The information came from a Freedom of Information request by technology consultants LEWIS Communications over misuse of social networking in the past 18 months. The Metropolitan Police has confirmed that access to social networking sites for personal reasons is not permitted during working hours to any member of police staff although a number have access for professional reasons, having obtained the required senior management permission. It also confirms vetting enquiries ‘may look at any source of information that will assist in determining whether the vetting applicant is suitable for the vetted post applied for.’

The MPS Information Code of Conduct sets out the policy on the use of MPS information and information communication and technology systems and is rigorously enforced.

Keith Crosley, director at email security specialist Proofprint make the point that these law enforcement agencies are hardly alone in having dealt with such abuses. ‘People post a wealth of information about themselves and their employers on Facebook,’ he observes. The MPS highlights employee safety in its code: ‘It is suggested that staff do not disclose their position as an MPS employee or officer…..one should avoid disclosing personal details which may be used for identity details. Do ensure that the privacy settings available on social networking sites are used.’

Facebook’s 350m users have to manually alter the status of all content uploaded on the site to prevent them being automatically made public – a move that has caused an outcry among civil liberties campaigners.

Matt Rhodes, of society media agency FreshNetworks makes the point that allowing employees to use social media is opening up a new communication channel. ‘It is like the conversation with a friend in a cafe, just taken to new levels, reaching more people and being significantly more shareable. This should be a risk for all firms. We don’t need reminding of the examples where employees have posted a video that has embarrassed their employer, or a Facebook status that has lost them their job. Firms need a policy on social media and part of this policy should be guidelines for their staff.’

Rhodes goes on to refer to a statement made by ESPN, a US sports cable TV network, observing that the biggest threat to organisations from social media networks is failure to have a policy on their use. He highlights the core elements of the ESPN one as sensible and relevant to most employers and makes some helpful comments.

• Don’t run your own websites or blogs that talk about sports content. This is not to be unexpected for a business that produces sports content. They should, however, make sure they are harnessing any enthusiastic employees and giving them a platform to write their own thoughts in a place that benefits ESPN too, such as an ESPN blog.
• You are representatives of ESPN even out of working hours. This is a sensible policy that most firms have already had – to remind people that even when they are not at work people will see them as representing the firm and so they shouldn’t do anything to discredit it.
• Show respect for your colleagues and for fans. In this case the fans are the customers and it is sensible to remind people not to embarrass or otherwise harm either them or fellow colleagues.
• Content posted by employees needs to conform to ESPN editorial guidelines. It is difficult if employees talk about things in one way at work and another out of work but both are visible and shareable on the web.
• Do not discuss internal policies, processes, decisions or debates. What goes on in the office, stays in the office and some things probably shouldn’t be shared.

Warren Wayne, employment law partner with law firm Bird & Bird LLP adds: ‘With the modern Blackberry culture, it can be difficult for employees to make a firm distinction between their own time and their work time and this often also leads to a blurring of the lines around how they use their personal PC’s and work PC’s. Work time is increasingly being defined by the context in which staff are dealing with tasks or information, rather than the working day simply being defined by the clock. The safest thing for employees is for them never to assume that their online activity is completely separate from their work identity. But employers also need to help staff understand the boundaries by having policies and by being clear about the standards they expect.’

A useful background to social media and its function as a communications tool is available from the Chartered Institute of Public Relations and can be viewed here.

• creating a modern technician class through more advanced apprenticeships;
• investing in skills in the sectors on which future growth and jobs depend;
• empowering individuals through skills accounts giving people ‘consumer choice’ and better information about courses;
• the introduction of light touch monitoring arrangements for our best providers; and
• simplifying the skills landscape, working with UKCES to implement their recommendation to reduce the number of separately publicly funded agencies by over 30 in the next three years.

One of the biggest quangos, The Learning and Skills Council, will be broken up into a number of smaller ones, each with their own back office function.  The idea is that a single contractor for all publicly funded post-19 education and training (not higher education) will deliver a faster response to user demand and feedback.  It will operate through the following services:

• National Apprenticeship Service (NAS). This has complete responsibility for the apprenticeship programme.
• Employer Skills Services. This is designed to match skills services to all sizes of businesses in all sectors via Skills Funding Agency managed services, such as Train to Gain and the National Employer Service.
• Adult Advancement and Careers Service. This is a universal advice service for individuals both in and out of work.
• Learner Skills Services. These include Skills Accounts, funding FE colleges and providers, integrated employment and skills services for the unemployed, offender learning, informal adult learning etc.

