Waving, Not Drowning Is there or isn’t there a recession? Is it just a figment of the media’s imagination? And can your business afford to take the chance that it is not? Here are a number of HR tips to help keep your company recession proof.
Keep recruiting
Most of the time, economic downturns are short-lived so keep the bigger picture of long-term growth in sight. Keep your nerve. It's easier to invest training time for new recruits during slower growth periods. It’s also worth remembering that if you dismiss employees during a recession, you will have to appoint someone to take their places when times get better — and that can cost companies a lot more money in the long run.
Don’t recruit a problem
In the first instance, it’s essential, in tough times, to ensure that you’ve got the right people working for you. The recruitment process should be conducted with rigorous thoroughness.
There are three key areas to note:
- Legal requirements
- Best practice
- Collect facts
Do make sure that you ask questions that are relevant to the job being recruited for and don’t be afraid to build in some testing. Some excellent CVs don’t hold up under scrutiny. Once the candidate was tested and evidence collected to see if he/she could deliver the skills claimed, the results were both surprising and disappointing.
Apportion your resources wisely
Limit activities with limited business purposes. Instead, organise a sales or other company meeting with a clearly defined profit purpose. You can make it fun, for example, using a suitable speaker. Create specific individual performance requirements from the meeting.
Reduce expenses that don’t add value. Instead include low-cost but high-impact benefits at a time when the rest of the business world is cutting back.
Keep talking
Be honest with employees about difficult times. Let them know how you’re doing so that they understand the true financial picture. Often employees are willing to make cuts and changes when they understand the facts. There are no winners if the business goes down. Talking clearly and honestly with your employees also helps to reduce the rumours flying around the workplace.
See the silver lining
Give employees positive feedback whenever you can. Acknowledge when a job is well done, and consider non-cash incentives. It can make a big difference to employee motivation.
Irrespective of the financial climate it’s reasonable to ask employees to do their best. If they’re not performing to their full potential, a suitable performance appraisal, encouraging input from both parties, can be useful.
Employee power!
OK, so the tin hat may have come out, but you’re still here. Use this time to work positively with your employees. Focus on your costs, differentiation and value advantages. Know your core competencies –the things you are really good at – and take steps to optimise them.
Allow your employees to contribute to and manage the solutions that will drive success in a recession. When asked to participate, employee feel more valued, and are more likely to accept proposed solutions. More gets done with fewer people, ideas are more creative and employees feel more valued. So don’t cut back. Build a strong problem solving team.
Can you afford to throw money down the drain?
Chink-splosh! Chink-splosh! Chink-splosh! I know an awful lot of employers who just won’t tackle employment problems. And if you don’t tackle employees who aren’t performing, or who have chronic Mondayitis, you might just as well chuck money down the drain. It’s bad business and it’s very bad for the morale of the majority of your hard-working employees.
Keep up to date with employment law
Just because there’s a recession it doesn’t mean that employment law stops developing. Look for cost-effective ways of keeping up-to-date – sign up for free newsletters and subscribe to great value products or services which cut your costs, but still keep you up-to-date with practical information and advice, keeping you abreast of the ever changing employment law.
Keep on training your people
All the research shows that the companies who weather the storm best perform better because they keep up their training. It doesn’t have to be expensive classroom training. There are so many cost-effective alternatives – buy a book (or series of books), arrange virtual classroom or online training, encourage employees to be seconded on to other projects or work outside their usual sphere of activity.
Reward your employees
Be flexible about rewarding employees. There is no legal right to a pay rise. If you have a bad year you may not be able to give a salary increase. Think creatively about other things that you can do at little or no cost to thank your employees.
Redundancy
None of us want to make people redundant, but It is occasionally a necessary evil. Redundancy is a dismissal. You need to follow the correct process for selection and dismissal otherwise you may find that you face a claim for unfair dismissal.
For more information and free resources visit our website www.russell-personnel.com
About the author
Kate Russell is a Human Resources expert. She specialises in employment law and practical problem solving in the workplace. A qualified barrister, she worked in industry before setting up her own business, Russell Personnel & Training, which through the HR Hotline and a variety of other activities, delivers robust and practical HR solutions.
Kate’s unusual combination of legal training, line management background, and hands-on HR experience has resulted in her being an accomplished advisor and trainer in employment law. She is a charismatic and entertaining speaker, and her brisk no-nonsense style has earned her the nickname ‘The Headmistress’.
Kate delivers a variety of employment law training courses. She is the author of several successful books, and records a quarterly audio update called ‘Law on the Move®’.
