• Skip to primary navigation
  • Skip to main content

IPA Involve Homepage

In partnership with the Institute for Employment Studies
  • About IPA
    • Who are IPA?
    • Our Team
      • The IPA Team
      • Our Work Insight Group
    • History
    • Report and accounts
    • Contact Us
  • What we do
    • Overview of services
    • Strengthening Employment Relations
    • Learning & Development
      • Learning and development programmes
      • Training for Managers
      • Training for Representatives
    • Diagnostic reviews
    • Election Services
    • Speak at events
  • Evidence & Research
    • Making the case for engagement
    • Why is diversity, equality and inclusion important?
    • What is Employee Voice?
    • Employee engagement
    • Collaborative Working
    • Research Publications
    • Factsheets
    • Case Studies
    • Podcasts
  • IPA Membership
    • Corporate Membership
  • Support us
    • Campaign
  • News & Events
    • News
    • Events
    • Employee Voice Hub
    • Jobs

ben

How trade unions need to adapt to a changing workforce

Five million people in Britain are now self-employed and this continues to grow, soon to overtake the size of the public sector. Although growth of the gig economy is now slowing, there is no doubt that technology is fundamentally changing the nature of work.

Trade unions are used to working with traditional forms of employment – permanent jobs with employment contracts and accessible shop floors – but the workforce is now starting to look very different. Increasingly people are switching jobs, careers and sectors and more and more workers do not have contracts at all. This requires us to think differently about how we approach and represent these workers and, secondly, how we approach and work with an employer, if there is one, so that we are relevant to the needs of modern workers. That’s why at Community we’re taking action to ensure innovation works for workers, on our terms, and that means ensuring good pay, fairer working conditions and decent work prevail through any change.

We’re seeing over 3.9 million workers in the UK such as parents, carers, women and the underemployed who would like additional work to earn an extra income to help their family, or top up their wage. There are legitimate concerns that unions share about the potential for exploitation, but responses differ as to how this can be prevented and how workers who want gig work or to be self-employed can be supported.

At Community, we have joined forces with Labour xchange, an independent platform that connects individuals to employers in an open and fair way. People can sign up and list their availability for work, which businesses then book as and when staff are required. The workers get work on their terms, while businesses get the staff they need, when they need them.

Labour xchange ensures that workers are paid a living wage for their work within 24 hours, meaning people aren’t left in the lurch like we know many self-employed workers are, unpaid and unable to predict and manage their finances. This innovative system has led to increased wages and more security for working people.

Community believes flexibility and fair work are not mutually exclusive. Much research has shown that self-employed people feel working in this way creates more opportunity, encourages transparency, flexibility and innovation. Trade unions need to ensure these workers can be given the opportunity to reap the benefits of gig work as well as mitigating the adverse impacts of low paid work.

There is a great trade union tradition of supporting self-employed workers in the creative and media industries. However, there’s not a great deal of union support for the growing number of self-employed workers in the wider economy.

At Community, we’ve found an increasing number of our members have been leaving traditional employment and going it alone as our traditional trade union offer wasn’t relevant to them. So we looked at the support that we offer and at who else was working with self-employed people, and were introduced to a co-operative called Indycube who provide affordable co-working desk space to self-employed people. 

Working in partnership with them we’ve come up with a package of benefits to support self-employed workers. It includes a factoring service, where in return for a small percentage, a company will pay your invoice on time and then it will chase up the payment from your client.

It’s only by collectivising workers with the backing of a trade union that we’ve been able to access such services and it’s a solution to a problem that millions of self-employed and sole traders face. In the UK today, self-employed workers are owed £26 billion. We want to get that money back in their pockets and back into local economies.

The provision of services for self-employed workers is not new. Organisations such as IPSE and the FSB have offered benefits and services to self-employed people for many years.

However, collective representation and the strengthening of the voice of gig and self-employed workers is lacking outside the aforementioned sector-specific unions. And the reality is that too many of those who face low pay and poor conditions are in these types of employment. So there is a duty on unions to change our normal practices to ensure we continue to fulfil the purpose for which we were created: to empower workers to come together and improve their lot.

Pointing out the problems or concerns around working independently isn’t enough. Trade unions need to recognise that working this way – whilst not always a choice – isn’t solved by saying that everyone needs to be directly employed and involved in a rigid employment relationship with an employer.

Expanding the self-employed and freelance network of users and organising them into a collective group with a voice on the issues that matter to them is why we’re proud to be a modern union for a changing world, by preparing our economy and workplaces for the next generation of workers.

Kate Dearden is Research and Campaigns Officer at the trade union Community

News in Brief December 2018

Pay ratio reporting requirements take effect on January 1st

From 1st January 2019 the new pay ratio reporting requirements, passed last summer and applying to all firms UK quoted companies with more than 250 employees, will be in effect. As part of the directors’ remuneration report, companies will have to publish the ratio of the Chief Executive’s pay to the 25th, 50th and 75th percentile pay levels of all full-time equivalent UK employees. The first figures should be released in annual reports in 2020, covering the figures from 2019. Business Secretary Greg Clark commented that, while most companies in Britain act responsibly. “We do, however, understand the frustration of workers and shareholders when executive pay is out of step with performance, and their concerns are not heard.”

 

Uber employment tribunal ruling upheld by Court of Appeal

The Court of Appeal has upheld previous rulings that Uber drivers should be classified as workers, rather than self-employed contractors. This status entitles them to holiday pay and a guaranteed minimum wage. As one of the archetypal ‘gig economy’ professions, the Uber drivers’ case is seen as a key landmark for employment rights across a wide range of similar professions. Nigel Mackay of Leigh Day, the solicitors firm representing the drivers, commented that Uber has yet to give drivers “what three legal decisions have ruled they are entitled to – holiday pay and to be paid at least the minimum wage.” Uber have announced they will be appealing the decision to the Supreme Court, where a final definitive ruling is expected.

