Since the beginning of the COVID-19 pandemic in March 2020, the way many of us work has changed dramatically and, with that, expectations of how we will work going forward. There is a degree of alarm and uncertainty for many employers about employee retention, with media outlets labelling the current times as the “Great Resignation”. However, employers should perhaps look at this as a transitional time and look for ways to differentiate themselves from other organisations in order to attract and retain talent. For those that succeed, this will instead be the “Great Transition”.
2022 marks the start of new opportunities. In this article, we discuss some new ideas and practices which may both encourage employees to apply for or remain in roles and result in greater productivity.
The introduction of a four-day working-week has been mooted for many years – the Labour Party even included plans to introduce a 32-hour working week with no loss of pay in the 2019 General Election Manifesto. However, due to the dramatic change to work patterns over the last two years, the voices of those who support fewer hours’ work for the same pay have grown louder and greater in number.
Last year, the Scottish branch of the Institute for Public Policy Research found that 83% of those of working age in Scotland would be in favour of a four-day working-week with no loss of pay. Campaigners have argued that modern technology in the workplace means the time that needs to be spent carrying out specific tasks is less than ever before. The belief that longer hours produces greater output is no longer necessarily correct and a four-day working-week has been shown to have significant benefits by various employers across the world.
Microsoft Japan’s four-day working-week trial in 2019 led to a 40% increase in productivity. Perpetual Guardian, a New Zealand owned trust company, implemented a four-day trial and reported that, due to the flexible working arrangement, the company remained more resilient throughout the lockdown and staff were able to manage their time effectively with a focus on output rather than on hours spent carrying out work.
Reports from a small number of British employers that have trialled a four-day working-week highlight improved morale and a reduction in long-term stress among employees – avoiding the wave of “burnout” that is increasingly touted across the headlines. Therefore, the introduction of a shorter working-week may not only be a mechanism to convince employees to stay, but it may also be an attractive perk for recruiting external talent.
Iceland is currently leading the way with this initiative. Reykjavik City Council trialled a four-day working-week between 2015 and 2019 which was deemed an “overwhelming success” by researchers. Due to the success of the trial, trade unions in the country have now sought and been granted permanent reductions in working hours for their members. Approximately 86% of Iceland’s workforce currently works fewer hours (or have gained a right to), proving that shorter working weeks can be implemented successfully on a national scale.
Many employers may see the introduction of a four-day working-week as radical. However, a six-day working-week was prevalent in the UK until 1926 when the five-day working-week was standardised without loss of pay by Henry Ford. Life and work have changed significantly in the last 100 years and perhaps the COVID-19 pandemic has presented a rare opportunity for some industries, where work demands or sector services allow, to transition to a shorter working-week with less disruption to normal business than may have existed pre-pandemic.
Some employers may feel blindsided or surprised when a worker hands in their notice. In many cases, the only time an employer will know, or listen to, what went wrong will be during the employee’s exit interview when it is usually too late to convince them to stay. That is why “stay interviews” may be an effective and productive way to find out about any concerns employees may have before they decide to seek an alternative role elsewhere. It is usual for employers to carry out annual appraisals of employees. However, it is more unusual for employers to request feedback about whether they are meeting employee expectations.
Regular check-ins with employees are particularly important when individuals are working from home and may not have the same opportunities to raise any concerns they may have informally. Having brief, informal conversations with employees which allow a safe space for them to share their views can provide employers with an opportunity to respond proactively and resolve any issues before an employee considers leaving.
Discussing salaries is still taboo in many workplaces. The UK government has introduced reporting requirements as an attempt to address pay imbalances within organisations, predominantly mandatory pay gap reporting and CEO pay ratio reporting. There have also been calls on the government by organisations such as the Trades Union Congress (TUC) to introduce mandatory ethnicity, class and disability pay gap reporting.
However, as we previously reported in “Pay gap reporting – are employers doing enough to close the gap?“, the overall gender pay gap across all organisations that published reports has disappointingly risen from 14.9% in 2019/2020 to 15.4% in 2020/2021 and the gender pay gap amongst full-time employees rose from 7% to 7.9% between 2019/2020 and 2020/2021. Therefore, reporting alone appears very unlikely to be enough to achieve pay equality.
If individuals do not know they are being paid less than their colleagues, it is very difficult for them to ask their employers to address the difference. Employees are also less likely to ask for an increase in their salary if they mistakenly believe they have pay parity.
The Robert Walters 2022 UK Salary Guide reports that this year professional service firms plan to increase their budgets for pay rises by 10-15% in order to recruit and retain staff. Many other companies plan to increase current employees’ salaries to match new joiners’ pay. In order to attract and retain the best talent, organisations may benefit from advertising these approaches openly. Two-thirds of workers have stated that they will leave their workplace if they do not believe they have been rewarded fairly, so advertising salaries to external candidates and communicating salary increases to existing employees may give an employer a competitive advantage over other organisations. However, before publishing or sharing details regarding pay, the CIPD recommends that employers should first determine how they will define pay – for example, whether pension contributions and other benefits should be included.
