When was the last time you were up at 3am? Big birthday bash? New baby? Box set? There are many life-affirming reasons to have your eyeballs open at silly o’clock. But slaving over your accounts or squinting at your Google Analytics dashboard aren’t among them. There are four classic mistakes that start-ups and small businesses often make. Here’s how you can avoid them:
There’s an unavoidable period where start-up owners have to wear all the hats: sales, marketing, finance, IT, operations. While it is possible to find joy in all these tasks (the thrill of a sell, the hum of a server, the glint of a spreadsheet anyone?) there are some you will always despise. But if you’re not careful you’ll end up doing everything forever. So cherry-pick the bits that give you a buzz and for everything else, use freelancers to get it off your desk and get it done. If you can’t face your accounts, your blog or your SEO, ship them off to someone who can. You get some sleep – or finish that box set.
If you’re trudging through your tax return or fiddling for hours with Photoshop, you’re definitely not making best use of your time and you’re probably not making a great job of it either. Don’t run your business doing lots of stuff averagely; do less stuff, but outstandingly. Build a network of fellow specialists and you’ve created a multi-skilled team without employing a single person. Find freelancers with the right skill set and experience, check out examples of their work and read independent reviews from other business owners. When you hire, set a fixed rate, for an agreed period, with clear deliverables.
Unless you live in a cave, you’ll know the two Truths of Domestic Existence: 1) you will one day, possibly quite soon, have need of a good plumber and 2) there is nothing harder to find than a good plumber. However – and here’s the point – you still wouldn’t hire a permanent one would you? Similarly in your business, you might have a recurring but unpredictable need for say, a proofreader, a salesperson or a website designer. Using online hiring platforms such as Elance or ODesk to hire an expert resource on a project-by-project basis – exactly when you need it – keeps your options open and your cash available. Even if business is flying at the moment, future demand is hard to foresee. Focus on what you need now and stay flexible for as long as you can.
What happens when you go on holiday or get ill? Do all gears grind to a halt? If so, you’re not running a business, you are a business. Diverting streams of repeat activity such as admin support or website maintenance through reliable freelance channels makes your business less vulnerable to disease, pestilence and man-flu. It also gives you a greater sense of progress: in addition to the furrow you’re ploughing, you have another production line. Most importantly however, placing tasks with others automatically promotes you to an executive position. That means you are reviewing, checking, approving and deciding everything, which is a lot less time-consuming and more important for your business than doing absolutely everything.
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“More than ever, students go to college [university] because they want to get jobs – good jobs,” states Navneet Kapur (“Product Innovator, Higher Ed Data Vigilante at LinkedIn, San Francisco Bay Area”), writing on the LinkedIn Official Blog. “To that end, students and parents want to know which schools give them the best chance at getting a desirable job after graduation. This is where we can help.”
He continues: “By analyzing employment patterns of over 300 million LinkedIn members, we figured out what the desirable jobs are within several professions and which graduates get those desirable jobs. As a result, we [can] rank schools based on [graduate] career outcomes.”
Kapur goes on to define a “desirable job” as a “job at a desirable company for the relevant profession. We let the career choices of our members tell us how desirable it is to work at a company.”
According to LinkedIn’s UK University Rankings, if someone wants to become an investment banker, they will greatly improve their chances if they study at the LSE (London School Economics and Political Science, which, perhaps somewhat less predictably, also comes out on top for wannabe marketers), UCL (University College London), Cambridge, Oxford or Warwick universities.
If they dream of working in finance, getting on a relevant course at the LSE, UCL, Cambridge, Imperial College London or the University of Warwick would be a wise first step. And, for a career in the media, best head for the universities of Leeds, Oxford, Nottingham, Cardiff or Durham.
No doubt LinkedIn has the very best of intentions with their university rankings, but they ignore two key points. Firstly, many graduates build great careers after taking positions with small businesses, where they can also find (equally if not more) “desirable” jobs. Secondly, UK universities are now a fertile breeding ground for enterprise, with starting a business continuing to prove an irresistible attraction for many students.
“Many of our graduates welcome the opportunity of working for smaller businesses,” says Hannah Newmarch, head of employer partnership services at the University of the West of England (UWE) in Bristol. “We support SMEs in our region that want to recruit graduates and we help to fill hundreds of vacancies each year.”
Not all UWE graduates are attracted by the prospect of working in London, either, as Newmarch explains. “Each year, about half of our graduates stay in the West of England region, which is home to almost 37,000 SMEs; there are far fewer large corporate employers here. Many graduates make their decision based on the role and not necessarily just company size. Many end up at small firms doing exciting, innovative work in sectors that are buoyant in our region, such as media and engineering.”
Choosing to work for a smaller business can offer many benefits, she says. “In an area such as Bristol, where many SMEs are highly successful, students recognise that opting to work for a small business can bring them more responsibility, greater experience and other career opportunities sooner. Many students now recognise these benefits. Earlier this year we held an SME-only employer fair and more than 700 students attended.”
As Newmarch also stresses, enterprise culture is thriving at UWE and other UK universities. “In 2013/2014, 241 UWE students/graduates set up their own business. It remains a challenge, of course, but we provide a ‘safe place to fail’, so students can test and develop their ideas with mentoring and support from our staff.
“As well as learning about enterprise, they can develop their networks and hone skills such as leadership, commercial awareness, personal branding, etc. They might not set up a business on graduation, but they may start up after gaining experience by working for someone else.”
Newmarch says the last thing many graduates want is to end up a very small cog in a large wheel. “Running their own business gives many people more autonomy and greater opportunity to pursue their passion, using knowledge and experience gained at university. Some of our former students who are now successful entrepreneurs return to give inspiring talks to our students.
“Whether working for a large or small business, not everyone wants to live in London. Bristol was recently voted the best place to live in the UK. It has one of the largest economies in the UK and there are exciting opportunities for growth here. Why would you want to go anywhere else?”
Blog written by Start Up Donut editor and freelance SME content writer Mark Williams.
The world of work is changing. The Connected Age has enabled business to become more agile. Online work platforms provide access to professional talent quickly and affordably, meaning businesses can staff up when they need to, and quickly respond to changes in market demand.
Outline exactly what’s expected and try to answer the freelance’s questions up front. For example, if you’d like to have an article written, specify exactly what you’re looking for and don’t neglect details such as word count, purpose, subject and key themes.
Spell out the skills you’re looking for. If you’re seeking someone with a background in animation or Adobe Photoshop, make that clear. Include the timeframe and decide whether you’ll be hiring on an hourly or fixed-price basis. Hourly projects are useful for ongoing work or if the scope of the project may change.
