Overtime – who should get it?

Today the TUC report that the amount of paid overtime has fallen significantly over the last year. This is not surprising given the depth of the recession. Much of the reduction will have come from reduced output; especially in manufacturing; some will have come from organisations where overtime was reduced to save jobs. Countering this will be situations where job losses result in essential overtime for those remaining.

The working population falls into two groups. Those for whom paid overtime is a regular part of life and those whose monthly pay rarely differs from their basic salary divided by 12. Overtime is a valuable management tool for flexing costs in situations where attendance equals output (manufacturing) or where attendance is a necessity (counter or call centre staff). However, there is a grey area, particularly for office-based jobs, where output is not quantified and allocation of time is down to the individual.

Much administrative and managerial work requires social interaction as well as form-filling and decision-making. The HR Officer who never asks staff how they feel about their work or discuses last night’s football will be seen as aloof and will not understand employee attitudes as they should. But when, at the end of the day, they have to stay on to complete a promised report are they working legitimate overtime or did they spend too long discussing last night’s match? Did they choose the wrong priorities for that day’s many tasks?

Common practice, and the law, require specified hours work but there are many jobs where a day at work may not always equal a day’s work.

Top of the heap – public sector pay

Today’s Times has an article on the topic of whether any public servant should be paid more than the Prime Minister. It is a two-part article with one writer arguing the case against, another the case for. The question, of course, arises from the fact that quite a lot of them already do.

Once you start debating senior pay in this way, and in public, you end up with all sorts of highly emotive but inappropriate comparisons. Just how many nurses is the Prime Minister worth? How many times the minimum wage should the person running your local council be paid? Once you go down this route you inevitably end up with truncated salary structures, and much bickering.

The salaries paid to public sector chief executives (local government, the NHS, quangos, etc.) should, as in all sectors, be based on: the skills and experience needed; what is paid for such people elsewhere; and the difficulty, or otherwise, of attracting good candidates. Whether or not you think the correct answer has been arrived at for these executives you have to admit that the third part of the test, the ease of finding candidates, goes out of the window if you make the PM’s salary the yardstick. At the very least there are the 300+ MPs who would love to reverse their initials; possibly even take a pay cut for the privilege.

MoD bonuses – why the fuss?

Much heat and great indignation in the media today as it becomes known that the MoD (an arm of government that has overtaken the Child Support Agency in the public ordure stakes) is paying £47m in bonuses to its staff. Most of the critics seem not to understand the nature of this scheme. Essentially it uses a pot of money (possibly around 3% of payroll) accumulated by withholding small amounts from earlier pay reviews. It is distributed among staff as a non-consolidated payment based on annual appraisal ratings (it looks as though around two thirds of staff shared the pot). As it is not consolidated into basic, contractual pay it is not an addition to the annual paybill. It should be similar in amount to what was paid in previous years – just (potentially) distributed differently each year.

Sick on Monday; back by Friday – absence

Recent research by Mercer has found that 35% of all sick leave is taken on Mondays but only 3% on Fridays. Which must mean the vast majority of those away on Monday are back in by Friday (if not Tuesday).

Mercer suggest that Monday sickness and frequent short-term absences can be a symptom of low employee engagement and morale. More cynical readers might wonder whether this might better be credited to weekend excess and little fear of the consequences of staying away.

Cynicism apart, the real lesson of this survey is that the sophistication of many HRIS systems makes detailed analyses easier than ever. Mercer extend their own analysis to consider differences between men and women and between full- and part-time staff. But why stop there? Many investigations into absence fail to be useful because they aggregate too many different causes and situations. Modern HRIS systems enable you to avoid that pitfall and the consequent over-generalisations.

Perhaps you should code in all the additional stuff you know about your staff and work out what proportion of the Monday sickies had been playing soccer or rugby at the weekend? Or rock climbing? Or sky diving? You might improve your absence statistics at a stroke by sifting out all those application forms that proudly fill up the ‘other activities’ box with such high-risk pastimes. After all, few train-spotters or embroidery enthusiasts end up in A&E on a Sunday afternoon.

Say it like it is

I never learned to type properly and, consequently, my keyboard time is not as efficient as it should be. Occasionally I have flirted with typing tutor programmes but willpower and dedication always desert me. I have recently been experimenting with a speech to text program and have been mightily impressed. The software required very little initial training so that I was up and running virtually straight out of the box. By no means do I have RADA-like diction and know that I can, all too easily, descend into mumbling yet the number of times it misinterprets what I say are very few.

The greatest benefit comes when I am writing longer pieces of text for a proposal, report or this blog. Normally I find it difficult to maintain my train of thought through the many corrections of my miss-keying. The software is also very useful when filling in forms and the like. Instead of moving hand to mouse to place the cursor in the box, hand back to keyboard to type and then back to mouse to select the next box I can just leave my hand on the mouse and say the words as I select each box in turn.

The software I bought is Dragon NaturallySpeaking (other programs are available) and my only complaint is that the microphone headset that came with the box was designed for a much smaller head than mine. Luckily I had a suitable, adult-sized one already. Oh yes, and do remember to switch the microphone off when you’re on the telephone.

