Connect with us

Increasing Productivity

Working with Employees for Sustainable Businesses

Government’s proposed labour law adjustments and an out-of-touch attitude towards the realities of day-to-day business are a matter of concern to local companies.

Nadine Todd

Published

on

Work_Sustain_Business

While employees are the most valuable assets business owners have at their disposal, severe Governmental legislation and red tape can often do more harm than good – for employers and employees alike.

According to Advocate Saleem

Seedat, convenor of the Certificate in Practical Labour Relations at Wits Plus, many entrepreneurs and business owners view labour relations as a diabolical instrument that should be shoved into the footnotes of a business plan. “Employers harbour a pathological fear of any issues that even suggest some kind of disciplinary measure,” he explains. “In South Africa, labour relations should be part of the arsenal of any entrepreneur. It is not something to fear, and should be an area entrepreneurs make a point of understanding. Your labour force can be one of your greatest assets. Understand their rights – and educate them on yours. Together you can create a sustainable business.”

Seedat points out that just as employers shy away from labour relations, employees have an attitude of entitlement. “Employees forget that fairness applies equally to employers. For a business owner to create a successful labour relations policy it is vital that the lines of communication are opened between employer and employee and that everyone understands the others’ rights and expectations.”

Proposed labour laws

Unfortunately, many of Government’s proposed plans are more likely to make business owners skittish than open channels of communication with their staff. For example, local business has recently criticised Government for its proposed labour law adjustments. Is this fear talking or are there real reasons for business to be worried?

It appears the fear is in fact justified. Business owners face the prospect of being weighed down by more red tape than ever before when they hire staff, if the proposals to overhaul the labour laws are enacted. These proposals include the effective banning of labour brokers, the outlawing of temporary work and the fining of employers who don’t report firm vacancies to the Department of Labour (DoL). The period for submitting public comments came to an end in February.

A regulatory impact assessment (Ria) by local policy analysts concluded that if the proposals were made law in their present form, employers would steer away from taking on new employees or retaining existing temporary staff, putting thousands of jobs at risk.

If the proposals are made law, employers that rely on contract workers to fulfil projects will have to argue their case to the DoL for hiring temporary employees, as, by default, all employees will have to be made permanent. In addition, business owners running more sizeable operations will risk fines if they fail to carry out employment equity quotas.

Vacancy fines

The proposals also include the setting up of a state employment services portal (under the Employment Services Bill) which will act as a massive job placement database.

The bill proposes to make it compulsory for employers to report any vacancies in their firms to the department within 14 days. Employers that fail to do so can be fined up to R10 000.

The department believes that employers will use the portal to fill vacancies in their firms and justifies this by singling out a similar portal in Sweden where employers are fined when they fail to report vacancies.

The bill aims to “improve labour market inefficiencies” with the aim of combating unemployment. The problem is that it comes off as ‘big brother’ recruiting employees on behalf of employers. Will businesses be forced to hire employees they do not necessarily need simply because the post was filled before? One of the few benefits of the recession has been business tightening its belt, becoming leaner and more efficient and doing away with redundant and inefficient employees and positions.

Another worrying point about this particular proposal is that it hasn’t actually worked in Sweden. The DoL’s head of employment services, Zodwa Mabaso, has publically conceded that a Swedish official has advised her department against levying fines, pointing out that in Sweden fines had only succeeded in clogging up the Nordic country’s courts as resolute employers sought to challenge the fines.

Out of touch

The proposals reveal how out of touch Government appears to be when it comes to creating and enabling business environments. During the economic development portfolio committee’s public hearings on SME Finance late last year, some MPs asked business owners whether they had considered turning their businesses into cooperatives. These are entrepreneurs who have taken it upon themselves to start a business and put their families and homes at risk to finance their start-ups. Now they are being asked whether workers shouldn’t be given an equal share in their business.

