HR Barometer for Housing Associations -  about to close! 

Our current survey gives housing associations the opportunity to benchmark the performance of their HR functions.  It is about to close, so if you would like to join then contact us today to find out more.

Pay lessons we can learn from the Budget - read our article 

Equality Act 2010 comes into force (1 Oct 2010)

The new Equality Act has come into force and harmonises existing laws on discrimination. As part of this, it is intended to create a more straightforward framework to address inequities in pay. See our Equal Pay page to find out how the law will affect your business in practice and how we can help you.

New Minimum Wage rates take effect (1 Oct 2010)

From 1 October 2010, the following changes were made to National Minimum Wage rates:

> Standard (adult) rate: £5.93 (up from £5.80) This has been extended to apply to workers aged 21 and over.

> Development rate (workers aged between 18 and 20): £4.92 (rising from £4.83).

> Young workers rate (workers aged under 18, but above the compulsory school age - who are not apprentices): £3.64 (increasing from £3.57).

> Apprentices: new minimum wage of £2.50 per hour for apprentices who are under 19, or those aged 19 and over who are in the first year of their apprenticeship.

Do you need to take any action?
The government has promised to ‘name and shame’ employers who flout the minimum wage laws from January, so it is worth checking that that your pay levels comply with these increases.
Also, if you use minimum wage rates, you should check whether there is an impact on those employees who are paid slightly above these levels - you may need to increase their pay to maintain the existing differentials.  

EBRS at the Business Show Bristol (20 Sep 2010)

A big thank you to everyone who visited our stand at the Business Show Bristol exhibition at Leigh Court on 15 September. It was great to meet such a variety of people and to talk about how we could help to meet your reward needs. We offered visitors to the chance of a free Reward-Check assessment. Don't worry if you couldn't make it, as we've opened this offer to any organisation so book your consultation with us.

A Reward-Check assessment will enable your company to find out whether it is getting value from the money it spends on rewarding its employees. It includes a no-obligation discussion with the person responsible for reward in your organisation. Afterwards, they will receive a report outlining the strengths and weaknesses of your company's current reward practices. Where appropriate, it will also suggest how more might be made of your reward spending.

We also ran a Pay Quiz to raise awareness of what influences basic pay levels in the market. Congratulations go to Sean Humby of Business Network SW, who was the only person to get every answer right. He'll be receiving his reward - a bottle of champagne - shortly!

CPI Inflation unchanged in July (14 Sep 2010)

The Retail Price Index (RPI) fell slightly to 4.7% in July, according to the Office for National Statistics (ONS) [1].  Meanwhile, the government’s target measure of annual inflation, the Consumer Price Index (CPI), remained at 3.1%. This measure excludes housing costs and has a target rate of 2%.

Economists had expected inflation to fall further, and underlying trends within the figures suggest that it will remain above the 2% target until early 2012.

Employers struggle to manage reward risks (2 Sep 2010)

The proportion of HR professionals who believe that their organisation is poorly prepared to manage the risks around how they reward their staff has grown in the past 12 months, according to a survey of Chartered Institute of Personnel and Development (CIPD) members.

The report, 'Managing reward risks', suggests that participants were most concerned about the overall effectiveness of reward to attract and retain people with key skills. Perceived poor line management capability to deal with reward matters was also ranked highly. Looking ahead, financial constraints and increased pension provision costs were seen as the reward risks that will need most attention in the future.

Pay freezes and benefit cuts during the recession have clearly made things difficult. Whilst participants were predominantly from organisations of 1,000 employees or more, the survey highlights the need for all organisations to get most value from finite reward budgets. It pays to review your reward strategy periodically to ensure that it is still appropriate for the challenges ahead.

Average earning figures (17 Aug 2010)

According to figures released by the ONS, average earnings in the year to June rose by 1.3%. This is well below the RPI, meaning that most people will have less spending power than they did a year ago, a trend that is likely  to continue over the next 12 months. 

Survey finds that pay reductions continue to be applied (20 Jul 2010)

Over three-quarters of employees who took a pay cut during the recession have still not had their previous pay reinstated, a study has found.