Outline a budget. Freelances are generally professionals who work online for a living. Set the price at a level that you believe is fair.
It’s important to consider all factors when evaluating proposals from freelances (not just the price).
First and foremost, you should avoid template submissions, and focus on those that are written specifically for your project. Look for professionalism and attention to detail, plus a logical structure and information flow in the proposal.
Some freelances will include samples of their previous work. Give the most weight to samples that are closely related to your task. Ultimately, it’s wise to select freelances that are most excited by the opportunity, show that they are truly interested in the work, and can bring enthusiasm and quality to the finished product.
In addition to a freelance’s proposal, you can delve deeper into their profile to get a better sense of how they will perform. Review their ratings, work history, accredited skills and examples of past work. Browse through written feedback from previous clients and see how the freelance responded to this feedback. This can be a good indicator of the freelance’s level of professionalism.
Consider the freelance’s expertise, but don’t be afraid of new profiles. Although untested, these freelances may be more motivated to impress you in order to launch their freelancing career. Use multiple forms of communication to screen candidates and get a better sense of how they’ll work. You can send emails or make video calls, but be sure to record all communication on the platform for safety and future reference.
If you’re hiring for a long-term or recurring task, do a small test project to evaluate two or three freelances before making a selection. You’ll get a good idea of each person’s skills and work style to help you make a better decision.
If you need to provide sensitive information, ask freelances to sign a non-disclosure agreement before engaging in further discussions. This will help protect your intellectual property.
When you’re ready to select a freelance and finalise negotiations, confirm the price and the job terms before awarding the job. If the scope of the project or milestones change, you can always update a project’s terms with agreement from the freelance.
Communication is key when managing online projects, and you should constantly ask questions and track progress to ensure outcomes and deadlines are met. Use the tools available to view work in progress, and set clear timelines for receipt of deliverables.
For hourly jobs, be sure to review timesheets on a regular basis so that there are no surprises. For fixed-price jobs, specify the milestones and key dates you expect work items to be delivered. This gives you multiple opportunities to view, approve and pay for work along the way. Request weekly reports on tasks performed, hours worked, files completed and plans for the upcoming week. Ensure all files are uploaded and all communication is tracked.
By using online talent you only pay when services are delivered. As the freelance completes phases of your project, evaluate their work. Is it what you expected? Be straightforward with your freelance about their performance, their professionalism and their overall contribution to your business. Feedback enables freelances to grow their careers and businesses to thrive.
When you’ve finished the project and paid your freelance, take a moment to rate their performance. Be honest and professional. You can provide feedback both one to one and for the broader community to see. Your opinion matters, because it is the most significant way clients differentiate between freelances. Once you get started, you’ll find that hiring talent online is a safe, fast and effective way to get things done.
For many business owners, striking a happy work-life balance is like finding the pot of gold under the rainbow: it’s something we all strive for but never quite achieve. For anyone who works with family members, it can often seem like nothing more than a fantasy.
According to the Institute for Family Business, family firms now account for two thirds of private sector enterprises in the UK and family-run businesses experience a range of unique challenges. Here are my five tips to help you and your family create a healthy work-life balance, as well as create a more productive workplace.
Always communicate openly, calmly and clearly between yourselves during work hours. Resolving those inevitable disputes and clearing the air before you leave work is fundamental to not bringing the stresses of the day back home with you.
You’re family, but you’re also at work, so maintaining your professionalism is not only essential to the atmosphere you create for your employees, but it also helps you separate the two areas of your lives.
It’s easy to fall into the habit of only seeing the people you work with at work. But when your colleagues double up as your family members, it’s important to carry on doing what families do together – socialising and supporting each other.
There’s always a level of guilt that comes with leaving work before a colleague who’s up against it (even more so when it’s a family member). By all means offer support and stay late every so often, just as long as it’s not a regular occurrence, or resentment could easily build. Better to review workloads at the next staff meeting and make sure tasks are divided equally.
This is obvious - everything works better if it’s organised. As a family, decide upon a way of filing or structuring systems – and all stick to it. Better you all find a new efficient system, than each battle on with some archaic process that creates more harm than good.
© Copyright 2014 Ben Copper. Ben is the founder of family-run business Nutshell Construction.
From the Grumpy Boss to the Barely-There Manager and the “David Brent”, every manager has a different style of management. Officebroker.com looks at ten types of boss. Maybe you’ve worked for one. You may even be one of the following…
They put everything into their job and are constantly willing to “take one for the team”. They have no concept of the word “holiday” and are in work regardless of the weather or ill health. They expect their staff to meet their high standards, so employees can forget about leaving early. Ever.
They are smarmy and often get a little too close for comfort. Establishing friendships with employees can have many benefits, but relationships must always be kept professional.
The type of boss who yearns to be both friend and mentor to employees. They imagine their “people” find them to be “hilarious” and great company, while still looking up to them. In truth, employees find them annoying, frustrating, offensive and a bit of a joke.
Tends to lose focus, with employees having no clear idea of where the business is heading as a result. When the Barely-There boss does show their face they always try to take credit for other people’s hard work and success, before disappearing out of the door for another “meeting” or to “work from home”.
Even when a situation is completely under control, the Stresser is always running around like a headless chicken. They’re first to panic when something goes wrong, and prefer to stress rather than find solutions. All employees agree that the workplace would be a much calmer (and better) place without them.
Never satisfied. They’re constantly leaning over employees’ shoulders commenting on everything they do. Lunch breaks are always too long and nothing is ever right. Grumpy Bosses damage employee mood, goodwill and confidence. And restrict their businesses as a consequence.
Has the biggest mouth of all. They probably don’t get the opportunity to voice their opinions outside the workplace, with employees’ eardrums suffering as a result. From moaning about their commute to sharing details of their divorce, they have no boundaries when it comes to telling others what they think.
Their mood determines their management. If they come in with a face like thunder, they’re best avoided – unless you want to have your head bitten off. Can be great when they’re in a happy mood, but can be extremely unpleasant at other times, when employees are forced to walk around on eggshells.
A totalitarian who rules by fear. Terror is their key weapon when seeking to motivate employees, often using the threat of the sack. They shout at their employees for whatever reason and treat no one with respect.
The Nice Boss gives praise where due and is always willing to muck in. They know where to draw the line when using their authority, which they’re not afraid to use when necessary. They don’t mind getting their hands dirty and helping out the team. They’re firm but fair and are respected by their employees as a result.
Copyright © 2014, Officebroker.com
Whether you’re a sole trader or manage many employees, you must ensure that important work gets done to a high standard and on time. So how do you prevent important tasks from being neglected?
Share the load with people who are stronger in areas where you are weaker. The work will get done; you’ll feel less stressed; and your business will benefit.