However, there is widespread concern that many of the key personnel from the LSC, including its chief executive, will merely transfer to the new agency and there will be no infusion of new ideas and some wasteful duplication.

The EEF, the manufacturers’ organisation, has complained to Kevin Brennan, the Skills Minister, on grounds that the upheaval would be worth it if the new structure would deliver substantial improvements.  But, it says ‘It is unclear how this new agency will be substantially different from the old one without the culture change that is really needed across the organisation. Therefore, a further reshuffle which results in many of the same people undertaking the same roles under new titles would be the worst of all worlds. And if we are to develop world class skills we need a system that is responsive to the training needs of both employers and individuals.’

Tom Richmond, policy adviser at the CIPD agrees that the new structure is not exactly user-centric.  He told The People Bulletin:

‘The creation of the Skills Funding Agency is supposed to help bring about a ‘demand-led’ approach to the funding for training courses, but the early indications are that the Skills Funding Agency will in fact retain considerable power over which courses get funded, It is employers and learners, not quangos and government departments, who know what skills and qualifications this country needs.  Unless the Skills Funding Agency reflects this simple truth, the UK will struggle to meet the considerable economic challenges that lie ahead.’

http://www.bis.gov.uk/policies/skills-for-growth
www.dius.gov.uk/further_education/fe_reform/skills-funding-agency-transition

The claimant, a devout practising Christian worked part time as a member of the check-in staff for BA since 1999 and has to wear a uniform because her role is customer-facing. The role also involved shift work. She complained of a number of incidents between 2003 and 2006 which she said showed anti-Christian bias by BA.

Up until 2004, her uniform included a high-necked blouse, and she wore a silver cross on a necklace underneath the blouse. British Airways redesigned the uniform in 2004, which included provision for an open neck, but prohibited any item of ‘adornment’ around the neck. Between 20 May and 20 September 2006 she came to work on at least three occasions with the cross visible under her uniform, but when asked to conceal it complied. However, on 20 September 2006 she refused and was sent home by her employers. She remained at home, unpaid from that date until the following February and launched grievance procedures. There was significant media attention – much of it hostile to BA and this led the airline to reconsider its uniform policy and amend it on 1 February 2007. This amended policy permitted staff to display a faith or charity symbol with the uniform. Miss Eweida returned to work on 2 February 2007 and is still an employee of BA.

She brought a number of claims against her employer, including claims under the Employment Equality (Religion or Belief) Regulations 2003 of direct and indirect discrimination and harassment. The Employment Tribunal dismissed these and found no evidence BA had done anything other than attempt to enforce its contractual uniform policy. Neither was it able to support the claim that she had been discriminated against on grounds of her religion – the policy did not single out Christians – all personal jewellery had to be concealed by the uniform.

The Court of Appeal was left to decide whether there had been indirect discrimination against Ms Eweida on grounds of her religion or belief. Because there was no identifiable section of the workforce (not even a small one) that would have suffered a particular disadvantage by not being able to display the jewellery, this claim failed as well, with Lord Justice Sedley commenting: ‘This case has perhaps illustrated some of the problems which can arise when an individual (or equally a group) asserts that a provision, criterion, or practice adopted by an employer conflicts with beliefs which they hold but which may not only be shared but may be opposed by others in the workforce. It is not unthinkable that a blanket ban may sometimes be the only fair solution.’

Tim Marshall, national head of employment at DLA Piper observes:

‘Cases of indirect discrimination in this area will always turn on their specific facts, and employers must still take care to ensure that dress codes do not negatively impact on members of a particular faith. A dress code will not be indirectly discriminatory if it is only to the disadvantage of someone holding a subjective personal religious view, or other belief. Where a dress code or other policy or practice does disadvantage a group, the employer will have to consider whether the dress code is justified, i.e. whether there is a genuine and important reason for its policy and whether there are any less discriminatory alternatives which could reasonably be implemented.’

See ‘Get a haircut’ is not sex discrimination, says the EAT, The People Bulletin, 20 January 2010.

See also ‘Dress down tribunals’ by James Williams, The People Bulletin, 2 December 2009.

www.dlapiper.com/global/publications/detail.aspx?pub=4816/

www.bailii.org/ew/cases/EWCA/Civ/2010/80.html

Why is it that, in management, we keep finding ourselves having to reinvent good practice, before managers relapse and implement failed hierarchical, mechanistic or cynical models such as Business Process Re-engineering?

