How to Minimise Exposure to Employee Costs image

How to Minimise Exposure to Employee Costs

Staff Squared date icon28th July 2016

Tag iconSmall Business

Employee costs, from the moment that you plan to hire somebody new, slowly begin to mount up.

First, you must deal with the costs that are associated with hiring and recruitment. Then, there are ongoing expenses that continue for as long as the employee stays on your payroll, and potentially even beyond.

What are some of the potential employee costs?

  • The costs of recruiting including advert prices and recruitment agency fees
  • The employee’s salary, or wage
  • Employer National Insurance contributions
  • Pension contributions
  • Holiday pay
  • Sick pay and absence
  • Lateness
  • Training costs
  • Equipment
  • Maternity or paternity pay
  • Possible redundancy pay
  • Possible unfair dismissal case costs
  • Consumables and general overheads (the small costs like tea and coffee, electricity and paper)

In addition to all of the above costs, linked to one employee, be aware of extra costs such as employers’ liability insurance.

How can you minimise exposure to employee costs?

Recruitment

When you’re hiring someone new, consider avoiding recruitment fees by sourcing new employees through existing ones.

Advertise the vacancy on your company website, and ask existing members of staff if they can recommend anyone for the role. You’ll be surprised how far networking can take you!

As additional motivation, you may wish to offer a small reward to any employee that passes on the name of someone that you later employ. Even with the cost of a reward factored in, this should be cheaper than using a recruitment agency.

Sick pay, absence and lateness

As long as it is taken for a valid reason, sick pay is an unavoidable business expense. It is important to support your employees through both short-term and long-term illness.

That said, it is your responsibility (and in your interest) to keep track of employee sick leave.

Using high quality HR software from Staff Squared, you will be able to easily record employee sick days, and view reports that are based on these records. You may discover that someone is taking a very high amount of sick leave, when compared to everyone else in the company, or that they seem to continually be calling in sick on a certain day of the week.

Whilst it is important not to accuse an employee, without evidence that they might not be ill, you may find that it helps to address the issue privately. The employee may have a valid reason for requiring all of the sick days that they are taking, but it may be something that you can help with such as stress or family issues.

Think about whether you could decrease sick leave by providing more flexibility, for example. If employees are taking sick leave to deal with childcare emergencies, could you encourage them to work by offering the option to work from home?

By keeping clear and detailed reports of employee working times and dates, you may also detect patterns of lateness that may be having an impact on your business. If an employee is five minutes late, twice a week, then this adds up to 40 minutes per month or a full working day every year. It might not sound like a lot, but imagine if every single worker was doing this!

Possible redundancy costs

Before taking on a new employee, do your best to look ahead to the future.

Do you definitely have a role available? Can you afford to fill that role long term?

Some new employees are absolutely essential, whilst others are hired to do work that could probably be comfortably shared amongst existing workers if everyone sat down and discussed it.

The key to avoiding the redundancy process might lie with your existing employees, who can provide ongoing feedback about how realistic their workloads are. If employees are consistently struggling to stay on top of their job lists, someone new will need to be brought in. If they’re struggling for a short while, could you handle the extra work with temporary staff or freelance workers? Outsourcing can often remove the need to go through the entire employment process, when a new full time employee may not be absolutely necessary.

If employees might be able to take on a bigger workload, offer some incentives for doing so. Often, these incentives will be cheaper than the recruitment process and potential future redundancy costs. Could you pay some employees to work overtime, if they are happy to?

Possible unfair dismissal case costs

According to the Ministry of Justice, there were more than 61,000 unfair dismissal claims made in the year from April 2014 to March 2015.

Unfair dismissal is a big issue in the workplace, and can also be costly for employers. Most cases result in payouts of £1,000, but the largest from 2014-2015 was more than £235,000.

Regular performance reviews can reduce the risk of an unfair dismissal claim. Employees will be alerted quickly if they are seen to be underperforming at work.

Always have clear goals and targets in place for your employees. Make sure that your expectations are realistic. Objectives are important for individuals, and for the business as a whole.

Unfair dismissal cases can have a big impact on businesses of any size, but will be particularly tough on smaller businesses with limited funds available. It is far better to invest time and money in setting out clear workplace rules, reviewing staff performance regularly and making sure that each employee knows what responsibilities they have to manage.

Consumables

Did you know that the average worker uses 10,000 pieces of paper every year? That’s paper to the value of roughly £40, most of which does not need to be used.

