Category: 2016

22
Dec2016

Festive period closure 2016-17

Gravitate HR’s offices in Edinburgh and Glasgow will be closed from 12pm on Friday 23rd December 2016 and opening in the new year on Wednesday 4th January 2017.

On behalf of the team at Gravitate HR, we wish everyone the very best for the festive period.

21
Dec2016

2016 and the Implications for Globalisation

2016 is likely to go down in history as one of the most unpredictable years in decades, particularly from a business and political perspective.

The year marked two of the most historic political events in a generation. Britain’s decision to leave the European Union on the 23rd of June sent shockwaves throughout Europe and indeed the rest of the world, and resulted in the resignation of Prime Minister David Cameron followed by the appointment of Teresa May as our new Prime Minister. A few months later, Donald Trump defied pre-election polls by defeating Hilary Clinton to become the US President-elect.

The end of Globalisation?

In the last couple of decades, many academics, business leaders, and politicians have been commenting on Globalisation and the concept of the ‘borderless world’ that we are living in today. This is the idea that capital, goods, services, and people can move freely between different nation states, as well as the enhanced power of multinational companies who are able to operate in several different countries. Many academics were arguing as recently as ten years ago that globalisation was unanimously viewed as a good thing by states and the people that lived in them. If this statement was true ten years ago, it is hard to argue that this view remains the same on the back of the ‘Brexit’ vote and Trump’s victory.

The free movement of people to the UK from Eastern European countries was arguably the most important issue during the EU Referendum. Nigel Farage had frequently argued that this “globalised world” meant that the UK could not control the number of people coming into the country and that British nationals were being deprived of employment because of this. Meanwhile, in the US, Donald Trump was a harsh critic of America’s trade deals and even indicated that he would take the US out of the Trans-Pacific Partnership trade deal on his first day of office.

What effect could these events have on UK businesses?

I think the most interesting question surrounds the possible restrictions on the movement of labour and the effect that it might have on the skill levels of UK workforces. I am aware of one example of a prominent specialist engineering company that requires manual machinists to carry out their work. When you consider that the UK is dominated by automatic machinery, the pool in the UK for manual machinists has become so narrow that such talent comes at a high price, and the company decided it would be more sensible to recruit talent from Poland where manual machinery is a common trade. Therefore, if the freedom of movement is restricted to such an extent that Polish nationals find it difficult to move to the UK or are even forced to return to their homeland, this company could be faced with high recruitment costs or the need to upskill a significant proportion of their workforce.

This is just speculation at this moment in time as Article 50 has not yet been triggered, but hopefully 2017 will provide a clearer picture of what changes we can expect.

What does 2017 have in store?

It will be interesting to see if this assault on Globalisation continues in 2017. Aside from the ‘Brexit’ vote and a Trump Presidency, there are elections in the EU’s two main players. Angela Merkel will be running to be re-elected as Chancellor of Germany and Marine Le Pen of the National Front seems to be in a two-horse race with Francois Fillon to become the President of France. A Merkel defeat or a Le Pen victory would certainly be a significant blow to the EU.

If a similar trend continues in 2017, we could well see radical changes to the environment that businesses operate in with significant implications for the way in which they recruit talent as well as possibly ‘upskilling’ or ‘deskilling’ their workforce.

Image Source: https://www.theguardian.com/

14
Dec2016

Camping Out Just To Make Ends Meet – Working At Amazon

The festive period is the busiest time of the year for most businesses, particularly for those that operate within the retail sector. A perfect example of this is Amazon. Amazon was founded in 1994 by American entrepreneur Jeff Bezos and is the largest Internet-based retailer in the world in both total sales and market share. As of December 2016, Bezos is worth an estimated $65.7 billion.

Responding to the Christmas rush

Leading up to Christmas, consumer demand for products from Amazon reaches an extremely high level and the operational logistics function of the business is placed under massive pressure as a result. Like many other retail organisations during this period, Amazon will normally recruit temporary warehouse staff or indeed offer an increase in seasonal hours for their existing warehouse employees in order to respond to this increased demand. In Scotland, Amazon has two ‘Fulfilment Centres’ – one in Dunfermline and another in Gourock in the West of Scotland. In fact, Amazon’s warehouse in Dunfermline is the biggest in the UK at 1,000,000 square feet – the size of 14 football pitches – and employs approximately 1,500 permanent staff.

