How to motivate your team when forced to freeze or cut their pay

Wednesday July 1, 2020

Coronavirus has made 2020 a challenging year for many people. Although our enforced period of lockdown is easing, there are likely to be new challenges for employers on the horizon.

Despite emergency financial relief from the UK government, such as the Coronavirus Job Retention Scheme with recent flexible furlough, many businesses have had to initiate critical contingency plans to survive the pandemic.

Because of this, redundancies are on the rise. Whilst this is perhaps seen as an inevitable result of recent events, redundancies should be a last resort once all alternative options have been explored.

Pay cuts and freezing pay

A recent report by Xpert HR has revealed that pay freezes in the three months leading up to June have almost doubled since the previous rolling quarter. One in seven employers has introduced a pay freeze, likely attributed to budget cuts in response to the economic fallout from coronavirus.

Others have resorted to pay cuts to keep their staff. Whilst a pay cut can feel like the lesser of two evils when the alternative is redundancy, it can still impact mental health and financial well-being. Agreement through a consultation process with employees is needed as it is a change to their terms and conditions. The process should be managed with care.

Employers are going to need their people to be on top form for their business to succeed in the current climate. A mismanaged message regarding pay cuts could feel like another blow to hard working employees at an already difficult time.

Applying a time limit to pay cuts may help so that employees can see a light at the end of the tunnel. Additionally, demonstrating that company leaders have been affected too would be a further show of support.

Money talks, but there are other ways to motivate people

As well as following the correct procedure and managing the message of pay modifications to your workforce, it is worth considering non-financial methods to help employees feel valued and continue to work well.

Here are five ways you can boost employee morale and motivation without increasing pay.

1.Say ‘Thank you’
Acknowledging the efforts of your employees, both in-person and publicly within your business, can be motivating. Showing appreciation for hard work can add value for employees and encourage others to reach their full potential.

2.Make work fun
Employee experience can provide great refuge from the disruption that many have had in their day-to-day life. Work socials might be off the agenda for now, but there are still ways you can lift spirits without costing the earth: a Friday quiz, a virtual book club or themed lunches for instance. Get buy-in from employees by asking them to vote on their favourite activity.

3.Provide opportunities to grow
Giving employees the opportunity to develop new skills, take on extra responsibilities or expand their knowledge can motivate them. This could be achieved through job shadowing or training and can also benefit the business in the event of absences. Just make sure that time allocated for skills development does not disrupt daily workflow or see other tasks start to pile up.

4.Create a sense of belonging
People have a psychological need to belong, to feel a sense of security and purpose. You can do this by developing a workplace culture where employees believe:They are an integral part of your business.
Their contribution is valued and important to the future success of the business.

5.Offer flexibility
Work-life balance is in high demand, and it’s an affordable option. Giving employees some flexibility on where and how they work, with outcome-based expectations, can help them to become more motivated, trusted and consequently more productive.

Looking after your staff as a growth strategy

We understand many business owners are under pressure financially, but one way to help your business turn around is to look after your staff. If they are productive and engaged at work, everyone will thrive.

If you’re seeking alternatives to redundancy in your business and would like to discuss your options, give us a call today.

 

Preventing People Problems

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