New HR Legislation January-March 2013

Overview of important changes for business in HR legislation from January to March 2013 inclusive:

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1st Jan 2013: New Percentages for Pension Revaluation:

New percentages for pension revaluation are up; view the UK Gov Table of Pension Revaluation Percentages for revaluation percentages of occupational pension scheme benefits on or after Jan 1st 2013. Note that the revaluation percentages are now calculated by Retail Price Index – RPI (formally calculated by Consumer Price Index – CPI).

9th Jan 2013: Apprentice Minimum Wage Enforced for Employees under Apprenticeship Agreement:

The Apprenticeships, Skills, Children and Learning Act 2009 (Consequential Amendments to Subordinate Legislation) (England and Wales) Order 2012 amends the National Minimum Wage Regulations 1999 so that employees under apprenticeship agreements are entitled to “Apprenticeship National Minimum Wage Rate” (see table below).  Also, with this order, the Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations 2002 does not apply to apprenticeship agreements anymore.

Apprentice National Minimum Wage 2012-13: 21years old and upwards £6.19, 19-20 years old £4.98 and under 19 or in the first year of apprenticeship £2.65

Source & for more minimum wage rates: https://www.gov.uk/national-minimum-wage-rates

19th Jan 2013: New Motor Vehicle Driving Licences Validity Period and Medical Test Requirements

For all licences issued on or after 19 January 2013, those for Group 1 categories (cars and motorcycles) must generally have a validity period (AVP) of 10 years, and those for Group 2 categories must generally have a 5 year validity period (although shorter AVPs on grounds of age or disability are permitted).

For Group 2 categories, new drivers from 19th Jan 2013, (and anyone renewing their licence over 65) will be need to provide a medical examination report to confirm they meet medical standards for driving these vehicles; renewing the licence under 45 will require signing a declaration that they are still fit for duty. More information can be found at www.nidirect.gov.uk.

Make sure your drivers aren’t caught off guard by the legislation!

1st Feb 2013: New tribunal award limits:

The Employment Rights (Increase of Limits) Order 2012 increases the limits applying to certain employment tribunal rewards (and other amounts payable under employment legislation) given for events occurring after 1st Feb 2013. Events from before 1st Feb 2013 leading to tribunal rewards are limited by the previously in force Employment Rights (Increase of Limits) Order 2011. (See table below for a summary of important award limits).

Tribunal Awards Limits from Events Before/After 1st February 2013: Situations: Unfair dismissal (before £72.3k, after £74.2k maximum); Unfair dismissal or selection for redundancy on grounds of union membership or activities (before £5.3k, after £5.5k minimum); Unfair dismissal of an individual on grounds of the individual performing (or proposing to perform) functions as a representative (or candidate) for health and safety or trade unions or as a trustee for a relevant occupational pension scheme (before 5.3k, after 5.5k minimum). Payment to an employee for calculating basic awards and various additional awards: In respect of any single day’s pay (before £23.50, after £24.20); In respect of a week’s pay (before £430, after £450).

Source & for more tribunal award limits: http://www.legislation.gov.uk/uksi/2012/3007/schedule/made

Also, the Enterprise and Regulatory Reform Bill (due in February 2013) is expected to amend the formulae for various tribunal awards and statutory redundancy payments, rounding awards to the nearest pound.

8th March 2013: Unpaid parental leave increases to 18 weeks:

The Parental Leave Directive 2010 (postponed enforcement until 2013) increases the right to unpaid parental leave from 13 weeks (three months) to 18 weeks (four months) from 8 March 2013. This unpaid leave can only be taken within the first five years of the child’s life or in the case of adoptive parents within the first five years of the adoption or by the child’s 18th birthday (if it is sooner). For more details on Parental Leave, check out www.acas.org.uk.

March 2013: Enterprise and Regulatory Reform Bill:

In March 2013 the Enterprise and Regulatory Reform Bill is due to:

  • Repeal a provision of the Equality Act 2010, which provides that the employer will, in certain circumstances, be liable where an individual is harassed by a third party (such as a customer).
  • Amend Tribunal procedure in discrimination cases, requiring employment tribunals to order an equal pay audit where an employer breaches the equal pay provisions under the Equality Act 2010 (except in prescribed circumstances).

