Saving Money the HR Way

Piggy Bank

According to research conducted by leadership organisation Common Purpose, almost 50% of HR professionals are expecting a training budget cut. The report found that over half of respondents felt that that the short term benefits of training cuts and reprioritisation would have long term negative consequences such as damage to staff morale, employee retention, recruitment and overall organisational performance.

In difficult financial times we understand that it is common to be tempted to cut your training budgets, but at ABHR we feel that this is false economy and there are often more effective ways to reduce your costs. Based on our experience we have provided a number of tip tips to help you save money.

TOP TIPS TO SAVING MONEY THE HR WAY

Use the knowledge of your employees

Create a process by which you can consult with your employees and gain their ideas for reducing costs. Your staff are on the front line and often have very good ideas for saving money. Listen to all ideas, do not dismiss them out of hand.

Review your expenses

Review and tighten up on your expenses procedures. Are all expenses necessary? Can they be reduced or limits implemented?

Consider Travel and Accomodation Expenses

Investigate the most efficient way to travel to any destination is this by rail, car, bus or even walking? Book travel in advance where this is possible to take advantage of early booking offers. Review your hire car suppliers etc to ensure you are getting the best rates, set them a challenge to reduce your costs by 5%. Briefly search the internet for deals on hotels and other accommodation.

Use your HR Professionals

HR can help you save costs through a number of initiatives and add value to the organisation, such as; programmes to reduce absence and sick pay, directly recruiting staff thereby reducing agency costs, delivering training using internal expertise rather than spending money on external trainers.

The Christmas Party

It is often the temptation to cancel the Christmas Party in times of financial difficulty. Removing this benefit can be a de-motivator and cause employee upset amongst your staff. Therefore you could consider holding the party but cutting back, i.e. having a buffet instead of a Christmas meal, paying for all soft drinks, but asking employees to pays for their own alcoholic drinks etc. Gain your employees thoughts, but remember it is unlikely you will please everyone.

Should you pay a Bonus?

Firstly it is important to consider whether the bonus is contractual or discretionary. Seek advice if you are unsure. If the bonus is discretionary then you need to ask yourselves what the bonus is being paid for? If it is based on performance and the company has made a profit, then you may choose to pay a proportionate level of bonus in accordance with the scheme rules where this can be justified. If however the bonus is a blanket bonus paid to all staff at Christmas time for example, and the company has not been performing then we recommend that you do not pay a bonus. Employees need to be aware that they will receive a bonus when the company is performing and will not receive a bonus when it is not, this way they can impact on the company performance and are rewarded for its success. Most importantly ensure that you are being consistent or can justify all levels of bonus paid.

REMEMBER COMMUNICATE AND USE THE KNOWLED|GE OF YOUR STAFF!

If you are interested in a HR consultant conducting a cost review of your business processes or any other aspects of employment then please call ABHR on 0115 9743519 for your free no-obligation consultation or visit our website abhr.co.uk for further details.