However, Amazon has frequently received criticism for their treatment of workers and this trend seems to be continuing after it emerged in the media that some warehouse staff were camping out in freezing temperatures next to the Dunfermline warehouse because they could not afford the costs of travelling to work from their homes in Perth, which is roughly 30 miles away.

Amazon: A history of bad practices?

As mentioned earlier, criticism of Amazon over their treatment of workers in the UK is not a new phenomenon. In 2013, a BBC Panorama documentary revealed the tough working conditions for their employees at one of their warehouses. Amazon employees were subjected to intense working practices as well as strict performance measures. Indeed, one of the experts in the documentary remarked that such conditions could “increase the likelihood of mental illness as well as physical illness”, with trade unions also describing worker conditions as among the “worst in Britain”. These recent developments are likely to attract even more criticism and perhaps convince people that the company does not take worker wellbeing seriously, despite making public statements that it was their “number one priority”.

Given the fact that the main reason for these individuals deciding to camp outside in freezing temperatures was that they could not afford to travel to work, there have been calls for Amazon to start paying their staff members the voluntary Living Wage. The company has responded by stating that they pay their associates £7.35 an hour with an £11 an hour overtime rate.

Labour Costs Versus Profit Maximisation

This situation once again highlights the perceived conflict between the cost of labour and a company’s bottom line, and the relatively new concept of a Living Wage has added another dimension to the debate.

A recent survey of over 150 accredited Living Wage Employers in Scotland produced some interesting statistics: 67% of employers found Living Wage accreditation had a positive impact on staff retention; 66% thought it had a positive impact on recruitment; 78% felt it had a positive impact on staff morale/motivation; and 55% thought it had a positive impact on productivity.

On this basis, companies (particularly ones as large as Amazon) should have no qualms with increasing their basic wage rate for staff. However, one could perhaps argue that, when considering the popular service that Amazon offers, are consumers really going to be put off by stories like this to the extent that they stop purchasing goods from the company? So, is there any real incentive for Amazon to make effective changes apart from improving their reputation as an employer?

Whatever solution Amazon produces, we can only hope that having to camp in freezing temperatures is no longer viewed as a necessity by workers in order to make work pay.

Image source: dailymail.co.uk

Covert Recordings – What’s an Employer to do?

It would be wise for employers to recognise that it is becoming more common for what is termed “covert” recording during disciplinary and grievance proceeding by employees. That is, employees are taking it upon themselves to secretly record the meeting, without the knowledge of the other participants.

So, what do the Employment Tribunals say? Are these “covert” recordings admissible or not?

Secret recordings taken by an employee during a disciplinary hearing or a meeting will generally be admissible evidence where all parties are present. Where an employee continues to secretly record, when they have left the room and captures private discussions between the manager and HR, a tribunal will tend to frown on this and not accept this as evidence.

What steps can an employer take?

  • You may want to clearly state in your company policy that employees are not permitted to record meetings.
  • You may want to consider recording all meetings.
  • When meetings are adjourned ask/ensure employees and their representatives take their belongings with them.
  • Ask the employee if they are recording the meeting and if appropriate ask the employee to show you their phone to make sure.
  • And, assume that you are being recorded during the meeting.
08
Dec2016

Sports Direct

Background

We’ve all been reading and hearing about Sports Direct on the TV, in the paper, on the radio… But what really happened? What are the issues?
At the end of 2015, the Guardian sent two undercover reporters to work at Sports Direct’s warehouse in Shirebrook in Derbyshire.

Read more

28
Nov2016

The Autumn Statement 2016

The Autumn Statement 2016 and Non-Financial Rewards

This year’s Autumn Statement was Phillip Hammond’s first as Chancellor of the Exchequer. Ironically, however, it will also be his last as he announced that from Autumn 2017, there will be an Autumn Budget followed by a Spring statement. Therefore, next year’s Spring budget will be the last of its kind before the UK reverts to having a Spring statement in 2018.