I am a management writer. I write management books. In the course of 10 years or so of writing such tomes, I have come across not hundreds but thousands of books, reports and learned articles on the subject, nearly all coming to the same broad conclusion as mine. The conclusion is this: the creation of workplaces with high levels of commitment and enthusiasm, and promising career options for the staff, strong teams and communication, out-perform more exploitative companies in pure business terms. Making the workplace miserable does not maximise profits, other than perhaps in deliberately cruel trades like the sex industry.

Yet all our carefully chosen words and thorough research may count for less than we hope. Because there is a puzzle at the heart of management, and it is this: to a considerable extent, it is not based on what managers themselves have discovered about what works. It’s not like medicine, engineering or painting, where one learns from the finest exponents or from clear evidence of what is effective. One of my more learned contemporaries in the field of management writing, Jeffrey Pfeffer, commented in his work The Human Equation a few years ago that something ‘very strange’ was occurring in organisational management. While numerous studies have demonstrated the enormous economic returns obtained through the implementation of enlightened, participative management practices, ‘trends in actual management practice are, in many instances, moving in a direction exactly opposite to what this growing body of evidence prescribes,’ he noted².

Professor Pfeffer has found that pretending that people behave like ‘resources’, obsession with quarterly financial reports, thoughtless cost-cutting, gratuitous reorganisational tinkering are preferred by most executives to the time-consuming task of making teams of people work more effectively; and above all to the horrifying concept of creating workplaces that are suitably humane and habitable for sane human beings to spend the greater part of their waking hours. The cult of recent decades has been to pretend that people aren’t people – it’s even written in to the jargon: ‘human resources’; and that endlessly restructuring our public and private sector institutions, in the mindlessly mechanical approach that flows from this, ‘improves efficiency’.

If management is not influenced by management research; what on earth is it influenced by? Why this eccentric mix of cynical folklore and bean-counting as the guide to running our great  institutions? This engendering of collective misery that is, it turns out, largely gratuitous?

I have become increasingly convinced that some of the most powerful influences upon the way in which managers go about their craft are extra-curricular. We interpret and understand the world through stories; we grow up absorbing stories – either consciously, in the history and literature lessons at school, or sub-consciously, through the messages and anecdotes we hear from parents and others.

Normally, when researching for a management book, I will read academic works, and interview managers about their working lives. For my most recent work, Meet the New Boss³, I decided to look more broadly at how themes and stories about work and careers are conveyed to us in our leisure time.

I have discovered that there are plenty of books that propagate the notion that treating workers as a cost and a nuisance is the way to maximise profits. They are long established in Western culture, are widely read, and have wide influence. It transpires that those of us who write management books have a rival literature – literature. Charles Dickens and John Steinbeck have probably had more influence on how managers go about their craft than Professor Pfeffer. And far more than myself.

Let’s consider Ebenezer Scrooge from Dickens’ A Christmas Carol; his counting house and his one employee. Let’s make a people and business risk assessment (something that very few employers do to any comprehensive extent).

Just how advisable would it be for a Scrooge, under any economic circumstance, to treat such a diligent, incorruptible and effective worker as Bob Cratchit quite so badly? The most cursory risk assessment would rapidly conclude that Mr Cratchit was highly likely to seek employment elsewhere, and that there would be no guarantee at all of finding a replacement of similar calibre. His first duty was to his large family, including a disabled son, not to Mr Scrooge. Only if unemployment were very high would such a people strategy be even feasible, never mind sensible.

The little scene at the start of A Christmas Carol, with Scrooge in his counting house and Cratchit in his frozen office, is a perfect microcosm of the priorities, structure and operating assumptions of the typical business: the pretence that employee welfare matters only to the employee and is a net cost to the business; the emphasis upon accountancy, rather than understanding the business; the ignorance of the links between employee engagement and business performance; the neglect of the risk of loss of talent through indifferent management and poor leadership.

If management were guided primarily by evidence, the approach of enlightened employers such as Southwest Airlines, Nationwide Building Society, WL Gore and others would be the norm, not the exception. Do the others sub-consciously imitate Ebenezer Scrooge, rather than the latest findings from Harvard Business Review?