Some 77% of staff who accepted a pay reduction in order to avoid redundancy have not seen their pay return to pre-recession levels, according to the report by recruitment consultants Badenoch & Clark published in People Management.

The survey also found that employers were using alternative benefits in order to retain and motivate staff. 38% of employees were being offered flexible working hours, while 16% had access to remote working facilities or additional annual leave.

34% of employees revealed that access to training would encourage them to remain with their current employer.

Lynne Hardman, managing director at Badenoch & Clark, commented: “There is no disputing that the job market in the UK has been tough, particularly in certain sectors, over the past couple of years.

“Now the UK is emerging out of recession we could see employees being given more work for a lower remuneration package then pre-recession, which in turn could lead to many employees embarking on a search for new employment,” she continued. “Where budgets are tight, employers need to find other ways to incentivise staff to keep them engaged and to prevent them from looking for new opportunities.”

Pay rise trends update (12 Jul 2010)

Pay increases across the whole economy typically ranged from 1% to 2.5% in the early months of the year, when most settlements are agreed. Figures researched by Income Data Services indicate that the median rise was 2%, with around 10% of private sector organisations applying a pay freeze.   

The signs are that pay settlements outside the public sector are edging upwards. With RPI inflation expected to stay high for the rest of the year, pay pressures are likely to grow over the next 12 months.

We can advise on the developing pay trends in your sector. By checking the pay market for your organisation, we will ensure that your pay rates are competitive so that you get the most from your pay budget. If you would like to know more about how we can help with pay benchmarking or design, then do contact us.

Survey shows value of offering flexible working (3 Jun 2010)

Employees believe that flexible working is the most valuable benefit they can be offered, beating many financial rewards, according to a new survey.

Flexible working arrangements were rated the most important benefit by 47% of the 1,200 UK workers surveyed, above performance-related bonuses, which came second at 19%.  Flexible working was prioritised by a significant number of both men and women, with 41% and 54% respectively ranking this benefit the most valuable.  Read the full article in People Management here.

CIPD report shows how organisations can develop an employer brand that links strongly to employee reward (added 9 Apr 2010)

Integrating your employer branding and reward strategy can help to position your company positively for the upturn. This is one of the conclusions from a new CIPD report, Employer Branding and Total Reward.  The report's findings include:

• As reward can influence employee behaviours it should be linked to behaviours that ultimately support organisation strategy.
• Communication is a crucial way of reinforcing the employer brand as it raises awareness of the rewards offered by an organisation.
• While financial rewards are important, non-financial rewards can also be key in reinforcing the brand.
• It is important to check whether the reward approach is adding value to the employer brand. This can be done using HR metrics such as employee surveys or performance management data, as well as business metrics such as customer service or budget reductions.

The report identifies emerging themes and examples of good practice and highlights those areas where approaches to interlink the employer brand with the reward offering have worked particularly well. It also addresses the challenges that companies have faced during their employer branding journey and how these can be overcome.

Charles Cotton, reward adviser, CIPD, says: "There are many benefits that can be derived from having a compelling employer brand that is supported by employee rewards, which is demonstrated in our interviews. Engagement can be enhanced by a brand that is demonstrably aligned to rewards as it provides an opportunity for companies to put their money where their mouth is in promoting desired corporate behaviours and image. Engaged employees who believe in the brand then promote the image more effectively to customers."  This is an interesting report and can be downloaded here.

How can EBRS help you? (added 23 Mar 2010)

Download our new brochure to find out!  It contains a summary of the range of services we offer.  Have a look and give us a call to discuss how we can help. 

We've also launched our Reward Review service, that gives you the chance to tailor a review of your reward strategy to suit your needs.

EBRS survey finds that charities' pay decisions are being affected by economic uncertainty and organisational change (added 24 Feb 2010)

34 charities took part in our survey in early February, examining their approach to pay rises and their plans for reward strategy in the year ahead. 

> Their median pay increase is expected to be 1% in 2010, which is identical to last year’s pay round.

