Complete HR guide: The 2022 Building Regs changes

In the race to net zero, the new 2022 Building Regs changes have come into place to help ensure low carbon construction that’s fit for the future. Here, in our complete guide to the recent changes, we break them down and tackle some of the HR challenges they may bring.

What are the 2022 Building Regs changes?

The recent changes to Building Regulations are interim measures, part of the roadmap towards the government’s Future Homes Standard and Future Buildings Standard–planned for 2025.

That 2025 standard will see all new builds being capable of being net zero in terms of operational carbon when the grid decarbonises. Decarbonisation is the elimination of our reliance on fossil fuels and switching to cleaner sources of power, such as electric. 

The UK Government has set the goal of grid decarbonisation for 2035. In the meantime, the 2022 Building Regs changes will bring us one step closer to the 2025 building standard changes.

For clarity, we’ve listed the stages to full decarbonisation below:

• 2022 Building Regs changes – paving the way for net zero
• 2025 Future Homes Standard and Future Buildings Standard
• 2035 full decarbonisation of our energy grid and a reliance on renewable sources of energy
• 2050 Net Zero

Who is affected?

Existing buildings

With existing buildings, the 2022 Building Regs changes come into play when additional work is being carried out. For example, retrofitting or adding an extension.

The construction industry is already planning ways to maximise the efficiency of extensions. This could include installing a low-carbon heating system or doors with a low U-value. This reduces heat loss from the building, making it better insulated.

New builds

When embarking on new builds, it’s essential to plan the project carefully from the outset. The design must be created in line with the 2022 Building Regs changes to ensure the building is capable of zero carbon emissions. 

Breaking it down: The 2022 Building Regs changes in 7 key points

We’ve highlighted 7 major points from the 2022 Building Regs changes. Full details can be found on the UK government website.

1. 30% reduction of carbon emissions in new builds

A simple way of reducing building CO2 emissions is by installing an energy-efficient heating system.

Consider one that can be paired with home renewables, like solar panels. Alternatively, electric radiators are a popular, convenient, and sustainable choice.

2. 27% cut on carbon emissions in commercial buildings

Use of low carbon materials such as bricks, cement, and cladding will ensure maximum efficiency in insulation.

 3. preventing overheating in new builds

The new approved Document O introduces glazing limits in new-build homes, care homes, schools and student accommodation to reduce unwanted solar gain. This will help reduce overheating.

4. Capping maximum flow temperatures

New and replacement heating systems in both domestic and non-domestic builds must have a maximum flow temperature of 55°C.

5. Ventilation improvements

Background trickle vents have been recommended for non-domestic buildings along with a new requirement for CO2 monitors in all offices.

6. Reducing reliance on heating systems with FEES–Fabric energy efficient standard

Through better insulation, properties will run on a higher level of energy efficiency. Builds will move away from reliance on heating systems and move towards fabric first heat retention.

7. Electrical vehicle charging

The new approved document S requires all domestic new builds to have the preparatory work completed for future installation of an electric vehicle charging point.

Extensive guidance on ways to meet the building regulations can be found in the Approved Documents area on the GOV.UK website.

What do these 2022 Building Regs changes mean for those working in the industry?

The 2022 Building Regs changes will have far-reaching consequences over and above the obvious changes in building compliance.

As the construction sector moves towards more energy efficient ways to build, this will fundamentally change the way we work and the materials the industry uses.

Products are likely to become more expensive, lead times longer, and the planning process more complex.

This will have implications for the entire construction team, from planning and design to onsite execution.

New building designs will drive the changes

The overarching aim of these 2022 Building Regs changes is to replace reliance on heating systems with fabric-first heat retention. That means that structural engineers, architects, and designers will see the emergence of building designs that are more energy efficient. 

In homes of the future, low carbon materials such as cement, bricks and cladding could do the heavy lifting. This will pave the way for the 2025 boiler ban.

With this critical shift to a material-led design, HR will either be looking for talent that can respond to this new demand or training existing talent to meet these new challenges.

Onsite operations will adapt to implement new designs

Site workers will have to install renewable energy resources for electricity and heating, which may well bring up a need for new skills.

This may lead HR departments to increase their learning and development budgets to allow for extra training and upskilling of their existing workforce.

It could be challenging, finding the time for extra training, in an industry which is already under pressure from a lack of skilled labour and project delays.

Finding new additional workers would be a solution, but let’s not forget that the labour market is already tight. Organisations may want to take these challenges into consideration and perhaps review additional ways to tackle the labour shortage.

For example, up-scaling your benefits package can help attract and keep skilled workers. Organisations can also use tech to tackle labour shortages. 

Upgrading your HR stack is just one way to use tech more efficiently. Streamlining your recruitment process in this way frees up time for HR to focus on training existing employees or exploring creative ways to improve employee retention.

Far-reaching changes require even better collaboration

Planning ahead will be key in an organisation’s ability to successfully meet these responsibilities. It will demand an even greater emphasis on planning in the pre-construction phase. This will include guidance from HR and leaders when it comes to communication and coordination.

Ideally, architects, SAP assessors, and building control professionals should collaborate from the outset of any project. And throughout the construction phase.

Consider ways to collaborate within the supply chain, so everyone reaps the benefits.

This will allow organisations to model the energy footprint of each new house and lock in compliance from start to finish.

It’s important to remember that changes require a period of adaptation and teething periods can occur. For this reason, employee feedback is essential. Encourage input from those onsite who can identify problems and solutions first hand.

New techniques mean updated safety requirements

With new regulations, new systems and different materials, new health and safety risks will arise. Leaders and project managers will need extra training to meet these new safety requirements.

It therefore makes sense to consider how you can achieve this. Ideas include mentoring, educational courses, and job shadowing.

Another issue to consider is that these new Building Regs may contribute to over working, at least until workers have adapted to the changes.

Changes create uncertainty, and that can lead to stress

Over working can negatively affect the mental health of your workers. This directly relates to onsite safety because anxiety and exhaustion all contribute to increased safety risks.

Anxiety is already high among construction employees due to labour shortages and project delays. In addition to this, the changes in Building Regs could cause additional stress. This could affect employee wellbeing and ultimately your organisation’s bottom line.

In 2020, the National Building Specification found that mental health resulted in 70 million sick days in construction. This cost businesses in the sector a whopping £70 -£100 billion. So it’s definitely worth looking at ways to safeguard your workforce and your business.

Safeguarding the environment and your employees

The drive to attain a carbon free future concerns us all. It will take teamwork, creative solutions, the upskilling of existing employees and the sourcing of new talent.

However, a successful implementation of this road map to net zero shouldn’t neglect employee wellbeing. Because that would be counterproductive. 

The financial cost of accidents and ill health to the construction industry is £16 billion a year. That was in 2020, and we want to see that figure go down, not up.

Organisations must do their part to safeguard the environment and their employees. We know that financial anxiety is a major factor in poor mental health. 

By finding creative solutions to ease financial stress, organisations can improve employee wellbeing because workers are less likely to be distracted, which can lead to safety issues.

Boost employee wellbeing and safety

To help ease financial stress, we’ve built an app that allows construction employees to access their money on their schedule. 

On-demand pay from Openwage gives employees greater financial flexibility by instantly accessing the money they’ve earned. This means that employees can get paid before their scheduled payday to help ease expenses that crop up throughout the month.

Employees can access up to 50% of their gross earned salary any time, for a low, transparent fee.

For employers, there’s no cost to roll out this employee benefit. With no impact on company cash flow or payroll, Openwage is the new way to pay employees that’s win-win.

To learn more about Openwage and how we can quickly and easily roll-out this benefit to your employees, request a demo today.

Wearable technology: Promoting health in construction

Wearable technology is gaining momentum in the construction industry. That’s because its benefits in promoting the health and safety of those working on site and the working environment as a whole have been more widely recognised. Join us as we explore how wearable technology is revolutionising health in construction. 

The risky business of construction 

Health and safety in construction is a matter of life and death. The statistics make stark reading.

In 2021/22, nearly a quarter of all fatal injuries at work were in the construction sector. That’s according to an HSE report, ‘Workplace fatal injuries in Great Britain, 2022’. 

When it comes to mental health, finances are one of the most common causes of anxiety amongst construction workers. 

And critically, this sector has the highest rates of suicide of all industries in the UK.

It’s clear that more needs to be done to protect the health of workers. People who are physically and mentally stressed are less effective in the work they do. It also takes its toll on their productivity levels. 

Poor physical health is costly for businesses too. Low levels of health are associated with higher absenteeism, disability claims, and compensation costs. For these reasons, employers are always striving to promote a healthier workforce.

How can wearable technology improve health in construction?