 

Government to lower threshold for information and consultation of employees

As part of their response to the Matthew Taylor Review of Modern Employment Practices, the department for Business Energy and Industrial Strategy has announced they will be accepting Matthew Taylor’s recommendation to lower the threshold in the information and consultation of employees regulations. Currently 10% of employees have to make a formal request to set up information and consultation mechanisms in order for the regulations to take effect and their employer to be obligated to respond. The government have announced they will be bringing forward legislation to reduce this threshold to just 2%, with a minimum of 15 employees. It is expected that this change could lead to a large increase in the number of companies required to set up consultative bodies with their workforces.

New corporate governance rules open door to greater employee voice

From 1st January 2019, the revised UK Corporate Governance Code drawn up last summer by the FRC will come into force. The major change on previous years relates to the requirement for firms to establish formal mechanisms for employee voice to be heard at the boardroom level. While formally the code applies only to those companies with a premium listing on the London Stock Exchange, in practice we would suggest the code should be seen as a model of good practice in corporate governance for all large and medium sized companies across the UK. The new Code states:

FRC UK Corporate Governance Code

These three methods are broadly based around the three models outlined under corporate governance reform plans in the Conservative Party manifesto in 2017. The options are, unsurprisingly, broad and flexible, allowing a very wide range of interpretation by individual firms in terms of how they are implemented. This presents both an opportunity and a risk. While the IPA would not claim that any of the three options; worker directors, a workforce advisory panel, or a designated NED; was inherently superior to the others, it is clear that there are ways of complying with the letter of the code that involve doing very little in practice.

Simply designating a non-executive director to be responsible for listening to the workforce, but setting up no other mechanisms to actually collect worker voice or open an informed dialogue with the workforce, is going to lead to a very selective and minimal worker voice being represented at best. Similarly if a random member of the workforce is simply selected by management and appointed to the board, without any kind of election from the workforce or other means by which that worker can actually represent the views of the workforce more broadly, they will improve board diversity, but do little to actually improve employee voice.

On the other hand, a company that really wanted to seize this opportunity to bring a meaningful employee voice to their boardroom could use a combination of the suggested options, perhaps having an elected employee director or designated non-executive director who also acted as chair of an employee advisory panel that was itself elected by the workforce.

At the same time, a separate regulatory change that could have far-reaching consequences is coming down the line. The government announced shortly before Christmas that, in their response to the Matthew Taylor Review of Modern Employment Practices, they would be bringing forward legislation to amend the Information and Consultation of Employees Regulations first brought in back in 2004. Under the changes, the proportion of the workforce that would need to make a request to set up formal information and consultation arrangements will be lowered from 10% to 2% of employees (with a minimum of 15 employees).

This small change could lead to a huge increase in demands for formal consultation mechanisms to be set up under the regulations; finding 20 employees willing to support such a request in a 1,000 person company will be a far easier hurdle to jump than finding 100 such employees. Given that one of the best ways for companies to protect against having mechanisms imposed on them against their will is to act preemptively to set up a pre-existing information and consultation arrangement with the agreement of the workforce, wise firms will have yet another reason to act now in overhauling their employee voice arrangements.

Given the potentially enormous benefits of having an informed employee voice, in terms of productivity, creativity, more long-term thinking, better industrial relations and organisational resilience to weather storms such as Brexit, firms should be jumping at the opportunity these two sets of changes offer and trying to set up new voice arrangements that will stand the test of time; not just looking for the quickest solution that will satisfy the letter of the law. IPA stands ready to support and advise any firms looking at ways to establish or improve employee voice mechanisms, through consultation, managing ballots for employee elections and providing training to new staff representatives.

Patrick Brione is Head of Policy & Research at IPA

[email protected] 

0207 759 1004

Why Is Cyber Security An Employee Engagement Issue?

The Employment Appeal Tribunal (EAT) ruled in October 2018 that Morrisons Supermarkets were vicariously responsible for a data breach, in which the personal data and bank account details of thousands of employees were posted online by a disgruntled employee. This has led to a major concern on the part of many employers about what they can reasonably do to mitigate the “internal threat” whether it is by human error or malicious intent? 

A 2016 study of 874 data breaches found that less than 10 per cent were conducted by outsiders with stolen credentials – compared with 22 per cent caused by malicious employee activity and a shocking 65 per cent as a result of employee or contractor negligence. With the EU GDPR (General Data Protection Regulation) now in force, organisations could be faced with fines of up to €20 million or 4% of annual global turnover for certain infractions. There are also non-financial costs to be considered, such as reputational damage and loss of customer trust.

Robust cyber security involves implementing controls that are based around three pillars: people, processes and technology. This three-pronged approach helps organisations defend themselves from both highly organised attacks and common internal threats, such as accidental breaches and human error. IPA has developed a training programme which is aimed at strengthening this first pillar – people. It is vital that every employee is aware of their role in preventing and reducing cyber threats. At the same time, the specialised technical cyber security staff within any organisation need to be equipped to explain the processes and technology to their non-technical colleagues and – equally importantly, why they need to use them in their daily job roles.  Cyber threats change quickly, and processes need to be continually reviewed to be able to adapt with them and this is why organisations need adaptable employees who are engaged with their organisation and the challenges it faces.

The essence of employee engagement is that given the right circumstances, employees will be prepared to ‘go the extra mile’ in the service of their organisation. The four key enablers (Leadership, Engaging Managers, Integrity and Informed Voice) are well known to regular readers but it is clear that all have a role to play in ensuring any organisation’s cyber security.

An engaged workforce is probably the best friend a senior manager can have when trying to lead their organisation through challenges and change. Supporting it, enabling it, and listening to it, may provide one of the best returns on investment it is possible to make. A workforce that feels they are listened to by management in a respectful way are far more likely to head off a major security incident which could cost the organisation dearly.  Having an engaged and informed workforce also makes it easier to secure buy-in to the cyber security objectives and to ensure colleagues are more likely to listen when organisations explain security protocols to them.