You can save your business a small fortune by keeping many of your documents online. A secure cloud based storage system, perhaps built into your HR software, can enable employees and their managers to collaborate and share documents with ease. You can also store all company policies online, where they can be easily accessed 24 hours a day.

Keeping track

The best way to minimise employee costs is to make sure that you are on top of them at all times. Record details about every employee, ideally using feature packed online HR software.

Don’t be one of the many employers that accidentally approves too much holiday, giving someone paid time off when they’ve already used up their allowance.

Some costs, like pension and National Insurance contributions, are completely unavoidable and should be given fairly. Other employee costs are often the result of poor management or poor record keeping.

Look to online software to help you to keep tabs on every worker within your business, and don’t forget to carefully consider the true cost of each employee.

Find out why most small businesses are successful and why many will fail.  See our small business tips guide can help optimize how manage your HR processes.

Written by Sue Crow

Office Manager - Staff Squared

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Disability Discrimination in the Workplace: How to Accommodate Employees with Disabilities image

Disability Discrimination in the Workplace: How to Accommodate Employees with Disabilities

Staff Squared date icon13th March 2019

Tag iconManaging staff

There are over 11 million people with a disability or long-term medical condition in the UK alone and around 800,000 of them are working adults below State Pension age. Yet, even with the implementation of the Equality Act and an ever-growing understanding of disabilities, there are still a large number of people who are made the victim of disability discrimination, either in the workplace or in the wider community.

What is Meant by ‘Disability’?

The word ‘disability’ is commonly used on a daily basis and can often mean different things to different people, but ‘disability’ is offically defined under the Equality Act 2010 as a physical or mental impairment that has a substantial or long-term negative effect on a person’s ability to carry out normal day-to-day activities; where:

Substantial is more than minor or trivial; and,

Long-term means twelve months or more.

However, there are certain conditions that are not considered as a disability, such as drug addiction or alcoholism. You can read more about these here.

Some examples of disabilities include:

  • Vision impairment
  • Deafness or hard of hearing
  • Mental health conditions
  • Autism Spectrum Disorder
  • Physical impairment

Disability Discrimination and the Law

The Equality Act 2010 replaced previous anti-discrimination laws including the Disability Discrimination Act 1995 (DDA) and protects people in the workplace and wider society from discrimination.

The Act states that it is illegal to discriminate based on the protected characteristics of a person, of which there are nine:

  • Age
  • Gender reassignment
  • Being married or in a civil partnership
  • Being pregnant or on maternity leave
  • Disability
  • Race including colour, nationality, ethnic or national origin
  • Religion or belief
  • Sex
  • Sexual orientation

You are also protected from discrimination if you are associated with a person who has a protected characteristic or have complained about discrimination or supported someone’s claim.

Amongst the many requirements stipulated under the Equality Act, the main points that all employers and organisations should be actively aware of are:

  • Reasonable adjustments in the workplace and wider community must be made
  • A recruiter is limited when asking about an applicants health or disability
  • A person cannot be fired or made redundant based on their disability
  • Employment and education must be readily available to people with disabilities

You can read more about the Equality Act here.

What does Disability Discrimination Look Like?

Disability discrimination is the prejudice against people who have a physical or mental disability or learning difficulty which leads to the ill-treatment of a person or leaves them at a disadvantage based on their condition.

A discriminatory action can be a one-off action or comment, the implementation of a rule or policy that negatively impacts on a person’s disability or a physical or communication barrier which makes access to something difficult or impossible.

There are six main types of disability discrimination.

Direct Discrimination

This means that a person with a disability is treated less favourably than a person without a disability in a similar or equal situation.

For example:

David has Arthritis. He is being interviewed for a job alongside Alice who is able-bodied. During his interview, the employer feels that David is the best candidate for the job, however, he discloses his disability and so they offer the job to Alice as they assume that David will need a lot of time off work.

Indirect Discrimination

Indirect discrimination is when a policy or process is in place that has has a negative impact on a person with a disability. Unless the organisation or employer is able to prove that there is a specific and justifiable reason as to why the policy is appropriate, indirect discrimination is unlawful.

Having a valid reason behind the policy or process being in place is known as objective justification.  

For example:

If a job advert for a delivery driver requires the applicant to hold a driving licence, this is justified as it is a legal requirement of the job, even though this will disadvantage applicants who cannot obtain a licence based on their disability. Whereas, if a job advert for an office worker has the same requirement because it may be necessary to work between two sites, that requirement isn’t so easy to justify.