The Institute of Occupational Medicine found that effective use of data and technology could improve safety in the UK construction industry. 

Wearable tech has become increasingly applied to construction settings. Factors for this include the pandemic, advances in technology, and the growing trend of using data to drive business decisions. 

The COVID-19 pandemic altered the safety landscape

The pandemic was a key driver for the construction industry to increase investment in technology-based personal protective equipment. 

Technology such as Trimble XR10 with HoloLens 2 was adopted by companies to overcome social distancing rules. This technology enables clients to see the progress of their projects through mixed reality. As a result, clients don’t need to visit a site in person. 

This enabled projects to continue, thereby minimising costly delays. 

As wearable technology began to take off, employers noticed that it also offered significant health benefits for construction workers. 

Jordan Lawver, senior business area manager at Trimble, believes that the greatest driver behind the growth of tech-based PPE is worker safety. And that this will “remain long after COVID-19 is a memory.”

Advancing technology keeps workers safer

The technology available to the construction industry is advancing at an “astounding rate”. That’s according to Jennifer Stiansen, Director of Marketing at JLG Industries. 

Construction safety technology like safety goggles, smart boots, smart helmets, and power gloves, are becoming less costly, lighter, and more user-friendly.

Lawver believes that wearables in the construction industry will be “an indispensable tool” for construction workers, “that helps guide their work and keep them safe on the site”. 

Making better business decisions using data

Employers lose 1.6 million working days a year due to accidents at work. 

Wearable technology can be used to address endemic problems in the construction industry like high accident rates, over-working, and labour shortages caused by accidents and illness. 

Wearable devices can:

• Monitor a worker’s heart rate for signs of fatigue and stress.
• Monitor a worker’s activity and location.
• Detect when an accident occurs.
• Detect gas levels.
• Alert a worker to potential hazards.
• Send an alert for help when needed.

Devices provide workers with data that helps them to stay healthy by:

• Making them aware of potential hazards so they can proactively stay safe.
• Alerting them to signs that they need to take a break. Overworking and fatigue significantly increase the risk of accidents at work.

Data can help employers become aware of issues so they can take immediate steps to mitigate health and safety risks. 

Examples of wearable technology in the construction industry

Wearable technology has many health benefits in construction. Let’s look at some examples.

1. Exoskeleton (or exosuits) enhance human capabilities

Exoskeletons (or exosuits) are lightweight machines that construction workers wear to aid movement and support their bodies. They’re useful for strenuous, repetitive tasks.

Different exoskeletons in construction are designed for specific types of movement, for example: 

• Someone who lifts and holds heavy tools above head height for much of the day can benefit from wearing an exoskeleton to reduce strain on their arms and shoulders.
• A worker who spends much of their day picking up and grasping heavy tools might wear power gloves to increase their grip and support their muscles. 

Each day, construction workers perform tasks that put them at high risk of injury. The biggest cause of accidents in the UK construction industry is musculoskeletal disorders. 

These disorders are caused by heavy lifting, regular overhead work, and performing repetitive tasks involving force. 

As well as reducing the risk of injury, exoskeletons can increase productivity by enabling workers to carry out a task without straining their bodies. 

Exoskeletons can also help ease the labour shortage in construction. This is because workers with lower levels of physical fitness can remain in the industry for longer, and they can help prevent injuries which leads to worker absenteeism.

2. Smart helmets reduce the risk of collisions on site

Smart helmets in construction combine the protection of a normal hard hat using Internet of Things (IoT) technology. 

Using IoT, these helmets connect the wearer to a control centre. Data such as the wearer’s location, heart rate, oxygen saturation level, and skin temperature are tracked for safety management.

Using sensors, helmets can also detect dangers in the environment. For example, the proximity warning system, Sitezone, alerts pedestrians and machine operators to potential collisions. 

With the Sitezone system, pedestrians wear a tag on the back of their hard hat, which creates an alert if they get too close to plant equipment. This reduces the risk of collisions and accidents. 

3. AR eyewear help prevent costly (and dangerous) errors

AR (augmented reality) eyewear has many applications in the construction industry. This powerful technology enables architects to see their projects in real spaces, so they can identify problems before they arise. 

Using augmented reality in construction prevents costly mistakes, which reduces the time workers are on site redoing work. The less time workers are on site, the lower the health and safety risks.

With AR eyewear, workers can be warned of potential dangers through their visual display. Glasses can also display prompts and guides to prevent workers from making mistakes. 

Research has shown that 90% of accidents at work are caused by human error, so this is a major advantage (Postnote, Parliamentary Office of Science and Technology, June 2001).

AR eye wear can also be used to train unskilled workers. As the construction industry is facing a massive skills shortage, AR glasses can be used on-site to instruct new workers. This reduces the need for as much in-person training.

4. Smart boots help protect workers from fatigue

Smart boots have GPS, LED lights, and sensors that monitor a worker’s physical condition and environmental factors. 

Using kinetic energy, smart boots can monitor workers for fatigue and warn them against environmental dangers, including high temperatures and poor air quality. The boots can track the wearer’s location in case of an accident, and they illuminate to make it safer to work at night.

Tech is reaching new heights as a means to promote worker health

Although construction has always been a high-risk industry, increasing numbers of employers are addressing health and safety in the sector holistically. They’re addressing all three aspects of worker health; physical, mental, and financial wellbeing. 

Since financial wellbeing is the biggest cause of stress for construction workers, it should also be central to a wellbeing strategy. On-demand pay from Openwage puts workers in control of when they access their earnings. It can be rolled out as an employee benefit in a matter of days. 

To find out more about how Openwage can support your employees’ financial wellbeing, request a demo today.

Overcome labour shortages in construction with tech

A 2021 skills shortage report compiled by recruitment consultancy Search shows that a whopping 83% of construction businesses are feeling the strain of the labour shortage.

Many are tackling this recruitment headache by offering higher wages and more benefits. Here we delve into how another aspect – tech – can overcome the labour shortages in construction.

The consequences of the labour shortage are far reaching

Brexit and the pandemic have taken their toll. The construction industry has been hit from all sides. 

Businesses cite supply chain issues, a lack of availability of materials, and labour shortages as fundamental challenges for them right now.

We’re going to look at the shortage of skilled labour and how it affects businesses.

Increased risk of employees being overworked

A lack of qualified labour puts a strain on existing staff and can lead to overworking.

A report on mental health in the construction industry by recruitment company Randstad shows how being overworked has a negative impact on peoples’ mental health.

In 2019, the Office for National Statistics (ONS) reported that the rate of suicide for males working in low-skilled trades (particularly within construction) was three times the national average (ONS, 2017). 

Since then, the mental health of people working in construction has worsened. This is due, in part, to the shortage of skilled labour.

Health and safety can be overlooked with disastrous results

The construction industry has the highest average fatalities of any sector in the UK. This makes construction one of the most dangerous industries to work in.

And yet, labour shortages mean there are fewer eyes and ears on site to identify and address safety issues. This can create barriers to keeping up with health and safety protocols.

According to one of the UK’s leading trade associations, NFRC, the volume of construction output here in the UK is forecast to rise by 2.8% in 2022 and 2.2% in 2023.

While this looks like good news, the increased pressure of demand often negatively affects health and safety. With less labour and more demand, it can be hard for employers to find the time to upskill employees and ensure new hires are properly trained.

Project delays happen without enough resources 

Project delays are multifactorial. Supply chain issues due to Brexit and the pandemic are big contributors. However, a shortage of skilled labour is also an important factor.

Over 50% of UK businesses with labour shortages said they were unable to meet demands. According to a survey by leading recruiter Randstad, vacancies in the construction industry have risen by 39% in the first half of 2021.

Meanwhile, the Federation of Master Builders found that 60% of building firms have had to pause projects due to a lack of skilled tradespeople and that 42% of firms can’t get hold of general labourers. 

A staggering 89% of builders have faced delays due to either materials or skills shortages.

Using tech to help overcome labour shortages in construction

When it comes to overcoming labour shortages in construction, people analytics is a great place for HR teams to start. 

People Analytics is the process of gathering data about employees. But it’s more than just a database. It’s the analysing of that data that’s important.

There are many use cases for people analytics, and the reason it’s become so widespread is that it can help businesses identify and solve issues, as well as pre-empt problems arising in the future.

Let’s identify some of the ways people analytics can help address the labour shortage.

Increase employee retention to overcome labour shortages

With a lack of skilled workers, retention of existing employees becomes critical. If a business has a high turnover, then it isn’t operating effectively. 

People analytics can help leaders understand why this turnover is happening and how it can be corrected.