The key challenges for managers, and the areas they need support in include:

  • How to engage employees in fighting the cyber-security threat
  • How to effectively communicate the importance of cyber security and processes
  • Understanding the role of staff involvement in reducing the cyber security threat
  • Understanding the importance of training and encouraging adjustments to change peoples’ skillsets

Ultimately, an informed employee voice acts to strengthen organisational resilience. Moreover, an engaged workforce with a meaningful voice will support an organisation undergoing periods of turbulence, either as a result of internal change programmes or external pressures. A disengaged workforce that lacks a proper mechanism for meaningful dialogue will instead exacerbate those pressures as they look for means to vent the frustrations that they have no legitimate means to express.

It is critical, therefore, that managers at all levels become aware of these links between cyber security and employee engagement – if this does not happen, who will be next to face the EAT?

Derek Luckhurst is Training and Development Director at the IPA

IPA have been working with the National Cyber Security Centre at GCHQ to develop a training product around the human element of cyber security. For more advice and information about how the IPA could help you with cyber security issues through workforce engagement, please get in touch via the details below.

[email protected] 

07780 697024

News in Brief November 2018

Cybersecurity is now top concern for businesses

The latest survey of 12,000 top executives around the world by the World Economic Forum (WEF) has indicated that cyber-attacks are now the biggest threat to businesses around the world. Following a series of high profile security breaches at companies including BA and HSBC the issue has shot up the list of business leaders’ priorities to take the number one spot. Lori Bailey, global head of Cyber Risk at Zurich Insurance Group and member of the WEF’s Global Future Council on Cybersecurity commented, “Cyber-attacks are seen as the number one risk for doing business in markets that account for 50% of global GDP… this strongly suggests that governments and businesses need to strengthen cybersecurity and resilience in order to maintain confidence in a highly connected digital economy.”

 

Agency workers losing out on rights and pay

A study by the Resolution Foundation has suggested agency workers in the UK are missing out on at least £500m a year in missing holiday pay, as well as receiving around 22p an hour less, on average, than permanent employees doing exactly the same work. While there are genuine benefits of flexibility from agency work for some workers, the average pay penalty was £400 a year per worker compared with direct employees. Top causes included missing holiday pay, lack of auto-enrolment in pension schemes and travel costs, as well as firms violating their equal treatment obligations and imposing covert deductions for things like uniforms.

 

Industrial dispute looms at British Gas over pension reforms

British Gas owner Centrica faces rising anger from its 11,000 engineers over plans to cut worker pensions as part of a £200 million cost-saving exercise, at a time when executive pay at the firm is perceived to remain high. One estimate suggested staff could end up with £190,000 less in their retirement pot over a 15-year period if the plans go through as announced. Meanwhile, Chief Executive Iain Conn enjoyed a 40% pay rise to £4.15 million in 2016 and workers expressed anger over other senior executives who would benefit if share prices rise off the back of the move. Centrica commented that they were consulting with unions and colleagues about the proposals, which were key to keeping the company price competitive with rivals.

How a strong employee voice in the workplace can lead to greater employee involvement in lean manufacturing systems

Lean methods are considered the best practice for organising work in the manufacturing sector and beyond. Lean human resource systems theoretically place employees’ skills and competences at the centre of the production process as employees should be responsible for ‘zero-error’ and ‘zero-waste’ production and be directly involved in improving efficiency.  And yet, lean work organisation has often been criticised for contributing to work intensification, routinisation and, ultimately, to alienation.

My research, conducted at King’s College London with the support of the Economic and Social Research Council, found that strong employees’ voice in the workplace, which is often perceived as an obstacle to lean methods, contributes to create lean HR systems promoting employees’ involvement in the production process. Through interviews with workers and their representatives and with human resource managers in manufacturing companies in Germany, Italy and UK, I investigated the differences between German workplaces, where workers’ representatives have strong voice rights on work organisation, working time and variable pay, and British and Italian workplaces, characterised by weaker employees’ voice.

I illustrate these differences by discussing the systems for improvement suggestions. In lean manufacturing systems workers don’t always have an interest in making suggestions for improving the production process.  On the one hand, suggestions such as e.g. raising the tool trolley might benefit both workers and the company by preventing back injuries and therefore contributing to a healthy and productive workforce. On the other hand, some suggestions might lead to work intensification; e.g. changing the sequence of tasks within a team for reducing waiting time might lead to efficiency gains but also to higher cycle time saturation. Therefore, workers might not always be willing to share their insights with the management unless they are provided incentives and they are able to influence how these practices are implemented.

In all companies across countries, workers could use suggestion boxes, online platforms or paper-based forms for suggesting efficiency improvements. In Italy and in the UK workers would also pass their suggestions to the team leader, who would then discuss them with the supervisor. If suggestions were considered potentially valuable and implementing them required investments, top management would get involved in the evaluation as well. It was reported that workers whose suggestions are not accepted did not always receive feedback even if requested, leading to a diffused perception that the evaluation process is arbitrary.

In Germany the system for collecting improvement suggestions, which is regulated by detailed workplace agreements between the works council and the management, is different. Every team has an elected group speaker who collects workers’ suggestions and passes them on to the supervisors. Workers’ representatives sit alongside the management in the evaluation committee and can request feedback on behalf of individual workers. The elected group speaker, rather than a team leader appointed by the management, and works councils’ supervision were reported as crucial for re-assuring workers that their improvement suggestions would be evaluated fairly and their implementation would not have a negative impact on their working conditions.

The system of incentives is also different. In Italian and British companies team discussions are limited to five minutes at the beginning of each shift, when the team leader usually briefs the team about the problems encountered in the previous shift. Therefore, workers are supposed to develop improvement suggestions during the breaks or their free time. Rewards for successful suggestions are mostly symbolic such as a lunch voucher, a baseball cap or permission to take one of the company cars for the weekend – these incentives were reported to be perceived as inappropriate by workers. While these prizes are common in Germany as well, improvement suggestions leading to relevant efficiency gains are economically rewarded using an algorithm which calculates the amount as a percentage of companies’ savings, which in some cases amounted to thousands of pounds.  Furthermore, in addition to the pre-shift meeting, workplace agreements in Germany set that teams have 30minutes/shift each week for discussion.

