Catherine Sherwood from The Engine Limited and provider to the The Engine Limited Lisa Mackay founder of HRtoolkit, joined Carly in her home to talk about how poor HR management can affect the cost of running a small business. This week’s segment is all about looking after your employee’s and maintaining a strong business model.
Last time we talked about the 3 reasons that managing staff performance is critical ( NB 10 minutes per day x 5 days x 52 weeks a year = 43 hours per year or over 2% of your payroll cost) and how to assess if the issues is Education, Training or a Disciplinary
Where to from here?
They’re Still not getting it….
Sadly, despite your best efforts, some people still don’t seem to get it, so you need to get formal:
But they are still not improving….
The next newsletter will be about escalating into the disciplinary process, but in short:
Ultimately, it is actually quite rare to dismiss someone as a result of a PIP, the vast majority of people will either pick up their performance or will resign because they don’t like the pressure of the weekly PIP meetings.
How we can help
HRtoolkit has many great tools to help you managing performance and defining your expectations. Including:
In the next newsletter I will be talking more about how escalate into the disciplinary process, but in the meantime sign-up for HRtoolkit, or give me a call on 021 741 544 if you need pointing in the right direction
Cheers
Lisa Mackay
Founder HRtoolkit
Webinar – Business Briefing – Navigating the road ahead with Keynote Speaker Tony Alexander
3 Nov 2020 – 9 -10:30am
Lisa Mackay will be joining Catherine Sherwood of the Engine for 1 1/2 hour business briefing with Keynote speakers of:
– Catherine Sherwood, Director of The Engine
– Greg Wertheim, GM ScotPac
– Tony Alexander, Economist
To Sign up for this free webinar follow this link – https://theengine.biz/business-briefing-navigating-the-road-ahead/
Hi Guys
Wow, 2020 has been a year, and give yourselves a huge pat on the back, you have survived, so let’s look to 2021 and how we can thrive.
But, before we get into that don’t forget, if you are planning to do a shutdown this Christmas you need to give your team 14 days notice, and here is a link to the template letter to announce the shut-down
On the 10th December I will be teaming up Rosina Webb of Energise to give you some tips on how to maximise your Brand, and ensure that your Internal Brand is reflecting your External brand. Register here
Is your Internal Brand on track?
So, apart from that sounding like a lot of marketing speak, what is Internal Brand? Simply put, your people are the face of your Business, and if they are not portraying the image that you want, then no amount of pretty logos and fancy websites are going to get your brand message across.
For example, you may want to portray a brand of friendly and approachable, but if your team are grumpy and unhelpful then your internal brand is not on track.
During the webinar, you will learn about:
So you can:
Sign up now
So let’s get sorted for a stellar 2021, and sign up now for this free webinar
HR is easy!
Sign up now for only $349+ GST for 12 months access to all the tools you need to ensure you have the right people, in the right jobs, being managed effectively…. And being the most awesome Brand Ambassadors.
And if you have any questions feel free to call me on 021 741 544
Cheers
Lisa Mackay
Founder HRtoolkit
Hi Guys
Just before we get into the next steps in escalating into the disciplinary process, don’t forget, if you are planning to do a shutdown this Christmas you need to give your team 14 days notice, and here is a link to the template letter to announce the shut-down
The 5 steps in the disciplinary process
Last time we talked about the 7 steps to improving staff performance, sadly, despite your best efforts, sometimes people just can’t or won’t get it, and you need to escalate into the disciplinary process.
Attitude V’s Aptitude
If you have gone through the steps of explaining what needs doing, giving appropriate (re) training (see previous blogs on this) then you will generally have ruled out aptitude (ability to do the tasks required of them), and the main core problem will be more to do with their attitude (desire to actually be bothered to do the job). As such, the disciplinary process will often be strongly centred around attitudinal issues (NB check out the Assessment criteria Matrix to help define these softer attitudinal skills).
The disciplinary process
The disciplinary process is actually pretty straight forward:
Read the quick guide to the disciplinary process for more details
Possible outcomes
Just because you have had a disciplinary meeting does not mean there is necessarily a disciplinary outcome. Things may come out in the meeting which make you re-evaluate. But disciplinary outcomes may include:
A case study where no warning was given after a disciplinary process
I had a disciplinary process with a gentleman who’s performance was dropping off, he was consistently turning up late, and had a pattern of “Monday-it is”. When we went into the disciplinary process he revealed that he was on dialysis, awaiting a kidney transplant, but hadn’t told anyone at work because it was the only place where he wasn’t being treated as “the patient”.
Obviously, we didn’t want to give a disciplinary outcome in this case, but his erratic work pattern did mean that his absence had an impact on other staff members. As such we agreed on a change in the role so that he could work from home the majority of the time, on a project job which meant that his work (or inability to work) didn’t impact others, but he could continue to keep his private life, private.