The data collected may point to low levels of wellbeing, lack of career progression, or insufficient training. Perhaps current workers feel overworked? 

There are solutions to all these problems, but businesses cannot put strategies in place unless they know what those issues are.

Achieve success with employee engagement strategies

According to Gallup high employee engagement leads to a 41% decrease in absenteeism and 17% increase in productivity. So engaging employees makes a big difference to organisations’ bottom lines.

Yet, employee engagement is complex, and the reasons for disengaged employees are multi-faceted. That means that measuring employee engagement requires a scaled approach, as the Utrecht Work Engagement Scale suggests.

People analytics can tell you not just whether employees are disengaged, but how and why. This data enables employers to tackle the issues at the heart of their employees and reap the benefits of a more engaged workforce.

Use professional development opportunities to overcome labour shortages

With the labour shortage, upskilling existing employees so they have a broader skill set becomes doubly important. Data from HR analytics can help identify which training courses deliver the best value for money. 

Additionally, this data can identify skills gaps within a workforce or ones which are important to develop.

Upgrading your HR tech stack can help tackle the labour shortage

Many employers are turning to AI to help overcome the impact of labour shortages. IBM, who created the Watson Candidate Assistant for recruitment, says that AI has saved their own company $1 billion in recruitment costs. 

Using tech not only streamlines processes to reduce cost, it can also accelerate the hiring process and reduce dependency on labour. 

Here are two tools that digitise certain tasks and help HR professionals better manage their workloads.

1. HR bots streamline recruitment processes 

These virtual assistants simulate human dialogue with candidates. They can help tackle the labour shortage in construction by making the recruitment process more efficient and streamlined. 

This means that greater numbers of candidates can be screened and interviewed because they’re more automated and require less human intervention.

In addition, automating these processes allows HR teams to promote creative solutions to the labour shortage from within the organisation. 

An example would be upskilling existing employees and focusing on the retention and wellbeing of the current workforce.

2. Applicant Tracking System

An Applicant Tracking System or ATS acquires data that goes beyond an applicant’s CV.

By looking at publicly available social media profiles and past work experience, an ATS can delve deeper into a candidate’s background. This saves HR considerable time and helps identify the most suitable talent for a position.

Even if AI doesn’t uncover talent for a particular role, you may find that the process reveals certain existing employees who have much-needed skills that have gone unnoticed.

Digital communication can help keep construction employees engaged

According to Mckinsey, the number one reason workers leave a company is because of uncaring leaders. So putting measures in place to tackle this issue can help overcome the labour shortages the construction industry is facing by reducing turnover.

Using digital communication tools such as instant messaging, employee perk platforms, and video conferencing can help employees feel more engaged. 

Integrating person-led communications tools into your organisation can help workers feel appreciated and more connected to their team and managers. Even if they don’t see them face to face regularly. 

This is especially useful for younger generations who are used to being kept up to date via their mobile phones.

Using tech has long-term people benefits for business

As well as helping to tackle the labour crisis by reducing dependency on labour, upgrading your tech stack can positively impact your bottom line in other ways. This includes:

• Streamlining and digitising HR functions
• Helping leaders make decisions backed by data
• Providing insights on how to target problem areas like employee retention and training 
• Delivering savings on training and recruitment costs

Technology-driven benefits can reduce turnover

Often operating from project-to-project, construction workers can’t always rely on a set and stable work schedule. 

Some construction companies are increasingly relying on incentive compensation to attract talent and encourage existing employees to perform at peak levels. 

In fact, the labour shortage in construction has driven wages up by 6% according to a Government report. 

Overcome the construction labour shortage without increasing wages

When trying to overcome labour shortages in construction, it can be easy to believe that increasing financial rewards is the answer. Yet not every employer can afford to increase wages right now due to rising business costs.

That’s why it’s important to look at other ways to attract and retain skilled labour that doesn’t include salaries. 

Upgrading your benefits package is a good option for construction companies to consider. That’s because a carefully created benefits package can significantly raise levels of employee physical, mental, and financial wellbeing. 

The average staff turnover rate in the UK is 15% while in the construction industry it’s significantly higher (21.4%). 

Part of the explanation for this high turnover is low levels of wellbeing and a lack of focus on mental health. Worryingly, the construction industry has the highest rates of suicide in any sector.  

According to the CIPD’s Health and Wellbeing at Work 2021 survey report, a focus on health and wellbeing at work plays a strategic role in reducing employee turnover. 

By listening to workers and tailoring your benefits package, companies can help reduce turnover by increasing employee wellbeing.

Financial wellbeing benefits can give your organisation the edge

While benefits such as healthcare and pensions increase workers’ sense of security and wellbeing, it’s worth considering benefits that go above and beyond the standard (and predictable) format.

An area of employee wellbeing that’s often overlooked is financial wellbeing. Stress caused by finances can have a devastating impact on an employee’s life. 

So it makes sense that companies offering financial wellbeing support to employees are more likely to retain staff.

That’s why here at Openwage, we built a platform that allows employers to easily and securely roll out earned wage access to employees. Through our app, your employees can benefit from on demand access to the money they’ve earned before their scheduled payday. 

Learn more about the benefits of this employee perk for both your company and your people. 

What does an effective offboarding process look like?

Offboarding is one part of the employee life cycle that’s often ignored. But a well-managed, effective exit strategy is good for business because it can positively affect your bottom line. Here, we do a deep dive into what an effective offboarding process looks like, with practical tips on how to create one.

What is offboarding?

As the old saying goes, few things in life are certain. Death, taxes and….employee offboarding for that matter.

Employees leave. New hires don’t always work out. It may not be the first thing we think about when an employee starts a new role, but it’s a fact of working life.

We’re not going to go into details here about what offboarding is and why it matters. But, even when you understand just how important offboarding is for your business, you’re probably wondering what an effective offboarding process looks like. 

You already have an offboarding process – but is it effective?

If you’ve ever had an employee leave, then you already have an offboarding process. But the big question is, is it working?

Employee separation from a company is a certainty, yet it’s given very little attention by most businesses. According to research from Aberdeen Strategy & Research, only 29% of companies have an exit strategy in place. 

Without an exit strategy, many companies just let this process run organically. This haphazard exit strategy can lead to lost hiring opportunities at best, and serious data breaches at worst. 

What does an effective offboarding process look like?

7 tips for your offboarding process checklist

An offboarding checklist is a valuable tool for ensuring your strategy is as effective as possible. 

Your process will vary depending on the size of your organisation and whether the departure was initiated by the company or by the employee themselves.

Use the checklist we’ve created below to ensure your company is reaping the benefits of a well-managed offboarding process and minimising the risks associated with a poor offboarding process.

1. Document the contract termination

Make sure the HR has a formal letter of resignation or contract termination from the employee. 

When important issues are recorded in writing and dated clearly, there’s less room for misunderstandings.

2. Boost company culture by notifying the team

You’ve invested time and resources into creating a successful team. 

So don’t let gossip or rumours throw that cohesiveness off balance. Make sure you notify the team as soon as possible that someone is leaving (if that person hasn’t told the team themself).

Secrecy has a negative impact on company culture, so make sure other employees feel they can freely express any concerns or ask questions as a result of that person leaving. 

By keeping everyone in the loop, there are no secrets and employees understand that their confidence and wellbeing are a priority.

3. Ensure continuity beyond the offboarding

One essential aspect of an effective offboarding process is the handover. 

Continuity is a priority and much of this is down to your outgoing employee. LinkedIn has some useful tips for employees writing a handover document.

Consider asking them to provide a to do list. This is for final projects and deliverables. That way, there are no loose ends when the outgoing employee hands over their role.

From an HR perspective, leaders will want to decide who will replace the employee or whether their work will be reassigned to other people.

There may also be training needs and skills gaps that should be identified and acted upon.

4. Use checklists as part of your offboarding process

While HR is planning the logistics of the handover, it’s good offboarding practice to provide the outgoing employee with a checklist of any items that need to be returned. 

This may include keys, ID badges, laptops, mobile phones, parking permits and anything else employees use.

5. Reduce security risks by managing IT accounts

A poor offboarding process opens the door to huge security risks, but an effective process can greatly reduce or even eliminate this threat.

For the IT team, offboarding an employee can be complex. According to leading SaaS management company Torii that’s where a great IT checklist comes in.

6. Exit interviews are an opportunity to collect valuable data

Losing a valued employee is hard, but the offboarding process presents HR with an opportunity to understand how to improve the employee experience.

According to a study from Business News Daily, 60% of HR managers say their organisation takes action on exit interview employee feedback. That means that 40% of organisations are missing out on the opportunity to do things better in the future.