The tasks to delegate are the ones that are least enjoyable and require less-skill. Why? Because they are: easier to train others to do; cheapest to hire for; and often create the most distractions.
Before you hire, define the role along with responsibilities and desired output. Then match that against a few key considerations:
Introducing a system is critical if you want to ensure tasks don’t fall through the cracks. It will also you help you manage your team.
Create concise but comprehensive documentation and it will feed back into your business by making the training of new hires a breeze, ensuring your business runs without interruption. Remember to keep it concise and simple:
At the London Coaching Group, we have an efficient team that works very closely. And we exchange barely any emails.
What you need:
You then create column headings for:
So how do we use this?
Whenever a task comes to mind, I, as the team leader, add it to the spreadsheet straight away. My team then fills in the fields accordingly. Once a task has a "Date complete" I double-check the task. Once I've double-checked and it's done, I delete it from this list. Only I can delete.
My team and I keep this document open during our working day. It acts as our communal 'to-do' list. Everyone is aware of the status of all other projects, which makes meetings a breeze and ensures nothing falls through the cracks.
By using the tips and tools above you can run your business and your projects smoothly and efficiently. You will be 100% in control of each project, which reduces stress and that feeling of a ‘heavy load’. So you’ll have more time to work on your business and its future.
Copyright © Shweta Jhajharia 2014. Shweta is an award-winning business coach and founder of The London Coaching Group.
Smart businesses and entrepreneurs are increasingly getting more hands on deck by using freelancers online. Gone is the need for an endless list of “stuff I need to do” (aka everything). Whittling down your to-do list to the stuff you want to do (and are best at) and getting someone else to do the rest frees up your valuable time.
Across Elance and oDesk there are over 8m freelancers covering over 2,500 skills – that’s a big pool of talent you can tap into. But it’s not just a question of posting a job and then forgetting all about it. Online hiring can make a huge difference to your business but only if you approach it in the right way. Avoid these schoolboy errors and you’ll be laughing.
If you don’t know what you want, you’ll never get what you want. Whether you need a mobile app created or a piece of content written, clarity and details are all important.
The very first question you need to ask yourself is quite simply, what exactly do I need them to do? The more clearly you can define this the easier the process will be. Let’s say your website needs an overhaul. Perhaps you’ve gone as far as you can with free website templates and now need more functionality. Or perhaps it’s time to integrate a customised ecommerce engine that connects your market with your products. Take the time to work out exactly what you need. If you have an existing site, note where you are having issues currently (eg technical problems that come up on a regular basis). Prioritise your wish list into “must-haves” and “nice-to haves”.
If you don’t have the technical know-how to write a really great brief, your first job should be to find someone who can help you craft the brief before it even gets to the freelancer who will actually do the work. Trying to write a brief for something you don’t understand yourself is schoolboy error #1.
In the same way that you don’t buy a car without taking it for a test drive and you wouldn’t buy a year’s supply of wine you haven’t tasted, don’t launch into an enormous project with a freelancer you haven’t worked with before.
Start with something small to test the waters. Bite-size chunks are what you’re after. You could even try giving the same small job to a couple of different freelancers (paying them both of course – nobody should have to work for free). That way you get to see firsthand whom you like working with best. When you’ve selected your freelancer, again make sure the project is split into clear milestones and deliverables – and don’t forget to check in regularly.
You can find talent very quickly online. Often within minutes of posting a job you’ll receive proposals from relevant freelancers and it can be tempting to choose quickly and let them get on with it. Don’t. If you were hiring a full-time employee, you wouldn’t take the first CV that lands in your inbox, you’d wait until you’d had a few applicants, conducted interviews and checked references. All this can happen much more quickly online, of course, where you can see a person’s portfolio and read feedback from previous clients.
The bigger the job however, the more time you should take selecting the right person for it. On Elance, for example, you can conduct a video interview with your shortlisted freelancers to get a better feel for whether they are right. Also bear in mind that often the best freelancers are busy people and they may not have chance to see your proposal right away. For bigger design or development jobs you may be better off posting the job and then inviting selected freelancers to apply. Be sure to tell them why you’ve selected them specifically – flattery gets you everywhere!
• Blog supplied by Hayley Conick, Country Manager for Elance UK & Ireland.
Save time and get more done with online freelancers. Elance, the leading platform for online work is offering Donut readers $50 towards paying a freelancer. Whether you need a developer, designer, SEO expert or writer, Elance has over 3m skilled experts ready to help. More >>
I co-founded the cleaner-booking platform Mopp in April 2013. For us, hiring interns (ie a student or trainee who works in order to gain experience or satisfy requirements for a qualification) has been a great way to help grow the business while staying lean. But how do you find great candidates and motivate them to really contribute to your business?
Blog written by Pete Dowds, co-founder of cleaner-booking platform Mopp.
One of the biggest recent changes to recruitment has been the rise of the video interview. Enabled by lower cost, easy-to-use video conferencing software-based systems, an increasingly global job market and cuts in HR budgets have been key drivers. And with businesses facing pressure to speed up the recruitment process, a first or second interview can be conducted via video conference, played back and reviewed quickly and easily.
So with the traditional face-to-face interview being replaced by video, how can candidates and prospective employers better prepare themselves and what should both be aware of during a video interview?
First, a video interview features the same elements as an in-person interview, so the same rules of engagement, attention and acknowledgement must be observed. This means dressing to impress, looking alert, engaged and professional throughout.
Remember, 93% of communication is thought to be non-verbal, so don't forget to pay attention to body language. Positive body language includes nodding your head, smiling genuinely and leaning forward to show interest or understanding. A furrowed brow, frowning and leaning back can all be perceived negatively.
Also ensure that you have the proper hardware and test it before you start. A good webcam is essential to maintain eye contact without losing sight of the other person, and make sure you adjust your seat/computer to frame your face.
Use headphones too, because they are much better than speakerphones, which can amplify background noise, disturb and distract you from the conversation. Make sure you have a neutral backdrop, because a distracting or messy background may cause the other person to lose their attention. Proper lighting is important to make you look your best, and you also need to be aware of any reflective surfaces that can be distracting. Finally, be prepared. Just because it is remote, a video interview should be treated just like a face-to-face one.
Blog provided by video conferencing solutions provider Vidyo.
Every business owner wants their employees to be dedicated, hardworking and willing to go the extra mile by putting in extra hours when necessary. However, there is a balance to be struck between hard work and unhealthy, obsessive behaviour. So, has Britain become a nation of workaholics?
The stereotype of an overworked executive was once associated with American high-fliers, yet in recent years this poor work-life balance has made its way across the Atlantic.