Government does have a point: Employees who have a stake in the business’s success are more likely to perform and will benefit economically. Everyone wins. But the suggestion does raise the spectre of government seizing ownership of private assets a la Zimbabwe. Are these fears justified? And even if they aren’t, is it fair to ask entrepreneurs to simply give away shares in their hard-earned companies? Is this in any way supportive of an entrepreneurial spirit in South Africa? The issue of finance is no better. In the last five years Khula has been running a 42% default rate on its guarantee scheme, while a similar scheme in India had a default rate of just 2,5% over the same period. An ANC MP excuses the record with the oft-repeated mantra: “But we live in a developmental state.” It seems to suggest that business owners shouldn’t worry about paying back state loans because it’s Government’s job to bail you out. A DA MP’s point is just as worrying. He seems more concerned that increasing Khula lending through the banks might place the local banking system at risk, than that Khula has never lent out more than 800 guarantees a year in its over 14-year existence.

Taking action

As Barrie Terblanche, author of Starting Your Own Business in South Africa, puts it, Government seems to think that all businesses, even small, are solid entities. You can tax them, make them sell a cut in a BEE transaction or turn them into cooperatives and they won’t close shop. The reality is of course quite different – and often the cause of business owners resenting Government, its laws and fearing the murky waters of labour relations.

Business owners need to take action. First, take a close look at your business and see where you can improve labour relations. The proposed laws might come into effect or they might change, but use this as an opportunity to scrutinise the way you do business. Labour relations are nothing to fear, as long as you know your rights as an employer, and what you should be offering your employees. Alternatively, if, as a business owner, you want to take action, the best thing you can do is write to the DoL outlining how many jobs you would have to cut should the labour law amendments be enacted, or for that matter, if any other anti-business proposal threatens to make it more expensive or difficult to run your own business. Entrepreneurs are the life blood of the gross domestic product and their businesses should be encouraged to thrive. This should not be achieved at the detriment of the local labour force, but threatening the livelihood of business is no solution either.

Proactive Solutions

Amidst the doom and gloom there are some things business owners can do to improve their labour relations. Saleem Seedat outlines a few steps you can implement today:

  • Understand that Government’s proposed bills are just that – proposals. There is a swell of opposition and they are unlikely to be implemented in their present form. Do not have a knee-jerk reaction to something that hasn’t happened yet.
  • Try instead to view your relationship with your employees as a partnership. If you are antagonistic towards them they will be antagonistic back. Remember that without your labour force you have no business and try to be accommodating instead. Once your employees buy in to the fact that a sustainable business means job security and growth for them, you can build a trusting relationship.
  • Be open and honest with your employees. Explain how your business works and your objectives. Allow them to believe you also have their best interests at heart.
  • Unfortunately unions can be militant. They need to be seen as vocal and aggressive by their members. This stems back to the 80s when they were at the forefront of the struggle, and certain tendencies have not yet changed. This militant behaviour means that they push for extremes but do not always educate their members. Many employees do not know their rights. They also do not understand the rights of their employers, and carry a sense of entitlement that is not always accurate.
  • If your employees feel they can trust you, talk to you and that you have their best interests at heart, you will immediately have a better relationship with them. Build this relationship now and the new proposals need not have an adverse effect on your business.
  • One way to improve productivity is also to offer performance bonuses. These can be based on quality, outputs, whatever suits your business model. Even if you pay minimum wage this is a way to give your employees a reason to work hard and feel connected to the business’s success. Help them understand that better productivity equals a better business and more money for everyone.

In a nutshell

What the future might hold

The DoL’s labour law proposals, which were released late last year and closed for public comment in February, include:

  • Regulating contract work by putting a stop to the practice of repeated contracting for short-term periods. The onus will be on employers to justify the use of short-term or fixed-term contracts (Labour Relations Amendment Bill).
  • Temporary employees or those on fixed-term contracts will be expected to qualify for the same benefits as permanent employees (Labour Relations Amendment Bill).
  • Labour brokers will only be able to perform recruitment services on behalf of clients and will be prohibited from paying benefits and wages on behalf of the client.
  • Designated employers (defined by annual turnover with for example Community, Social and Personal Services being R5 million) that don’t prepare and implement an employment equity plan can be taken to the Labour Court and fined between 2% and 10% of their turnover.
  • Designated employers with less than 150 employees must submit an employment equity plan to the department once a year, instead of the present once every two years.
  • Employers must register all vacancies in the workplace to the department within 14 days or face fines of up to R10 000 (Employment Services Bill).