These findings suggest that negotiated agreements between managers and strong workers’ representation bodies like German works councils contributed to develop lean HR systems integrating workers’ skills and knowledge in the production process. Appropriate incentives, the emphasis on the collective dimension of the suggestion process through the team and the group speaker and the supervision of works councils over evaluation can encourage workers to actively participate in efficiency improvements.

Dr Chiara Benassi is Lecturer in Human Resource Management at King’s College London

The full research report will be published in the following weeks on Chiara’s King’s profile website:

https://www.kcl.ac.uk/business/people/chiara-benassi.aspx

Where would a ‘No Deal’ Brexit leave UK employees?

We are fast approaching what could be the decisive moment of the entire Brexit process. The House of Commons is due to vote on the Prime Minister’s draft Brexit deal on the 11th December and, with every indication so far that she is headed for a historic defeat, the possibility of a collapse of the Article 50 process, or even of the entire government, and the associated risk of a No Deal Brexit must seriously be considered. What implications might this have for the UK workforce and what should employers and trade unions be thinking about in such a scenario?

As it stands, the UK is due to leave the European Union by automatic operation of both UK and EU law at 11pm on 29th March 2019, with or without a deal. Simultaneously, the European Communities Act 1972, which gives legal force in the UK to EU directives, rights and regulations will cease to operate. Thanks to the European Union (Withdrawal) Act 2018 (colloquially and misleadingly referred to as the ‘Great Repeal Bill’), previous EU regulations, including on employment rights, will be transposed directly into UK law regardless of whether we leave the EU with or without a deal. However, whereas under Theresa May’s deal we would enter a transitional period until at least the end of 2020 and potentially be bound to shadow or maintain equivalence with EU employment rights through that period and beyond (including ECJ jurisdiction to enforce such rights), without a deal no new changes to EU employment rights would apply in the UK after 29th March next year.

Enforcement of existing rights would fall solely to UK courts and employment tribunals, with no further right of appeal to the ECJ. While in practice there doesn’t seem any reason to think existing rights would not be enforced any longer, we could certainly imagine a potential drop in compliance following the reduction in enforcement infrastructure and lack of EU-level pressure to enforce compliance. More troublingly, there would be nothing to prevent the UK government from acting to repeal significant parts of the Social Europe regulations.

The EU has strengthened both individual and collective workplace rights immeasurably over the past four decades. Examples include stronger rights for working parents and women, guarantees over maximum working time and minimum holidays, protection against discrimination, equal treatment for ‘atypical’ workers and regulations such as TUPE which offer protection for employees being transferred to a different employer or those facing redundancy. In addition, the EU has been fundamental in extending and enshrining health and safety regulations in the UK. Finally, the EU has strengthened rights surrounding collective voice at work via the Information and Consultation Directive and the right to request European Works Councils in large multinationals operating across EU member states.

Many of these protections are much derided by those on the libertarian right, led by the vision of a buccaneering Britain unshackled from the ‘red tape’ of regulation as outlined by the five authors of the 2012 “Britannia Unchained” book; all of whom are now senior government figures including recently departed Brexit Secretary Dominic Raab, new junior Brexit Minsiter Kwasi Kwarteng, two other Cabinet Ministers and a Conservative Vice Chair. Theresa May has promised explicitly that “Existing workers’ legal rights will continue to be guaranteed in law – and they will be guaranteed as long as I am prime minister.” With the political situation being what it is, however, such a promise is not perhaps as reassuring at this time as she might have hoped when she made it back in 2016.

A new Conservative Prime Minister from this wing of the party would no doubt be keen to scrap a number of these landmark employment rights, with the Working Time Directive, TUPE and anti-discrimination legislation considered particularly high priority targets. As IPA have previously argued, however, to do so would be a serious mistake. It would inflict major harm on working people and there is little evidence that it would do anything to seriously boost productivity; in fact it might do quite the opposite by encouraging industrial disputes and further undermining employee engagement at a time when morale is likely to already be at rock bottom as a result of economic shocks. Furthermore, the EU would be bound to retaliate against a perceived uneven playing field of employment rights by further restricting our access to the single market and making any future trade deal to escape the economic damage of a no deal Brexit that much harder.

Rather than countenance such a scenario, the government (whoever may lead it in the months ahead) should do everything possible to provide continuity, stability and continued reassurance to working people in Britain that, whatever happens, their fundamental rights at work will not be at risk.

Patrick Briône is Head of Policy & Research at the IPA

[email protected]

0207 759 1004

News in Brief October 2018

NHS Workforce risks being further demoralised by hospital car park charging

An article in the British Medical Journal has warned that employee morale in the NHS, already hit hard in recent years, is at further risk from the introduction of hospital car park charging. Figures released earlier this year indicated that around a third of NHS hospitals already charge their own staff for car parking. At the top end, charges average out at around £2 per hour, or the equivalent of an £80 charge for a doctor or nurse working a 40 hour week. To highlight the scale of the issue, new figures this month suggest that the English NHS made a profit of £69.5 million last year from car parking charges levied on their own employees.

 

Over 20,000 Google employees walkout over Sexual Harassment Policy

On Thursday 1st November over 20,000 employees and contractors of Google across the world walked out in protest against sexual harassment, misconduct, lack of transparency and workplace culture. The move was triggered by the revelation of sexual misconduct allegations against Android co-founder Andy Rubin, who was reportedly paid $90 million to resign from Google and keep quiet about the affair. Google employees in countries around the world, including the UK, issued a set of demands including an end to forced arbitration for issues of sexual harassment and discrimination, commitments to equal pay and opportunity, clearer sexual misconduct reporting process and the addition of an employee representative to the board of directors.