As always, the Chancellor’s words were closely monitored by many business leaders to see how the Government’s plans would affect them.

“Salary Sacrifice” Schemes

A “Salary Sacrifice” scheme is a term used to describe a situation when an employee will “sacrifice” part of their salary for a non-cash benefit (such as gym memberships or mobile phone deals) with the business and the employee also benefitting from having to pay less tax.

The Chancellor remarked that such schemes are “unfair” and will abolish many of them from Spring next year. However, some schemes such as child care, cycling to work, and pensions will not be affected by the decision.

However, the measure announced in the Statement was not met with the widespread approval from business associations and lobby groups. The CBI, for example, argued that the measure would “send the wrong signal to companies wanting to invest more in employee health and wellbeing”. Furthermore, the Reward and Employee Benefits Association argued that the changes would affect lower paid workers the most, remarking that “essential employee benefits have been caught up in the change”.

‘Non-financial’ or ‘Non-cash’ rewards

I think this move prompts another debate over how valuable or beneficial these ‘non-financial’ rewards are to businesses and employees alike. Perhaps ‘non-cash’ is a more appropriate term given that traditional non-financial rewards such as gym memberships or supermarket vouchers can still have monetary value. There is no doubt that money is the most significant factor in whether an individual supplies their labour to an organisation; however, ‘non-cash’ rewards can still be an effective way of motivating employees.

A key factor in the effectiveness of any reward is that the nature of it must match the needs or desires of the recipient. If a company is offering a discount on gym membership to a workforce which comprises of people who are not regular gym users, then there is less of a chance that it will yield any significant benefits. Many critics argue that although such schemes are great for regular gym users, non-gym users are likely to view it as something they have to pay money for, albeit at a lower price than usual. Indeed, it can be common for businesses to assume that, by offering gym memberships to their staff, they will automatically have a healthier workforce and benefit from lower levels of staff absence. According to the annual Absence Management Report by the CIPD, the average number of days lost per employee per year in 2016 was 6.3 days, which is down from 6.9 days in 2015.

Final Thoughts

There is unlikely to be a widespread elimination of these schemes by businesses as a result of the Autumn Statement, however they will be less financially sustainable than they were previously. It is hard to tell whether or not these changes will have a negative effect on employee health and wellbeing, as suggested by the Reward and Employee Benefits Association. On one hand, you could argue that these benefits are only used people who use these schemes to save money on a product or service that they regularly use anyway. On the other hand, these schemes could provide individuals, such as the lower paid workers mentioned by REBA, with an incentive or indeed the opportunity to go to the gym for example, which they could otherwise not afford. Only time will tell from April 2017 when the changes are made.

Image source

23
Nov2016

Equal Pay Day: How far have we come?

Thursday the 10th November marked Equal Pay Day – a day that acknowledges the long struggle for women to receive the same amount of pay as men. Equal pay is an interesting and sometimes quite complex issue that still holds relevance today. This blog will attempt to understand the ‘big picture’ around equal pay and why it remains an ambition rather than a reality.

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Success under Stress

Recently, I attended a fascinating seminar around the causes, effects and solutions for stress in the workplace; something that affects so many of us around the world in our everyday working lives. This Edinburgh-based session was courtesy of the Business Matters group, hosted by the CMS Law Firm and presented by the captivating speaker, Stephen Turnbull. Read more

25
Oct2016

Uber drivers: workers or self-employed?

Uber drivers await tribunal verdict on employment status – workers or self-employed, that is the question?

The ruling over whether Uber the taxi app, is acting unlawfully by considering drivers to be ‘self-employed partners’ rather than ‘workers’ could be delivered this week. Read more

19
Oct2016

Resourcing during uncertain times

Research conducted by CV Library saw a remarkable 9.8% growth in vacancies last month in the UK, suggesting that the labour market remains strong despite Brexit. However, this research does not provide details around what types of vacancies the growth has been in, whether these are permanent, fixed term or temporary project-based roles and it is clear that uncertainty remains. One can only assume that employers may be or will be re-thinking their resourcing strategies in the short term. Read more

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