By acting on the feedback departing employees give during exit interviews, companies can make significant improvements in employee turnover, wellbeing, and experience. 

It can be a great boost to team morale when the leadership team takes onboard feedback from departing employees.

Glean useful insights from employees by asking the right questions

Employees may feel more comfortable sharing information at their exit interview than while working at the company.

UK based recruiter Indeed has a list of the 8 best exit strategy questions to help you collect valuable data and innovative ideas for improving your organisation.

Carefully plan your exit interviews to boost your company’s reputation

The exit interview is one of the last interactions the outgoing employee will have with your company. Conduct them in a way that creates lifelong brand ambassadors who leave your company speaking highly of their experience.

7. Show your gratitude

According to Work.com, 69% of employees show better performance when they receive appreciation and recognition for their work.

Remembering to appreciate your workforce not only boosts morale, it creates a strong company culture and raises employee engagement levels.

So why is this important when it comes to creating an effective offboarding process? Consider organising a leaving party or giving the outgoing employee a token of the company’s appreciation for their efforts.

Looking after your employees starts before you hire them

When an employee contemplates joining your company, one of the key areas they’re interested in is the benefits package. At a time when the cost of living is rapidly rising, great employee perks are becoming more important than ever.

Openwage is an on-demand pay platform that enables your employees to access up to 50% of their earnings before payday. There’s no cost to your business and no need to change the way you run payroll.

Learn more about how on-demand pay can benefit your employees and your company. Contact us to request a demo. 

The true cost of poor mental health in construction

Shockingly, 82% of UK people in construction say they’ve experienced a mental health issue because of work. In this article, we discuss the impact of the mental health crisis specifically on the construction sector. We’ll also help answer the question; how can companies support construction employees’ mental health in the workplace.

Who’s affected by poor mental health in construction?

Female construction workers are more likely to have mental health conditions than their male colleagues. However, the percentage difference is very little; 87% compared to 80%. 

When it comes to age, workers under 24 are the most likely to experience mental health issues, although 18% of people between 35 and 44 say they struggle with mental health every day.

Construction workers who are employed are at 10% greater risk of suffering from mental health conditions than those who are self-employed.

It’s concerning that most tradespeople (64%) say they experience stress due to work once a month or more.

What’s causing this crisis? 

Here are some of the major factors causing the mental health crisis in construction:

Financial wellbeing

Financial stress is the number one cause of poor mental health in construction workers. 

A 2022 report by IronmongeryDirect in collaboration with the charity, Mind found that finances were the principal cause of stress for 34% of construction workers. 

Plasterers are the group most likely to experience financial worries (92% say this is the main reason for stress). They’re also the least likely to take time away from work for mental health reasons. 

This lack of time-off means construction workers can become locked in a vicious cycle. That’s because not taking a break from work further increases their stress levels.

Worryingly, there’s evidence that construction workers are continuing to work even when they’re sick or injured because they’re anxious about losing pay. This could cause severe, long-term damage to both their physical and mental health.

It’s vital that financial wellbeing is prioritised by employers in the construction industry because it’s a problem that will only worsen as the cost-of-living crisis escalates.

Overworking

IronmongeryDirect and Mind found that 23% of construction workers said ‘high workload’ was the cause of their anxiety. 

Those working in the construction industry work an average 41.2 hours a week compared to 36.3 hours for other sectors. Crane drivers work the longest hours (52.8 hours a week).

Evidence shows that productivity declines after 50 hours a week, so overworking isn’t good for a business either.

Not taking annual leave

Research cited by Professional Builder magazine found that construction workers take significantly fewer days of holiday than those in many other sectors. Their reasons include feeling ‘too busy’.

Not taking time off work can have a serious impact on someone’s mental and physical health. Overworking is linked to conditions such as heart disease, stroke and diabetes. 

In contrast, taking time away from work reduces stress. When people aren’t feeling stressed, they’re more focussed and productive. 

Workers who are tired and burnt-out make mistakes. This is incredibly dangerous in the construction industry (see ‘Occupational accidents’ below).

Difficulties with customers 

A staggering 24% of construction workers said difficulties with customers were the main cause of their mental health difficulties. 

Abuse from customers is a growing problem, according to IronmongeryDirect and Mind. 86% of construction workers say they’ve suffered abuse from customers in the course of their work. 

Not talking about mental health

At the heart of the construction industry is a male-dominated culture. It’s a culture where people can often feel embarrassed and ashamed to ask for mental health support.

A study by Mates in Mind and the Institute for Employment Studies (IES) found that construction workers were unlikely to discuss their mental health with anybody. If they did decide to talk, it would only be to a close friend or family member. 

It’s important for employers to take every possible step to de-stigmatise mental health. The longer it takes for someone to seek help, the more harmful the consequences can be. 

What’s the impact of poor mental health in the construction industry? 

Cases of suicide are highest in the construction sector

shockingly, the construction industry has the highest suicide rates of any other sector in the UK. 

In 2020 there were 276 recorded suicides amongst skilled construction and building trades. That’s 80 more suicides than the next highest group (elementary administration and service occupations). 

Research has found that those working in the construction sector may be 10 times more likely to die by suicide than from an accident at work.

These are horrifying statistics that demonstrate the absolute importance of prioritising mental health in the construction industry.

Occupational accidents

Overworking, fatigue, and high stress levels increase the risk of mistakes and accidents in the workplace. Those who suffer from mental health conditions may be less aware of what’s going on around them. This increases the likelihood of injuries and accidents.

In 2020, the Health and Safety Executive (HSE) found that 36% of all fatal accidents were in the construction sector. The financial cost of accidents and ill health to the construction industry is now over £16 billion a year.

Time off work

In 2020, 26% of tradespeople who reported illness cited anxiety, depression, or stress. 

More than 30% of construction workers who’ve suffered from mental health in the last two years haven’t taken time off work. However, according to National Building Specification, mental health still resulted in 70 million sick days at a cost of £70-£100 billion.

What can companies do to support employees’ mental health?

There are some importantgtant steps you can take to support the mental health of construction workers:

The correct mental health training could save a life

Offer managers and employees mental health training so they can spot the signs that a colleague may be struggling. The charity, Mind offers both face-to-face and virtual training courses for organisations.

Break the stigma surrounding mental health

For construction workers to have the confidence to ask for mental health support, there needs to be a cultural shift. Mates in Mind is a charity that advises employers in the construction industry how to foster a culture of openness and support.

Education is the most powerful way to challenge the stigma surrounding mental health (see ‘Provide mental health training’). 

You could also encourage managers to share their own mental health challenges with colleagues to shift people’s perceptions. By having the courage to be open themselves, managers may give others the confidence to ask for help when they need it.

Encourage managers to check on colleagues

Managers may need training so they can offer genuinely valuable mental health support to colleagues. Spotting the signs of mental health issues, asking the right questions, listening, and then responding sensitively and constructively are key skills to develop. 

There’s a fine line to walk when addressing mental health in the workplace. Your people need to know they can trust the person they’re confiding in with personal details.

Offer flexible mental health support

Consider providing opportunities for employees to have open conversations about their mental health. 

As well as booking in regular check-ins with managers, make sure your people know they can receive support whenever they need it. 

Offering a range of different ways for employees to access support can be helpful. Some people prefer to talk face-to-face, whilst others would rather communicate through email or online chat. 

Share sources of support

Promote places where people can find professional help, such as Mind, Samaritans and any local mental health charities. 

The NHS website also provides useful links to different sources of support.

Have a robust work-life balance policy

Consider creating a strong work-life balance policy that is promoted to employees when they join your organisation. The policy could clearly state the benefits of work-life balance both for employees and for the business.

The policy might cover parental leave, leave for medical appointments, flexible working arrangements, and more. 

The aim is to communicate to staff that the business understands they have responsibilities outside work and that it respects those commitments.

Encourage employees to take annual leave

When managers and business leaders don’t take their holiday entitlement, other employees don’t feel they can either. This establishes an unhealthy culture where it becomes a luxury or over-indulgent to take annual leave. 

Businesses need to make it easy for employees to book holiday days by having simple systems in place (for example, an app). 

Employees need to know their managers are happy for them to take holiday and that it’s not an inconvenience. 

Design a robust mix of employee benefits

You could provide employee benefits that promote construction workers’ mental health. Choose the benefits that best suit your workforce. 

For example, you could offer free access to mental health apps. Apps have the advantage of being convenient for those who don’t have time to make an appointment. 

Plus, they usually provide some level of support 24 hours a day. They’re also anonymous, so people can receive help without involving anybody else. 

You could partner with a third party to provide employees with access to free, confidential counselling services. Sessions could be offered face-to-face, over the phone, or online to suit each employee.