“Verbal warning” is a misnomer
NB for a warning to be legally compliant you must have followed the process and confirmed it in writing. Just telling them verbally that they have been given a warning is not actually a legally compliant warning.
Why the performance improvement plan?
I always recommend, if you are going into the disciplinary process as a result of performance issues, that you make it a condition of the warning that they participate in a performance improvement plan. This plan is, basically, a performance appraisal on acid, with:
By following this process people will either pull up their socks, or exit voluntarily quite quickly because they don’t like the pressure
You’re Bullying Me!
Sadly, this is a common catch cry from employees who are being subject to performance management and the disciplinary process. You absolutely, as an employer need to check that your behaviour is NOT bullying. However, Worksafe NZ specifically states the following as examples of what is NOT bullying:
https://worksafe.govt.nz/topic-and-industry/bullying/bullying-at-work-advice-for-small-businesses/
As a manager, it is often frustrating to deal these issues, so:
And if the tempers are getting frayed, take a break and call me on 021 741 544
In the next newsletter I will be talking managing sick leave issues. And in the meantime sign-up for HRtoolkit, or give me a call on 021 741 544 if you need pointing in the right direction
Cheers
Lisa Mackay
Founder HRtoolkit
Minimum wage is increasing to $20 per hour with effect from 1 April 2021 which represents another 5.8% increase, or a 31.1% increase over the last 5 years. Unfortunately, this is about 3 times the rate of inflation over the same period, and this rate of increase is liable to continue until such time as the Minimum wage and the Living Wage are in alignment. Or, in other words, someone who was on minimum wage in April 2016 of $15.25, would now be being paid $16.42 if they had received CPI increases each year.
Whatever your political view-point on this, there are 2 key issues for employers:
Who gets paid minimum wage?
My experience is that most small business owners aim to pay above minimum wage wherever possible. However, for those employee who are unskilled, lack experience, or are poor performers it is tough to justify or afford higher pay. Further, even though the minimum wage has increased, the amount that you can charge clients for services provided has not kept pace with that increase so there is, for many, a limited ability to recoup those increased costs.
Is money a motivator?
No. People don’t work harder because they are paid more money, however, lack of money (or perceived lack of money) is very definitely a de-motivator. 5 years ago reaching the heady heights of (e.g.) Team leader on $20 an hour (or more than 31% over minimum wage) was pretty good. But 5 years later that team leader who has had CPI increases is now being paid $21.54 or only 7% above minimum wage is most likely feeling somewhat less valued.
How do you keep the value level, even if you can’t afford to pay more?
Meeting minimum wage requirements is a legal requirement, you can’t avoid that. But, awarding those same levels of percentage increase across the board is out of reach for most businesses. So, how else do you motivate people without it being cost-prohibitive?
Some things to consider are:
Free Webinar discussion
I will be hosting a free webinar discussion at 10am on February 25th to talk through practical ways in which you can address this eroding differential, and ensure that you maintain motivation for those paid above minimum wage.
Click here to register for this webinar
Future free webinar schedule
I will be hosting monthly webinars on a range of topics, and the plan for the next 6 months is:
Looking forward to seeing you at the webinar
Cheers
Lisa Mackay
Managing Director
Managing sick leave so you don’t get caught out if the law changes
There is currently a Bill before the Select Committee to increase the amount of employer funded sick leave to 10 days. This is NOT law as yet, though the vast majority of people that I have spoken to believe that it will pass into legislation. So, what can you do to prepare for this change?
Sick leave is a significant cost to business, not only is 5 days sick leave 2% of your annual payroll cost, there is also the disruption to the team of unplanned absences.
Categories of sick leave and how to manage them
Next months free webinar is on Managing sick leave, on 25th March at 10am, click here to register
Many people don’t use all their sick leave every year, and generally those are not people you are concerned about, after all, we all get sick from time to time. However, there are several groups of people who you do need to manage more carefully:
Long-term genuine sick leave
Some absences (e.g. broken leg) have a fairly predictable timeframe and therefore can be planned for relatively easily, e.g. get a temp worker in. However, issues such as mental health, cancer etc have a far less predictable timeframe. And, though you may be exceedingly sympathetic to the individual’s situation, you, as a business owner, have a duty of care to provide a safe working environment to all staff. And, if you have one team member down, the others will be picking up the slack, and potentially getting overworked or stressed trying to keep up.
You also need to consider what is best for the individual involved, being off on long-term sick, and feeling that you are letting the team down by not getting back to work can create huge stresses on the individual. Further, if the absence is caused by something which is not covered by ACC, and they are not receiving money from you because they have exhausted their sick leave, they may be under significant financial pressure, and not entitled to benefit because they are still employed.