– Stephen Timm

Nadine Todd is the Managing Editor of Entrepreneur Magazine, the How-To guide for growing businesses. Find her on Google+.

Advertisement
Comments

Company Posts

Why Incentives Are A Must For Your Business

Incentives are a game changer. Find out just how influential a successful incentive programme can be for your team and your business.

Uwin Iwin

Published

on

uwin-iwin-incentives

To be at the cutting edge of incentive programme design and execution, Uwin Iwin International, one of the incentive leaders on the African continent keeps a close eye on the incentive industry, thereby ensuring that we offer the very best in incentive solutions to our myriad of customers. We have recently embarked on a research project and would like to highlight an interesting finding uncovered by Ask Afrika, our research partner. The question we look at this time round is, “Do companies actually find incentives useful?”

Recognising Value

The following figures give a good picture of how employers see the value of incentives into their respective organisations:

  • 74% of respondents recognise that there is a need for a incentive programme, citing that: it motivates employees, helps employees feel valued, helps employees reach goals, assists with employee retention, and helps with financial burdens.
  • One respondent noted that whereas the market for incentives was considerable, “a lot of companies are not getting [incentives] right” despite having a programme in place.
  • Respondents further acknowledged that small and struggling companies should implement an incentive programme, even if it is informal and the rewards offered are small.

Our buying analytics have also picked up that between the period of the 25th to the 11th of each month, incentive spend is focused on mainly personal rewards and after the 11th, spend is directed towards mainly food retailers. This shows the value of an incentive during more strenuous times, as it adds some relief to certain tough periods.

Related: End Of Year Slump? Now’s The Time To Pull Out The Right Rewards

Why you need incentives in your business

Cost-cutting is common during an economic downturn, but be prudent when applying this to incentives. As the research indicates, incentives provide motivation, increase revenues and retain valuable and experienced staff members. Moreover, employees and channel partners value incentive programmes and reducing them could create dissatisfaction.

For further information or advice on your incentive programme, contact Uwin Iwin, and start a fruitful conversation.


Employee Perceptions of their current Incentive Programme

The responses from programme participants reflect that they appreciate the incentive programme and find it motivational.

  • I feel proud when I get an incentive: 82%
  • Job satisfaction motivates me: 85%
  • An incentive programme motivates me to work harder: 81%
  • I will go the extra mile in my job for an incentive: 78%
  • The incentive programme is very important to me and my family: 77%
  • Incentive programmes make me stay loyal to my company: 63%

Rating of Effectiveness of Incentive Programme

HR personnel were asked to give feedback concerning the effectiveness of incentives in achieving programme objectives. Below are the figures that correlate to each objective:

  • Employee motivation: 77%
  • Employee performance: 79%
  • Employee engagement: 73%
  • Employee satisfaction: 72%
  • Employee retention: 64%

These results are encouraging, and prove that having an effective, well-designed and well-executed incentive programme in place impacts very positively upon the business.

For more information, please visit uwiniwin.net or call +27 (0)11 557 5700

Continue Reading

Increasing Productivity

The 3 Nasty Little Secrets About Teams

Internal competition, poorly designed incentive systems and groupthink can derail your group quickly.

Beth Miller

Published

on

team-work-secrets

In today’s world of business, we all understand the value of teams. Well-functioning teams can collaborate and drive innovation, which is a competitive advantage. Without innovation, many companies wither and die.

Iconic brands like Borders and Blockbuster are examples of companies that were unable to adapt quickly enough to the changing competitive landscape. Now you can bet that these companies understood the importance of innovation and had teams focused on the future, but what went wrong? From my experience, three things derail teams – internal competition, poorly designed incentive systems and groupthink.

1Internal competition

When companies have processes and structures that create competition for limited internal resources, things can get ugly quickly. Strong team identity can be a huge benefit to productivity and engagement but only if all of your departments have a single goal that requires co-operation, not competition, amongst the departments. So how do you create the “big goal?”

