Archive for the ‘Human Resources’ Category

Why are there so many employment tribunal claims?

Tuesday, June 15th, 2010

It never ceases to amaze me how many companies lay themselves open to employment tribunal claims. 

The Department for Business, Innovation & Skills (BIS) recently revealed that 20% of business owners are worried that they are getting their employment obligations wrong, while a further 34% believe that employment legislation is not relevant to their business.  That adds up to a high proportion of employers at risk of infringing employment law.

It comes as no surprise therefore that the most recent Employment Tribunal statistics (to March 2009) show that claims have rocketed again this year to 266,542 – a rise of some 40% - the cost to employers was £2.6bn 

Whilst it would be inprudent of me to tell you that its is possible to eliminate the chance of a claim it is definately possible to minimise the risk or mitigate  the impact of any claim by taking a few basic precautions and ensuring that your employment contracts comply with the lastest employment legislation.

Never let it be said I’m not a generous man.  Click here for a bit of free consultancy and your own copy of Employment Legislation – 10 Ways to Mimimse your Risk  Exposure.

Mike O’connell, CEO, Isosceles Finance

 

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Trials and tribulations of the Venture Backed Turnaround – Part I

Tuesday, April 27th, 2010

Being a venture capitalist must be one of the toughest jobs going – you are as popular as a traffic warden who used to be an investment banker.  Your odds of success are probably no more than one or two projects in ten.  Although you perform as much due diligence as you can, you are still more or less reliant upon the representations that the management team make.  If you are successful no one likes you, if you fail you deserved it.  Yet without this very important source of capital, some of our largest and best companies in the world could never have made it – Google, e-bay, Amazon.

I believe there are only three ingredients to a successful venture-backed business excellent people, timing and luck.

Mike O’connell, CEO, Isosceles Finance

To be continued ……….

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What is in store for 2010?

Wednesday, February 3rd, 2010

It is a shame the start of the business year has been interrupted by the weather.  A strong December trading performance will have been somewhat diluted by a poor January.   Although seeing the number of Dad’s sledging last week, people may be returning to work relaxed and happy having had a bit of quality time at home outside of the Christmas rush.

This year will be dominated by politics and the economy.

Whilst the private sector has swallowed its medicine with the minimum of fuss and the maximum of fortitude during 2009 the public sector had been spared.  Not only have the public sector been spared actual cuts, but they have not even had their expectations properly set.  Alastair Darling has fallen out with Gordon Brown because he won’t even talk about the massive cuts coming.

The indications are that we will have a period of industrial relations turbulence.   If the unions at BA (I know they are privatised, but they still think like public servants) can’t wake up and smell the coffee it is a bad indicator for what is to come.

An insolvency practitioner friend of mine told me the insolvency courts were full of winding up orders at the end of 2009. The reason being that HMRC were treating companies with kid gloves in the first half of 2009 but in the second half their attitude changed  – no more Mr Nice Guy.  The significance of this is timing, the companies which are being wound up actually failed in the first half of 2009, however the news about their winding up will only surface over the next few months. 

The worry is that the news about more company closures, public sector cuts, higher taxes and industrial relations strife will sap confidence.   The reduction in public spending will also reduce the amount of cash swirling around in the economy.

Overall I am optimistic, but not confident in the prospects for 2010.  The difference between 2009 and 2010 is that we have an idea of what is coming, at this time last year we didn’t know whether the sky was still about to fall in.  We know this year is going to be tough, we know there will be public sector cuts, a change of Government with little latitude to make a big changes.   We also have the confidence of knowing we can come through a year like 2009. 

This is the year of the “Grind”, where good companies and good management teams grind their way from survival to growth.

Mike O’Connell, CEO, Isosceles Finance

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You’re Fired!

Tuesday, July 14th, 2009

My eleven year old son has been an avid follower of this season’s Apprentice.  He is eager to pick up knowledge of the ways of business, man management and team play.  Isn’t it interesting how we take pleasure in watching a program where if an individual makes a business mistake they get fired?  Current legislation, however, doesn’t make it that easy.   In the real world Nick and Margaret would meet with the candidate informally to ascertain whether there were factors affecting performance.  Should Sir Alan be doing anything else to support the candidate – perhaps some training?  In the board room session we would finish with Sir Alan, Margaret and Nick agreeing SMART objectives and a specific improvement plan together with the candidate.  Sir Alan would turn to the candidate and utter “with regret”, point to the candidate and proclaim “you’re on review”.

Ironic isn’t it that as a society we readily adopt a “you’re fired” mentality, but legislation is taking employment regulations in the opposite direction.  What is the right answer?

Right now businesses need flexibility more than ever.  Roles need to be made redundant in order to save money and save other jobs.  Like it or not businesses managers will try to select those individuals whose performance is sub-optimal, those with poor attendance records, those who are difficult to manage first.  Legislation does not allow companies to confuse the two issues and can make the process for both employee and employer too long.

I have great sympathy with smaller companies, who do not have the breadth of business to cope with the current downturn.  It needs to be easier for those companies to adjust their workforce quickly.  Although the Government is being lobbied by organisations such as the CBI, current legislation  needs to reflect the fundamental change in economic conditions and quickly.

But before Managers start shouting “you’re fired” at their staff, they should take note that employees are being very supportive to their employers right now.  Many of our clients have been able to negotiate pay cuts for senior managers and staff in order to save jobs.  Employees have accepted pension holidays, benefit deferrals in the interests of helping their employer.  I have never experienced a more pragmatic work  force. 

Mike O’Connell, CEO, Isosceles Finance

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