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The global financial difficulties are now having a significant impact on businesses of all sizes and redundancies are being announced each day.

* Do you need to cut costs?
* Do you need help quickly to make changes to your staffing legally?
* Do you need or to make plans to ensure survival throughout the current downturn?

This came into effect on 27th October 2008. It could mean that employers will need to make adjustments to working conditions to help sick people get back to work. Individuals, meanwhile, will face much stiffer tests to qualify for incapacity benefit and will be encouraged to view it as a temporary measure.

The revised Acas Code of Practice on Disciplinary and Grievance Procedures has now been published. It comes into effect on 6th April 2009, when the statutory dismissal and grievance procedures are abolished. This places more emphasis on mediation. However, an unreasonable failure by an employer to follow the Code will result in a tribunal having the power to increase any award by up to 25%.

The final phase of the increase in minimum annual leave entitlement occurs in April 2009. The minimum will become 28 days in total (including bank holidays) for employees working 5 days per week (5.6 weeks per year.)

The Government had accepted the Walsh review’s recommendation on raising child-related age limit for the right to request flexible working to those with children aged up to 16 and this was expected to take effect from April 2009. However, the Government is now considering delaying implementation.

Last week, the EU's employment committee voted to scrap the UK’s Working Time Directive opt out - a decision that is likely to influence opinions when the full European Parliament finally votes next month (December). The ability to opt out currently allows British employees to work more than 48 hours per week on a regular basis. 10% of British employees have signed a form to opt out of the restriction, mainly in response to business demand or to make up for relatively low base pay. If you rely on employees working extra hours on a regular basis, this outcome of this decision will impact on your business planning and costs.

Many UK businesses are being hit by the global ‘credit crunch’ as the knock-on effects threaten their growth plans. Reduced profits and cash-flow problems mean that to survive this period of uncertainty and lack of confidence, employers need to reduce costs. Redundancy is often seen as the only answer, but there may be other alternatives.

Losing valuable staff because of a temporary downturn in business is a risky thing to do as you may not be able to replace them quickly when the situation recovers.

Therefore it is always a good idea to attempt to avoid redundancies in such circumstances unless you are planning a radical restructuring.

Individual consultation is required for all redundancies. The law also requires employers to undertake collective consultation for multiple redundancy situations where 20 or more posts may be affected.

Selecting potential candidates for redundancy from within a workforce is probably the most difficult part of the process. The employer needs to start by determining the pool for selection. This is the group of employees all doing the same or similar work where changes need to be made.

Once the consultation and selection processes are complete and the decisions made, the employer needs to give the affected employees notice that they will be dismissed by reason of redundancy.

The redundancy situation must be genuine. If you have very poor performers, use your disciplinary or capability procedure instead. If you don’t your other employees will feel unfairly treated if they see poorly performing colleagues affecting the overall performance of the business.

Giving notice can be stressful for both the manager and the affected employees, particularly if they have worked together for many years.

Some employees react badly to news of redundancy, especially if it is not handled well. If you have large numbers of employees affected, train your managers to deal with the situation sympathetically.

Cherington HR will be exhibiting at the Herefordshire & Worcestershire Chamber of Commerce Business Expo on the 22nd October 2008 at the Worcester Warriors Sixways Stadium. Visitors to the stand will be able to enter a draw to win an hour’s free HR consultancy.

If you would like to be kept informed of news and updates, please send a request by email through the Contact Us' page. You will then receive a copy of the quarterly newsletter.

Welcome … to those readers of The Director, the magazine of the Institute of Directors, who have recently joined the Cherington HR Mailing list. It was featured in a recent article, which can be found at:

http://www.director.co.uk/MAGAZINE/2008/9%20September/employment_legislation_62_2.html

Age Concern, under the banner of ‘Heyday’ is challenging UK laws, which since 2006 have allowed employers to compel workers to retire at 65.

The Advocate-general, a senior legal adviser to the European Court of Justice, has recently backed current UK rules - although the view is not binding. Some 260 people in Britain have cases at employment tribunals which depend on the European court's ultimate decision.

Do you use temporary agency workers? If so, you need to know that the rules for statutory sick pay change in October. Contact your agency to find out how it will impact on your company.