Figures from the Trades Union Congress suggest that one in eight UK employees works more than 48 hours per week, while research from the BBC suggests that more than half (54%) of Britain's workforce regularly works through their lunch break.
People who work long and unsociable hours could be doing themselves serious harm. Indeed, studies have shown that working 11 hours a day compared to eight increases your chances of developing heart disease by 67%.
In Japan 'workaholism' is referred to as Karoshi ('death by overwork') and is the likely cause of some 1,000 deaths each year.
It is crucial that owners recognise the damage that a long-hours culture can have on a business and its people.
One American firm takes the idea of combating workaholism so seriously that its employees are punished for working more than 40 hours a week.
A less drastic approach is to implement time-management tricks that can help boost productivity and performance. Time wasted by office workers during meetings has been estimated to cost the UK economy about £26bn a year. Rather than sitting around a table, you could request that staff members stand for the duration. This helps to rapidly reduce meeting length, while ensuring the same ground is covered.
Some firms use video conferencing to keep in touch with key individuals. This provides a powerful way to communicate in real time, meaning work can happen anywhere and at any time. Something as simple as implementing a flexible working policy can help to combat workaholism. When handled correctly, flexible working can boost employee morale and motivation, while reducing absenteeism.
If a staff member suffers from ‘workaholism’, your first step should be to review their responsibilities and duties, to determine whether they're burdened with an excessive workload and identify any reasonable adjustments that can made to address the issue.
Under the Working Time Regulations employees aged 18 and over are limited to working 48 hours a week. Members of staff have the legal right to opt out, enabling an increase in their working hours, but this must be done in writing and on a voluntary basis.
Start-ups and small businesses have the upper hand when it comes to tackling overworking. Effectively monitoring and managing the issue helps to prevent a workaholic culture from developing.
Blog supplied by Helen Pedder, head of HR for ClearSky HR.
Happy employees are usually productive employees. If they believe they’re valued and an integral part of your business, employees will be more inclined to work harder because they will feel they have a personal investment in their role. Inspired by The Happiness Project by author Gretchen Rubin, here are five ways to try to ensure your people remain happy and well motivated…
Rubin says happiness is affected by a sense of control, so where practical try to give your employees a choice over what they do and when. Some businesses have flexible project management roles that are adopted by different employees or teams on a project-by-project basis. On a simpler level, giving your employees control over what they wear and how they decorate their workspace can also inspire happiness. Employees who feel their individuality is crushed by their job may soon leave.
Tight deadlines cause stress, yet they’re necessary for successful businesses. What is unnecessary, however, are long meetings where nothing gets decided. Cut meeting times in half by having specific topics decided beforehand, a time limit that is rigidly stuck to, and clear and concise actions so that everyone leaves knowing exactly what they have to do and for when. Keep all employees in the loop about important matters so that every team member knows exactly what stage of the project they are on. Set realistic targets and stick to them.
Take some chocolates into an arduous meeting; remember employee’s birthdays; organise office trips or team building activities. Even little rewards can achieve big results. Such small gestures contribute to an overall sense of value. Hosting a surprise office party in the middle of the day can be a great way to break up the working routine and re-energise your employees. Don’t see such activities as a waste of time, they’re important for employee happiness and productivity.
Make your business more than just a place to work. By inspiring a feeling of community, your employees are more likely to work together, help each other and look forward to coming to work. This can also spread to your local community – get involved in charity fundraisers, sponsor events and take part in team races and other activities. This will not only get you noticed, but also make your employees feel proud of where they work.
Invest in decent chairs and educate your employees about exercises and stretches to relieve tension and retain energy. Make use of the other businesses nearby; perhaps speak to a local gym or exercise class to get discounted deals for your employees. Educate them on the importance of healthy living (but practise what you preach).
If your employees are miserable, they’re likely to convey this to others and it will also be reflected in their attitude, which will affect their performance. If you employ people, place their satisfaction at the top of your priorities. Make them feel valued and that they have a stake in the future of your business. Then you can work together to make your business a success.
Blog supplied by Sophie Turton of Crunch Accounting.
We all make mistakes – it’s inevitable. In fact, it’s desirable. Unless people are pushing themselves, innovating and taking risks, a business could stagnate. What’s more, an inevitable part of risk-taking is that mistakes will happen.
And while you may not want to create an environment where mistakes are feared, you need to address them. Fortunately, it need not be an excruciatingly painful process for you or the person who’s messed up.
If you are tempted to ignore mistakes or brush them under the carpet, you may find that your business suffers and people never improve or progress.
Instead, if you deal with the situation, your business will benefit from fewer mistakes. Fewer refunds will need to be issued, there will be fewer quality control issues, fewer customer and colleague complaints, and less time spent rectifying the same errors. Also, the employee will understand clearly how to avoid making similar mistakes in the future.
It’s important to identify what type of mistake has been made. Is it major or minor? While a spelling mistake in an important document may not be a sackable offence, wilfully neglecting an important client is pretty inexcusable.
Similarly, is this the first of its kind, or an oft-repeated action? No one is perfect and mistakes do happen, particularly when people are undertaking a task for the first time. This, though, is vastly different from someone who persists in making the same mistake over and over, despite being told about it and perhaps receiving training intended to help them get it right. Identifying the type of mistake you’re addressing will inform what you need to do about it.
If you have identified that the mistake needs addressing, before offering an opinion, suggestion or sanction, fully investigate with all necessary parties three things – what caused the mistake, who was responsible and what the impact was. There will be countless times you will be grateful that you did so. It’s amazing how often things aren’t quite as black and white as they first appear. By investigating the matter objectively and fairly you’ll be better placed to take the next step.
Once you’ve established the facts, it’s your turn to be clear with the employee. Describe what you understand to be the mistake, its cause and where the responsibility lies. The employee needs to confirm that his/her understanding matches yours (if not, go back to the previous ‘fact checking’ stage). Then you need to explore why they made the mistake and what can be done to prevent it happening again. You need a firm commitment from your employee that they will strive not to repeat the mistake.
You must be clear and not gloss over the impact of the mistake on your business, but this doesn’t mean you need to be unkind. Acknowledge that everyone makes mistakes and express your confidence and encouragement that the employee’s future performance will be better.
It’s easier to deal with this type of problem if you have an open and trusting relationship with your employee. Investing in good relationships with your team is something you should do all year round. Not only will that make these types of conversations easier, but it will also help identify likely mistakes before they happen.
Don’t be afraid of mistakes. They’re a common fact of life and one that, with a bit of thought, can be easily managed. What’s more, accept that making mistakes need not be a bad thing. After all, in the words of legendary US basketball player and coach John Wooden: “If you’re not making mistakes, then you’re not doing anything”.