That nanny state again

If you were wondering how MPs are filling their time now that they have less to write on their expenses look no further than Labour member Ashok Kumar. He has tabled a motion that employers should be legally compelled to contact all applicants both to acknowledge receipt of application and again after selection has been made to notify applicants whether they have been successful. This may be good practice, and good manners, but think of all the red tape and opportunities for litigation that would follow. But why stop there? Why not impose a legal obligation on all teenagers to write prompt letters of thanks for Christmas and birthday presents? Not only would that breed a more polite society but might help fill the hole in Royal Mail’s business left by all those disgruntled customers who, thanks to the strikes, now pay all their bills online.

Read faster, learn quicker

I attend most Richmond Group sessions and I certainly could not resist attending one with the title “Speed through your workload”. The session, last Monday evening, presented by Helen Whitten, MD of Positiveworks left me with several good intentions for improving my efficiency (sadly, I have a very long list of good intentions). The session focused on techniques for speeding up your efficiency at reading documents and reports and on helping you to remember the content and facts and figures generally.

The efficient reading element explained how we often fall into the error of trying to read every word in the order written when an initial scan of the contents to learn the shape of the document would allow a more selective, and speedier, reading. The remembering part centred on the use of mind maps to structure information. I do use mind maps when planning proposals or reports but am the first to acknowledge that I have only dabbled and resort to a normal page-based list of headings and bullet points at an early stage. I have now resolved to persevere for longer with the full-blown multicolour variety and to become more proficient in using the software that I have.

Careful what you wish for – Bonuses

There is much heat, and less light, everywhere on the topic of bonuses. Mostly it is aimed at the banks but now the spotlight has fallen on the CIPD with a decision to allow the Chief Executive to retain her 20% performance bonus (on her salary of £300,000) at a time when the organisation has been reducing jobs and stopping bonuses for lesser staff (qv. articles in Personnel Today). I do not know enough of the facts to comment on this particular issue but there is a general clamour against bonuses. This has its dangers.

Executive bonuses are generally based on achieving quantified targets (in the case of the banks it was the nature of the targets that were wrong, rather than the concept). So what happens if bonuses are banned? Will the executives not try as hard to meet those targets? Well possibly. There are a great many pressures on executives’ time and attention and target-based bonuses help maintain focus on those specific metrics. More significantly what, otherwise, happens to basic pay?

Bonuses are not just a top-up reward for the employee. They also provide a safeguard that an element of cost will vary with a key performance measure, usually income-related. Normally, zero bonus will reflect poor performance and maximum bonus better-than-can-be-expected achievement. Standard performance will lie somewhere in between. So, assuming the CIPD remuneration committee got its research right, the market rate for the job, and the person, under a bonus-free contract is not £300,000 but somewhere between that and £300,000 plus the maximum bonus (possibly 20% in this case). Flat salaries will inevitably cost more than bonus-free contracts; but without the same guarantee of results.

Not all cats are fat – executive pay

The CIPD has launched a 10-point set of guidelines to help HR Directors and Remuneration Committees set executive remuneration. The guidelines are considered and temperate and have avoided the temptation to rush to simplistic solutions (unlike much press and political comment). The first four points discuss the appropriate characteristics of executive reward structures and, in particular, the variable elements and the need to avoid schemes that encourage inappropriate risk taking. All good stuff.

Interestingly, the remaining six points focus on role and responsibilities of remuneration committees. They discuss the factors they should take into account, stress the need for the committee to be knowledgeable on reward matters, if necessary, calling upon appropriate independent expert advice (my favourite, that one) and to be prepared to exercise judgment.

At the present time, when you read of ‘executive remuneration’ and ‘remuneration committees’ the words ‘fat’ and ‘cats’ leaps to mind. But it is not just City firms and large plcs that rely on remuneration committees to set directors’ pay. Just about every charity, not-for-profit organisation and many quangos report to a board of trustees from which a remuneration committee will be formed. These committees normally take direct control of the Chief Executive’s pay and, in most cases, the rest of the executive team as well.

Committee members in these organisations can often have a harder task than their counterparts on big company boards. Here boards comprise people from a wide variety of backgrounds; sector specialists, representatives of funding organisations, local or national government representatives, and many others. Unlike on big company boards, many will come from backgrounds where pay is highly structured right to the top of the organisation. In some of the smaller organisations executive pay is definitely not in the fat cat league and can be well below that of some board members. Very few board members in this sector have any experience of individual-based pay. Whereas commercial organisations can link pay to audited business metrics success, in this sector, can be much more complex to quantify.

All these factors can lead to an over-cautious approach being taken, especially when it comes to bonus or incentive pay. While the world is pre-occupied with working out how to restrain City bonuses this is a sector where linking executive pay to performance is often viewed with suspicion and seen as too difficult.

A name by any other rose is just as prickly

Human Resources magazine reports that Cable & Wireless has renamed its HR function “People & Brand”; to be lead by their new Director of Brand and Culture.

The news item says that the new man’s responsibilities cover HR, resourcing, talent management, culture change, corporate communications and brand management across the business. So possibly things are not quite as bad as they seem and when an employee (bet they call them colleagues) wants to discuss pay the door they go through may still say HR. If not, pity the poor graduate trainee  having to write ‘People and Brand Officer’ in the ‘what job’ box on the ‘where are they now’ section of the alumni newsletter.

OK, a new label can help to kick-start change but stick to words that work in everyday use and have face-value currency. I for one do not want to be accredited to a Chartered Institute of People.