Philip Whiteley

Philip Whiteley is the founder and chair of the Human Capital Forum. He is the author of six books, including Strategic Risk & Reward, published in 2008 by International Financing Review, Thomson Reuters, which is a critique of strategic people management and reward in banking, in the wake of the credit crisis. How to Manage in a Flat World, published by Financial Times Prentice Hall in 2007, features interviews with 25 business leaders. Co-authored with business coach Susan Bloch, it has seven translations and two English language reprints (USA and India). He is a member of the Society of Authors.

Blog: http://felipewh.wordpress.com

www.humancapitalforum.com

http://hbr.org/2009/12/to-be-a-better-leader-give-up-authority/ar/1
The Human Equation, Pfeffer J, Harvard Business Press, 1998
Meet the New Boss is available as an e-book only, from www.whiteleywords.com

Data protection

The Data Protection Act 1998 strives to protect the population at large in the new age of instant, globally accessible information and globally organised crime. HR professionals recognise the need for this legislation in light of the significant upsurge in identity fraud now reportedly reaching the staggering level of an average £631.00 each year per household in the UK¹. This is the fastest growing crime in the world.

If you collect or use information about people as part of a recruitment or selection exercise, the Act will apply. If a candidate is not taken on, it is not a good idea to shred documents immediately as this may be needed if the candidate was to make, for example a discrimination claim as to why they were not employed. The CV and interview notes may be required as evidence in an Employment Tribunal. If records are retained therefore, at least until a claim would be time-barred, then the details and contents should be kept private.

It is sensible for employers to avoid collecting more information than they need. More sensitive details such as banking information and next of kin should only be taken from applicants who are appointed. You should also only ask for information on criminal convictions if it is relevant and justified for the type of job you are recruiting for.

If you propose to check and verify information, it is recommended that the prospective employee is informed that this will be done and the manner in which it will be done. The Act does not prevent you from collecting, keeping and using employment records but is to balance the employer’s need to keep records and the worker’s right to privacy. Employees have a right to know how an employer will use records about them and in what circumstances information will be disclosed.

Employers must be aware that data protection rules apply to those who have access to employment records and that personal information must be handled with respect. Employers should also encourage workers to check their own records periodically to keep information relevant and up to date.

In practice

I have advised on a number of high value, international frauds which could not have operated unless the perpetrators had been able to obtain personal details of individuals in order to assume their identities, open accounts, set up companies and arrange finance. In one case a client was arrested, charged and put on trial for fraud. The jury accepted that her identity was stolen and she was acquitted, but the process took close to four years.

Fines

Protection against fraudsters is a responsibility that must be taken seriously.
If it is established that the criminals got access to the information, through the ‘data controllers’ carelessness, they may well be liable for a £500,000 fine.

Jack Straw, the secretary of state for justice, recently ruled that The Information Commissioner’s Office (ICO) has the power to enforce hefty fines to organisations who fail to secure confidential data appropriately².

If threatened with a penalty the Information Commissioner will take a business’s turnover, sector, size and the data breach into account before considering a fine. This will be determined by:

• carefully considering the circumstances, including the seriousness of the data breach;
• the likelihood of substantial damage and distress to individuals; and
• whether the breach was deliberate or negligent and what reasonable steps the organisation has taken to prevent breaches.

The power to impose these substantially increased monetary penalty notices is designed to deal with serious breaches of the Data Protection Act and is part of the ICO’s overall regulatory toolkit.

The Data Protection Act provides protection for sensitive information about much more than an individual’s finances, it extends to ethnic origins, political opinions, religious beliefs, trade union membership, health, sexual life and any criminal history.

Refresh button

There are eight common-sense rules known as the Data Protection Principles. These require personal information to be:

• fairly and lawfully processed;
• processed for limited purposes;
• adequate, relevant and not excessive;
• accurate;
• not kept longer than necessary;
• processed in such a way as to kept the subjects rights secure;
• not transferred abroad without adequate protection; and
• Any information an employer retains must be brief, relevant, confidential and justified.

A case history

Last year’s Kerr Construction case investigated by the Information Commissioner’s Office (ICO) uncovered a database containing details on 3,213 construction workers which was used by over 40 construction companies to vet individuals for employment.

The information included sensitive personal information such as construction workers’ personal relationships, trade union activity, as well as their employment history.