Blog supplied by Heather Foley of HR consultancy ETSplc.
There’s no denying that as a working population we are experiencing the throes of a revolution – and a flexible one at that. The concept of flexible working is one that is rapidly emerging, resulting in the adaptation of the traditional workspace as we knew it.
Rapidly advancing technologies are making it easier than ever for professionals to work remotely, on the move and reduce the need for a business to run its operations entirely under one roof 9-5, seven days a week.
The number of employers offering work-from-home options increased from just 13% in 2006 to 59% in 2011, according to the CBI/Harvey Nash Employment Trends Survey 2011. Indeed, its most recent survey in 2012 also spoke of the flexibility of the UK’s labour market, believing its freedom has made the country a good location for sizeable international projects.
Flexible working has psychological, financial and business benefits and these all result in heightened productivity and efficiency. Finding the right work-life balance is something we all strive for and can be one of the biggest challenges any entrepreneur faces when starting a business. Flexible working hours, whether that means working alternative hours or at different locations, may help to strike this balance.
One of the many reasons entrepreneurs start their own business is because they feel stressed and restricted by conventional working hours, particularly if they have young family commitments. The ability to work outside the office and keep your fingers on the pulse is a positive for both employees and employers.
Small-business owners concerned about the bottom line are also welcoming flexible working because it is proven to be good for businesses, too.
The Department for Work and Pensions produced a report on the effects of flexible working on employees and employers and it found a marked reduction in costs as a result of fewer people missing work or leaving their positions. Similarly, 58% of small-business owners recorded notable increases in productivity within their workforce.
Flexible working has made business increasingly global. Firms can entertain the idea of spreading their net further than ever before by travelling overseas for client pitches and meetings without the fear of taking their eye off the ball back at headquarters, with email, apps and the cloud improving connectivity in ways we could never have imagined just a couple of decades ago.
The growth of business hubs and fewer business owners demanding central office locations, combined with the continued use of smartphone and tablet devices means professionals can increasingly take responsibility for finding their own work-life balance.
Guest blog supplied by Generator, one of Europe’s fastest-growing hostel accommodation chains, with eight locations across the continent.
With little or no daylight outside of work, it’s perhaps easy to understand why people’s morale descends into the abyss during winter.
As some employees suffer a bout of the winter blues, small businesses can breathe a sigh of relief when they begin to realise that very little budget is needed to boost staff morale.
In fact, contrary to popular beliefs, money isn’t the best motivator. Praise and flexibility are far more influential than bonuses and pay.
A high proportion of small businesses will suffer a drop in staff numbers this winter, whether that’s caused by a spike in sickness-related absences or an influx of last-minute holiday requests. Combine the two, and your other employees could be facing a crippling workload.
A watertight sickness absence policy and holiday request policy offer the best preventative measures to manage the risk of a limited workforce.
It’s also crucial not to forget those who are left behind, with recognition for their achievements helping to reinforce morale.
Adopting a flexible approach also helps to keep morale high. Take severe weather for example. Offering your employees the chance to work from home helps to reduce absences and prevent the business from grinding to a halt. In such an event, it’s crucial that you have a robust flexible working policy in place.
A dysfunctional team can have a devastating impact on productivity, which is why good communication within the workplace is vital.
Be sure to keep your employees up-to-date of any business news. However, do remember that this is a two-way street, as your employees should be able to approach you with any work-related issues.
A well-engaged workforce will ultimately deliver increased productivity and performance, therefore it’s crucial to recognise and meet the needs of your staff.
Remember that even the smallest gesture can make a big impact, such as enabling staff to leave early once targets have been met or even treating them to lunch.
At the end of the day, it’s up to you as the employer to motivate your workforce and prevent a dip in staff morale.
Blog supplied by Helen Pedder, head of HR for ClearSky HR.
Flexible working isn’t right for all businesses. Call centres, for example, can only function with a traditional workplace structure in place. For creative and consultancy-based disciplines, however, you can match and even exceed productivity by giving your staff greater flexibility. In our quest to be a better employer – and get the most out of our staff – we’ve learned a few lessons we wanted to share.
Teams that perform knowledge-based roles can work pretty much anywhere they can get reception and plug in a laptop. For that reason, we have a developer who works 300 miles away and barely steps foot inside our Stockport-based offices. Similarly, I’m only in the office two days a week, spending the remaining three beavering away from my home. All the work gets done, though, no matter where we are located.
However, we need our distribution staff to work in our warehouse to set hours, it’s the only way to meet delivery deadlines. Flexible working for this function is just not an option.
If you’re adopting a more flexible hours/location approach, you’ll need to revise your line management model, and the solution for this is to replace a hierarchical structure with a flat one.
This means instead of employees measuring their progress by their peers, they measure their own achievements against KPIs (key performance indicators) you’ve agreed with them.
There are three reasons for having a flat structure. Firstly, it’s purely practical. If your employees are working out of the office, they no longer have peers constantly within sight to use as benchmarks. Secondly, they become more concerned with their own development than their colleagues' – reducing time spent on office politics, increasing time spent on development. Thirdly, you are both very clear on what you expect from them.
Thanks to today’s technology, you and your team can be virtually in the same room, even though you’re physically miles apart. Meaning there are lots of ways combine the benefits of working from home with those of being in an office.
For example, I work at home for three out of five working days each week. But Google Hangout allows me to virtually work side by side with colleagues who also work at home. We turn the camera off (as we have no interest in being in our own reality show!), but keep the sound on so we can talk through issues in real time, update each other on projects and ensure we have a healthy amount of banter to keep us sane.
We’d also recommend ensuring you’re in constant communication with your team, even if you’re working remotely. Each morning our senior team ‘meets’ for a 20-minute call so we can discuss the previous day’s activity and agree plans for the day ahead. It ensures we’re all working in sync.
Finally, we’re huge fans of Google Suite. It’s a fantastic tool with a series of apps that allow you to collaborate on one project at the same time and save files to a cloud. Meaning there’s no need for a hard drive, jobs can be are completed much faster and gone are the days of 23 versions of the same document.
We all know that a project’s success is due to the productive hours put in – rather than the minutes clocked up with bums on seats. Just because someone appears to be at work does not always mean they are!
But we know from talking to some of our ‘old-skool’ contacts, it can be hard to trust that staff are working when they’re ‘working from home’. So we’re huge advocates of KPIs. They enable you to set targets and measure progress, leaving you to trust your employees to get on with their work. If they’re hitting the numbers, the work’s being done – and it doesn’t matter if they’re working from midday until 6am or from their second home in Spain.