> Charities are planning different approaches to pay, with some looking to freeze pay whilst others expect to make average increases of as much as 3%.

> A quarter expect staff numbers to rise this year, but worryingly 19% think that numbers will fall, largely due to reductions in funding and the need to cut overheads. 

> Over half of participants plan to make their pay decision by the end of March, against the backdrop of organisational change and economic uncertainty.

For many charities, what had looked to be a straightforward decision to apply a pay freeze has been complicated by recent increases in inflation.  They now need to balance budgetary considerations against the need to keeping up with pay market.  This will be crucial if they are to be able to recruit and retain high performers during the year ahead.

The uncertain economic climate has made it tricky to benchmark pay accurately.  Many organisations froze pay last year and are reluctant to repeat this in 2010.  Those that awarded modest rises in 2009 now need to think carefully before freezing pay.

The 21-page report is available for purchase for just £50 plus VAT.  Contact us to order your copy.

How will you hold on to your best people as the economy recovers?       (12 Feb 2010)

Recession has meant that key performers who might have moved elsewhere in 2009 have tended to stay put.  However, when signs of an end to economic stagnation begin to emerge, it is inevitable that this pent up pressure will be released. 

A recent survey of European companies published by the Corporate Executive Board (CEB) states the obvious.  High-performing employees are 10% more likely to leave their organisations today than a year ago and, when the economy does pick up, up to 65% of the high-performing employees who said they are most likely to leave, could actually do so.

A recent report, ‘Creating an Engaged Workforce’, by Kingston University on behalf of the Chartered Institute of Personnel and Development, suggested that engaged employees perform better, are more innovative and are more likely to want to stay with their employer.

The challenge for HR professionals in the year ahead is to create a climate that promotes engagement with their employees.  Making staff feel valued is key to this approach, not only through ensuring that they are fairly and competitively rewarded, but also by following the basics like keeping them informed and recognising their achievements.

ONS reports average rise in pay of 2.6% in 2009 (10 Feb 2010)

The annual average wage for full-time employees rose by 2.6% in 2009, according to The Office for National Statistics’ Annual Survey of Hours and Earnings[1].

The data found that public sector workers enjoyed average rises of 2.8% last year, whilst private sector employees received pay rises of just 0.8%.

What will be the key reward issues for 2010? (15 Jan 2010)

Below is an extract from an article that highlights the reward challenges that we will be facing this year.  Read the full text, by Alastair Hatchett, head of pay and HR services at Incomes Data Services, in People Management magazine.

The top four issues he highlights are:

1) Inflation returns after a year off. Pay freezes were more palatable in 2009 because  inflation was in unprecedented negative territory. From January 2010, RPI inflation will move sharply back to a more usual 2.5 or 3 per cent level. Private-sector pay rises of 2 to 3 per cent are anticipated as economic recovery takes root.

2) Pay freezes are thawing out. Some pay freezes last year were seen as deferring decisions, while others were emergency reactions to a critical collapse in demand. Some involved an implicit suggestion that discussions would resume when things got better. Many of those employers that chose to freeze pay in 2009 now hope to award increases in 2010, while others that did not freeze pay last year will seek to keep increases in 2010 to a modest level.

3) Recessions create anomalies. Some companies froze salary scales last year but chose to pay progression increments. Some chose to pay bonuses but freeze basic pay, while others increased basic pay but decided to freeze bonuses. Many firms went down the route of freezing recruitment and promotions. As the economy begins to open up again there will be all sorts of pay anomalies to deal with.

4) Pay benchmarking. This will be used to re-establish market-related salary levels and to adjust all salaries and benefits that have gone out of line during the recession. Market adjustments will help to sort out anomalies and may well take place outside of annual pay reviews.

Contact us to discuss how we can help to benchmark your pay levels and deal with the reward anomalies caused by the recession.

[1] Source: Office for National Statistics (http://www.statistics.gov.uk/). Crown Copyright material is reproduced with the permission of the Office of Public Sector Information (OPSI)