Attracting and retaining talented employees
The stability and ability of a workforce is a major factor when considering whether to purchase a business and assessing its value. It is therefore important that in advance of a sale, businesses consider what steps they can take in order to secure and retain great employees.
High levels of staff turnover not only increases financial investment in recruitment, but also impacts upon the morale of an existing workforce. This can often cause more employees to leave causing the business to go round in circles trying to attract and train the right individuals to support the organisation’s aims and objectives.
Jorge Paulo Lemann (Co-Founder of Banco Garantia) once said "The greatest asset of a company is its people”, which is a commonly stated fact amongst some of the largest corporations in the world. So how can family/owner managed businesses attract and retain the right employees who go on to become long-standing assets of their business?
Whilst competitive salary/pay will always be a significant factor to attracting individuals, retaining key employees relies upon a combination of factors, both financial and non-financial. For established businesses a key aspect to attracting and retaining the right talent is to understand why it may have failed to do so in the past and to gather information from existing and departing employees in order to implement the right changes to the business. These surveys/interviews should include finding out what attracted the employee to the business in the first place, what they like about the business, what they would change, what caused them to leave and finally, what it is about their incoming employer that attracted them.
This data can help to address specific issues within the workplace (including identifying individuals whose approach may be causing friction in the workplace), whilst strengthening the foundation for future recruitment to reduce levels of staff turnover. As a practical tip, businesses should conduct exit interviews on the last day of employment or shortly thereafter as the individual is more likely to be open and honest about their reasons for leaving once they are no longer working in the business and before they have got stuck in elsewhere and may no longer feel obliged to engage with the business.
Offering attractive benefits also plays a key part in retaining employees in the business and employers need to consider going beyond providing the legal minimum in order to remain competitive and be attractive in the market. For example, benefits often include:
Health care and insurance benefits
Access to employee assistance programmes, counselling or GP’s
Paid birthday leave
Enhanced paid leave i.e. maternity/paternity etc.
Salary sacrifice schemes
Providing clear and transparent pathways to progression
Fresh fruit in the workplace
On-site fitness classes
However, family/owner managed business could seize this opportunity to think outside of the box and consider innovative benefits that are not widely available on the market and can complement the “family” like culture within the workplace. Examples of less common benefits that we have seen organisations offering include:
Reproductive healthcare benefits and support
Bring a parent/child to workday
Bring a pet to workday
Contribution towards driving lessons
Pet bereavement leave
Interest free loans
Payments towards special causes
Use of holiday homes
Contribution towards maternity clothes
Time off for child’s first day at school
Legal advice on wills, accidents, personal injury
Massages at lunch time
Onsite hairdressers/ beauticians
Ability to work abroad
Paid time off for carers
Contributions towards education
Global parental leave
….. and the list goes on! This bespoke and valued approach is more likely to solidify a long-term and loyal relationship between the business and its people.
In implementing such benefits, we would always recommend seeking legal advice; to ensure that the benefits are recorded in a way which retains maximum flexibility so that they can be easily updated in the future and also to avoid a situation arising where a benefit which is intended to promote engagement is in fact viewed by some colleagues as being exclusive (for example specific rules apply relating to benefits which are aimed at rewarding long service and might be considered discriminatory on grounds of age).
Furthermore, when considering benefits, it is important to consider succession planning and the financial burden on the business and whether this could make the business less or more attractive when preparing for sale. Undoubtedly, having a lower staff turnover will make the business more attractive and valuable and in turn, there will inevitably be fewer employment issues that arise – again, making for an attractive business when it comes to selling.
If you require any assistance, please do not hesitate to contact me or a member of our Employment Team who will be able to help. We also work closely with other organisations who can assist you to review and overhaul your employee benefits package to ensure that this is right for your business. For more information, please get in touch.
This article contains a general overview of information only. It does not constitute, and should not be relied upon, as legal advice. You should consult a suitably qualified lawyer on any specific legal problem or matter.