 

Gender pay gap among senior executives may have shrunk significantly in 2018

Research by The Pay Index has found that the UK gender pay gap among senior executives in the UK has almost halved, from a reported figure of -22% in March to -12% in September 2018. The introduction of mandatory gender pay reporting in large firms has shed light on where major disparities exist and there has been growing pressure on employers to eliminate pay disparities. Globally, amid a climate of increased attention and focus on gender pay issues, The Pay Index found the gender pay gap for senior global executives shrunk from 17% to 9%, with an average male executive salary of £396,810 set against a female average of £327,240.

Cyber security risk for employers with low engagement

In the news last week, the Court of Appeal found that Morrisons Supermarkets should be held liable for a rogue employee’s deliberate disclosure of his colleagues’ personal data. A Senior IT Internal Auditor, Mr Skelton, used his legitimate access to the company’s staff payroll data to copy this data onto a personal USB before going on to upload it into the public domain on a file sharing website. Mr Skelton was acting in a personal grudge against the company due to disciplinary action he had previously been subjected to. While he was convicted and imprisoned for 8 years for his crimes, the Court of Appeal ruled this week that the employer, Morrisons, was vicariously liable for his actions and may have to pay damages to some of the 100,000 Morrisons employees affected by the breach, whose leaked personal data included names, addresses, national insurance numbers, banking and salary information.

This ruling could have enormous consequences for other UK employers, almost all of which have vulnerabilities in their own cyber security, in particular to insider threats from among their own employees. Evidence suggests that between two-thirds and three quarters of all cyber attacks are at least partially a result of insider threat – defined as cyber threats that originate from people within the organization, such as employees, former employees or contractors who have inside information about and access to the organization’s security practices, data and computer systems. Likewise a 2017 study by  IBM and X-Force in the US found that 58% of attacks against financial services and 71% of attacks against health care organizations came from inside employees, either maliciously or inadvertently.

Some of these threats will be employees seeking financial gain or doing the bidding of competitors, stealing data as a form of corporate espionage. Others, as in the Morrisons case, will come from disgruntled former or current employees, seeking revenge for perceived injustices at work. While there are some physical security measures employers can put in place to guard against this, such as requiring unique user accounts with two-factor authentication and ensuring employees don’t have more privileged access to your systems than required to do their jobs, there are limits to how much this threat can be mitigated by technical solutions alone. The problem is that, as in the case of Mr Skelton, insider threats can result from employees misusing their legitimate and necessary access to corporate systems and their malicious activities can be hard to distinguish from them doing their regular job.

While good security protocols are important, perhaps the best way to protect against this kind of security threat is through a strong focus on employee engagement. Employees are far less likely to vent their rage and frustration with their employers through acts of malicious sabotage if they have a strong voice in the organisation and other legitimate avenues to seek redress for their grievances. Likewise, line managers who are closely engaged with their teams, listening to feedback and attentive to their employees’ moods and behaviour are far more likely to pick up on potentially disgruntled employees and head off problems before they escalate to this kind of situation. Strong trust between the workforce and management and an expectation that their voice will be listened to and valued will also make co-workers confident to speak up and alert management if they notice concerning behaviour among one of their colleagues. Finally having a strong workplace culture with shared values means that those rare employees motivated by personal greed or external political or social agendas that they wish to promote at the company’s expense are more likely to stand out and be easily identified before they can act.

Insider threat also extends far beyond deliberate and malicious actions – in fact around half of all insider threats result from inadvertent breaches from employees who usually don’t realise the full consequences of what they are doing. Often this is itself a result of poor training and education – something which can reflect deeper problems of poor engagement and a silo mentality where cyber security and IT functions are isolated from strategic management and HR. Often in organisations, employees receive one set of instructions about cyber security from IT or cyber security professionals, and a competing set of priorities around productivity and performance from their line managers, which encourages them to cut corners and ignore time consuming security protocols. Inevitably, the demands from line managers win out and cyber security is compromised. Having a more joined up approach, with cyber security being part of a strong strategic narrative from the top of the organisation which all managers are bought into and actively working to promote, offers a far better likelihood of success. The IPA are keen to work with the National Cyber Security Centre and other organisations to promote better thinking around how to engage with the workforce over cyber security issues. Anyone interested in learning more should get in touch.

 

Patrick Briône is Head of Policy & Research at the IPA

[email protected]

0207 759 1004

Dealing with Brexit-related Uncertainty

In a previous bulletin article back in October 2016 I outlined several key questions that had been posed to us following the Brexit vote. These included:

  • What are people’s concerns relating to the future of their work since the referendum?
  • What communication have they had from their employer since the referendum relating to Brexit and what reassurance has this provided?
  • How confident are workers that their employment is secure, do they feel that their business will benefit or be harmed by Brexit?
  • Do they fear outsourcing abroad?
  • What aspects of Brexit are UK workers most concerned about and what would they like to see the government and business leaders doing more of to reassure them?

Arguably, these questions have remained unanswered.

Organisations appear to be unsure of what to tell their staff fearing that a lack of clarity or certainty might make their people question their leadership capability. However, staff all over the UK tell us that they do not expect clarity or certainty but want to know that their leaders are thinking about the strategic implications of a deal or even a no deal. They want to know that their organisations have a Plan A, a Plan B and even a Plan C if necessary even if those are dependent on assumptions that might change as more detail is provided by government. As one person stated, “If we know what the worst is, we can deal with it.” As it is, the communication vacuum is being filled by rumours based on the negative perspective rather than fact.

There are ways this communication gap can be filled quickly. Organisations could consider a fortnightly (or monthly) Brexit session for staff forums and trade unions where factual communication could be filtered through to all employees. Frequently answered questions could be updated regularly. Not everyone will read them or believe them but I suspect that will be the small percentage of people who believe in grand conspiracies. If 95% of employees choose to be informed and take that information on board, that is the best we can hope for.