Tackle the biggest cause of poor mental health with Openwage

Financial stress is the main cause of poor mental health in the construction industry. To help counter financial stress, we’ve built an app that allows construction employees to be paid sooner. 

On-demand pay from Openwage gives employees greater financial flexibility by instantly getting paid the money they’ve earned. Employees can access up to 50% of their gross earned salary any time, for a low, transparent fee.

For employers, there’s no cost to roll out this employee benefit. With no impact on company cashflow or payroll, Openwage is the new way to pay employees that’s win-win.

To learn more about Openwage and how we can quickly and easily roll-out this benefit to your employees, please request a demo today.

3 ways to support employee financial stability

It’s never been more critical to understand how to support your employees’ financial stability. With the cost-of-living crisis deepening, more and more employees are now under financial strain.

Worrying about money impacts your mental and physical health and makes it harder for employees doing their jobs properly. 

Why prioritise employee financial wellbeing?

Did you know that money worries affect 77% of employees today? Stagnant wages, increasing inflation, and the rising cost of food, energy, and fuel have caused a cost-of-living crisis that’s the worst in Europe. 

On top of this, there’s an underlying feeling of instability with job losses in the technology sector and, in contrast, an abundance of positions in other sectors like care, hospitality, and retail. 

Almost three-quarters of people are financially stressed

Taking a holistic approach to employee wellness has never been more important. Today, employee financial wellbeing is a critical priority.

Let’s’ discuss how organisations can support your employees’ financial stability and why every organisation needs to do it.

What does financial stress look like?

Financial stress can cause a wide range of mental and physical issues, including:

Sleep problems 

Lack of sleep results in difficulties making decisions and increases the chances of making mistakes. It can also cause severe illnesses like heart disease and stroke if it continues.

Weight loss or weight gain

Worrying about money can cause overeating or loss of appetite. Both can cause fatigue and listlessness, and make it hard to concentrate. 

Depression

This is a paralysing feeling of hopelessness which destroys motivation and affects cognitive functions. It also causes physical illnesses such as high blood pressure.

Anxiety

Physical symptoms include panic attacks, shaking and excessive sweating, all of which can have a long-term impact on self-esteem.

Withdrawing from social situations

Worrying about money can stop people from going out because they don’t want to spend money. It can also mean they’re too preoccupied to interact with others. But socialising is vital for mental health. 

Strained relationships

Arguments between couples are most often about money. Instability at home has a huge impact on people’s mental health and performance at work.

Destructive coping tactics

Feelings of desperation about money can result in excessive drinking, smoking, and gambling. In extreme cases it can be a contributing factor in self-harm and suicide.

It’s clear that no business can get the best from an employee who is suffering from financial stress. 

What does employee financial vulnerability cost employers?

In the UK, 4.2 million working days are lost annually due to absences caused by poor financial wellbeing. The cost is estimated to be £626 million.

Employee financial vulnerability also increases staff turnover, raises the likelihood of workplace accidents, and results in poor decision making and low motivation – to name just a few. 

In a study by SHRM, 80% of employers said that financial stress decreases employee performance and lowers productivity. 

How to support employee financial stability

Here are three things you can do to improve employee financial resilience:

1. Offer perks that focus on better money management

Here are some perks your business could offer:

Earned wage access (EWA)

Earned wage access (EWA), also called ‘on-demand pay, is a perk that improves employees’ financial stability. EWA gives employees the peace of mind that they can cover unexpected expenses. 

To find out how on-demand pay boosts employee financial resilience, take a look at How can on-demand pay benefit your employees’ financial wellness?

On-demand pay can save your business money by lowering recruitment and training costs because it gives you an edge over your competitors when it comes to attracting and retaining talent. 

Explore this plus other Business benefits of earned wage access: An HR manager’s guide to discover more ways earned wage access can benefit your organisation.

Financial coaching 

Organisations like Octopus Money Coach work with employers to offer employees financial coaching. With personalised coaching sessions tailored to individual employees’ financial situations, it’s a cost-effective way for employees to feel more confident in managing their finances. 

It’s a good idea to ask employees what benefits they would like because their responses will depend on their particular circumstances. 

Also consider tapping into data collected through HR technology like people analytics to understand issues affecting your workforce so that your benefits package helps you meet organisational goals. 

2. Help employees gain financial knowledge 

Very few schools teach financial education, and a lack of financial management skills can lead to financial stress. Many people become trapped in a cycle of debt because of poor financial decisions they’ve made in the past.

When people read advice online about money management, it can be confusing and overwhelming. So, many businesses are addressing this issue by providing financial education for employees. 

Your organisation could promote employee financial wellbeing by:

• Webinars on financial topics that are most important to your employees. If in doubt what these are, don’t be afraid to ask them. You don’t have to create your own webinars, you may be able to tap into external providers on a low-budget.

• Access to unbiased financial advice. There is a common perception that financial advice isn’t for everyone, or is only needed for life-impacting financial decisions like mortgages. But this isn’t the case.

• Partnering with a financial coach such as Octopus Money Coach which helps employees on and individual level to manage their finances better.

• Signpost to debt advice help like the Money and Pensions Service which offers free, confidential advice.

Supporting employees’ financial knowledge will increase their confidence to make the best financial decisions. Better financial decisions lead to better money management, which means employees will be less likely to feel financially stressed. 

3. Promote a culture of trust and openness

According to a survey carried out by the Money and Pensions Service, 29 million UK adults don’t feel comfortable talking about money. That’s despite 49% of people being worried about it. 

Unfortunately, talking about money carries a stigma because many of us have been brought up to believe it’s a taboo subject.

By promoting a culture in which people feel more confident to open up about money, you can find out what particular financial challenges they face.

Try to focus on the areas of finances your specific workforce is struggling with

Once you know what the difficulties are, you can address specific areas (for example, retirement planning, issues around paying for company expenses upfront, etc.)

To normalise talking about money, consider leading by example. If people in senior positions in your company share money difficulties they’ve experienced, this can break down barriers.

Financial champions can be a great way to get engagement

Why not appoint financial champions? These are employees you train to offer support to colleagues with money concerns. Financial champions can work alongside your HR team, who should also be given financial training. 

Financial champions can be invaluable because often it’s easier for people with money worries to approach a peer rather than a professional or a family member at first. 

Having someone to talk to, in confidence, can be the first step towards facing and addressing financial problems.

Do employees want financial support from employers?

Today’s employees have high expectations in the workplace. Offering people perks, flexibility, recognition, and employee benefits that give them genuine value demonstrates that your business genuinely cares for them. 

Research by Nudge Global revealed that 67% of employees would like their employers to offer more financial wellbeing support. 

If your business understands how to support employee financial stability and provides the help people need, you can stand above your competitors and increase the profitability of your business. 

7 financial wellbeing programme mistakes to fix ASAP

With at least 72% of employees between the ages of 35 and 54 experiencing money worries, financial wellbeing is a high priority. Whether you have a financial wellbeing programme or you’re planning one, here are seven financial wellbeing programme mistakes to be aware of so you can offer the best package to your employees.

What is a financial wellbeing programme?

A financial wellbeing programme should relieve employees’ financial stress by helping them to feel more in control of their money. 

The following employee benefits may be included:

• Advice from external financial advisors to help individuals achieve their financial goals.
• Financial education (most people in the UK haven’t been taught how to manage their money).
• Support from ‘money champions’. These are employees in the business who’ve received financial training. 
• Financial products such as Openwage on-demand pay, online budgeting tools and money management software.
• Schemes to help reduce costs, such as supermarket discounts, discounted gym memberships, and childcare vouchers.

This list isn’t exhaustive. For more financial wellbeing programme tips, look out for our upcoming about how to support employee financial stability. 

Does a financial wellbeing programme benefit a business?

Having a financial wellbeing programme in place benefits employers and employees. 

Research by Aegon, the pension provider, revealed that 4 million working days are lost every year due to poor financial wellbeing. In fact, the cost of employees’ financial stress to businesses is staggeringly high.

7 common financial wellbeing programme mistakes

Whether you’re considering how to improve a financial wellbeing programme or you’re starting from scratch, these are some mistakes that are crucial to address.

1. Basing employee financial wellbeing on salary

Money concerns affect everyone, not just people on lower salaries. In fact, various studies show that those earning over £100K are as likely to be worried about money as those on £10 – £14K. 

People with higher salaries may have large mortgages or be concerned about tax issues, whilst those on lower salaries may struggle to get by from payday to payday. 

Although the challenges are different, financial wellbeing support should be offered to all employees.

2. Not understanding employee needs

Don’t assume you know what challenges your employees face. Involve them in planning a financial wellbeing package so you can tailor your offering to them. Everybody is an individual going through their own challenges. 

