Listening.  Many managers say they have an open door policy.  But do they really mean it?  Are they so busy that their diary doesn’t have a free space for two weeks? So if your door is not really open very often, don’t advertise that it is.  Your employees may be brimming with fantastic ideas which could save time, money and effort.  Or they may have a pressing issue which really needs your input.  Or they may just want to let off steam.

You need to ensure that your employees can raise suggestions, complaints or ideas, whatever their reason.  And you need to really listen to those things and respond carefully. If they feel they cannot be heard, they will leave your employment to go and work somewhere else where they can be heard.

4.Integrity and Trust. Your employees need to know that you trust them.  They may need some supervision if they are unsure of the work, or are new to a process.  But once they have learnt the ropes and feel confident, then you should trust them.  Of course, if they abuse that trust, you will need to take action.  But it is much better to trust them until they prove untrustworthy. The vast majority will bend over backwards to deserve your trust.

Strangely, you will find that if you trust your employees and show them that trust, then they are very likely to trust you as well.  That is the basis of a sound working relationship.  Your employees are far less likely to leave your employment if they feel valued and trusted.

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Performance Appraisal – Is It Just A Tick Box Exercise?

The debate has raged for years about whether the annual performance appraisal is just a tick box exercise or a useful management tool.

Many employees feel that this is just a painful exercise to satisfy HR and senior management. They think it doesn’t really mean anything. Especially if their voice is not heard.  Some HR practitioners and managers feel much the same way.

So what is the point of the performance appraisal?

Regular discussions between managers and their employees are really important.  These can be formal or informal, depending on the business and the style of working.  I would suggest that once a year is not nearly often enough.

Your people are an important asset (arguably the most important).  You need to ensure they are engaged with your business and aligned with your objectives.  Whatever you call these discussions – appraisals, reviews, 1-2-1 chats – they are an opportunity for you to listen to your employee.  They provide a chance for you to guide their successful employment journey with you.

The discussion should be a two-way conversation.  It needs to cover the employee’s job, their key responsibilities and their overall contribution to the company’s objectives.  It should help you jointly decide on development needs. Importantly, it should include recognition of the achievements and effort of the employee. Ideally, you should agree an action plan.  This doesn’t need to be long or complicated but it should reflect an agreed way forward.

Key points for discussion in a performance appraisal

  1. You need to highlight the things that the individual is doing well and any where some improvement is needed;
  2. Make sure they know how their performance contributes to the success of your business;
  3. Your aim should be to reach a joint decision about any training needs there are;
  4. Have an open discussion about any concerns they or you may have;
  5. Agree an action plan for moving forward.

 Critical factors for successful discussions:

  1. It is essential that there can be trust and openness between you . You should be building this from the first day of their employment with you.
  2. You need to be able to ask the right questions and make sure you really listen to the answers.
  3. The employee must be prepared to take responsibility for their actions, to hear and to learn.
  4. This is personal to that individual and should not be discussed with anyone else.  Keep it confidential.
  5. It is important to be consistent. The employee must come away with the knowledge that they have been treated fairly and in the same way as other people.

Things to avoid

  1. Once a year for performance discussions with the employee is definitely not often enough. Once a month is better – and makes the task easier.
  2. If you have having discussions often, then nothing should come as a surprise at the performance appraisal.
  3. Try to avoid too much discussion about past performance. It is important to recognise success and it is important to discuss any areas where development is needed.  But the main thrust of the discussion should be about future needs and how you can jointly meet them.
  4. Review processes often involve too much paperwork. Keep it simple.
  5. Be aware of any management bias. You may not personally like the individual, but that should not influence the discussion.  This is about their performance and the results achieved, not about how they achieved them.  So if they do things differently from you, don’t automatically think they are wrong.

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How Can I Help? (to improve Mental Health in the Workplace)

Mental Health in the WorkPlace has hit the news again this week, with The Duke of Cambridge talking on this subject to employers and employees from a range of British businesses.

I wrote a blog post on this subject back in May, but it bears repeating as there are things we can all be doing to help people cope.  Employers, in particular, can make small changes which will have a huge impact.  And why wouldn’t you, when it can also have a huge and beneficial impact on productivity and costs in your Organisation?

What can an employer do to improve mental health in the workplace?

Any organisation can – and should -create a Mental Health plan and then follow it and communicate it to all employees.  Here are some suggestions to help you to improve the mental health of your employees  and to combat mental health issues at work:

  • Create an open atmosphere where people feel they can talk about such issues. You can do this by making employees aware of what help is available and where they can access it. Facilitate open discussions amongst employees.
  • Ensure you offer enough breaks from work and make sure people take them. When we get engrossed in a piece of work, it is easy to skip lunch, or work late. But this can be counter-productive and lead to other problems.  Make sure people take regular breaks from work and have a change of scene.  Try and encourage a good work-life balance – and LEAD BY EXAMPLE.  If people see you working all hours and not taking breaks, they will follow your lead as they will think that is what you expect of them as well.
  • Try and give people interesting, varied work which they can excel at. This will increase their sense of worth and happiness at work.
  • Praising people when they do well, exciting them about challenges and opportunities, recognising them when they do well. All of these will help to prevent mental health problems from occurring in the first place. 