March 2013: DBS Checks (formerly CRB checks) Become Portable:

Independent Safeguarding Authority (ISA) and the Criminal Records Bureau (CRB) functions were transferred to the Disclosure and Barring Service (DBS) on 1st Dec 2012. Formally known CRB checks are now obtained as DBS checks from the DBS. Expected March 2013 (as per the Home Office Business Plan 2012-15), once a DBS check has been completed, the results will be portable (available online for employers to confirm that no new information has been added since the check was originally conducted). This will enable an employee to not require a new check every time he or she starts a new job.

Fast Forward to April:

There are even more changes due April including all new: employee-shareholder contracts; collective consultation period; responsibility for real-time payroll Information; statutory payments; and much more, look out for our overview of April changes closer to the time!

Factsheet: HR: New Legislation January-March 2013
This information is provided for reference only – no liability accepted. All registered trademarks recognised. E&OE.

HR Policy: Why Promote Gender Diversity to Top Management?

Are you trying to convince board members that levelling the male to female ratio in top management is not just about portraying gender equality and equal opportunity? Or considering the promotion of gender diversity to top management in your own company, but not certain how much resource you can ‘afford’ to use on the change? Then this factsheet on why promoting gender diversity to top management may be just what you need!

Just diversity?

A socially diverse team is more likely to question and amend ideas to suit more types of people before releasing a more effective ‘finished product decision’. As with including any social diversity in a team, including both males and females brings together a wider range of knowledge, skills and points of view and so improves team abilities, especially in the case of the decision making process. A ‘culture club’ management team (of very little social diversity) may come to a decision very quickly but with very little distance between the original idea and the ‘finished product decision’ it is likely to fall short of the success it could have made with more varied input. However, having a ‘token’ female on the management team is not enough, as including females in top management is not ‘just’ about social diversity, some other factors to consider follow.

Understanding Important Players:

p>The two main groups (important players) that top management teams need to understand are the customers and the employees; how best to communicate with them, engage and persuade them. To best understand a target audience, and how to effectively complete the tasks above, the team should either mirror the audience demographic or include individuals with strong empathy skills. Looking at the statistics for these important players; 50% of workers are females and 70% of household purchasing decisions are driven by females (TCAM 2009), therefore a management team of 50-70% females would be expected to be more successful than other management teams. Similarly, when looking at studies of female/male empathy skills, generally females show a higher competency than males, concluding that a management team with a higher percentage of females is more likely to be successful.

Complementary Gender Skill Sets:

It’s not just empathy skills that generally differ between males and females. A recent study (2012) showed that males and females generally have polar opposite leadership strengths and weaknesses suggesting that the natural styles of males and females are complementary.

The female leadership style has been shown to be more social with stronger interpersonal leadership competencies: scoring higher in planning, managing and organizing activities, respect & empathy for others and personal responsibility. The study also showed that generally females are good at prioritising and multitasking, tending to meet deadlines and deliver on promises, and are socially-sensitive and good listeners.

The male leadership style was shown to be more strategic and visionary: scoring higher in strategic vision, commercial focus and personal impact. The study also showed that males are generally good at making a strong first impression, expressing views with confidence, being visible across the organisation and making their presence felt. Less socially-sensitive, males tend to be more focused on the rational, practical and commercial aspects of achieving results.

By creating a management team with a more even split of males and females, a balance of the general strengths and weaknesses of the male and female leadership styles can be reached, ensuring effective team performance in all leadership areas.

Brand Image:

More social awareness and higher empathy levels brought to top management through a higher percentage representation of females can have a further knock-on positive effect on brand image. While males are more likely to focus on the profits that can be made by an idea with a mind to put in place corrective measures if problems occur, presence of females beyond the token sense in top management would mean the team is more likely to take into account risk assessment and prevention before passing a decision. This in turn reduces the negative impacts that the company has on the environment and communities within which the company functions improving the brand image.

The Bottom Line:

The real business savvy question is of course, does putting time and effort in to introduce HR Policies to increase the percentage of females in top management really make a difference to the bottom line figures? Some may say that the current setup has always worked, and is still working just fine. However, empirical studies over the last few years are showing results worth making a fuss over; showing a strong correlation between business performance and female participation in top management:

  • Studies 2007: Companies with more females on the board and in top management showed considerably higher return in sales (+42%), on invested capital (+66%) and on equity (+53%) – Catalyst, and had a higher chance of gaining strong stock market growth among European companies – McKinsey&Company.
  • Study 2009: Companies with at least one female on the board cut the chance of going bankrupt by 20%; having two or three females lowered the chances even further – Leeds University Business School.
  • Studies 2011: Companies with 19-44% females on the board had higher return on invested capital (+26%) than companies with zero females – Catalyst. Companies with females on the board had higher operational profits (+56%) than those without – McKinsey.