Failure to Make Reasonable Adjustments

The Equality Act 2010 gives employees and organisations the responsibility of ensuring that disabled people have the same opportunities to access employment, education and services as freely as people without disabilities. This is called the ‘duty to make reasonable adjustments’.

Reasonable adjustments are changes that an employer or organisation can make to the workplace, service or public area that allow people with disabilities to work safely and productively or otherwise carry out day-to-day tasks normally.

Failure to make reasonable adjustments to accommodate a person with a disability is a discriminatory offence.

For example:

Sandra suffers from chronic pain and requires regular breaks to move around; however, her employer only allows staff to take breaks during the designated lunch period and refuses to let her move away from her desk outside of those times.

NB: Reasonable adjustments are subject to a number of factors such as the resources available to the employer or organisations and the broader impact that those adjustments might have on the company as a whole.

Discrimination Arising from Disability

Section 15(1) of the Equality Act 2010 states that discrimination arising from disability occurs where:

  1. A treats B unfavourably because of something arising in consequence of B’s disability; and,
  2. A cannot show that the treatment is a proportionate means of achieving a legitimate aim.

While it is similar to indirect discrimination in that a person with a disability is treated unfavourably, discrimination arising from disability differs slightly as it needn’t compare the person with a disability to someone without; they simply need to prove unfavourable treatment towards them in particular.

For example:

Sam has Multiple Sclerosis (MS) and needs to stay on top of a time-consuming exercise regime to manage his condition; however, his employer doubles his workload leading up to an approaching deadline. There are other staff members who could take some (if not all) of the extra work, but Sam’s employer insists that he must do it, even though Sam has expressed his concerns that he will struggle to keep up with his health management while completing the additional work to a high standard. Inevitably, this puts Sam under a lot of stress which leads him to accidentally break company protocol. Sam is dismissed.

NB: If the employer or organisation can show that they didn’t know and couldn’t have been reasonably expected to know that a person has a disability, they cannot truthfully be accused of discrimination arising from a disability.

Harassment

Disability-related harassment is defined as unwanted, exploitative or abusive behaviour targeted at a person with a disability that is intended to violate their dignity, safety, security or autonomy or create an intimidating, hostile, degrading or offensive environment.

Some examples of disability-related harassment include:

  • Derogatory, demeaning or humiliating remarks
  • Name-calling or ridicule
  • Offensive or patronising language
  • Insults
  • Threats and intimidation
  • Invasion of personal space
  • Unnecessary touching
  • Unwanted comments about appearance or disability
  • Intrusive questioning about disability
  • Offensive jokes, banter
  • Abusive verbal or written comments related to disability
  • Offensive emails
  • Cyberbullying
  • Offensive graffiti
  • Financial exploitation of a disabled person including taking their benefits money
  • Deliberately putting aids and adaptations out of reach
  • Damage to a disabled person’s property, including aids and adaptations
  • Sexual abuse, rape and sexual assault
  • Physical assault, ranging from lower level assaults up to murder

Victimisation

Section 27 Of the Equality Act 2010 describes victimisation as when a person is ‘punished’ as a result of being involved in a previous discrimination claim or alleged a breach of the Equality Act.

Examples of victimisation are:

  • A person is turned down for a job promotion as a result of raising a grievance for disability-related harassment.
  • A person complains to the management of a shop because staff have been making fun of his speech impediment and as a result, is treated rudely or ignored when he returns to the store.

NB: Discrimination may not always be intentional. Many people struggle to understand how to treat those who are less able than themselves; however, just because it isn’t intentional, doesn’t mean that it isn’t unlawful.

Things you Should know about Staff with Disabilities as an Employer

As an employer, you have a duty of care to your staff, which includes ensuring that you are aware and fully understand the implications of a person’s long-term health issues or disability.

While there are strict rules in place that limit you to the questions you can ask a staff member about their disability, there are certain things that you will need to know in order to make any adaptations or adjustments necessary to accommodate them:

  • Are there certain tasks that the employee will struggle to do (or not be able to do at all)?
  • Are there any adjustments that the employee will require in order to make access to the property or any resources easy for them to obtain? i.e. a ramp or monitor covers.  
  • Are there any adjustments that the employee will require in order to make them comfortable at work? i.e. additional breaks throughout the day or an orthopaedic chair.
  • Will the employee require leniency to take time out of work for appointments or unexpected days off to recover from illness as a direct result of their health condition or disability?

Once you know these things, you will be able to appropriately put steps in place to make the employee’s time at work as comfortable and accessible as possible.

