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What’s in store for business owners, managers and HR professionals in 2010?

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Human Law Mediation Ezine - December 2009

What does 2010 have in store for business owners, managers and HR professionals?

It’s at this time of year I like to sit back and reflect on the year that’s gone and consider what the future might hold for my business and my clients.

2009 has been, as the queen once said, an annus horribilis, a horrible year!. A global recession and the banking crisis have resulted in wide scale redundancies even in sectors that might have felt immune to job losses – take the legal profession for example. Our politicians have been called to book over their expenses; a global pandemic was declared and worst of all X-Factor, I’m a Celebrity and Big Brother were still on our screens!

But seriously there were some plus points. Some businesses have weathered the recession well and come out fighting. People still need to eat so the supermarkets are doing well, alongside many of the specialist local grocery suppliers. I hear of many well run and managed small businesses where they’ve been able to tighten their belts and focus on what they do best. Niche market players in particular (provided they’re not in a niche which has been destroyed by the current economic climate) are doing well.

Businesses that have faced the difficult prospect of making redundancies but managed the process professionally have come out well too. Redundancy can be a very emotional time for employees and stressful for managers and business owners but the more prepared you are and the closer you follow recommended procedures the less likely you are to fall foul of the law or add additional distress to those involved in the process.

So what of 2010?

We all know that we will have a general election and as a consequence the country will be stuck in limbo at least until May 2010. What else might be happening? What can our crystal ball tell us?

Being realistic we can all expect more challenges ahead. The public sector in particular is likely to see job cuts, wage freezes and the challenge of significant change programmes. Local government, housing, transport and universities are all expected to see more redundancy programmes. These are the areas where HR managers and in-house lawyers will be facing conflict with staff. Potentially the public sector is going to start experiencing real pain which will be made worse if due process isn’t followed.

Employment legislation will rise. More legislation to distract time pressed managers who already struggle to keep up with rule changes. From April 2010 fathers will be able to benefit from up to 26 weeks' additional paternity leave if the mother of the child returns to work before the end of the maternity leave period to which she is entitled. This will be available during the second six months of the child's life and may be paid if taken during the mother's statutory maternity pay period. In addition, the right to request time off for training will be introduced. Employers will be obliged to consider seriously requests that they receive, but will be able to refuse a request where there is a good business reason for doing so. On the plus front for employers they will not be obliged to meet the salary or training costs to enable a request for time off to train to be met.

Pay is expected to remain low. The number of employees receiving a pay freeze has risen by 17% this year, according to the Chartered Institute of Personnel and Development's (CIPD) annual pay survey. The study of more than 2,500 employees, reveals that 41% have seen a pay freeze, up from 24% last year, while just 50% have received a pay rise compared to 67% in 2008. The state of the economy is by far the most common reason for pay freezes and cuts followed by how much the organisation needs to spend. It is also the reason used by most organisations to explain changes in pay (57%).

Our prediction is that employment disputes and workplace conflict will continue to be managed well by trained professionals but mismanaged by those who fail to follow the rules and specialist advice they given.

The use of mediation to settle employee disputes will rise in the public sector we think, but it won’t take off in the private sector. The barrier to growth of mediation within the workplace is the legal absence of incentive to mediate and the ignorance of parties and some of their legal representatives. Nevertheless with the public sector and non government associations having a financial need to mediate, there will continue to be a growth in the use of mediation to solve employment disputes and workplace conflicts. In line with this we see an increase in the use of mediation skills by managers in the public sector. During 2009 we trained a group of managers in core mediation skills which they will use not only in formal mediation situations but on a day-to-day basis to effectively manage the performance of their people.

Bearing all of this in mind what’s our advice for those facing employee challenges in 2010?

  • Anticipate and plan – if business is tough and you are struggling financially the sooner you start planning for the worst the better. Consider fully all the options – redundancy isn’t the only one. 
  • Tackle employee disputes quickly – don’t let them fester. The same is true of performance problems, attendance, discipline and so on. The longer you allow a problem to persist the more difficult it will be to solve.
  • Keep up with the latest changes in employment law, or use an advisor who will let you know which ones affect your business. Don’t get caught out by new rules.
  • Follow the rules. In the case of redundancy fully understand the procedures you need to conform with and do so. Take advice at every step of the way and follow that advice.
  • Communicate. If things are tough but you believe you’re managing them – tell you staff. Keeping them in the dark can breed mistrust and rumour which itself can start to cause conflict.
  • Consider mediation. If you have an employee dispute to tackle why not consider mediation? Whether that’s using your own mediation skills to mediate a solution between members of your team or using an independent mediator to solve a conflict between yourself and a director or staff member. It’ll be cheaper than going to court and much quicker too.

Of course, I could be wrong in my assessment of 2010 and instead we could face a year when there will be no back-stabbing and criticism of general election candidates; all politicians will tell the truth; the economy will grow ten-fold and we will hear that Britain is genuinely on the up as a country. England will win the Football World Cup, Andy Murray will win Wimbledon, and it will not rain during summer, and this won’t be due to global warming. The reality is perhaps more likely to be along the lines of my first scenario and it certainly won’t hurt if you take my advice anyway!

I hope 2009 hasn’t been too much of a challenge for you and your organisation. Have a Merry Christmas and here’s to a dispute free 2010.

Justin Patten

Human Law Mediation

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