Employees on additional maternity or adoption leave are entitled, like employees taking ordinary leave, to the benefit of all the non-remuneration terms and conditions of employment that would have applied if they had not been absent. The amendments apply to employees with an expected week of childbirth on or after 5 October 2008, and those with a child expected to be placed with them for adoption on or after this date.

If you employ an expectant mother whose baby is due on or after 5th October this year, you must make changes to the benefits entitled to staff on Maternity Leave.

The new rates become effective shortly and employers need to check that they continue to pay staff correctly. This is particularly important for employees who may have changed age band.

Where do you display your Employer's Liability Insurance Certificate? Changes to the regulations mean that you might be able to change the way you do this.

The cost of recruiting will vary widely depending on the role you wish to fill, but most recent figures given by the Chartered Institute of Personnel and Development (CIPD) for replacing a worker are £4.6k rising to £10k for a senior manager.

Recruitment is time consuming and costly. Therefore before proceeding, you will want to be sure that it is the best or only solution in any particular set of circumstances.

Preparing a job description and person specification will help you write an effective advertisement and will serve to inform potential candidates about the job later in the selection process.

Deciding where to advertise the vacancy will depend on the sort of role you wish to fill and the sort of skills you need the candidates to have.

You must decide whether you are going to accept CVs or send out application forms for completion. CVs may be quicker for applicants to send, but you may not get all the information you are seeking. Application forms can be designed to ask specific questions relevant to the job and they are likely to be easier to compare for short-listing purposes.

You may have a short-list of candidates who can perform the technical, administrative or management elements of the role. However, you may want to know how the candidates would perform in specific circumstances, or find out how they would fit in with your existing team.

When you have made your choice, any offer you make to your chosen candidate should be subject to satisfactory references and the right of the individual to work in the UK. An offer can be verbal (and will be binding) but written terms must be provided within 8 weeks of starting the job.

Helen Astill, Managing Director of Upton upon Severn based company, Cherington HR, narrowly missed winning an award at the 2008 Herefordshire and Worcestershire Chamber of Commerce Awards event on Thursday last week.

A recent report (Feb 2008) by the Work Foundation and the Institute for Employment Studies (IES) found that businesses with good HR practices - from resourcing to employee engagement and skills development, enjoyed higher profit margins and productivity than those without. The study concluded that if an organisation increased its investment in HR by just 10% it would boost gross profits by £1,500 per employee per year.

Your business success ultimately depends on the combined efforts and abilities of your employees to do their jobs and to meet your customers’ needs. This means that they need to be able to carry out their duties to a satisfactory level and perform consistently well.

Employees need the right knowledge, skills and attitude. Identifying development needs can be done at three levels:
* For the Business as a whole;
* For a specific department or project area;
* For the individual.

There are many ways to learn and different people have different preferred learning styles. Going on a course is not the only option. Other more effective (and potentially more cost effective) alternatives are available.

Once the development activity has been undertaken, the job holder and line manager should meet to review progress. If the activity is planned to take place over a period of time, e.g. a college course or project, regular reviews should be held to check that the job holder is able to apply the learning.

It is all too easy for business owners and managers to focus on the development needs of their staff and forget about their own. If you fall into that trap read on ...

Cherington HR has been selected as one of the finalists for Herefordshire & Worcestershire Chamber of Commerce Awards for successful businesses in 2008.

From April 6th 2008 there were changes to statutory payments and these are now as follows;

• Statutory Sick Pay has increased from £72.55 to £75.40 per week (average weekly earnings of £90 or more).

• Statutory Maternity Pay has increased from £112.75 to £117.18 per week.
• Statutory Paternity Pay has increased from £112.75 to £117.18 per week.
• Statutory Adoption Pay has increased from £112.75 to £117.18 per week.
(or 90% of the employee’s average weekly earnings if these are less than £117.18 for Statutory Maternity, Paternity or Adoption Pay.)

Reminder - As from 1st February 2008 the maximum unfair dismissal award rose to £63,000 and basic weekly award to £330.

The National Minimum Wage is something which affects all employers and needs to be taken into account when planning the business finances.

The National Minimum Wage is reviewed in October every year, and increases are made on the recommendations of the Independent Low Pay Commission.

The Information and Consultation of Employees (ICE) Regulations have been in effect for companies with over 150 employees since 2004, and have been described as one of the most important pieces of employment legislation to be introduced in the UK in recent years. This has now been extended to cover more companies.