Tips on how to Accommodate Staff with Disabilities

As an employer, it can be somewhat daunting when you find yourself with an employee who suffers from a long-term illness or disability – especially if it’s a first time experience. What if they don’t feel supported enough and don’t want to talk to you? What if you don’t meet their needs or legal requirements? All normal fears to have, yet unnecessary.

With the following tips, you will be able to accommodate your disabled employees in a way that will nurture your professional relationship and eliminate the worry that you aren’t meeting their needs.

Provide Adjustments and Accommodations

Physical adaptations will differ depending on the needs of the employee.

For example, if they have been diagnosed with cancer and are going through chemotherapy or have a mental health condition such as autism or anxiety, a quiet and private rest area where the employee can take a beat and gather themselves would be massively beneficial.

Whereas, a wheelchair user might need to have a parking space close to the main entrance which allows enough room for them to get in and out of their vehicle.

Other physical or flexible adjustments might include:

  • Flexible schedules
  • Part-time hours
  • Working from home
  • Reduced or revised responsibilities
  • Adaptive office equipment (i.e. sit/stand desk, coloured paper, back support)
  • Layout changes to make the office easier to navigate
  • Disabled toilets
  • Additional breaks

Develop your Policies and Procedures

All companies should at least have standard policies and procedures in place which cover the basic level of accommodation that they will meet in the case of a disabled employee joining their team.

Further from that, any processes in place should be easily adaptable on an individual basis.

Assign someone with decision-making capacity to create and implement plans for accommodating staff – a great place to start is to ask them how they support themselves at home. This will give you an insight into areas that you could replicate for them at work.

Show Support

Being understanding is probably the single most important thing you can do for employees who have a disability. Demonstrating that you appreciate their needs by making reasonable adjustments is the first step towards showing your support, but you shouldn’t just stop there.

Show emotional and social support too by creating a caring environment where management and coworkers show solidarity by helping the employee with offers of help outside of work where possible and arranging events such as fundraisers in support of medical fees or a charity that focuses on research into their disability.

Provide Benefits

Offering benefits such as health insurance or paid leave to attend appointments or therapy sessions is a great way to accommodate the needs of a disabled employee and also helps you to go that bit further in demonstrating that you care about them. There’s nothing worse than worrying about losing money because you have to regularly attend appointments during working hours. That’s just unnecessary stress that benefits no one.

Have Regular Catch-Ups

It’s important to stay up-to-date on catch-ups with any employee to ensure that they are happy and have no concerns or grievances – this is even more crucial for those with long-term health issues or disabilities.

Schedule regular meetings with the employee to review how they are coping with their responsibilities and any adjustments that have been made for them. It may be the case, as with many degenerative conditions, that abilities change; in which case adjustments that are in place or job responsibilities may need to be reviewed. At the end of the day, you want to give your staff the best possible chance to ensure that they are able to perform their job to the best of their ability – it’s beneficial to everyone involved.

Don’t Make them Feel Pressured

Can you imagine feeling insecure or scared to call in sick for fear of being reprimanded or placed on a disciplinary by your manager? Many disabled people feel this anxiety when they find themselves in a situation where they can’t make it into work. This is usually followed by a large sense of guilt that they are leaving their colleagues in the lurch.

Take the time to sit down with your employee and reassure them that you want them to feel that they can call in sick if they are too unwell to make it into the office without feeling pressure to live up to an unrealistic expectation.

The same rule applies for work and deadlines. The employee isn’t always going to be able to meet set deadlines if they are unwell or not feeling 100%, so there shouldn’t be any excessive pressure put on them to get everything done to your timeline as long as they are able to complete their duties to an acceptable standard and within a reasonable timeframe.  

Maintain Contact

If the employee is off sick, nothing says you care more than a call or text for no other reason than to make sure that they are okay and to ask whether there is anything that you can do for them.

In the event that the absence is prolonged as a result of a serious bought of illness, medical procedure or hospital stay, why not start a whip-around collection and send a card to let them know that they’re in your thoughts and are missed.

Welcome them Back After they’ve been Off Work

Make sure that they are welcomed back in a positive way upon their return to work.

For example, arrange for a welcome back card and gift (and maybe even a banner) to await them at their desk, make additional required adjustments ready for when they return or organise a meeting with them to ensure that they are well enough to be back and give them the opportunity to voice any concerns.

The sky is the limit when it comes to making your staff feel valued.

Written by Clarisse Levitan

Lead First Line Customer Support Agent - Staff Squared

Clarisse works as the Lead of our Customer Support Team to provide all of our customers with the very best care and guidance when using their HR software.

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