Further to the previous blog: 4 Ways Employers Lose Money Through Poor HR Policies, we continue to look at how some Employers lose money unnecessarily because they haven’t followed legislation, or simply do not have the right policies and procedures in place.
1. Health and Safety
Make sure you provide the required basic health and safety training when an employee starts. There could be a £20,000 HSE penalty if you don’t. The risk to new employees is doubled in their first 6 months of employment. At the very least new employees should be given information on your fire alarm, evacuation and first aid provisions. What if there is a fire or someone injures them self and does not know what the procedure is? In a serious case this could lead to investigation by the HSE, prohibition order and fines. Make sure you have an adequate induction process in place for new employees especially for young or inexperienced workers. With the introduction of Intervention Costs (where an inspector identifies issues during a visit), can you afford to think Health and Safety is just another burden to be ignored?
2. Staff Motivation
Hang onto good staff by providing the motivation good staff want! Insufficient training can result in a loss of efficiency and motivation. This could cost a company £1000+ in decreased productivity & recruitment. In general you want the best from your staff and they want to achieve in their job successes. They need the tools to do the job and this includes training. If they haven’t been shown the way you want things to be done and the way to achieve further success in their position then they may not be working as efficiently or safely as they could.
Research shows that a workforce is more motivated when they are stretched through training. Failure to develop staff can lead to lack of motivation, and the willingness to go somewhere where their skills will be improved.
3. Review Your Disciplinary Procedure
An incorrect discipline process can cost a company dearly. The average Unfair Dismissal Award is £12,000. Despite recent changes, over half of small businesses still find dismissal rules burdensome. It is often more a case of how you have run the procedure than the actual problem being addressed. Do you have the correct procedure written down, and do all your Managers know how to implement it?
The internet means staff more often than not check what their rights are, but are not always correct in their understanding of it.
Make sure you know the correct process to use and when to seek advice. Failure to implement things correctly can end up in a costly Tribunal. With increased fines of up to 25% if the procedures are not being carried out correctly. It is much easier to have these processes in place before a problem occurs than trying to back track when a Tribunal threat occurs. Tribunal Compensation Awarded: Unfair Dismissal Ave £ 12,362 (Max £ 238,216)
4. Reduce Absences
Absence costs average at £553 per year per employee. Ill health and absence costs companies, yet it has been reported that if 70% of the UK population exercised for 30 minutes a day, five days a week, the annual saving to employers would be almost £500m in recouped sick days. Many gyms and leisure facilities have options for companies to promote a group rate to join. This would result in your employees joining their gym at a reduced rate. Some companies may even pay their subscriptions.
Research has shown you can see as much as 50% improvement in productivity in a motivated or happy workforce. Key areas to address are: promoting wellbeing, making them feel valued, explaining why they are there and improving skills through training and development.
By putting in place the procedures needed, investing in training, or going the extra mile by further motivating your staff, you may end up saving money and increase your turnover by having more efficiency and motivation in your company.
For further advice on how to implement the changes in your company, or a FREE review on your current practices, contact Metis HR on 01706 565332 or email on email@example.com.
Metis HR is a professional HR Consultancy based in the North West of England supporting clients across the country. We specialise in providing outsourced HR services to small and medium-sized businesses. Call us now on 01706 565332 to discuss how we may help you.