Related: 10 Traits Of Managers Whose Teams Are Happy To Come To Work

Ideally the big goal is a concept and more abstract. It should speak to your company’s purpose. For example, one PEO company’s big goal was to provide unique human resource solutions to their customers’ problems by listening to customer needs and leveraging unique technology solutions.

Once the company “why” was clear, the CEO facilitated a discussion with each department about what the goal meant for them. They explored the answers to questions like: What are the principles and programs that each department could create and embrace that would assist them in providing unique solutions to customer problems?

For the PEO, listening to customers was determined to be a core principal. The CEO met with his executive team to determine what program could be developed for each department that would enhance listening to their customers. In this case, all the executives agreed there were three departments – sales, customer service and accounting – that interfaced with customers on an ongoing basis. And, that without the three departments cooperating, they could not deliver unique custom human resource solutions to their customers.

Armed with this knowledge, each of the three department leaders were in charge with communicating the big goal and assisting in determining what department goals would drive and support the big goal while requiring the cooperation of the other departments.

2Incentive systems

With incentive systems, remember that what you incent and reward others for will drive their behavior and results. The classic example is sales commissions. When the metric for sales commission is revenue, you will have your sales team looking for any sales opportunity. But, if you compensate your sales team by gross margin dollars, your sales team will bring you only profitable sales.

Compensating sales by gross margin dollars may increase profits but it doesn’t help solve the problem of internal competition amongst sales and other departments. What behaviors do you need to increase your sales and profits while focusing on collaboration and innovation?

For one technology company, there was one value that all employees within every department lived by that helped drive company growth and profitability – listening to and solving customer problems. So company leaders proceeded to develop firm goals around listening to customers and driving innovative solutions. Then each department created specific objectives, which linked to the goals and were dependent on the other departments’ co-operation.

Related: Building A Hard-Working Team Starts With You

3Groupthink

Leaders often have strong opinions, which can lead to groupthink. Groupthink discourages perspectives from being challenged and narrows thinking, stifling innovation and organisational competitiveness. In order to manage and break groupthink, a leader needs to listen more than talk during meetings where strategy and innovation are the focus. He/she needs to have dissenter(s) on their teams and encourage and support the dissenters. While team members generally do not like dissenters, they are often the ones who care the most and have the courage to dissent.

As a leader of a team, is your team at risk of groupthink? You can do a quick assessment by asking for feedback from team members on your listening skills. How much time do you spend listening versus talking? When do team members get the opportunity to speak in meetings? What questions are you asking that will lead to exploring alternatives and processing information objectively? Who are the dissenters on your team? And how do you support and encourage their views and suggestions?

One technique I recommend to team leaders is Six Thinking Hats presented by Edward de Bono in his book by the same title. The method will transform your meetings so that all perspectives are taken into account.

Now that you know the derailers of teams, it is time to take action and define goals that drive collaboration across the company, reward teams for working collaboratively and encourage the dissenters on your team. What is your first step?

This article was originally posted here on Entrepreneur.com.

Continue Reading

Increasing Productivity

7 Bad Workplace Habits Millennials Need To Stop Making

Walk away from the computer once in a while. Leave your tablet behind for meetings. And don’t check your smartphone during a conversation.

Jayson Demers

Published

on

workplace-habits-millennials

The millennial generation has faced a great deal of criticism, and in some cases, scorn from older generations. We millennials – yes, I’m one of them – are seen as selfish, entitled and demanding, not to mention addicted to technology.

Are these stereotypes true? Certainly not for all millennials. But there are certain tendencies and habits that are associated with the millennial generation more than any other generation – and they run both positive and negative.

Here, let’s focus on the negatives, setting aside the fact that you can’t categorize an entire generation, and behavioral traits and stereotypes can’t be empirically proven to exist. Instead, let’s focus on the bad workplace habits that the older generations perceive millennials to have, and work on eliminating them.