The owner of a firm, known as the Consulting Association, had apparently run the database for many years. The ICO uncovered evidence that numerous named construction firms subscribed to his system for a £3,000 annual fee. They could add information to the system and pay £2.20 for details held on individuals. Invoices to construction firms for up to £7,500 were seized during the raid, suggesting that they’d used the system to vet all 3,200 candidates.

Evidently, in an industry known for its unusually heavy reliance on a relatively short-term mobile workforce and contractors, sub-contractors and agency workers, among others, had seen fit support this central databank. It contained the kind of information that organisations in many industries with more permanent staffing patterns might once have found useful and kept. By referring to it, construction companies hoped to avoid recruiting those whose records demonstrated that they were dishonest, indolent, disruptive, malevolent or insufficiently qualified for the work in hand.

The ICO ruled this to be criminal intrusiveness. Mr. Kerr closed his company amid outraged protests about blacklisting and victimisation³.

Reinvention

The pattern that emerges over this period is quite interesting. Feverishly rapid progress in the data processing and IT industries has transformed the financial services industries, causing a ubiquitous quantum shift in the storage, processing and retrieval of personal and business data.

The international criminal fraternity realises the opportunities and dangers that this data presents and will move as rapidly as technology allows to exploit it. Employers are at front line to defend personal data which can be used as a criminal tool. If companies fail to take this seriously and adopt proper safeguards and systems, they can face crippling fines and prosecution.

Daniel Berke

Daniel Berke is a solicitor at Lewis Hymanson Small Solicitors. He represents defendants in all areas of criminal law and has defended serious fraud cases, including a multinational VAT fraud which was one of the highest value frauds ever brought to trial.

www.lhs-solicitors.com

www.identitytheft.org.uk
www.ico.gov.uk/upload/documents/pressreleases/2010/penalties_guidance_120110.pdf
www.ico.gov.uk/upload/documents/pressreleases/2009/tca_release_060309.pdf

Convergence

The latest evolution in mobile communications is determined as ‘convergence’. This is a result of the digitisation across the three fields of broadcast:

• Television and radio.
• Telecommunications (fixed and mobile telephony).
• Computing.

The mobile phone is rapidly becoming a digital device capable of deploying and using all three of these facilities.

Additionally, the advent of internet access via broadband can now offer the potential for VoIP telephony (Voice over Internet Protocol), giving the user very low-cost international telephone calls from any fixed phone connected to the broadband line in a residential situation.

What are the business benefits?

In the commercial world, VoIP is available through the on-site or hosted Microsoft server that controls and manages the office internal email system when an appropriate VoIP-enabled telephone system is attached.

With a VoIP application in place, there are many packages available to an enterprise that can improve employee efficiency, keep more accurate records and help to reduce the overall carbon footprint.

Leslie Ferry, VP of marketing at BroadSoft, a VoIP solutions firm, told The People Bulletin: ‘We have supplied software applications where VoIP can integrate with specified called telephone numbers and it will log the time spent on each individual number. This is very useful for accurate billing purposes. This is particularly useful in accounting firms or legal practices where they deal with a great number of clients who need to be billed for services rendered.’

When the mobile device (a mobile phone or laptop with voice communications) is introduced, the possibilities for greater efficiency are increased. There are software applications available that will generate reports on the hours worked through a ‘time card’ system and tallied up via the mobile device.

One of the dominant applications of the new convergent technologies using VoIP is described as ‘unified communications’ (UC). ‘I only ever give out one telephone number,’ says Ferry. ‘I have control of my direct business telephone number as I can divert it to my mobile, the soft-phone in my laptop or my home office number. This makes my business desk phone geographically independent as any calls to that number can be diverted to any other device or location.’ In this way, enterprises can have personnel working from a home office or a mobile desk telephone number.

In a recent survey, Sage Research² found employees at organisations using this technology saved 32 minutes a day by being able to consult the best method for reaching a colleague before attempting contact. Mobile employees benefited even more with the average employee saving 43 minutes per day by managing voicemail, email and faxes from one inbox, while mobile employees saved 55 minutes.

Today, there are so many ways to contact company personnel, resulting in communication overload which is slowly choking even the most agile enterprises. Employees and organisations are finding it increasingly difficult to manage the vast array of communications and devices needed to perform their jobs. One person trying to reach another sends a voicemail, an email and an instant message, when the person they are trying to contact had a mobile with them all along. Unfortunately, each communication channel is totally unaware of the others.

There is a need to simplify communication by cutting through the complexity of multiple platforms and streamlining business processes to reduce time to decision, increase productivity, enhance customer service and provide a consistent user experience across all communications.

