Commenting on the workplace issues and emerging trends that could have the biggest impact on employers in 2013, Nick Burns, chief executive for Capita Employee Benefits, said: “The impact of legislation and regulation, particularly regarding pensions, became much more tangible during 2012. In 2013, these factors will be compounded as employers will find changes in social behaviours and employee expectations hard to ignore – this is particularly true in terms of communication and the millions of new defined contribution pension members that auto-enrolment will produce.
“Pensions will jostle alongside workplace health issues and flexible working for attention in the boardroom. Decisive action will be needed in some areas and we expect organisations to rely increasingly on technology to meet and manage these evolving challenges.”
Mobile pensions
To date, most organisations’ auto-enrolment technology budgets and bandwidth have been focused on middleware tools to identify eligible employees from multiple payroll systems and on building user-friendly intranet pages and contact centres for those being opted in. For those organisations still preparing for their auto-enrolment staging date, this is the right focus. But, next year, we should start to see leading employers embracing different platforms and making information accessible from multiple devices, including mobile phones and tablets.
Nick Burns commented: “From banking to booking appointments, most of us have growing expectations that we will be able to access instant and interactive information on our terms. Giving employees the option to design an avatar isn’t necessary, but embracing the mobile technology that is part of most people’s daily lives will be fundamental to building employee engagement with pensions.
“Smaller employers that haven’t started auto enrolling yet should embed the basics first as they are less likely to have in-house capability. Fortunately, their middleware options will grow during the year as new products hit the market and options for switching between suppliers become more flexible.”
Clear presenteeism danger
After years of investment and focus on absence management, organisations now also need to be wary of unsustainable improvements in attendance and the detrimental impact this can have on productivity. During the competitive boom years and subsequent recession, the term ‘presenteeism’ has gained momentum as people compete for promotion or feel fearful of jeopardising their jobs. Presenteeism is the opposite of absenteeism and is variously defined as working while unwell or being physically present at work out of hours, usually after productivity drops.
Nick Burns commented: “Employers must be wary of inadvertently encouraging unwell and potentially infectious people into work or sending the message that being seen in the office late at night will win out over overall performance. Rates and reasons for absence and attendance vary between sectors but good management training enabled by data and technology will go a long way to ensuring sustainable improvements in attendance.”
Health: the big policy picture
Providing health benefits for workers has benefits above and beyond supporting their health and wellbeing and being a good corporate citizen. For example, full interrogation of the data collected by health insurance policy providers can bring a wealth of management information.
Nick Burns commented: “Having a clear picture of the DNA of your workplace and where any good or poor health ‘hot spots’ are can help employers manage health or business continuity problems before they escalate. The next step will be for listed organisations or those looking for investment to find concrete ways of demonstrating why their health and wellbeing programmes deserve credit from investors.”
Commoditising pension solutions
The advent of new de-risking and funding arrangement options for employers with defined benefits (DB) pension schemes has been well-reported over the last few years. What’s new is that the complex and costly arrangements that used to be the domain of only the biggest pension schemes are now becoming more accessible for smaller schemes. This will increase over the course of 2013 as they become increasingly available as off-the-shelf solutions.
Nick Burns commented: “As complex funding arrangements and de-risking strategies become more tried and tested, they’ll become commoditised and arrangement costs will come down making them more accessible at the smaller end of the market – particularly for those that are well-prepared to take act quickly under the right conditions. For example, market conditions for buyouts were suboptimal for most of 2012 but they will bounce back and when they do there will be a limit on insurers’ capacity so preparedness will be critical. Early preparation, for example, data cleansing and early engagement with advisers and insurers, could prevent a deal breaker situation arising.”
Flexible working – a two-way street
The message that flexibility is critical to sustaining business strategy and responding to market changes has been hammered home in the last few years and this has translated into people-management strategies. In the early stages of the downturn, employers in sectors ranging from manufacturing to legal services found new ways to reward and deploy their staff to reduce the need to cut headcount. While positive, this does raise questions about whether this flexible approach will work in the long-term.
Nick Burns commented: “Opening out flexible working, job-sharing and sabbatical policies to reduce a bit of pressure on wage bills showed great innovation in terms of people management. The question is whether this new employee expectation for flexible working options will be sustainable when the upturn comes. There are always opportunities for top performers so competitive working arrangements and benefits packages will be integral to ring-fencing the people organisations need to compete at all stages in the economic cycle.”
Flexible benefits
The financial crisis of 2007 and subsequent recession have clearly had an impact on individuals’ saving and spending habits. While the need to cut costs has had a knock-on impact on some employers’ ability to provide generous benefits packages, many still provide flexible benefits choices to their employees in recognition of the fact that individuals’ wants and needs change throughout their employment lifecycle.
Nick Burns commented: “Those people who are savvy on the high street also pay attention to how they allocate their flexible benefits allowance. With household budgets stretched, people may opt for hard cash over the most tax-efficient option so employers need to stand firm on supporting their employees in long-term financial planning. Austere times bring the opportunity to assess whether the benefits provided are fully understood and valued by employees.”
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