Your employees might currently be:

• Struggling to pay off a student loan.
• Saving to move house or trying to get back on their feet after moving house.
• Adjusting to the financial demands of parenthood.
• Going through a costly divorce.
• Concerned about having enough money for retirement.
• Worried about escalating credit card debt.

The list is endless. That’s why it’s advisable to find out what your employees need so you can offer the package that’s right for them. 

Plus, if employees have been included in planning the programme, they’re also more likely to buy-in and make full use of the support on offer. 

3. Not taking a holistic approach

It can be easy to focus on one specific area of financial wellbeing, like savings or pensions. But to achieve true financial wellbeing, employees need support in financial capability and financial education as well. 

Nearly a third of employees don’t take financial advice or read information when making financial decisions, according to research by CIPD. 

The Financial Advice Market Review study by the FCA published in 2018 revealed that 91% of adults hadn’t taken financial advice in the 12 months before. This shows there’s a clear need for financial education.

A successful financial wellbeing programme includes access to educational resources so employees can learn the skills they need to manage their finances effectively. 

4. Not building support

It’s crucial that senior leaders buy into a financial wellbeing programme otherwise nobody else will. 

To gain their support, you could share evidence of how good financial wellbeing benefits the business by boosting productivity and lowering rates of absenteeism. When employees aren’t under financial pressure, they’re more ‘present’ at work.

Consider investing in training for senior staff and your HR team so they have the tools to support other employees’ financial wellbeing. 

Senior staff need to lead by example, encouraging employees to engage with the financial wellbeing programme and listening to their feedback. By finding out what employees want, the programme can be tailored to meet their unique financial goals.  

5. Treating everyone the same

Everybody’s needs are different, and everybody learns in different ways. Some employees may want personalised financial coaching, whilst others are happy to join webinars or be given resources for self-learning. 

Aim to provide a choice of ways to access financial wellbeing support so everyone is included. 

6. Trying to do everything in-house

Recognise when you need external providers to offer financial wellbeing initiatives. You might partner with an independent, regulated financial advisor or a financial coach who can help your employees to meet their financial goals.

There are some great options available, including on-demand pay from Openwage, which is free for employers. 

Openwage has a dashboard for employers so you can manage employees’ access to on-demand pay, plus much more. There’s no impact on your business cashflow and your payroll still runs once a month as usual. 

There are a huge number of business benefits of earned wage access as well as significant benefits for employees.

7. Not evaluating results 

A financial wellbeing programme that was successful in your business a few years ago might not be as successful today. That’s because people’s financial circumstances change as they go through life and new employees join your company. 

A financial wellbeing package needs to be continually evaluated to make sure it’s still meeting your employees’ needs. Act on feedback from employees and make data-driven decisions to make sure your programme is providing effective support.

For example, find out how far your financial wellbeing package is benefiting your business by tracking how rates of retention, absenteeism rates, and levels of productivity have changed since the programme was introduced. 

Take a holistic approach

When people suffer from poor financial wellbeing, it affects their physical and mental health too. According to Deloitte, poor mental health costs UK businesses around £45 billion a year.

Taking a holistic approach to workplace wellbeing means employees not only take greater control of their finances, but they feel better generally.

Financial wellbeing at work

Some people wonder whether work is the right place for addressing financial wellbeing, but employers have a unique opportunity. 

Employees trust employers with their finances because that’s where their money comes from. It makes sense that financial wellbeing support is provided alongside wages and pensions.

Openwage financial wellbeing support

With Openwage, employees can use a convenient app to manage the money they’ve already earned. They can instantly access up to 50% of their earnings for a low, transparent fee. 

Expenses and bills don’t all fall on payday, so being able to access the money they’ve earned when they need it can help ease financial stress. It means they don’t have to resort to loans, overdrafts and credit cards which are becoming ever more expensive with the cost-of-living crisis.

When people feel in control of their finances, it motivates them to take a proactive approach to managing their money, which promotes financial wellness. 

So, why not request a demo today? Let us show you how Openwage can improve employee financial wellbeing in your business. 

The role of leaders in shaping a winning company culture

According to Forbes, culture is a company’s single most powerful advantage with 88% of employees saying it’s vital for success. But who’s responsible for culture? Here, we look at what culture is and explore the intrinsic role that leaders play in shaping and maintaining a winning company culture.

What is company culture?

We can’t look at the role leaders play in shaping a winning company culture without defining what company culture is.

Company culture is a shared ethos, a set of goals, values, and practices that characterise an organisation.

Company culture is different from the company’s vision or mission statement, which are written down and set in stone. In contrast, company culture evolves more fluidly, it’s almost like a living thing. 

This is where leadership comes into play. Influential leaders and managers embody an organisation’s goals and values in their behaviours. In turn, leaders empower employees to help create a positive workplace culture, which shapes a successful company.

The effects of company culture are far-reaching 

In the last five to ten years, the importance of company culture has really come to the forefront of business leaders’ minds. As a result, it’s widely recognised that company culture affects:

• Employee engagement
• Productivity
• Recruitment
• Turnover

The culture of your organisation can have a huge impact on your bottom line. That’s why it’s vital to understand the role that leadership plays in shaping a winning company culture and how to optimise their roles and influence. 

Five major types of company culture

There are many different types of company culture with examples of high-profile companies for each. It’s not a case of which is best, but more a case of which one suits your industry and team. 

Here, we identify five major types of company culture:

1. Team-first

This type of organisation prioritises recruiting employees based on how well they fit with the rest of the team. This takes precedence over skills and expertise and is a more engagement-oriented approach. 

Netflix is a great example of a team-first company culture.

2. Elite corporate culture

Businesses with an elite corporate culture focus on hiring top talent. 

Recruitment processes prioritise leaders and innovators who go above and beyond what’s expected of them. Think Google.

3. Horizontal corporate culture

This type of culture is often seen in start-ups. 

It’s a collaborative “everyone pitches in” mindset, where job titles don’t mean much. Basecamp is a great example of a company championing this start-up mentality.

4. Conventional corporate culture

This is exactly what it sounds like. A traditional hierarchical structure where the CEO takes all the decisions. Your local bank probably has this type of culture.

5. Progressive corporate culture

A culture brought about by a good deal of uncertainty due to mergers and acquisitions. LinkedIn (which acquired Lydia.com and was then bought out by Microsoft), is a good example.

Due to multiple cultural influences, cultural differences and divides can surface after organisation transformations. These can be tricky cultures to manage. 

The chances are that your organisation may be a mixture of several of these five types of company culture. Whatever your current culture is, know that it likely won’t stay the same forever and that small changes can help shape the culture you’re striving for.

The link between leadership and corporate culture

Company culture starts from the top. Without outstanding leaders, there’s no one to embody and enforce your company’s values. 

You may have made your goals and values public, but it’s your leadership that makes sure they become woven into your corporate culture.

How can leaders use their role to shape a winning company culture?

As Bill Gates once said; 

“Leaders are those who empower others.”

This makes complete sense when you consider that a winning corporate culture is one where leaders help employees to thrive. When they thrive, they do their best work. 

Ethical leadership promotes a culture of honesty, trust, integrity, and fairness. In an ideal world, leaders consistently exhibit behaviours that promote the company’s core values. 

This then guides employees so that their own behaviour is reflective of the company values and, therefore, the desired culture.

Company culture can be negatively affected if leaders do not embody the company’s core values. Leaders who don’t lead by example can erode trust between the organisation and its employees.

A lack of trust is one of the warning signs of a toxic work culture. 

Five ways leaders can positively affect corporate culture

So how can leaders help shape a successful culture? Below we’ve put together five ways you can ensure leaders and managers are contributing to crafting a winning company culture.

1. A culture of accountability helps motivate employees

Leaders who foster a positive corporate culture make accountability a priority.

Accountability is a major influencer in corporate structure and low levels of accountability lead to mistrust and low morale. 

In a recent study, 84% of employees say the way leaders behave is the most important factor affecting accountability.

Characteristics of successful cultures include employees and leaders who understand what’s expected of them and are held accountable for achieving these goals.

2. Fostering effective communication builds trust

It’s hard to reinforce accountability without effective communication.

Great communication between leaders and employees ensures everyone is clear about their roles, responsibilities, and where to get support and help. Good communications also allows employees to understand the clear standards by which their work is assessed. 

Communication should never be one-way. Your organisation should have multiple channels for employees to share their views and ensure their voices are heard by the leadership team. This boosts trust and integrity and increases morale. 

There’s data to support this. Research from Cultureiq.com highlights the link between communication and a winning company culture. It found that 84% of employees working at organisations with successful cultures said their leaders listened to them.