A variety of methods can be deployed as part of an overall communications strategy to enable organisations to work more intelligently and efficiently. The UC technology empowers staff by freeing them from a myriad of difference pieces of kit and allows them to concentrate on the purpose of their communication, thus improving customer service, speeding up the decision-making process and the ability to locate relevant resources quickly and efficiently.

Simplification

It is when all business communication applications, across a range of interfaces including PC, telephone, web or mobile, are converged, that these efficiencies can be maximised. Once set up, users can access and respond to any communication message, (voicemail, text and email) and react to real-time communication (phone calls, instant messaging, video conferencing etc) from one interface. A seamless switch between communication applications while a communication application is in progress becomes possible. For example a user can switch from a mobile phone to desk phone or click to call the sender of an email. The technology works irrespective of device or location while providing access to the same directories and application of each application.

The facility for interaction between agent and customer – users of unified communication can manage all their voice and messaging applications from one interface and customers can contact individuals through single number access improves accessibility to contacts without the complexity of numerous contact numbers and addresses.

Kendrick Struthers Watson

Kendrick Struthers Watson is a telecoms journalist and one of the few who have experienced the beginning of the mobile phone phenomena when it started in the UK in 1985 which grew to the global digital standard it is today. He has edited a global telecoms magazine as well as unique overnight full colour show daily magazines for the International Telecommunications Union (ITU, the United Nations telecoms arm) at its events across the world. He is the telecoms editorial strategist at On&Off Communications, a London-based specialist agency in brand, positioning and marketing communications.

www.onandoffcomms.com

www.telegraph.co.uk/scienceandtechnology/technology/technologynews/3949050/Average-person-will-soon-have-two-mobile-phones.html
Sage Research, Unified Communications Application: Uses and Benefits, Jan 2006

In light of the government’s announcement that it is likely to remove the default retirement age, this article explores the HR, pensions and benefits implications for employers. An attempt to scrap the DRA via an amendment to the Equality Bill was withdrawn in the House of Lords at the end of January 2010 to allow time for the results of the government consultation (which closed 1 February 2010) to be analysed¹.

Current rules

At the moment, employers’ retirement policies are generally defined by age. Although this could be regarded as age discriminatory under recent legislation (The Employment Equality (Age) Regulations 2006), the legislation has a ‘default retirement age of 65’ provision that enables employers to require employees to retire at 65 without risking claims of unfair dismissal or age discrimination. The legislation actually provides a right for employees to request to work beyond 65, but the employer can decline such requests without needing to provide a reason.

There were concerns that a default retirement age may itself be considered discriminatory, and the government committed in 2006 to review the provision in 2011. Since then the government has made two significant announcements. First, for civil servants retirement policy will no longer be based on age. They can work to whatever ever age they choose, subject to there being a job available and acceptable performance. Secondly, in 2009 the government announced a decision the review of the default retirement age provisions forward to 2010. In addition, the legality of the default retirement age has been tested in the courts. The case brought by Age Concern was lost, but the judge cited the impending review in his judgement².

Immediate implications of DRA removal

An immediate direct consequence of removing the default retirement age is that employees will have more control over when they decide to retire. While many in the workforce today may have planned to retire at 60 or 65, the trend to replace defined benefit with defined contribution schemes with lower contributions and their continuing ability to work will probably encourage them to remain at work longer than originally planned.

For employers, the change will mean that the same grounds for dismissal will be needed for an older employee as for someone younger – generally redundancy or performance. Employers would be unable to use age as a basis of dismissal without risking a suit for age discrimination, which carries unlimited liability.

My view is that the current position is untenable, given increased longevity and the need to save longer for retirement. So change is to be welcomed. Early anecdotal indications from our clients who have recently removed retirement age are that around 2% of employees who would have retired are choosing to work beyond their planned retirement age. We expect this to be a growing trend.

There are four questions that now arise around human resource policies and practices that employers will need to address if they are to manage this situation effectively, from both the business and employee perspectives.

1. How should you implement a redundancy programme and ensure staff performance?

Up until now, some employers have used age-based retirement as an alternative to performance management, and it has provided clarity around whether a job needs to exist or not. The ability of employees to decide how long they stay in the workforce – subject to there being a job, and satisfactory performance – means that employers will need to refine their performance management processes and may become more likely to implement redundancy programmes.