Replacing a traditional workplace structure with something more fluid has delivered two key benefits to our business. Firstly, our time has increased. We no longer have to deal with the endless ‘can I leave early?’ questions, which zap time that can be better used.
Secondly – and most importantly – staff are happier, more relaxed and able to achieve a better work-life balance. By trusting them, they respond with greater productivity, resulting in a win-win for everyone.
Blog supplied by Sean Blanks, marketing director of Cartridge Save Ltd (“the UK’s largest reseller of ink and toner”).
It is often said that employees are the lifeblood of a business and it is certainly true that they are an important factor in its success. For this reason ensuring employees feel valued is vital in order that they remain motivated, loyal and productive.
Research conducted by Modern Survey suggests that 85% of employees who feel meaningfully recognised will go above their formal responsibilities to get a job done. However, as economic conditions continue to be tough, allocating a significant budget to an all-singing, all-dancing staff reward and recognition scheme is often simply not an option. Business owners and managers should therefore be looking at low-cost, high-impact alternatives.
Praise and recognition are essential and everyone likes a ‘pat on the back’ to make them feel good. Often the only reward for hard work is the satisfaction of the individual responsible in seeing a job well done, but it is important that time is taken to shine a spotlight on them.
Recognising an individual, or a team or department, has a huge knock-on effect throughout a business with word spreading both through the grapevine and via more formal communication channels. This mustn’t just apply to those team members whose contributions are obvious, such as those in sales. Equal pride must be taken in those whose skill and dedication is an integral part of your business success.
Can this be achieved on a budget? Yes, because a crucial element in any employee recognition programme is presentation and, for this reason, the reward itself does not need to be high-value. In most cases, acknowledgement in front of peers is known to mean more to the recipient than the reward itself and so the reward can be relatively low-cost, or in some cases no-cost. Rewards that cost little but have a big impact include an extra day’s holiday, employee of the month parking space or a free car clean during working hours. Thanking employees with an early finish on a Friday afternoon, a late start on a Monday morning or an extended lunch break are also popular as are experience days, giftcards and vouchers.
The key is to dedicate some time to present the reward in public and say a personal thank you, because it enhances the overall sentiment of the gift and makes it even more memorable. Overall, if employers recognise publicly, often, and associate the reward with desired behaviours, better results will be achieved than if the budget was blown on a fancy reward.
Length of service awards are another effective way to recognise employee contribution without incurring significant cost. They may seem like a thing from the past, but switched-on businesses are maximising their effectiveness by rewarding frequently to deliver recognition to the employee that will inspire a fresh burst of productivity and re-engage them in the business.
Today, the gold watch for 25 years of service is no longer relevant and so businesses have significantly shortened the length of time before awards are given with awards after five, 10 and 15 years. In some high employee turnover industries, such as call centres, rewards are given after six months or a year. While the physical award can be low-cost, such as a meal out, it is important to make the process of rewarding a really big deal by ensuring the presentation is attended by peers and by shouting about it via the appropriate communication channels.
Another low-cost step that employers can take to boost employee morale, engagement and loyalty is recognising and celebrating a range of occasions with them, including birthdays, weddings, housewarmings, baby showers, length of service awards, Christmas and special anniversaries. Arranging for a card containing a small gift to be delivered to an employee’s desk, home or email inbox is a personal and special way to recognise employees who creates a feel-good factor in the workplace with minimal financial outlay and effort for the person tasked with organising it.
Businesses that take small steps such as these to recognise and reward employees and make them feel valued will reap the rewards.
Blog supplied by Kuljit Kaur of The Voucher Shop.
The Forum of Private Business (FPB) is warning business owners to be aware of seasonal dangers that could potentially leave them with “a nasty financial hangover long after the decorations have been taken down”.
“With their mix of drink, high spirits and merriment, Christmas parties are still the number one source of potential problems,” argues FPB business adviser, Joanne Eccles.
To make sure you and your staff remember Christmas 2013 for all the right reasons, the FPB advises business owners to:
However, putting on a Christmas party does have “an upside for employers”, notes the FPB. It says up to £150 per head of the cost of holding the party is an allowable tax deduction and VAT can also be recovered on staff entertaining expenditure.
“No-one wants to put a dampener on the festive spirit and Christmas parties are great for boosting workplace morale and allowing staff to let their hair down,” adds Eccles. “But business owners need to take some important precautions if they want to guard against potential litigation.
"Most of the regulations which govern the normal working day also extend to the Christmas party, wherever it might be held, so employers need to ensure they're not leaving themselves open to claims, complaints and time-consuming employee disputes.”
As a small business owner it can be difficult to maintain your own morale and, just as importantly, that of your staff. In a climate in which budgets are stretched and purse strings are tight, many small businesses struggle to stay happy – and, as a result, they struggle to remain productive.
Workplace culture is a hugely important element of an overall business strategy.
We want to see happy employees, not only because that is good in and of itself, but also because people are at their best when they are at their happiest. We spend a great deal of time working out how we can make Simply Business the best possible place to work.
Happiness and efficiency are intrinsically linked in the business environment. So how can you ensure that both you and your employees keep both their spirits and their productivity high?
It is all too easy to become so absorbed in the day to day minutiae of running a business that you forget to celebrate your achievements. Perspective is important, both for you and your employees. Take time to ‘zoom out’ and recognise the ways in which you have succeeded, as well as the work you still have to do.
It is impossible to remain both productive and satisfied if you or your employees are working all day every day. Regular breaks are important in order to keep the mind focused and to prevent boredom. Rather than trying to do multiple things at once, try splitting up your time into 20 minute chunks, with short breaks in between. This may help to boost both your productivity and your work satisfaction.
Extended breaks are also vitally important for all of us, and yet many business owners fail to take enough time off. Make sure that you take holiday time off and that, as far as is possible, you use this time to do things other than work. Remember that this will likely require you to plan ahead in order to ensure that you tie up loose ends before you leave and that your business can continue to tick over in your absence.
The headline salary is not the only way in which you can attract and keep the top talent. You should also think about the working environment and, crucially, the benefits that you are offering. There is a range of cost-effective benefits that you might investigate. These include flexible working, the Cycle To Work scheme, and non-medical covers like life insurance.
Google famously encouraged employees to spend 20 per cent of their time working on their own projects. Although the company is now moving away from this ratio, ensuring that your employees have time to pursue their own interests during the working week can still be hugely beneficial. Not only will it help demonstrate to employees that their creative input is valued, it could also help to produce new innovation.
Finally, it is important to remember that a fragmented workforce is far more likely to be unhappy. You should think carefully about ways in which you can develop a sense of community amongst you and your employees. This might include away days, meals out together, visits to non-work related cultural events, and so on. Remember that these need not be hugely expensive; rather, the intention is to create a space in which employees can get to know each other better.