Related: Lifestyle-Focused Work Environments Are Not Just For Millennials

Regardless of how much of a stereotypical millennial you believe yourself to be, you’ll make a better impression in your new work environment if you avoid these common bad habits:

1Making demands instead of requests

Millennials do have a habit of making demands, and setting more rigid requirements for their workplaces. On some level, this is good; too many modern workers are afraid to voice their opinions, and would rather keep their heads down than verbally address something wrong with the organisations.

However, when voicing your opinion, turn your demands into requests. Making a request of your employer shows more respect and subordination than making a demand, which is especially important if you’re new to the organisation.

The more experience you earn, the more demanding you can afford to be, but start out by making requests instead.

2Exhibiting overconfidence

Confidence is good, but overconfidence can ruin your reputation if it’s perceived as arrogance. Millennials tend to overestimate their abilities and knowledge in the workplace, which is especially irritating to people from the older generations who have spent far more years on the job.

Recognize that your superiors have been at this job longer than you have, and don’t be afraid to exhibit confidence – as long as you keep that confidence reasonably in check. It’s better to perform well with a sense of humility than to boast about your abilities and fail to meet expectations. Just as happens with demands, you can demonstrate more confidence over time as your accomplishments start to speak for themselves.

3Relying only on certain forms of communication

Most millennials prefer text-based forms of communication over voice-based forms. They’re more comfortable with mediums like SMS text and email because they’ve grown up with these formats, and recognise the fact that they give you more time to put your thoughts together (not to mention leaving a paper trail).

However, it’s important to recognise that not everyone prefers to communicate this way – and that there are advantages to making a phone call rather than emailing. Showcase a degree of flexibility in the way you communicate, and you can eliminate this bad habit altogether.

Related: What Millennials Want From 2017 – How To Stay Ahead Of The Trend Curve

4Talking more than listening

Talking more than listening

This is a bad habit for any generation, not just millennials; but for millennials, it’s far more damning. Because millennials are seen as self-centered and overconfident, talking too much can be seen as an exacerbation of these qualities (even if it’s just a result of this individual’s extroverted personality).

Instead, make a conscious effort to speak less and listen more, especially when you’re in the company of someone more experienced or more authoritative than you are. You’ll end up making a better impression, and more importantly, you’ll learn more in the process.

5Assuming a certain behavior or action is okay

Office environments are becoming more relaxed. Work schedules are becoming more flexible, etiquette is becoming looser and dress codes are increasingly casual. These trends are facilitated by increasing technological sophistication and decreasing reliance on old-school business tropes. However, this isn’t a free license to show up at the office whenever you want, wearing whatever you want.

In fact, doing so could mark you as both overconfident and disrespectful. Don’t just assume a certain action or behavior is okay. If you’re even slightly in doubt, ask someone.

6Multitasking

Millennials grew up with technology that provided instantaneous information on demand. They work fast and think fast, which makes them highly productive and ingenious. Unfortunately, this high pace also lures them into the multitasking trap, tempting them to try to accomplish many things simultaneously in a bid to work as fast as possible.

As more people are beginning to realise, multitasking is ineffective, and engaging in multitasking could weaken your performance in multiple areas.

Related: Why Millennials Are Becoming Franchisees

7Staying plugged in

Again, thanks to our natural history with technological devices, we millennials tend to be more reliant on them than our older-generation counterparts. There’s a perception that weare addicted to technology, so if you’re young and want to combat this stereotype and improve your reputation in the process, avoid staying “plugged in” for too long.

Walk away from the computer every once in a while. Leave your tablet behind for that important meeting. Above all, don’t check your smartphone when you’re having a conversation.

The truth is, there are some differences that set millennials apart from other generations. This doesn’t mean millennials are bad workers or good workers – it just means they work differently. Acknowledging those differences, and compensating for them when they create workplace dissonance, can help you better adjust to your job, and make a better impression with the people in charge.

Focus on eliminating these bad habits, and you’ll stand apart from the rest of your generation.

This article was originally posted here on Entrepreneur.com.

Continue Reading

Trending

FREE E-BOOK: How to Build an Entrepreneurial Mindset

Sign up now for Entrepreneur's Daily Newsletters to Download​​