2. How should you make best use of the most talented employees?

Older, longer-serving employees will affect the flow of talent through the workforce: the availability of senior roles (typically held by older employees) will be less predictable than now, and less frequent in the short to medium term as the workforce rebalances to reflect the shift in actual retirement ages.

Managing the changes in workforce flows and ensuring the best talent is used will demand more of a focus on talent management programmes and succession planning processes. Older workers will also need to be offered more flexible job/career solutions. These might involve part-time working, down-shifting and partial retirement. Remember that offering these programmes only to older employees could be discriminatory. The issue of job/career flexibility is a matter for the whole workforce, though certain exemptions apply to retirement plans.’

3. What is the best way of rewarding older employees?
   • Funding. Predictable retirement of older and better paid employees is a source of reward funding that can be recycled into the wage bill. As employees get older, however, this source of funding will reduce.
   • Equal pay. Unless there is justification for it, there is a discrimination risk in pay systems where older employees are paid more than younger employees.’

In pay systems that involve forms of progression, older employees are typically paid more than younger employees by virtue of the time they have spent in their pay grade or band. If older employees are remaining in the workforce longer, two reward management issues need to be addressed:

As older employees are more often men, and younger workers are more often women, because of labour market characteristics, there is also a gender-based equal pay risk.

4. How can pension and benefits provision be best managed?

Changing demographics in the workforce could impact funding and liabilities in pension plans as well as drive changes in the design of both post and pre-retirement benefits – including group life cover and health insurance and/or well-being plans. Changes in pension plan arrangements could also inform the development of broader benefit strategies and aid partial retirement. Employers will need to address the impact of longer working lives on the funding and liabilities of pension plans and benefit arrangements.

Remember that everyone is living that much longer, and healthy life expectancy is still something that is not well understood. Longer working lives may be better for those who have comfortable white collar jobs; less so for those with blue collar or more routine jobs. In addition, while large companies should find it easy to implement required performance management processes, it will not be as simple for smaller employers. This begs the question of whether there should be a higher default age – perhaps 70, for example. And perhaps certain types of employers should be allowed to continue to retain a default.

Chris Johnson

Chris Johnson is head of Mercer’s human capital business in the UK. He is responsible for developing Mercer’s reputation for human capital services and the provision of human capital strategy, talent and reward services in the UK market. Before joining Mercer he was responsible for employee relations and reward in the UK Civil Service; a workforce of over 500,000 people. He has 20 years previous consulting experience with the Hay Group. Client assignments have mainly involved alignment of human capital programmes to enable complex business change, for example, mergers and acquisitions. Chris holds a degree in civil engineering from the University of Salford.

www.mercer.com

[1] See ‘So what are you doing about the DRA? Please tell us, say the government’ in The People Bulletin, 4 November 2009.
[2] See ‘RIP the default retirement age?’in The People Bulletin, 7 October 2009.

Every generation looks back to what they thought were less turbulent and troubled times. The 1980s look to many to have been a quiet, stable time marked certainly by a little, but not a lot of change, division and strife. During that period people even looked back to the 1960s, remembering only hippies and flower power and not Vietnam; the marches and the sit-ins. Even people in the peaceful 1950s looked back while their world was threatened by the Korean War, the Suez Crisis and de-colonialisation, to what they remembered as a golden, peaceful period of stability.
The past is always portrayed as more orderly, stable and predictable than the present. This is as true in business as elsewhere. We seem very conscious of instability and changes in our current situation believing that we now live in especially turbulent times. The wish, ‘may you live in interesting times’, can easily be read as, ‘oh dear, we seem to be living in turbulent and troubled times’.

Aftershocks

Assuming that the speed of change is indeed increasing, and the world is becoming more difficult and complex, what does this mean for people at work? Does it mean a Darwinian shake-up with the fittest surviving? Does it mean a massive increase in work and life stress and all the associated problems that go with that? Does it provide powerful and important lessons for companies and their managers to manage better?
Economic and organisational crises can lead to dramatic changes at work. Many activities cease. Some organisations freeze, then cut budgets on things they think are less essential. Favourite targets are recruitment and training, then advertising and marketing, and, if they have it, R&D. Making an error on easy cuts that turn out to be essential here has cost many organisations dearly. Costcutting leads not to recovery but demise.