3. A culture of learning means employees are valued

A culture of learning is essential for a positive company culture, and this also starts with leadership. 

When leaders encourage an environment where everyone feels psychologically safe in sharing their opinions, this leads to more creative solutions and better decision making.

A learning culture can also help your organisation boost retention rates. According to LinkedIn, 94% of employees would stay with their current company if it invested in their career development. 

A culture where knowledge and skills are valued encourages individual career strategies for employees so that their growth becomes aligned with that of the organisation.

Companies with low cultures of learning experience higher turnover rates. In contrast, leaders who care about employees and their development see higher engagement, better retention rates, and increased productivity.

4. Employee buy-in comes from feeling appreciated 

Another way leaders can positively affect corporate culture is by encouraging recognition and appreciation. 

Recognition improves engagement by 15%, which in turn has a positive impact on your company’s bottom line.

5. Leaders’ behaviour encapsulates the company’s core values 

Core values are part of your company culture. But unless they’re consistently put into practice, they are simply words on paper.

A report by Mckinsey found that only 42% of employees feel their company’s purpose statement had any impact. This means that most companies are not successfully translating their core values into corporate culture.

If leaders don’t live those values themselves, it can undermine confidence between employees and the leadership team. A workforce that has low confidence in management is less engaged and less productive.

Ensuring leaders exhibit behaviours in line with company core values is the greatest indicator of a winning company culture. Research by Cultureiq found that 90% of employees at successful companies are confident in their leadership teams.

Optimise the role of leaders because a winning company culture affects all areas of your business

Engaged employees working in a dynamic and caring work culture are crucial to business success. That’s because a winning company culture permeates every aspect of your business. 

Boost your brand reputation

Leaders who adhere to your company’s core values not only inspire confidence from employees but clients as well. A positive company culture affects not just how an organisation performs, but how it’s perceived in the marketplace by others. 

Strong company cultures create brand ambassadors because current and past employees speak highly of the organisation.

Attract employees who share your culture 

A reputation for integrity and solid values puts you in the best position to attract top talent. It’s a tight labour market out there and having a strong culture that develops and invests in talent can give you the edge.

According to Gallup 71% of workers say they use referrals from current employees to learn about job opportunities. When those who work for you can genuinely recommend your organisation as a great place to work, your talent pool widens.

Enjoy higher retention rates and productivity levels

A successful corporate culture promotes happier employees who are 12% more productive. They know that leadership cares about their career development and wellbeing and this encourages them to stay and grow with the company. 

According to a Columbia University study, cultures has a huge impact on turnover rates. It found that organisations with a high company culture see employee turnover at 13.9% whereas in those with low company cultures, turnover is 48.4%.

Empower employees to make better decisions

Decision making is possibly one of the most important aspects in business. Poor decision making affects your bottom line and can destroy trust between employee and manager.

Research by global consultancy Bain & Company found that companies with winning cultures are 50% better at decision effectiveness.  

Key takeaways for optimising the role of leaders in shaping a winning company culture:

Culture affects every aspect of your business, so it’s worth investing time and effort to get it spot on.

A company’s success is closely linked to their positive corporate culture.

Leaders have great responsibility in helping to shape a winning company culture. Coming out top is that leaders must translate company core values into corporate culture through their behaviours.

Outstanding leaders guide employees to embody the organisation’s values, spreading the culture they want to shape.

Maximising artificial intelligence (AI) in recruitment

Did you know that replacing an employee costs two and a half times their salary, on average? AI recruitment can help to reduce costs by improving the quality of hire and making the recruitment process more efficient. Read on to find out how you can maximise AI recruitment benefits for your business. 

What is AI recruitment? 

AI recruitment is using artificial intelligence to shortlist the best candidates for a job in the fastest possible time. 

AI can analyse hundreds of CVs and feed hours of data into an applicant tracking system (also called an ATS). These are tasks that normally take up to 40% of a recruiter’s time. 

By using AI recruitment techniques, HR teams can spend more time engaging with prospective employees, improving the recruitment experience, and making sure the company secures high-quality talent.

AI powered hiring

AI has many different applications in the recruitment process including:

1. Identifying the right candidates
2. Communicating with candidates
3. Digital interviews

Let’s look at each of these applications in turn. 

1. Identifying the right candidates

AI uses an algorithm to find CVs that use the same keywords as those found in the job description. Once the AI program has narrowed down the CVs, it analyses each candidate’s work experience, education, training and qualifications against the job role. It then gives the CV a score.

AI can also:

• Gather extended data on candidates 

For example, AI can look at publicly visible social media profiles to take a deeper dive into a candidate’s work experience, skills and other qualities that indicate they could be a good fit for the role. This takes the data beyond the candidate’s CV. 

• Use internal data to find the best candidates. 

It does this by taking data from your company’s ATS to gain insights into the skills and experiences of the most successful employees in your company. 

2. Communicating with candidates

When someone goes to the effort of applying for a job, it’s demoralising if they don’t hear back. Keeping candidates informed about the status of their application leaves them with a positive impression of a business, even if their application isn’t successful.

However, keeping candidates informed takes a lot of time, which is where recruiter chatbots come in. They can be programmed to let candidates know the status of their application, to provide feedback, and to answer frequently asked questions. 

Chatbots can sound like a human whilst giving answers to questions instantly. They’re already commonly used in customer service with brilliant success. 64% of customer service professionals who use chatbots say it frees up their time to solve more complex issues.

3. Digital interviews

Digital interviews are being used increasingly for initial screening interviews. 

Candidates record themselves answering set questions, then AI analyses the answers they give, the language they use, their tone of voice and even body language. 

Digital interviews can be a useful way to shortlist candidates when there are a huge number of applications for a role. 

However, there are many pitfalls to overcome with this technology. People are more likely to feel confused and awkward because they’re not used to being interviewed by AI which will inevitably affect the outcome. 

It’s often argued that digital interviews facilitate candidates to be treated equally since there’s no exposure to human bias, but the opposite may be true. Digital interviews may disadvantage those who don’t tend to do well in standard interviews, for example, neurodiverse candidates.

Benefits of using AI in your recruitment strategy

The purpose of AI is not to take over recruitment but to free your HR team from routine tasks so they can build relationships with candidates and focus on aspects that require social skills like listening, empathising, and negotiating. 

These are some of the benefits of AI powered recruitment:

1. AI recruitment saves time

AI swiftly completes repetitive tasks like screening CVs, arranging interviews, and carrying out background and reference checks. This means you can find the right talent faster, which is a significant advantage in a competitive recruitment market.

Checking references can be particularly time-consuming because people don’t always answer the phone or read emails. AI automates the entire process and sends out reminders to referees so HR teams can get on with more complex tasks.

2. AI recruitment finds the right talent

Attracting the right talent is one of the biggest challenges for recruiters. 

AI can provide access to a greater pool of talent than you would otherwise have had. That’s because it can sift through significant volumes of ‘passive candidates’ as well as those actively seeking a new role. 

Passive candidates are an enormous group, so it increases your chances of finding the right person. 

Finding the best talent is essential for every company. When the wrong person is hired, productivity is affected and money is wasted on recruitment, wages and training. 

IBM, who created the Watson Candidate Assistant for recruitment, say that AI has saved their own company $1 billion in recruitment costs. 

3. AI recruitment spots talent within a company

It’s faster and more cost-effective to hire people internally than externally. AI can take information from your ATS and other recruitment and screening tools by matching existing employees’ skills and experiences to the roles you need to fill.

Even if AI doesn’t uncover talent for a particular role, you may find that the process reveals certain employees who have much-needed skills that have gone unnoticed.

4. AI recruitment prevents unconscious bias

It’s very difficult to prevent unconscious bias in the recruitment process because we all have preconceptions (whether we’re aware of them or not). 

It’s argued that by removing the human element, AI is the answer to this. AI can even check job descriptions to make sure language doesn’t communicate unconscious bias and put off prospective candidates. 

The problem is that AI relies on data and algorithms created by people, which means bias can still creep in. 

That’s exactly what happened at Amazon. They discovered that their AI algorithm was discriminating against women. AI was basing its selection process on data from CVs submitted to Amazon over the last 10 years, which were mainly from men.

5. AI recruitment takes over onboarding

AI can carry out most of the process of onboarding new employees. This not only saves management time, but it can be more convenient for employees. 

Companies sometimes delay induction for weeks simply because managers don’t have time. With AI, onboarding can happen straight away, shortening the time to hire. 

Plus, chatbots can instantly answer employees’ questions about the business at any time of the day.