I believe organisations can be helped to make sure that employees receive clear communication from their leaders and are made to feel properly involved in any important decisions that will be taken about the future of their organisation. Our coaching and training course covers several key interventions:

  • Helping senior managers to clarify their messages
  • Helping managers to communicate the different options and dilemmas facing them
  • Keeping staff informed even when there is nothing new to relay
  • Ensuring the facts are communicated and the myths are dismissed
  • How to re-assure staff that the organisation will support them
  • How to use Social media to separate fact from fiction

Regardless of specific circumstances, UK workers can remain engaged with their organisation even under the most testing conditions. Uncertain times re-enforce the need for a strong strategic narrative and organisations need to tell staff what their plans are. A reluctance from managers to share such information is understandable but this is a time for leaders to show confidence and strength in their planning. This requires knowledgeable and confident leaders supported by skilled line managers. Without that confidence, the strategic narrative does not translate to operational levels and employees are kept in the dark.

It is equally important that the employee voice is informed enough to contribute to solutions rather than a means of simply highlighting problems. This is why it is important to repeat the facts rather than assume everyone has taken in the messages first time. Repetition is not reassurance but it is vital in trying to secure as shared an understanding amongst people as possible.

There is a strong argument that uncertainty amongst workers spreads and grows at an unmanageable rate resulting in reduced confidence in their business, knee-jerk decisions about their future and an unnecessary loss of talent. This is often caused by rumour and a reluctance from staff to ask the questions that would dispel those rumours.

People do not expect reassurance when none can be given and cynicism is often disproportionately represented through the various channels for voice, from formal representative structures through to social media. Uncertain times require a higher level of clarity around all communications whether they are top-down or bottom-up. It is imperative that mangers “tell it like is” and that voice represents the engaged as well as the disengaged.

If we start doing this now, it may not be too late.

 

Derek Luckhurst is Training and Development Director at the IPA

For more advice and information about how the IPA could help you engage with your workforce through Brexit and beyond, please contact:

[email protected]

07780 697024

News in Brief September 2018

Workers to keep all tips under new proposals

The government has announced plans to legislate in order to ban employers from deducting money from tips given by customers in bars and restaurants. The move comes in response to a consultation which showed that customers overwhelmingly wanted the full proceeds of tips they paid to go to serving staff. Announcing the move, the Prime Minister said that “the change is part of the government’s drive to back businesses to create good jobs while making sure the system works for ordinary people,” while Shadow Business Secretary Rebecca Long Bailey commented “This is now the fourth policy the Tories have copied from us at their conference, as they desperately try to catch up with Labour.”

 

Apprenticeship levy to pass more to supply chains

The Chancellor, Philip Hammond, has announced an overhaul of the apprenticeship levy at this year’s Conservative Party Conference. Following on from changes in May 2018 which allowed firms to pass 10% of their levy funds on to other firms in their supply chain, this proportion will be increased to 25% from April next year. Alongside these changes the Conservative Party has committed to expand the range of available apprenticeships and open up an consultation process to consider further changes to the levy, following a disappointingly low take-up during the scheme’s first two years, with large firms so far only making use of 10 percent of their available funds.

 

The UK cities most at risk of robot revolution

A new report by the Centre for Social Justice has highlighted the 10 UK towns and cities most at risk of job losses from the fourth industrial revolution. In a sign of a further widening North-South divide, the areas hardest hit are small post-industrial towns in the North of England which are already suffering from low skills, unemployment and poor transport links as a result of previous waves of industrial disruption during the 1980s. Meanwhile the South, London and other major cities will likely benefit from the coming waves of automation and artificial intelligence. The 10 places listed as likely to be hardest hit are Doncaster, Wigan, Blackpool, Mansfield, Barnsley, Bradford, Plymouth, Stoke-on-Trent, Wakefield and Dudley.

Personal appraisal success depends on frequent feedback and good standard setting

Appraisal of employees often gets a bad press, but recent research suggests if it involves frequent feedback between formal appraisal meetings and good prior planning and communication of standards then it can be successful and appreciated by employees.

The research, conducted by myself with two US colleagues, Shaun Pichler and Gerard Beenen at the California State University, Fullerton, shows that acceptability of appraisals is enhanced when feedback is frequent and standards are set and clear to employees. These two features also have a synergistic relationship, so feedback has a greater effect when standard setting is good. The research is based on a meta-analysis of existing research, that is a statistical analysis of the studies of appraisal that include feedback.

This evidence is consistent with the due process theory of performance appraisal associated with Robert Folger, a Business Ethics Professor at the University of Central Florida. The principles of the due process of law, which are prescribed by the Fifth and Fourteenth Amendments to the US Constitution, include adequate notice (notification of charges and proceedings), a fair hearing (one can present evidence on one’s behalf and prepare a legal defence) and judgement based on evidence (judgements that are impartial, free from bias). In the context of performance appraisal, setting standards or expectations in the planning stage and giving feedback between this stage and the formal appraisal provide the adequate notice dimension of due process. The remaining due process criteria – fair hearing and judgement on evidence – are fulfilled through the appraisal itself, appeals procedures, and ensuring judgements at all stages are based on relevant evidence.

Frequent feedback provides information that allows individuals to determine how well or poorly tasks have been done and facilitates discussions between a manager and the appraisee in order to enable change between the planning stage and the formal performance appraisal review. This can be change in employees’ behaviours, attitudes or orientations, their job characteristics, or the wider organizational context.

As it fulfils the adequate notice dimension of due process, the provision of frequent feedback should increase the likelihood that the appraisal process is seen as procedurally and interpersonally fair. The theory is that feedback generates favourable reactions to appraisal because it facilitates employees’ learning and error correction, gives them a greater sense of control over the appraisal process, and should increase the extent to which the appraisal is based on valid and accurate information.

Equally good standard setting fulfils the adequate notice dimension of due process. Knowledge of performance standards should increase the acceptability of appraisals since it ensures that employees can effectively prioritise and accomplish their work, which is especially important when employees have multiple tasks and goals. Without the provision of this knowledge, due process theory suggests that employees should not be held accountable to performance standards. Increased knowledge about the appraisal process creates shared understandings between the parties and improves employees’ justice perceptions. Knowledge of performance standards enables employees to match their work performance to a level required for optimal rewards; and the evidence is that goal achievement and progress towards goals, not goal-setting itself, positively affects well-being.