As such, proactive management of these people is crucial for everyone. In simple form the steps are:
NB you do have to make reasonable adjustments to a job, and you do have to be reasonable in your expectations about how long you keep the role open. But you DON’T have to keep the job open forever, and you DON’T have to create an entirely new job.
Regular Genuine sick leave
This is the group who are either regularly sick themselves, or are caring for dependants who are regularly sick. Though the absence may be 110% genuine, it does create a huge pressure on the rest of the team if you have someone who you can’t rely on being at work.
The key, is communication. Talk to them about your concerns and the impact on the team, and work together towards solutions. Some points of question could be:
Whatever the outcome, do it by agreement, and document it in writing
Sick leave abuse
Skivitis is a sadly common condition, which is also highly contagious.… i.e. if they are getting away with it, why should I bother getting out of bed? So, it definitely needs to be nipped in the bud quickly.
Common signs on skivitis are regular single days of absence, especially Fridays and Mondays, or the day after a statutory holiday. Often texting in rather than calling in person, and often having made a miraculous recovery by the time they return to work.
Sick leave is for genuine sick leave, and taking sick leave when you are not sick is theft of a days pay to which they are not entitled. However, I don’t recommend that you go straight to disciplinary as it could be that there is an underlying health condition that you are not aware.
Some ways to prevent/cure skivitis are:
And if they continue to abuse sick leave, then you may need to move into the disciplinary process.
HR is easy…
You just need the right tools and documentation, so sign up for HRtoolkit for only $349 + GST per annum for all the tools and documentation you need, and access to the expert when you are not sure exactly what to do
Free Webinar Programme
I will be hosting monthly webinars on a range of topics, and the plan for the next 6 months is:
Looking forward to seeing you at the next webinar
Cheers
Lisa Mackay
We all love a bonus, so they are a fantastic motivational tool. Often giving a far greater return on effort than is necessarily commensurate with the actual monetary value involved. I’ve seen people fight tooth and nail (not literally!) to win the prized Chocolate Fish 😊. However, they also drive the behaviour which will reap the rewards and that can create inadvertent issues. You also need to ensure that the rules of giving bonuses ensure that they aren’t paid out when they really can’t/shouldn’t be.
The HRtoolkit Bonus scheme template can be found at this link
Some key things to think about when creating your bonus scheme are:
Balanced bonus schemes
If you reward people based on “turnover generated” then you run the risk that they will discount the sales in order to achieve the bonus, but the net result is you don’t have any profit. Equally, if you just bonus on “profit” then you run the risk that they go past a high yield, but low profit margin job, because it is not giving enough profit for their bonus. So, for these scenarios, a bonus scheme would generally need to have achievement against profitability and turnover.
On a very somber note, bonus schemes can inadvertently have horrendous consequences. Pike river Mine is an example of this where, 4 months before the disaster, workers where offered at $13,000 bonus if they achieved production by a certain date, and this bonus value would reduce by each week they missed the target date.
Rewarding what creates the results you need
Turnover and profitability are obvious things that bonuses are paid on because they are easily measurable. However, you can bonus people on pretty much anything and at HRtoolkit we have an Assessment Criteria Matrix help you measure even soft competencies such as customer service. What you need to consider in your business is what will create the biggest impact on your business, and what might the ‘counter’ be for a balanced bonus e.g.:
Bonus schemes change over time
Bonus schemes should be reviewed regularly to ensure they are providing the results you need. And, they should also evolve with the age and stage of the business. For example, a hungry start up business may just want to build their client base quickly (at the expense of high profit margins), but an established business is more likely to be picky about wanting high profit margin and sustainable clients.
Bonus rules
Bonus schemes also need to include “rules” around payment, for example:
The Lehman Brothers collapse is often cited as one of the catalysts for the GFC, yet, post collapse they paid out tens of millions of dollars in bonuses … maybe they forgot to include the “no bonus if profit less than X%” clause?
HR is easy…
The HRtoolkit document library includes a bonus scheme template which can be found at this link.
You just need the right tools and documentation, so sign up for HRtoolkit for only $349 + GST per annum for all the tools and documentation you need, and access to the expert when you are not sure exactly what to do
Free Webinar Programme
I will be hosting monthly webinars on a range of topics, and the plan for the next 5 months is:
Looking forward to seeing you at the next webinar
Cheers
Lisa Mackay
No, you can’t make this compulsory. Under the NZ Bill of Rights Act 1990 everyone has the right to refuse to undergo medical treatment.
However, and this is where It gets more complicated, The Health and Safety at work act 2015 you have a legal obligation to take all reasonably practicable steps to provide a safe working environment
So, what do I need to do?
Even though you can’t force someone to get the Vaccination, you do, as an employer need to take “reasonably practicable” steps to provide a safe working environment for everyone.