So with all this evidence pointing towards needing more females in top management why are they not making it through?

Untapped Female Resource:

There isn’t a shortage of female talent in the UK: – At the moment, six out of ten university students are female and females are consistently showing better grade averages. However, while 50% of the UK workforce is female, they make up less than 15% of top management. It appears that currently a large pool of female talent is being largely unused. Many companies are already taking steps to improve their male to female ratio in top management. Don’t get left behind! Make sure potential female candidates in your company for top management are not being over-looked or left behind due to inappropriate incentives; bring their skills and knowledge to top management before a competitor steals them!

Check our factsheet paired with this on for more information on How to Promote Gender Diversity to Top Management in HR Policy.

Factsheet: HR Policy: Why Promote Gender Diversity to Top Management?
This information is provided for reference only – no liability accepted. All registered trademarks recognised. E&OE.

HR Policy: How to Promote Gender Diversity to Top Management

During the 15months since the Lord Davies Report in 2011 the percentage of female non-executives on FTSE 100 boards increased from 15.6% to 22.4% while the percentage of female executives is still abysmal at 6.6%! While it appears that companies are finding it relatively easy to outsource to bridge the female gap in non-executive board positions, the ability to find and nurture female talent up through top management to executive positions appears to be lacking.

Not certain why gender diversity in top management is important? Check out our other factsheet HR Policy: Why is Gender Diversity Important in Top Management? Continue reading for how HR Policies can help to improve your company at promoting gender diversity up to top management.

Create an effective HR Policy Plan:

To be effective at promoting gender diversity the HR Policy Plan needs to work from three directions:

  • Monitoring and periodic evaluation of the gender equality and diversity in the company from entry level to on the board; identifying where gender diversity is going awry and the causal inequality barriers, measuring the effect of current and any additional HR policies employed and ensuring that good HR policy is kept and ineffective HR policy is improved.
  • Building and delivering the case for gender diversity to ensure that adjusting the gender balance is not approached as a numbers game of filling quotas but as an opportunity and requirement to diversify the abilities of the top management team.
  • Take action and make policies that break and overcome the inequality barriers causing the gender in-balance starting at the most damaging barriers within your company indicated by the monitoring and evaluations.

Monitor & Evaluate the Effects of current and additional HR Policy on Gender Equality & Diversity:

The only way to understand when, where and what the most damaging barriers are against gender diversity in your company is to monitor the progress of gender diversity and equality within your own business. Following this, as HR Policy is put in place or changed to improve the situation, monitoring needs to continue so that the ‘improvements’ can be evaluated to ensure they are doing their job or if further tweaking is required. Although not an exhaustive list, a few suggestions for factors to consider for monitoring (and why) follow.

  • The ratio of males/females at each level of progression through the company structure from entry level to senior management – This can help to identify where gender diversity is dropping in your company and so where the most damaging barriers to success are acting.
  • The gap (if there is any) between male and female approximate pay/hour for similar levels of job responsibilities (disregarding the amount of hours per week total worked as this has no leverage on the value of the work done per hour) – This can help to identify where/if the company pay scheme may be unfair and a possible cause of the loss of gender diversity.
  • The ratio of male to female applicants for new positions – This can help to identify if jobs are appearing more attractive to one gender than another.
  • Gauge existing opinions towards gender roles and abilities in management and/or barriers to gender diversity in top management (maybe through anonymous questionnaires) – Although the opportunity to do this well would be reliant on company size, this can help to identify any existing bias that the case for gender diversity needs to address and may also shine light on specific barriers that are the most felt in your company against gender diversity.

Build & Deliver the Case for Gender Diversity in Top Management:

Magical Quotas:Before putting in place magical quotas to aim for gender equality in top management it is extremely important that these quotas are not seen as free ride tickets for females to the top, or as a requirement for filler positions for conformance with equality laws. In either of these cases the females that do make the cut to management may be undervalued by their peers and subordinates losing the positive effect being aimed for and ensuring that the business is not improved by the efforts made to diversify. Another three fold division of labour is needed here as employees, managers and share holders all need to be convinced that the changes are for business improvement and not for token equality measures to ensure that the change is most effective.