Supporting those with Mental Health issues

  • Think about appointing some Mental Health “First Aiders” or mentors.  They can act as a first port of call when somebody is in urgent need of support. As well as urgent issues, they can provide support and mentoring to those who have issues but feel they cannot approach you or their manager.  You would need to train these people, but it would be an investment well worth making.
  • If you manage people, or have line managers who support teams, then train the managers to recognise mental health problems and in how to manage such conversations.
  • The Mental Health Foundation provides a series of guides about dealing with mental health problems. You  can download these at no cost. Or you could order some paper copies to keep in the workplace for anyone who needs them.
  • If someone does disclose that they have a mental health problem, it could be made worse by other things.  Things such as money worries, fear of losing job, fear of taking time off, fear of talking about it. Investigate gently with the individual  – there might be something you can do to help with those concerns.
  • Offer access to a counselling service or at least a helpline.
  • If possible, provide a telephone in a private area, where an employee can ring a helpline or contact a charity for some help in an urgent situation.
  • Many Mental Health charities can provide support to you and your employees. Investigate the options which work for you and your company and provide details to your employees.  Provide a list of those charities to any employee who discloses they have a mental health issue.  There is a huge amount of help available for those who need it.

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The Truth, The Whole Truth and Nothing But The Truth

The Art of Giving a Reference

When we change jobs, we are all keen to be given a good reference to give to our new employer.

On the other hand, many employers these days only give a basic reference which confirms that the person worked for them for a specific period and what the job title was.  This is only of limited use to a new employer as it gives no indication of how well or badly the employee performed in the role or how they got on with colleagues and/or customers.

As a result, there is a general belief that “references are not worth the paper they are written on”.  This is a real shame when a little care could really help the recruitment process along.

Why do we only give out basic information?

Employers are frightened of horror stories of legislation.  “We might get sued if we say something nasty” and so they feel obliged to say as little as possible and to keep it very bland.  Additionally, many do not trust their managers to give references as they might inadvertently say something which may cause a problem for the Company.

Yet references should be a really powerful tool in the recruitment process. They should tell an employer whether the person is qualified to do the job and what experience they have; they should tell about any performance issues, or triumphs; they should tell of any misconduct or grievance; they should give an idea of the attendance record and any patterns of absence;  they should tell about the relationships and whether the person is a good fit for the new role and the team they will be working with.

How  can you write a “safe” reference, which also helps the new employer?

  1. References must be truthful and factual.  The manager or colleagues may have an opinion – good or bad – about the individual, but this should not be included, unless it is based on fact which can be backed up with evidence. So an opinion that “he was always late, never arrived in work at the right time” would need to be backed up with a record of occasions of lateness, plus evidence of a conversation (or even formal action) with the individual pointing out their lateness and exploring the reasons for it and giving targets for improvement.   Equally, if your opinion is that “she is the best sales person we have ever employed” then you should really be able to back that up with evidence of meeting high sales targets, or great customer feedback.  You don’t have to share any evidence with the new employer, but it must exist so you could produce it if anybody questioned the truth of your reference
  2. Contrary to popular belief, references can include “bad” things – but again, they must be backed up by evidence. So if the person  has a day off sick every other Monday, then it is fine to say so, as long as the attendance records exist which back this up.  It would also be helpful if you could show that you have taken this up with the individual and made them aware it is not acceptable and have agreed a way forward to improve things.
  3. There should be no surprises. You cannot say that the person was not very good at dealing with customers, unless you have had a conversation (or even a formal meeting) with the individual and told them about this problem and a record has been kept, with a copy given to the employee.  If dealing with customers is a critical part of their job, you would again need to show an agreed improvement plan.
  4. The employee may well get to see the reference. It is not unusual for a potential or new employer to show the reference they have received to the individual or even to ask their opinion of what has been said.  Indeed, I suggest this is a good idea for an employer to do.
  5. If you follow all these rules the individual will not be able to show it is not fair.  You might find it helpful to share a copy of the reference with them so they can see what has been said.  They may ask you to change it, but you don’t have to do that.  At least they will have seen you have been honest and they can take the opportunity to consider how to address any negatives with the new employer.
  6. These rules apply to verbal references as well as written ones. Employers sometimes feel they can get round the “difficult” issues by making  a quick ‘phone call to the previous employer, rather than getting a written reference.  This is risky as the person on the receiving end of the reference may well write notes or write the conversation down and it becomes as much of a liability as a written reference would have been.  In any event, is is unfair on the individual to say something which they are not able to be party to or to answer.
  7. Some employers get round the problem by allowing managers to give “personal character references” but not official work sanctioned references. This is also risky as the receiving manager is likely to think it is an “official” reference and to treat it as such, so the risks are still there.  It is better for the employer to produce the reference centrally, with input from the individual’s line manager – or to spend a small amount of time in training managers to write proper references (or show them this video!).

In a nutshell

Please produce and send meaningful references, following the above guidelines.  It will be helpful for the employee, helpful for the new employer – and you may be grateful for the same courtesy when you are next recruiting. It could help save an expensive mistake.

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