Unless you have been living in a monastery then you will aware that HR in the UK has been under attack on a number of different fronts by the media and by politicians.
The mauling given to the former BBC Head of HR
The criticism over the high pay of senior managers in the charity sector
Attacks on zero hours contracts
Complaints on police PPO’s overtime payments
Much of the criticism has been aimed at the area of reward. The quantum of the BBC termination payments, sizeable remuneration in the third sector even the discussion on low pay and zero hours contracts are clearly in the orbit of reward. What has puzzled and dismayed me as a seasoned reward manager is the lack of a robust response on these issues. Fleet Street knives have been sharpened and deployed against HR practices with very little parry from the profession or its leaders.
Let’s breakdown what is behind the political and media rhetoric. All big organisations have enhanced termination payments in place. Why? First, if it is a true redundancy where there is no replacement of role, the payback on a redundancy payment is very rapid. If you pay two years pay you are probably only paying 15 months costs of employment (let us not forget that employment costs also include all the infrastructure costs of offices, IT, administration support and the like) so you are very quickly in “profit”. I have only once seen this argument put forward in the attacks on BBC HR. Second, making a settlement agreement with an employee avoids costly legal disputes and reputational damage for both the organisation and the individual. Not to mention the management time costs. I have had some involvement with legal cases involving very senior managers having to sit around for hours at a time at court being totally unproductive, not to mention many expensive hours of briefings and the like with highly charging QC’s. Paying enhanced redundancy is very often in the interests of the organisation the stakeholders and the former employees. So, why does nobody stand up and explain this? I guess the facts do not make such good headlines.
We have seen the offensive (in both meanings of the word) being taken by politicians and the media over senior management pay in the charity sector. Why has nobody shown the politicians the salary surveys and the head-hunter advice on the costs of employing senior management? And, as a fan of big data I have to ask if anyone has produced the figures to show the large difference to an organisation that good leaders make in terms of both profit and success.
I also notice some attacks in the media recently against the overtime being paid to the Metropolitan Police Personal Protection Officers who look after the Royal Family, the Prime Minister and the like. These are very highly trained people – experts in their field with many years’ experience and very great skills. The do a very difficult job very well in the vast majority of cases. They may be required to put their life on the line for the people they protect – yet there are complaints about their overtime. There has been no discussion that I have seen of the enormous value of their work or the circumstances that led to the requirement for long hours. Why not?
There has been a lot of talk of both zero hours and low pay of late. No one would deny that low pay is an issue. But, it is a function of the labour market. Increasing low pay is a social good but comes at an economic cost. Politicians should not on one hand bemoan the erosion of working families incomes in the UK while at the same time urging employers to increase pay. Such increases can only be paid for by raising prices.
You will, by now, have perceived the common theme. Much of what is done in reward may not meet the highest moral standards, (and since when have either politicians or the media ever met that requirement); but our work is essential, commercial and pragmatic. The labour market is imperfect, ambiguous and messy. No amount of editorials or political band-standing is going to change those facts.
One Head of Reward did point out to me when I was researching for this article that the targets of these attacks, the BBC, the police and the big charities, are all out of favour with the government and thus may be seen as legitimate targets. She may say so, I could not possibly comment.
What is needed is a data rich, fact based discussion on these important reward questions by those who know and understand the issues. We need a very big pea shooter to take on the storm troopers of the Westminster village and the chattering classes. But it is time for reward professionals to do what they do best, provide the data and the analytics to take the battle in to the enemy camp. Let us have a proper intellectual debate on these issues rather than the glass house occupants driving their tanks over the green lawns of the HR and Reward profession.
I would urge you to buy/read the best-selling (#1 Amazon HR books) HR book “Humane, Resourced” a crowd sourced ebook by some 50 HR professionals providing a cutting edge view of HR today by those who fight in the trenches. I have honoured to have been a contributor to this volume. All the revenue from sales of the book go to charity. A very worthwhile read.
This is my last reward blog post for a while. I hope you have enjoyed the variety of topics covered over the last couple of years