Share Holders: Obviously if you want to fix this age old problem successfully it is going to take resources, and your share holders are going to want to know that these resources are being used for a reason they like. The bottom line (in our ‘why’ promote diversity factsheet) may well be the fastest and most effective reason to convince this group that the resources are most certainly worthwhile.

Managers: Your managers are your eyes and ears for searching for new talent to come up through the ranks. As such you need to ensure that they are on board with your plan of change and improvement for the future. As discussed in our why promote diversity (complementary gender skills), male dominant abilities tend to give them an advantage for being noticed in the company as achievers whereas more female dominant abilities (that are also important for management) can be easily overlooked. Based on this it is important that your managers understand all the skills and abilities that they need to be looking for in candidates to help to make sure that they are not overlooked so easily.

Employees: The questionnaires may help to bring to light some of the bias present in your employees towards gender diversity in management that may need to be combated subtly to ensure that male and female management figures are taken seriously with equal importance. It is also important to educate all employees of all the skills wanted from candidates for management as many females in your employment may be management material but don’t know it and so won’t apply for the positions. With very few role models about to show the more dominantly female management skills in action it would be easy for a female to feel that she is not up to the task of applying for management as they do not have the skills seen in the current male dominated management.

Take Action and Create HR Policy to Break and Overcome Gender Diversity Barriers

Now you have everyone reading from the same page it may be useful to set your company a target to meet for improving the male to female ratio in your top management so that you have something to work towards. More importantly though is to look to barriers beyond existing bias among your company members, barriers in place by your own HR Policy. The questionnaire may bring to light some barriers that are of poignancy in your own company but even without a questionnaire some things that come up regularly in the papers and gender equality blogs may be things to look at within your company. The following list, again not exhaustive, contains some of the areas in which you may be able to help even the playing field between males and females to help promote gender diversity through to top management:

  • Equality of pay/hour for similar work responsibilities (regardless of hours per week worked) – as females regularly have to take part-time work to be able to work around child responsibilities that aren’t expected of males. Being paid less for the same work means you are more likely to change jobs until finding a company that shows your skills are valued rather than the time per week you can give.
  • Availability of flexible work hours or work from home where possible – again this would help for females where certain shifts are impossible around child responsibilities leaving females no choice other than to move job. It has also been shown in polls and studies that employees would be happier and more productive with flexibility in shift hours and/or the possibility of some work from home so this arrangement could be a double edged winner!
  • Improve handling of maternity leave, for example treating it more like a sabbatical or long term sickness rather than a ‘lack of commitment’ to the workplace – maternity leave is said to have two effects: Firstly, females coming back from maternity leave are can be either not ready to jump in at full speed at first and may crumble if put under too much work pressure or on the flip side may feel undervalued for their capabilities if they are left out of the loop with activities as employees have adapted to not using them as a ‘go to’ while they were absent. In both these cases sufficient support is needed to ensure that on returning the employees re-integrate comfortably with the company (so they do not feel the need to leave) and continue their progress as high as they can get in the company (especially as working mums are likely to be improving their management skills in their free time almost constantly with children and a household to look after).
  • Use your advertising for top management to create attainable role models for female management traits. Maybe even set up a campaign within your company to find candidates and train them for fast track to the management positions they should already have made it to if the company had fixed the issues sooner! – You may not be able to provide female-dominant-trait role models right away for females to aspire to and recognise their leadership qualities through, but by being a bit clever when you advertise your top management positions you can create a visible attainable role model in theory at least, and with a bit of fast track training for top candidates you may even get the ball rolling a little faster with real role models.

Be Proud!

As a very final point, I feel it’s important to mention that (although in the UK we are still way behind many countries in our gender diversity in top management) taking on this age old issue is something to be proud of: It not only improves your company but helps to increase equality in society and that is something worth shouting about! So it makes perfect sense to make sure that you are open about your efforts to improve your company’s gender diversity in top management and to release your successes in the matter and make sure everyone knows that you are getting ahead of the game!

Factsheet: HR Policy: How to Promote Gender Diversity to Top Management
This information is provided for reference only – no liability accepted. All registered trademarks recognised. E&OE.