Blog by Jason Stockwood, CEO of Simply Business
Taking on employee is a significant step for all businesses, but new businesses in particular can find it a daunting experience. Mistakes can lead to costly tribunal claims, of course. Part of the problem is that many business owners aren’t sure about their obligations as an employer nor do they have the luxury of their own HR staff.
Nobody wants to think that what you thought was the perfect hire could result in a costly tribunal case, but one in six disputes do – at an average cost of £9,000. Add to this solicitor’s fees and time taken out of running your business and you are looking at nearer £20,000 in costs, which could be crippling for many small businesses.
At very least, employers need to know what basic legal rights employees have in the workplace. Mainly, these cover: pay and hours; discrimination; and disciplinary and dismissal.
Employees have the right to be paid at least the national minimum wage and the same pay as members of the opposite sex doing the same work of equal value for your business. Rest breaks and paid holiday must be in line with the Working Time Regulations. Employees also have rights to statutory sick pay and redundancy pay, while being protected from any unauthorised deductions in pay. Qualifying employees are also entitled maternity, paternity and adoption leave and pay, as well as paid leave for antenatal care, unpaid dependants’ leave, unpaid parental leave (after one year) and the right to request flexible working. Employees are also entitled to time off for public duties such as jury service.
Employees must not be discriminated against unlawfully on the grounds of race, sex, marriage, pregnancy, disability, gender reassignment, sexual orientation, age, religion or belief. Protection against less favourable treatment also exists for part-time workers, as well as ‘whistle-blowers’ and trade union members.
All employees have the right not to be unfairly dismissed, after a qualifying period of two years. Employees have the right to access fair grievance, disciplinary and disciplinary procedures, and the right to be accompanied at disciplinary and grievance procedure hearings.
All employees also have the right to receive a written statement of terms and conditions of employment (such as an employment contract) within two months of starting. This can avoid one the main causes of employment tribunal claims.
Tribunals and investigations may never happen to you, but by seeking advice from organisations such as the Forum, to ensure you are up to speed with your obligations as an employer, can help you avoid any nasty surprises later.
Blog supplied by Joanne Eccles, business advisor at the Forum of Private Business, which has produced a free-to-download guide called 5 Essential Things Every Employer Should Know, with further hints and tips on your obligations as an employer, health and safety legislation, tax and finance responsibilities and recruiting advice.
Flexible working has come a long way since the turn of the century, thanks to new technology that allows people to work when and where they choose.
This infographic from Expert Market offers an insight into the facts and figures surrounding flexible working, and how employers can use it to increase productivity, whilst gaining a loyal and happy workforce who enjoy a true work/life balance.
Now viewed as a serious option by forward-thinking firms looking to harness the power of the internet and streamline their operations, flexible working offers many benefits to both employers and staff.
Click on infographic to enlarge.
Most owners will tell you that their business is only as strong as its people, so it’s important that your employees are fit and able to work.
So what are some of the costs of a sick workforce to a small business? And what can they do to stay lean, fit and ready to make money?
Sick days are more than a slight inconvenience for managers. Research by PricewaterhouseCoopers (PWC) suggests that they cost the UK economy nearly £29 bn a year in lost revenue. For a small business, even a slight loss in productivity can make a big impact on bottom line, of course.
Businesses have a legal obligation to provide a safe working environment for their staff. But it's also in their economic interest to do more than the bare minimum. Healthy, happy workers make productive workers. And as the population ages, managing absence will be increasingly seen as ‘mission critical’ rather than a ‘nice to have’.
As a small business that is just starting up, you’re likely to be both time and cash poor, but it’s important to be aware of some of the more common reasons for sick days…and what you can do to prevent them.
According to the Employee Benefits Healthcare research 2013 study, minor ailments such as colds are the biggest cause of absence in the workplace.
Invest in antibacterial hand gel and place a few bottles around the office to stop germs from spreading. And could you look at being more flexible where and when your staff work? Cloud computing makes working from home far easier. Staff can access and share important files and keep on top of emails, as well as check in at regular intervals if they can manage it without infecting the whole office. You don’t have to splash out on an expensive cloud computing package, Google Docs is great for a cash-strapped business.
The second most common reason for an absence is musculoskeletal ailments, which affect the joints, tendons and muscles in the body. Most work-related musculoskeletal issues are developed over a period of time because the right health and safety measures haven’t been put in place. The result? Long-term absence or a series of sick days.
Remind your people to bend properly when lifting heavy boxes or invest in a trolley if they/you move a lot of stock regularly. Check that everyone is sitting at their desk at the right angle – adjust the height of their chair, change the position of the mouse or buy a stand for laptops if need be. And if you invest in a good employee health insurance scheme, they’ll be able to access physiotherapy or massage therapy to help get them back to work.
The third biggest cause of sick leave is mental health issues such as depression, anxiety and stress. The economic downturn has made many workers feel unsure about the security of their jobs and they may be putting in longer hours than usual to impress. But, eventually, prolonged periods of stress and anxiety can manifest itself in more serious mental health issues, which force people to take long-term leave or phone in sick.
This is a more difficult problem to address, because there are no quick fixes. It’s about looking at your business culture from the start. Could you take some of the pressure off by letting staff work flexibly so they spend less time commuting and have a better work-life balance? If everyone is working regular overtime, might it be time to hire new staff, even if it’s just part-time help?
Perfectly healthy staff phoning in sick when they simply want a day off. Did you know that one in three ‘sick’ days are not caused by an actual illness?
The heatwave this summer saw many office workers phone in sick to enjoy the sun. If this is a problem, remind staff to book holidays in advance and try to be flexible about your summertime working hours – it could really boost morale.
Staff are also less likely to ‘pull a sickie’ if the team is a close one and they genuinely care about not making colleagues pick up the slack. Try to encourage regular staff events, so team members get to know each other as people as well as colleagues.
Have stringent HR processes and include a clause about absence in your contracts. If someone has to phone in sick, make sure they have to explain their absence to you or one of your managers. If it’s a recurring problem, have firm but fair disciplinary procedures in place and try to establish if there’s another factor at play, such as stress.
Productivity slumps. According to figures released by the Office of National Statistics, productivity in the UK has been falling since the economic downturn began in 2008.
Is there a health and safety issue at work here? Studies have shown that people work more efficiently in optimum temperatures, so insulate your premises and turn the heating up in winter, while investing in fans or air conditioning in the summer.
Blog supplied by Jamie Monteath, online representative of Bupa.
The value of experience can be hard to judge. You only know for sure when you find yourself in a situation that demands it, and you perform – or not. The same goes for your staff. Will their lack of experience let them down? Or will their experience enable them to deliver in a tough situation?
