In our previous article, we highlighted the importance of the HR function and how it plays a key role and influence in many businesses. This was especially true during the Covid-19 pandemic when businesses had to re-evaluate the way they operated and manage the HR function during an unprecedented and uncertain time. In this article, we will further explore important aspects of HR in the 2020s, shared with us by HR Professional, Ian Pilbeam.
The challenges with Diversity & Inclusion
Whilst there has been much progress in diversity & inclusion since the introduction of the first UK legislation in the 1970s, it remains a complex issue with many challenges that require professional HR advice. This can include items such as the gender pay gap, the relatively low percentage of ethnic minorities in senior positions, or plain discrimination (both intentionally and unintentionally).
As an employer, it is important to understand that embracing a diverse and inclusive workforce generally leads to a more successful business. However, dealing with these issues in practice can be quite difficult and complex.
Some examples could be:
- A team member changing their gender orientation and now identifying as ‘X’. This has to be addressed carefully and respectfully.
- Employing staff from various religious backgrounds that may be unintentionally excluded by the business culture and social events. Company culture and practice would need to be adjusted accordingly to promote inclusivity.
- Employing the first female staff or apprentice in an all-male workforce. Again, this should be considered within the overall company culture and practices.
These issues will continue to develop and it is important for business owners to pay attention to these and should really consider seeking professional HR advice to address them appropriately.
The impact of technological advances on HR
The world is changing very quickly now due to the significant advances in technology. Over the last few decades, there have been many changes in workplaces, working patterns, employee expectations and recruitment. This has ultimately shaped the current HR function and will continue to heavily influence it going forward.
For example, at some restaurants and cafes, customers can now order food and drinks via a smartphone app. This technological advancement has effectively filled in some of the roles that employees might usually have, inviting employers to potentially reduce their headcount to lower running costs. This is just one example of an ongoing trend in a specific industry or sector.
Whilst the impacts of technological advances will differ depending on the industry or sector, it is important that employers have an eye for these and be able to adapt and adopt new trends. They must be able to recognise what new technology could mean for their businesses.
Of course, there is also another side to the coin. Whilst cutting jobs can help lower running costs for the business, employers should still look to grow jobs and look for opportunities to employ and develop people whenever possible. Thus, there is a very important balance that must be kept – employers must recognise this balance and identify which areas of the businesses could be cut and which should not.
It is important for employers to implement sensible HR planning. Ideally, this will involve careful observations of trends within an industry or sector so that employers can look ahead and correctly identify the opportunities to reduce headcount, as well as when new recruits are not required.
The Millennial and Generation Z workforce
Since the beginning of the 2000s, both the Millennials and now Generation Z have started entering the workforce and typically have different motivations to the previous generations. It is imperative that employers acknowledge this and understand that the values and interests of employees are constantly changing in this modern world.
Business owners and their senior management teams must now seek to understand the behaviour and motivations of the new generations entering the workforce.
In recent times, some general trends include:
- A higher emphasis on personal training and development. Employees want to feel valued and be treated like human beings rather than just another employee or number. Business leaders should take the time to get to know people on a personal level and take into account their personal goals and ambitions
- Working for an organisation with a real purpose beyond just making a profit. For employees, a real purpose can be a motivation that can push them to be productive – it is a lot more exciting for them to wake up each day knowing why they do what they do! Having a purpose is emotionally engaging and typically results in higher levels of productivity and generally lower levels of absence rates
- Embracing technology and offering flexible working and the ability to work from home. This is becoming more popular among the new generation entering the workforce. Businesses that are able to offer this can typically attract and retain more talent
The gig economy (freelancers)
The legislation around freelancers (almost employees but not quite) can be fairly complicated and difficult for employers to navigate through despite the numerous attempts to get it simplified in legislation.
To date, there are three main categories:
- Employees with full employment rights
- Workers with some employment rights
- Self-employed people with no employment rights
However, it is important to highlight that just because a business owner may use one of these labels for a person, this does not mean that the said person will be characterised as such by law. These decisions could ultimately be made through employment tribunals or HMRC. Employers must be aware of this, and thus, should seek professional advice when in doubt.
Furthermore, employers must be careful not to rely too heavily on those characterised as ‘workers’ and ‘self-employed’ (see above) in delivering their core services. Whilst it may sometimes be more cost-efficient for a business to go down this route, it is essential to understand that there are consequences when this is improperly applied.
Business owners must be able to balance profitability and good HR practice. There is a significant risk when relying heavily on people that are not treated as part of the team. These people are more likely to walk away at any given time as employers fail to strengthen and solidify the business relationship to make them feel valued. Thus, employers must learn to understand when it is proper to employ workers and self-employed, and also, when it is time to consider taking them on board as an employee.
Attracting and retaining talent
With the Coronavirus Job Retention Scheme (i.e. the Furlough Scheme) being utilised during the pandemic, both employers and employees were given a great opportunity to reset and really think about whom they want to employ or work for.
During this time, many employees have been able to reflect on the way they have been treated and the roles they are playing in different organisations. There has also been an increased emphasis on businesses having a clear purpose beyond just making a profit. Employers have begun to recognise this trend, realising that they need to better understand their employees and new recruits to ensure they have good people who will stay – looking at who they are rather than just what they can do.
This has begun changing the recruitment process over the last few years. Both employers and employees are now looking for those that match their own ethos and values. This is especially important during the current ‘talent war’ where there are a lot of negotiations and counter-offers.
Hence, it is crucial that employers don’t fall into a salary-bidding war as that is not always the most important aspect to consider in recruitment. Rather, employees should be valued and made to love their jobs so that they can see their colleagues as their work family and won’t even consider looking elsewhere. This balance and good practices can go a long way to ensuring business owners can continue to attract and retain good talent.
“The heart is what matters”
With thanks to Ian Pilbeam – CEO of the HR Dept – Edinburgh & Lothians