In a similar change to existing pensions regulations, companies employing 50 or more employees will now have to consult workers or employee representatives on any changes that may affect pension schemes.

Changes to the Sex Discrimination Act 1975 were published in March 2008. These will lead to new rules on benefits during maternity leave.

In the past, it was been extremely difficult to secure a criminal conviction for negligence against large firms where it was all but impossible to identify an individual directly responsible. However, from April 2008, if it can be shown that a substantial part of the breach of a company's duty of care is down to the way a firm is managed, it is the organisation that will face criminal prosecution.

Recent surveys reveal that not all employees have formal appraisals. The figures vary, but research by Investors in People UK found that only 54% of employees in SMEs get regular feedback on their performance. By contrast, 81% of employees in larger companies have annual appraisals.

An appraisal should be part of an ongoing discussion all managers and supervisors have with their staff throughout the year. It is the formal process of capturing and recording the progress made by individual employees and agreements on actions for their continuing development.

There are many different ways of creating appraisal processes, but for one to work well for your business, there are several questions you need to answer.

Appraisals should always cover past performance and objectives, but equally important are discussions of future targets and opportunities.

Before the discussion, the manager should make arrangements to ensure that the meeting will be as productive as possible.

In preparation for the discussion, the employee should be encouraged to consider the issues in advance and be aware that they are jointly responsible for the outcomes.

If there is a need for improvement, this should come as no surprise to the employee at the end of the year.

Any performance issues should be aired as soon as they arise so that the employee has a chance to put things right. If you do not give feedback on behaviours or mistakes that are unacceptable, the employee may continue acting in the same way completely oblivious to the fact that you are not happy with it.

Performance improvement comes from developing people’s knowledge, skills and attitudes/ behaviours. You will need to agree what development activities need to be undertaken and what support is required to allow the employee to undertake these activities successfully.

Employee absence is a significant cost to 90% of businesses according to recently published research from the Chartered Institute of Personnel and Development (CIPD). They found that on average sickness absence costs employers £659 per employee every year and employee absence costs employers 8.4 working days for every member of staff per year; representing 3.7% of working time.

Two-thirds of sickness absence, long term incapacity and ill-health retirement are due to mild/moderate ‘common health problems’ and 31% of respondents to CIPD survey reported an increase in stress-related absence in the previous 12 months.

A Return to Work Interview system is a methodical approach for managers to keep up-to-date with the reasons why employees are absent. Start by discussing every episode of absence with an employee on the day, or very shortly after, they return to work. Remember that it is not a disciplinary meeting or a formal review of an employee’s attendance pattern (although you may decide to hold a formal review subsequently if the employee has a poor attendance record).

Knowing when to take action regarding someone who is regularly absent can be difficult. However there is a formula used to produce a measure called the Bradford Factor which can help you highlight those employees with a poor record of frequent short-term absences. This gives you a consistent and objective measure of the disruption caused by such absences and allows you to identify those employees whose absence patterns need reviewing formally.

If you have employees who have been off sick for some time and you want an early resolution to the problem, consulting an Occupational Health (OH) adviser can help.

Many companies use GPs for their OH advice, but it is often better to use someone with specific OH knowledge to be able to make appropriate recommendations. If you are looking for an OH specialist ask whether they have any particular knowledge of your business sector, so that they can apply this knowledge in their assessments.

CIPD research shows that absence of eight days or more accounts for almost 40% of total time lost through absence and absence of four weeks or more accounts for about one fifth.

This is a significant element of the absence figures. So it is important to have a formal strategy in place to help employees to get back to work after a prolonged spell of sickness or injury-related absence. Awareness of potential disability discrimination claims is also crucial.

Some employees may find it hard to cope with your standard working hours because of caring responsibilities that they may have at home, either for a young child or elderly relative. They may take a lot of sick leave to deal with such issues or they may often be late as a result. Dealing with such pressures can also add a degree of stress which may affect their own health.

Sometimes workers take sick leave because they think that this is the only way to deal with emergencies at home. Employers need to make sure that their employees know that they are entitled to take time off to deal with certain sorts of emergencies so that these can be dealt with openly.

Several new regulations came into force on 1st October 2007. The ones most likely to have the most immediate impact on your business are summarised as follows: