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What HR challenges did 2021 bring?

As we draw to the end of 2021, Lauren Bholé and Lizzie Lord reflect on some of the HR challenges faced by many companies over the past 12 months.

1. Employees wanting a change in career – the ‘great resignation’

A study by Microsoft found that 41% of the global workforce is considering leaving their employer this year. This trend is reflected domestically in the UK, with a recent survey by Ranstad UK finding that out of 6,000 workers surveyed nearly a quarter of them were planning a new career.

It is apparent that COVID-19 has created a huge shift in the way that many employees view their employment and what they want from their life more generally. For example, a period of enforced working from home has shown many white-collar workers that some form of flexible working can help to achieve a better work life balance and if their employer decides not to offer this longer term but rather to insist on a full return to office working, those workers are likely to look to find a new employer with a more flexible approach.

The factors driving the ‘great resignation’ are multi-faceted and complex and are sector dependent. However, unsurprisingly, resignation rates are highest in the technology and health care sectors. This is likely to be explained by the demand placed on them during COVID-19. Certainly, within the health care sector, limited pay rises, increased demands due to staff shortages and now the requirement for mandatory vaccination, have all contributed to employees seeking alternative careers.

Staff and skills shortages caused by Brexit have also helped to create a marketplace in favour of job applicants.

In order to both attract and retain talent, this year more than ever, organisations have had to listen to their workforce and adapt to meet their demands whether this be by introducing permanent flexible working, pay rises or thinking of innovative ‘sweeteners’ to attract staff and ensure that their employees don’t move to a competitor or leave the industry altogether.

Considering the results of the Ranstad UK survey, this is likely to be a challenge that companies will continue to face as we move into in 2022.

2. Ensuring training and skillsets are developed remotely

Not only have companies had to work hard to attract and retain employees this year, but they have also had to grapple with ensuring that their workforce’s skillset and training is maintained and developed to fit a changing world, often managing this remotely. Interestingly, a survey by Gartner found that one third of the skills present in an average job advertisement from 2017 are no longer relevant in 2021. Alongside this, skills shortages as a result of Brexit and changes to immigration rules, has also led to organisations looking to upskill their existing workforce.

HR leaders and managers have therefore had to work with employees to identify skills gaps and to develop training programmes to foster the competencies required in the modern workplace. Some level of innovation has also been required to ensure that those predominantly working from home still develop the skills that may have been more typically learnt in the office.

As remote working becomes the new normal, it is likely that in 2022 organisations will start to find their feet with this and implement effective training programmes in response to this challenge.

3. Maintaining employee engagement

To add further to the challenges faced by HR this year, a study by Qualtrics found that employee engagement in the UK is currently sitting at just 50%. We all know that a happy workforce makes for a more engaged and productive workforce. However, keeping employees engaged during a global pandemic and its aftermath was never going to be an easy task.

As we approach 2022, employee engagement needs to be put back at the forefront of companies’ agendas. Simply taking small steps such as regular feedback programmes and encouraging team get togethers can help to improve motivation and engagement amongst employees.

4. Remote working

The term hybrid working has become commonplace this year, with many organisations embracing a mix of office and home working following the period of enforced home working during the pandemic. However, such arrangements are not without challenges. It is important that clear parameters on what is expected are set out to avoid disputes in the future, for example on matters such as attending meetings in the office, expectations around working hours and outputs.

Remote working also requires a change in approach from managers towards their teams, both in terms of support and supervision. HR plays a crucial role in assisting managers to make this change, equipping them to deal with wellbeing and productivity issues where their teams are working remotely. HR will also need to be mindful of continuing to create an inclusive work environment where employees are less visible.

5. Managing absence

Managing absence, especially related to COVID-19, has been a big hurdle for many companies. Having to grapple with large scale, sporadic and persistent absences because of contact tracing and managing employees required to isolate for periods of time, has topped off what has already been a challenging year. Added to this is the wide-ranging impact that COVID-19 can have, with different individuals experiencing different degrees of symptoms, as well as the uncertainty around Long COVID, making it hard to predict absence levels and creating staff shortages at short notice.

COVID-19 related absence is something that companies will have to continue to manage in 2022 and potentially the future years to come. As we settle down into some certainty and the government guidelines relating to COVID-19 gradually start to relax, companies should consider adapting their current sickness and absence policies to ensure that they meet the challenges presented by COVID-19 going forwards.

6. Furlough

Last but by no means least, we could not write on the biggest challenges presented to companies this year, without at least mentioning the Coronavirus Job Retention Scheme. 
With the Scheme closing at the end of September 2021, for those companies which were heavily reliant upon furlough, it is likely that the last few months of 2021 have been an incredibly difficult time, with many organisations having no choice but to make redundancies given the impact which the pandemic has had on their business.

2021 has certainly been a difficult year for many organisations and many of these challenges look set to continue into 2022. Look out for our next article focused on what lies ahead for HR next year.

Wishing you the best for the new year.

If you would like to discuss any of the issues raised in this article, please contact Lauren Bholé on [email protected].

Disclaimer

This information is for educational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given. © Shoosmiths LLP 2022.

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