When a challenge arises, staff with less experience tend to get bogged down in unimportant items and spread themselves too thinly, they don’t have the prior experience to just know what needs to be done and how.
Other symptoms of lack of experience include people coming into a situation with a belief that “the answer is X”, where X might be process mapping, improved accounting software or product line profitability, etc. It might well be that they are part of the solution, but a fixation with preconceived ideas is dangerous.
In many situations, you can work your way through. Experience is less important as you have time to consider your next move. It’s only in crisis situations, where there can be little margin for error, that experience is worth so much more than even its weight in gold.
Back in my auto industry days, I recall the words of the grizzled manager running the body assembly area, Derek Godsell. Talking about man-management skills, he said: “You need a good selection of tools in your box; you need to know how to use each of them; and you must know which one is for which job.”
I think it applies to many areas, though of course one can’t be expert in all of them. Bringing people into your team who have the relevant experience will strengthen your performance.
The challenge – with start-ups in particular – is often lack of resources. So fewer people (perhaps just you) have to cover many bases. Secondly, even if you want to recruit expertise, it can be hard to tell whether someone really has it. The truth is only revealed when that crunch moment arises and they’re put on the spot.
So what are the key benefits of experience? What I value most in experienced staff is:
For most people it’s inevitable that the older you get the more experience you have, so it really does pay to have older employees around you (preferably mixed in with younger ones).
Supplied by Hilary Briggs, a profitable growth expert with more than 15 years of industrial experience. For the past 10 years, she’s worked with SMEs to improve their profitability.
Teams are the building blocks of many new businesses and keeping your team working effectively will reap many benefits. So how can you help your team to get the most out of working together?
A good working atmosphere makes a huge difference to a team’s productivity. The key to the difference between high-performing and low-performing teams is the ratio of positive to negative comments. Interestingly, this doesn’t need to be balanced; it needs to be weighted in favour of positive comments, at least by a ratio of 3:1.
Forget weaknesses – play to strengths. This will reap greater benefit in terms of performance improvement. This is because when we are using our strengths work feels effortless, we are energised and confident, we are engaged and probably experience moments of flow. Feeling like this we are more able to be generous and patient with others, so the benefits flow onward.
Teams are often made up of people with different skills and areas of expertise that tend to see the world and the priorities for action within it differently. This can lead to a great awareness of difference, which can come to be seen as insurmountable. A productive way to overcome this is through sharing of personal stories about their moments of pride at work. In this way, they are expressing their values and sense of purpose in an engaging, passionate and easy-to-hear form. The listener will undoubtedly find that the story resonates with them, creating an emotional connection at the same time as they begin to see the person in a different light.
Groups can get stuck in repeating dynamic patterns. When this happens, listening declines, because everyone believes they’ve heard it all before, and so does the possibility of anything new happening. To break the patterns we need to ask questions that require people to think before they speak. This brings information into the common domain that hasn’t been heard before.
When teams suffer a crisis of motivation or morale it is often associated with a lack of hope. In ‘hopeless’ situations we need to engender hopefulness. Appreciative, positive questioning can help people imagine future scenarios based on what is possible. As people project themselves into optimistic futures clearly connected to the present, they begin to experience some hopefulness. By using the techniques described above it's possible to get a team moving again or move a working team from good to great.
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According to the However Big Your Ambition Report, which was commissioned by Volkswagen and surveyed 1,000 small-business owners, employing a friend or relative who wasn’t up to the job is one of the most common and most regretted mistakes that small-business owners make.
One-in-three respondents admitted to recruiting someone who turned out to be totally unsuitable for the position, the survey’s highest-ranking business blunder, while setting prices that were either too high or too low was the second and not taking advantage of an opportunity was third.
Other errors included offering too many discounts, trusting the wrong person or business partner, investing in the wrong equipment, ignoring good advice, allowing a junior to have more responsibility than they could handle and losing a good member of staff because they were refused a pay rise.
According to the report, on average, bad decisions cost the typical small business £2,340 a year. A third of respondents described themselves as “ambitious risk-takers” and 35% admitted to “letting their heart rule their heads at some point while running their business”, with 61% of those reporting that the decision had proved detrimental.
And the outlook for many remains rather gloomy. Nearly three-quarters (72%) of respondents now feel “less optimistic about 2013 then they did at any point in 2012”; 90% don’t expect to achieve their annual financial targets and just one in five says their business is ‘busy’. Almost two-thirds of respondents say they are reluctant to make long-term investments at this point.
The report was conducted to mark Volkswagen launching its new online SME mentoring service on its Facebook page. Mentors include Allegra McEvedy (co-founder of restaurant chain Leon) and Andrew Denham, founder of The Bicycle Academy.
Auto-enrolment is coming – and you’d better be ready. The first wave is already underway, with the nation’s largest employers now legally required to enrol all eligible employees into a workplace pension scheme, but pretty soon it’s going to be the turn of small businesses. By 2017, all UK employers – from families with nannies to the largest corporations – will be required to operate an occupational pension scheme.
Many smaller employers have never had to think about pension provision before, and the legislation can be complex and confusing if the right financial and legal advice is not sought. It is estimated that about 75% of small employers have no workplace pension scheme at present, and they will have the biggest hurdles in front of them.
The amount of preparatory work for auto-enrolment has been severely underestimated by a number of employers already, so it is best to start planning well in advance. To find out when you will be required to implement auto-enrolment (your ‘staging date’), it’s best to check the Pension Regulator’s website and begin finding out about the changes your business will need to instigate to be prepared for auto-enrolment.
In taking key decisions away from employees regarding their pension savings, there is an increased administrative burden on employers. Payroll systems must be capable of identifying eligible employees and deducting contributions from their salary as required. Employees’ circumstances (and therefore their eligibility) can change frequently and administrative systems must keep up to date to achieve full compliance with legislation.
Not only that, but employers will need to begin budgeting for the extra costs to their business. At your staging date you will only be required to pay 1% of your employees’ salaries into a pension pot, but by October 2018, this will rise to a 3% statutory contribution.
However, it is possible to see this pension expenditure as an investment in recruitment and a driver of organisational performance. Selecting a suitable pension scheme is a crucial decision, especially if you are unable to adapt an existing arrangement. Engaging with employees and aligning pension arrangements with business aims, culture and branding can attract new talent to your business and encourage greater performance from existing employees.
Although many employers do not agree with auto-enrolment legislation, wilful failure to comply is a criminal offence, and may attract fines, imprisonment or both. So, is your business prepared for auto-enrolment?
By Matthew Selby, who writes about pensions and employee benefits for Now Pensions and others.