The use of appraisal has grown substantially in the last two decades in Britain to the point that it is almost ubiquitous, and certainly the days when it was limited primarily to managers or only a handful of organisations like Nissan which appraised all their employees are gone.  Yet, all too often appraisal is treated as a once-a-year ritual or conceived as monitoring people’s performance, which does not entail feedback or good standard setting processes. The research suggests that appraisal is unlikely to offer much for employees without these features.

The implications for practice are that rather than abandoning appraisals or continuing to treat that as annual ritual, organisations and employees will benefit from implementing both aspects of the adequate notice dimensions of due process. Moreover, performance feedback should concentrate on employee development, as well as error correction, if it is to facilitate gains in the job satisfaction and performance of employees. It is important that in the feedback and standard setting potential trade-offs between goals is acknowledged. And the existence of multiple or conflicting goals is not used to justify a fatalistic approach to appraisal, that it can never really be much use. Standards make appraisal and feedback easier so the appraisal does not need to focus on the person; they can be defined as ideals and not obligations so the appraisal can focus on development and not ensuring obligations have been fulfilled.

With well communicated expectations and good quality feedback, appraisal can be transformed from a tool of performance management to a potentially vital high-involvement or participative management practice. Just as feedback transforms the traditional attitude survey to a high-involvement management practice – the survey feedback method – so feedback transforms appraisal. Name changes may help, for example from appraisal to personal development reviews or the personal development cycle. More generally, appraisal illustrates that a management valuing employee involvement will design personnel practices according to that principle and not simply pick from a set of best practices as for example prescribed in the high performance work system vogue or a performance management manual.

Professor Stephen Wood is Professor of Management at the University of Leicester. [email protected].

This research is presented in: S. Pichler, G. Beenan, S. Wood, Feedback Frequency and Appraisal Reactions: A Meta-analytic Test of Moderators, The International Journal of Human Resource Management. DOI: 10.1080/09585192.2018.1443961

Labour offers a radical vision for corporate governance

At their conference in Liverpool this month, the Labour Party have brought forward a number of radical proposals for reforms to corporate governance, including mandatory employee board representation and mandatory worker share schemes for all companies, public or private, with over 250 workers.

Under the first proposal, at least at least a third of places on all boards, with a minimum of two seats, would be reserved for worker representatives, bringing about a radical increase in the role for employee voice in corporate governance. The second proposal would bring about an equally radical transformation in corporate ownership; all companies with over 250 UK employees would be required to transfer 1% of ownership each year, up to a total of 10% over 10 years, into an “Inclusive Ownership Fund” that would be controlled by workers. These shares would be controlled collectively by the current workforce, giving the workforce at least 10% of shareholder voting rights. In total this would transfer assets worth hundreds of billions of pounds to the ownership of the UK workforce.

These proposals are being floated in response to a series of major crises which have beset corporate governance and the wider UK labour market over recent years. A number of corporate scandals, from Sports Direct to BHS have eroded public trust in UK businesses, which fell another two points in 2017 according to the latest Edelman Trust Barometer, to just 43%. Meanwhile, the problems faced by workers and businesses alike in our economy are very real. As Jeremy Corbyn said when announcing these policies on the eve of Labour’s conference, “In workplaces across the country, working hours have got longer, productivity has nosedived, pay has fallen and insecurity has risen.”

While almost everyone would agree with this diagnosis of the UK’s problems, there have been loud challenges from some quarters to Labour’s proposed solutions. The CBI suggested measures such as these would “only encourage investors to pack their bags”. As the Labour Party pointed out in their defence, however, the UK already has the lowest average level of business investment of any G7 nation as a share of GDP – a problem itself partly caused by dysfunctional corporate governance. Research published last year by the Bank of England found that four in five publicly owned firms reported that pressure to create short-term returns has dented investment levels over the previous five years. By giving employees, who generally have a longer term stake in the firm, a greater voice in boardroom decisions, might we not actually rebalance corporate decision making in favour of more long term investment? There is a further wealth of evidence, published by the IPA and others over a number of years, linking both employee voice and employee ownership with greater productivity, increased innovation and improved problem solving, as well as better workplace relations.

That is not to say that there aren’t valid criticisms of these proposals, or details that need to be worked out. There is certainly a risk that, as the proposed scheme does not cover foreign-owned firms, it would simply encourage some major British employers to transfer their stock exchange listings overseas to avoid having to comply. Furthermore, as laid out, Labour’s plans for the “Inclusive Ownership Funds” would cap any dividends paid to workers at a £500 annual payment per worker, with the remainder going to the government. With no accompanying rights to sell their shares, this renders the proposal a form of tax with some associated voting rights for workers, rather than true employee ownership.

Nevertheless these are bold proposals to challenge a culture of poor corporate governance that has been allowed to take hold in too many firms over recent years. The Conservative Party has also proposed major corporate governance reform, with Theresa May promising in 2016 that under her leadership “we’re going to have not just consumers represented on company boards but workers as well.” However, in the two years since then, concrete policy developments have been slow to emerge after a hostile business response and the watered-down proposals that were eventually published in the 2017 Corporate Governance Reform Green Paper and made their way into the Conservative manifesto for the 2017 general election. Over the past 18 months, while the FRC have reflected some of these ideas in their revised Corporate Governance Code, there have been few signs of progress from the government in implementing any of these promises on a legislative basis. Rather than relying on criticism of Labour’s new plans, the Conservative Party would be better off making good on their earlier commitments and bringing forward meaningful corporate governance reforms of their own before it is too late.

Patrick Brione is Head of Policy & Research at the IPA

Gareth Southgate – A Leader Who Fulfils the Four Pillars of Employee Engagement

I’ve read two articles recently that rightly laud Gareth Southgate’s leadership qualities, one published in the Huffington Post and one in Real Business. This is interesting in itself but what has struck me most is that much of the analysis of Southgate’s style of leadership is retrospective as if the recent World Cup campaign is the first time it has been noticed. Southgate’s name has also come up increasingly often in the IPA’s Stage 1 training workshops during the 10 Leader Exercise in the last two months – this never happened before the build-up to Russia 2018.

My personal view is that Southgate is a highly knowledgeable and impressive character who demonstrates more than traditional leadership qualities but is almost a personification of the 4 Enablers of Employee Engagement. As most readers will know, in 2009, David MacLeod and Nita Clarke co-authored and published Engaging for Success (also known as the MacLeod Review of Employee Engagement).  This report has become the cornerstone of thinking on engagement and identified the definitive four key enablers of employee engagement:

  • Visible, empowering leadership providing a strong strategic narrativeabout the organisation, where it’s come from and where it’s going.
  • Engaging managerswho focus their people and give them scope, treat their people as individuals and coach and stretch their people.
  • There is an informed employee voicethroughout the organisation, for reinforcing and challenging views, between functions and externally, employees are seen as central to the solution.
  • There is organisational integrity– the values on the wall are reflected in day to day behaviours.                            

As far as strategic narrative is concerned, Real Business noted that Southgate had become a fashion icon and that, “his appearance was part of a conscious decision by the manager to instil a sense of pride in the team both on and off the pitch.” This instillation of a sense of pride was his clear strategic objective  and was communicated to the players and staff in such a way that a clear line of sight was provided to link behaviours off the pitch with performances on it. In both, the England players were almost one hundred percent exemplary. It is telling that the strategic objective was not the usual aim of a wish to progress to a specific stage of the tournament. Such an objective is open to too many variables to be credible and can often come across as arrogant or delusional.

Southgate proved himself to be an engaging manager who certainly coached and stretched people. He was able to do this partly by using his own experience of supposed failure in a penalty-shoot-out in 1996 for England and partly by a detailed understanding of the strengths and weaknesses of each individual. As a team, England achieved more than the sum of its parts through Southgate’s utilisation of strengths (for example, set-pieces meticulously rehearsed) and a recognition of weaknesses (the lack of a playmaker in midfield compensated by energetic pressing of the opponent). This is classic team-building.

For older observers, the encouragement of players to speak freely to the press was a remarkable shift from previous England managers. They came across as highly informed about their individual roles and the team objective but, above all, seemed relaxed and unburdened by the pressure that has blighted more naturally gifted generations that came before them. Southgate himself stated that he would listen to ideas that came from the players in a consultative style but was unafraid to make unpopular decisions to ensure the team objective was met.  

The integrity of the entire squad was a key factor in their popularity and it has been stated by many journalists that this England squad connected with the public in a way we had not seen before. They were likeable, as was Southgate and their values, quite evidently, matched his. There was no “dentist’s chair” moment as in Euro 1996 or a series of sullen, disinterested interviews as in South Africa 2010. As a result, poorer performances (against Belgium and Colombia) were quickly forgotten and a penalty shoot-out win in the second round was greeted as if a monumental psychological burden had been lifted from an entire nation. But, there is nothing wrong with a leader developing a “feel-good factor” that allows people to put disappointments into perspective – in fact, it is an essential leadership skill.

Above all, Southgate’s style proves that great leaders are not infallible but that, even when errors are made, people feel in a safe enough pair of hands that those mistakes will be learnt from and addressed. That, essentially, is how he made England supporters feel. Defeat in the semi-final was not greeted with universal cynical derision but with a genuine feeling that Croatia’s greater individual talent had won despite the rigorous planning and infectious enthusiasm displayed from the top to the bottom of the England squad. That started from Southgate, the quintessential Four Enabler-leader.

News in Brief July 2018

Survey reveals potential efficiency gains if managers listen to their employees

The Skills and Employment Survey 2017 has shown clear evidence of a link between employee involvement and organisations’ ability to embrace efficiency-enhancing ideas. The survey found that 28% of those with a line manager who was highly supportive were able to put forward efficiency-enhancing ideas, compared with only 13% of those with a less supportive manager. Overall 70% of employees had taken direct action to implement efficiency-enhancing ideas themselves over the past year, but only one in eight (13%) had put forward such suggestions to management. Professor Alan Felstead of Cardiff University who led the research commented, “The big message coming out of our findings is that workers have great ideas about how productivity could be improved. Growth is unlikely to come from simply increasing the supply of skills; employers need to harness the views of their workforce and treat them fairly.”

 

New Commission launched on future of work

The Fabian Society and Community have launched a new Commission on Workers and Technology, chaired by Yvette Cooper, to explore the impacts automation will have on UK jobs over the next 10 years. Commenting on the launch, Yvette Cooper said “Technological change opens up the possibility of a positive transformation of the labour market, but there are significant risks that work itself could change for the worse. Politicians, trade unions and business leaders must act now.” A survey published to coincide with the launch reveals that under 10% of workers say the government is doing enough to prepare for the arrival of new workplace technologies and only 16% say trade unions in their workplace have been taking steps to ensure technology would improve their working lives.

 

Ford tests motion tracking of employees to reduce stress

Ford has begun a test programme at its Valencia Assembly Plant involving the issuing of motion tracking suits to over 70 employees, in a bid to reduce physical stresses on workers’ bodies during the assembly process. The special suits, normally used by elite athletes, track the motions of workers’ arms, legs, shoulders, head and neck to create virtual profiles of the employees’ movements throughout the day. These profiles are then used to adjust workstations to improve posture and comfort and reduce possible strains. The company is now looking to introduce the system to other European facilities.

« Previous Page
Next Page »

Sign up for our newsletter

In partnership with

Involvement & Participation Association (IPA) is part of the Institute for Employment Studies (IES) a company limited by guarantee registered in England and Wales under number 931547 and registered as a charity number 258390

Home

About

Other links

Registered office: Citygate, 185 Dyke Road, Brighton BN3 1TL | Privacy | Accessibility | Cookies