When the chips are down senior executives fear ‘mean’ early retirement packages and communication, of all sorts, changes. Some senior managers hide or go silent. The PR machine either goes into overdrive or itself is cut. The organisation may suddenly become the focus of press interest which may not be welcome. There are soon announcements of general ‘belt tightening’ policies. Pension schemes are closed, budgets slashed, people are not replaced.

Ordinary people, indeed those at all levels, begin to get worried even frightened. Many are concerned they will be made redundant and worry whether the organisation will have a LIFO or FIFO policy (last in/first out, first in/first out). Many get concerned about wage freezes co-occurring with mortgage payment increases as well as the sudden and difficult-to-manage increase in the cost of living. Those working on an hourly basis see a reduction in their hours.

Vicious and virtuous cycles

Those made redundant or even moved to a new position often experience a well known shock cycle. There are many versions of this cycle or stage theory based on death and dying literature. There are different, but related concepts or stages such as:

1. shock stage – initial paralysis at hearing the bad news;
2. denial stage – trying to avoid the inevitable;
3. anger stage – frustrated outpouring of bottled-up emotion;
4. bargaining stage – seeking in vain for a way out;
5. depression stage – final realisation of the inevitable;
6. testing stage – seeking realistic solutions; and
7. acceptance stage – finally finding the way forward.

Others have opted for a simpler three-point construction:

1. numbness – mechanical functioning and social isolation;
2. disorganisation – intensely painful feelings of loss; and
3. reorganisation – re-entry into a more ‘normal’ social life.

There are a number of caveats with the cycle or stage theory approach. It is not clear if people go through all the stages in a set order or whether they may skip some or get stuck in others. It is not certain what makes people ‘move on’ from one stage to the next.

However, the concept of vicious and virtuous cycles is well known. The idea is that in bad times people get worried. Managers take their eye off the ball or retreat into crisis group meetings. Workers too worry and may be ill; bad tempered, and pick fights with others. The ambiguity and the uncertainty are experienced almost exclusively as a threat. Threats lead to poor job focus and distraction that reduces productivity, which brings in worsening results at a bad time. This leads people to become anxious and possibly angry and to increase both of those negative emotions in those around them.

Managers need to constantly ‘steady the ship’. They can give confidence and energy to staff and seek to explore their fears and doubts. They should explain what has to be done and why, and model the appropriate behaviours.

The management essentials

The management of people is about five things.

1. The recruitment of talented, productive, motivated people.
2. Selecting the best and rejecting the less able, motivated or dedicated.
3. Engaging their heads and hearts so that they are optimally happy and productive.
4. The necessity of developing staff to enable individuals to reach their full potential. Managers need to know how, when and why to let go of people (to exit them) so that they leave with dignity and positive feelings about the organisation.
5. People stay productive and loyal because of many things; their personality, values and life situation, their available opportunities but most frequently because of the way they are managed.

There are clearly things to do if trying to manage in turbulent times:

1. re-engage through frequent, consistent, honest communication;
2. lead from the front: strong, bold, adventurous; giving confidence to others;
3. learn from previous recessions: beware cutting that which adds customer value, not going for big gestures, getting the little things right;
4. fix the leaks that soon appear when people leave or things are cut;
5. innovate – get creative with all the stakeholders;
6. change – sharpen your focus, streamline processes;
7. try to attract talent badly managed elsewhere and see this as an opportunity; and
8. prepare for economic recovery which will (eventually) come.

Just as the pessimist sees the glass half empty so they see turbulent times predominantly as a threat; a threat to their stability, livelihood and continued practices. Indeed their perceptions may well be self-fulfilling with all those potential vicious cycles already discussed.

Optimists believe that changes mean opportunities. Complacent, monopolistic organisations that have not moved with the times often go under. Bad times can be Darwinian in the sense that they are periods when only the fittest survive. Turbulent times test leaders. They can reveal hidden or obscured insights like what really motivates people at work. They demand creativity, new thinking and courage.

See also ‘Change for better’ by Gareth Chick in The People Bulletin, 18 November 2009.

This article first appeared in the Winter 2008/09 edition of The Leadership Trust’s quarterly journal, LTFocus.

Adrian Furnham

Adrian Furnham has been professor of psychology at University College, London since 1992. He was formerly a lecturer in psychology at Pembroke College, Oxford and has written over 700 scientific papers and 57 books. Recent publications have included The Elephant in the Boardroom and The Psychology of Leadership Derailment, published in 2009.

www.adrianfurnham.com

www.leadership.org.uk