I have a friend who is currently undergoing treatment for cancer. She has been advised, that due to her condition, she is at greater risk if she contracts COVID 19. BUT, in order for her to get the vaccination, she would have to come off her cancer medication for about 3 months. Obviously, she is understandably not going to get the vaccine at this stage, and personally, I will ensure I get the vaccination in order to protect her.
So, in a work environment you need to consider the risks if you have Ms A not able to get the vaccine, but at high risk, if she contracts the disease, and Ms B not wanting to get the vaccine simply on the basis that she doesn’t want to. How do you fulfil your H&S obligations to Ms A?
Step 1 – Assess the risk for your workers and business.
In some (probably fairly limited cases) there may be an argument to say that the requirement to get the COVID vaccination is a significant health and safety risk and the only way to manage the risk is to make the Vaccination compulsory. However, simply saying that “because they interact with people there is a risk” will not be sufficient to override the Bill of Rights. Even frontline workers at Airports are not being required to be vaccinated on health and safety grounds, but they are being redeployed to roles where there is less risk.
What is the risk for my business?
I confess that I would probably think twice about seeing a medical professional who had NOT been vaccinated. And I defiantly wouldn’t want to see a business being closed for 14 days due to a COVID outbreak in the team. So there are risks from a public perception perspective, and from a fiscal perspective. As such, supporting the vaccination programme makes business sense.
Can you recruit based on whether they have been vaccinated?
Unless you have assessed a specific risk, I would suggest that basing a decision to recruit, or not, based on a person’s legally correct refusal to undergo medical treatment would be considered discriminatory, and therefore not allowed.
Step 2 – So what can I do?
Obviously, the goal is to get as many people vaccinated as possible, and, as an employer, you do have a health and safety obligation to take “reasonably practicable steps”. These may include:
Whatever your personal views on the vaccination, there is already a huge amount of information in the public forum both for and against. And if your “news source” is facebook then the amount of misinformation, conspiracy theories etc is overwhelming. And no doubt that will get worse as we get further into the vaccination programme.
In summary
No, you can’t force someone to get the vaccine, but you do need to be proactive in ensuring the health and safety of members of your team. So, keep the communication channels open, and be open to different points of view!
HR is easy…
You just need the right tools and documentation, so sign up for HRtoolkit for only $349 + GST per annum for all the tools and documentation you need, and access to the expert when you are not sure exactly what to do.
Cheers
Lisa Mackay
Managing Director
Would you make a $130K expenditure decision without doing your research? For most of us (who plan to stay in business), the answer will be no.
As an absolute minimum, any recruitment decision is a $130K plus decision. Just think, if you recruit someone you hope they will stay for at least 2 to 3 years and 2.5 years multiplied by $53,040 (Median Full-time salary Mid 2020) = $132,600.
And that is without even thinking about reputational damage, stress, issues with getting rid of someone etc. if you recruit the wrong person!
Recruiting Mini-me’s
One of the most common mistakes is recruiting Mini-me’s. I.e. those people who you like, because they are like you. But guess what, Mini-me’s like doing the same things you do, and also avoid doing the same jobs you do. So if you don’t like doing detail work, the chances are, your mini-me will also avoid doing detail work. You need to recruit to fill those skill/job preference gaps.
The best way to do this is to really clearly define not only the skills you need the person to have, but more importantly, the competencies you need them to have. You can train someone to use a particular computer programme, but it is virtually impossible to train someone to be good at multitasking if their preference is to complete each job fully before moving onto the next. For example, a bookkeeper will need attention to detail, and the ability to work methodically through the tasks in order. However, a salesperson in a busy retail environment will need to effectively multi-task, jump between jobs easily, but get everything done accurately.
Recruiting warm bodies
The other fatal recruitment mistake is recruiting a person because they are available!
Despite everything that has gone on over the last year the recruitment market is exceedingly tight in many sectors:
But the dangers of settling for the person “who is available” can be catastrophic for the business. Reputation damage; costs to manage them out; damage to the team of a poor recruit pulling others down etc.
Maximising Recruitment Success
We are running a webinar on 27th May at 10am where you will learn:
NB using these simple recruitment processes can increase your chances of getting the right person from 8% to 60%
HR is easy…
The HRtoolkit document library includes whole suite of recruitment tools which can be found at this link.
You just need the right tools and documentation, so sign up for HRtoolkit for only $349 + GST per annum for all the tools and documentation you need, and access to the expert when you are not sure exactly what to do.
Free Webinar Programme
Don’t forget to sign up for our next webinar on Thursday April 29th 10am – Bonus Schemes – how to ensure they drive the right behaviour
And our webinars over the next few months are:
Looking forward to seeing you at the next webinar
Cheers
Lisa Mackay
Managing Director
021 741 544