Easier commutes, remote and hybrid working
The Recruitment and Employment Confederation and labour market analysts, Emsi Burning Glass, reported that 25% of jobs advertised in December 2021 mentioned flexible or hybrid working. Due to COVID-19 restrictions, many organisations have been required to work remotely or introduce hybrid working policies. One of the benefits of this is that large numbers of workers have been spared the busy commutes they endured before the pandemic. Even for those still attending offices, commutes have often been staggered throughout different times of the day, and days of the week, resulting in a shift away from mass “rush hours”.
A 2018 study linked stressful commutes to employee mental health issues and decreased job satisfaction. In addition, the costs associated with commuting to the office may deter employees from remaining at a workplace or joining an organisation with an office in a particular location. The People, Reward and Mobility team at Dentons recently held a round-table discussion attended by a broad profile of clients. A common theme was that one of the first questions most candidates ask at interview is whether the employer offers agile, hybrid and/or home working. There was also recognition that many employers are losing valued members of staff in circumstances where flexible working arrangements adopted during the pandemic are withdrawn. If feasible, giving staff greater flexibility to choose where they work from, providing pre-paid railcards or bus passes, and/or allowing flexible start and finish times may help attract and retain top talent.
Mental health focus
The impact that COVID-19 has had on mental wellbeing cannot be escaped. There has been a long and continuing period of uncertainty and a focus on employers needing to better prioritise the mental health of their employees.
A survey conducted by Barnett Waddingham found that 39% of employees felt that their mental health declined due to their organisation’s failure to support their wellbeing during the pandemic and resulted in 30% of those surveyed searching for a new role. Money worries contributed significantly to mental health issues among those who were surveyed. However, financial reward is not enough to prevent work associated mental health issues. Lockdown significantly blurred the lines between work and home life and introduced the notion of a work-life “blend”. Employers are encouraged to correct the “always on” culture that has presented itself in many pockets of industry and which continues to contribute to employee burnout.
Since 2019, burnout has been classed as a disease by the World Health Organisation. It is described as a “syndrome conceptualised as resulting from chronic workplace stress that has not been successfully managed”. Some organisations have acknowledged the importance of handling workplace stress – Nike shut down its headquarters for a week to allow employees time to unwind from workplace pressures and the Scottish government announced a proposal to introduce a “right to disconnect” for its employees in December (see our recent blog post on this here). There have been calls for the awaited Employment Bill to introduce a right to disconnect for all UK workers. However, the UK government has not yet confirmed whether this right will be included in the bill.
There is a financial advantage to introducing mental health interventions for those in the workplace. Analysis conducted by Deloitte found that for every £1 spent by employers on mental health interventions they get £5 back in reduced absence, presenteeism and staff turnover. Proactive employers may therefore wish to review their policies in relation to out-of-hours working. Better still, requesting employee feedback and involving staff in the process of implementing any new measures may lead to greater engagement and confidence in the support offered.
Inclusion of neurodivergent workers
Workplace diversity has been another big focus in recent years. However, that focus has often been limited to gender and race. What about those who are neurodivergent? Neurodivergent people are those whose brains process, learn or behave differently to what is deemed “typical”. They may be autistic, have Attention Deficit Hyperactivity Disorder or dyslexia. Neurodivergent people are frequently overlooked by employers and have higher rates of unemployment compared to neurotypical individuals. Neurodiversity in Business, a business-led industry group, highlights that those who are neurodivergent have a lot to offer employers in terms of skills and talents. These skills and talents could flourish within the right role and at the right organisation. For example, those who have autism may have strong attention to detail and be able to develop and analyse highly technical work, and those who are dyslexic may have enhanced verbal and problem-solving skills.
Employers should proactively try to remove barriers during the recruitment, interviewing and on-boarding processes which exist for neurodivergent candidates and be open to exploring how their skills could fit within their organisation. For example, employers could ask if an autistic candidate has a communication style preference or check if a dyslexic candidate would benefit from the provision of a talking calculator for any assessments they may need to undertake. As with any application or interview processes, whether for neurodivergent individuals or otherwise, employers should consider whether the candidate has a disability which may require reasonable adjustments.
We enter 2022 in a unique position where the old notion of the “working world” has been called into serious question with the result that there are many opportunities to improve employees’ experience at work and for businesses to reap the benefits of that. One thing is becoming increasingly clear: remaining wedded to old practices, while the world around us has changed so drastically, may no longer attract and retain top talent. So perhaps now, while things feel very much up in the air, it is time to throw caution to the wind, redefine what “normal” looks like and step into the shoes of some of these big ideas. While not all of the ideas mentioned in this article will be appropriate for all industries or work types, there are some key themes that remain relevant for all employers, whatever sector they operate within: promoting the inclusion, diversity and wellbeing of all their staff to foster stronger and enduring working relationships and so seek increased productivity rather than just more hours.