6. AI recruitment carries out offboarding

When an employee leaves, a business offboarding needs to be thorough and swift. This keeps disruption to a minimum, and company information secure. 

AI automates the repetitive tasks of employee offboarding in a quick, systematic, and organised way. 

A smooth offboarding process can also help ensure employees leave with a positive impression. It’s important that an employee leaves on a happy note, not least because the business might want them back one day. 

According to Unum UK, 1.5 million workers are planning to return to their previous employer this year. Interestingly, these ‘boomerang’ employees usually out-perform other employees because they’re more satisfied at work. 

Hiring using AI: Key considerations

These are some key considerations if you’re thinking about AI powered hiring:

Risk of ATS bias 

Critically, an AI system needs to integrate with your existing ATS and other HR recruitment tech you use for screening, interviewing, onboarding, and offboarding. AI relies on the quality of the data you hold in these systems.

A report by Harvard Business School called Hidden Workers: Untapped Talent found that applicant tracking systems were preventing businesses from tapping into certain talent pools.

The report revealed that people with gaps in their work history, for example, were often discounted because it was assumed they lacked work ethic. 

However, there are any number of reasons why people have gaps in their work history. Crucially, this assumption meant suitable candidates weren’t making it through the screening process.  

In fact, the report found that many groups of applicants were automatically disqualified by AI recruiting software based on assumptions that wouldn’t stand up to human scrutiny. 

The report recommends that recruiters use ATS filters to find candidates with demonstrated skills rather than sorting by credentials only. 

Tackling data protection with AI recruitment

There are several data protection issues to overcome when using AI powered recruitment. 

To comply with both GDPR and the Equality Act 2010, decisions taken based on data mustn’t be discriminatory or biased. If there’s already bias in an ATS, then the AI recruitment system on which it’s based will be equally flawed. 

AI needs a reasonable amount of data to work well, but GDPR means that organisations must minimise the volume of personal data they hold. 

This is an issue that can be overcome, however, and the Information Commissioner’s Office (ICO) has published guidance on this and other AI data protection matters. 

Overcoming bias in AI recruitment – ICO25 guidance

The ICO has set out a new plan for what they aim to achieve by 2025, ICO25. 

Part of the ICO25 plan is considering how AI recruitment is negatively affecting candidates who haven’t been involved in the testing of AI software. This includes those from diverse backgrounds, vulnerable groups, and neurodiverse people.

A further part of the ICO’s plan will be ‘investigating concerns over the use of algorithms to sift recruitment applications’. For this, they’ll be providing ‘refreshed guidance for AI developers on ensuring that algorithms treat people and their information fairly.’ (ICO – Empowering you through information, p. 41)

To find out more about how ICO25 could affect how your business uses AI in recruitment, visit the ICO’s website.

Meet your hiring goals with AI recruitment

AI recruitment can help your business to make the best and fairest hiring decisions, as long as it’s based on high-quality data. It can also make the process more efficient, which saves time and money and enhances your company’s reputation. 

Financial literacy and financial education: What’s the difference?

We all face financial decisions every day. How we make these decisions is based on our understanding of money and financial habits. If you’ve ever wondered about the difference between financial literacy and financial education, and what they mean for your employees, then read on.

The importance of financial wellbeing is a topic we feel strongly about. We’ve already explored how financial education at work can empower your employees and boost their work performance. 

For this to happen, there needs to be a grounding in how finances work. And this is when financial education and literacy become important.

What is financial literacy?

When considering the question of what financial literacy is, there are certain overlaps with financial education. Those who are financially literate have a better understanding of their money and how to deal with both day-to-day matters and planning for the future.

When you see financial literacy at work, you observe people who make good financial decisions. They understand how to use their income so that they can save, manage debt, and create an emergency fund. 

Being financially literate means that, even with low levels of disposable income, people can make the right decisions about their money. 

Some behaviours you may notice from those who are financially literate include:

• Using a pay rise to improve their financial situation instead of increasing their discretionary spending (like extravagant living). 
• Ensuring that if they dip into an emergency fund, they refill it as soon as they can.
• Look for investment opportunities to grow their wealth.

More often than not, those who are financially literate don’t just live in the here and now. While they can enjoy the benefits that money can bring, they always have an eye on the future. 

Importantly, financially literate people typically have solid plans in place that mean that they budget and save effectively. 

Why is financial literacy important?

When looking at the difference between financial literacy and financial education, you may be left wondering why financial literacy is important. 

With financial literacy, people are well-placed to manage their money with confidence. They are in a strong position to navigate life’s financial bumps in the road. Plus, they can manage major financial issues.

Financial literacy is important when it comes to assessing important questions like how many credit cards to have, when to consider a payday loan, or whether to use Buy Now Pay Later. The choices people make when faced with these financial tools is a test of someone’s level of financial literacy. 

There are business benefits to financially literate employees 

As an employer or business owner, you’ll benefit from employees who are financially literate. Reports show that financial literacy at work leads to employees who:

• Have more focus at work (meaning increased productivity).
• Are less stressed (so they can concentrate more easily on work).
• Stay at their workplace for longer (so retention rates increase).
• Are absent from work less often (lower levels of absenteeism).
• Are prepared to invest in their own education and to upskill.

So is financial literacy a result of financial education? And what’s the difference between financial literacy and financial education? Let’s find out. 

What is financial education?

When considering the differences between financial literacy and financial education, there are some clear links. 

Financially educated employees are capable of making positive decisions with their money because they have developed knowledge of personal finances. 

Those who are financially educated may be more likely to have higher levels of financial wellbeing and be more financially resilient. That’s because they may have a full understanding of the consequences that their decisions may bring.

How are financial literacy and financial education linked?

With this in mind, it can be helpful to consider that financial education can be the stepping stone to financial literacy. This means that in answer to the question are financial literacy and financial education the same, the answer is no. But they are very closely linked.

This means that any activity that helps someone to increase their knowledge, understanding, or skills with money counts as financial education.

Financial education goes beyond practical actions. That’s because financial education permeates to someone’s thought patterns and behaviours. It also leads to a change in attitude in how someone handles and views money. 

Equipped with the correct financial knowledge, you can expect people to:

• Manage money well and have good levels of financial wellbeing.
• Know the basics of budgeting.
• Make better-informed financial decisions.
• Grasp the basics such as how to read a payslip.
• Understand how mortgages, loans, and credit cards work.
• Acknowledge that needs and wants are different.

Why is financial education important?

When looking at the importance of employee financial education, you need to consider whether financial literacy and financial education are linked. 

Having explored the benefits that come as a result of employee financial literacy, it becomes clear that employee financial education is just as important.

Without the basics of financial education, employees aren’t able to go out and make the informed decisions that financially literate people make. They would lack the knowledge needed to understand principles such as compounding interest, what makes a savings account attractive, and how debt works. 

Low levels of financial education can make it harder for someone to make positive choices with their money because they may not understand the consequences of their decisions. This can lead to financial choices that are not conducive to financial wellbeing. 

Some examples of this include using short-term, high-cost credit for unnecessary spending. Or even prioritising the wrong bills when things get a little tight and falling behind on important payments like a mortgage.  

The difference between financial literacy and financial education 

While some people may think that financial literacy and financial education are the same, they are in fact distinct from each other, with subtle differences between the two. 

Here’s the crux of it. For employees to become financially literate, they must go through the process of financial education. 

Gaining financial knowledge could be a formal process that takes place within the working environment. Or it could be something as simple as using their spare time to gain valuable knowledge and advice.

People form financial habits through repeated financial behaviours. Often, people observe family members’ financial decisions and use this as a basis for their own decisions. If these decisions are not well-informed, then it can lead to a cycle of financial stress. 

Designing your financial wellbeing strategy 

With the cost-of-living crisis biting, and with inflation at a 40-year high, being able to manage finances has never been more important. Of course, businesses are struggling with their own increased costs too. 

By designing and implementing a financial wellbeing strategy in your organisation that includes elements of financial education, you’re actively helping employees become more financially well. Helping your employees to understand the difference between financial literacy and financial education will empower them. By assisting your employees with financial education, and leading them towards financial literacy, you have a workforce who:

• Have a full understanding of what they earn and how they spend.
• Are confident of exploring ways to deal with financial difficulties without resorting to bad debt.
• Have clear plans about how they’re going to pay for retirement.

Of course, this all leads to your employees experiencing a better quality of life, but it also leads to them performing better in the workplace. Taking the time to consider the financial literacy and financial education of your employees really does lead to a win-win situation. 

The information in this article is for general information only. It does not constitute professional advice from Openwage. Openwage is not a financial adviser. You should consider seeking independent legal, financial, taxation or other advice to check how the information in this document relates to your unique circumstances.