The festive season is upon us! The proudly displayed tinsel is a good reminder that this time of year is for reflection and future planning. In this blog, we reflect on 2022, and whilst none of us knows for sure what the future holds, here at ViewHR, we have identified some issues that employers are likely to face in 2023.

Let us start by reflecting on 2022. Last year in our blog, we spoke about working from home and its increasing popularity. Research provides evidence that homeworking – at least in a hybrid format – is here to stay. The Office for National Statistics reports that the ‘proportion of workers hybrid working has risen from 13% in early February 2022 to 24% in May 2022. The percentage working exclusively from home has fallen from 22% to 14% in the same period’. The ONS has not published further findings; however, based on conversations with clients we would hazard a professional guess that hybrid working either remains at the same level or has increased (in some industries) since May 2022. Our advice still stands and is increasingly more relevant today – employers should create a clear working-from-home policy which sets out the organisation’s expectations and requirements.

2022 has seen many unsettling and, in some cases, traumatic events. We have seen Prime Ministers come and go through Downing Street’s doors, a war was started in Ukraine, and we are still tackling the lasting effects of Covid-19. These events and others are partially to blame for the country now facing a cost-of-living crisis. In 2021 we highlighted ONS UK inflation data, which showed a 3.8% change over the 12 months to October 2021 (by comparison, in October 2020, this figure was just 0.9%). The ONS now report ‘the Consumer Prices Index including owner occupiers’ housing costs (CPIH) rose by 9.3% in the 12 months to November 2022, down from 9.6% in October.’

As in 2021, we still recommend that employers undertake regular benchmarking and keep abreast of market data to inform their pay policies. The National Minimum and Living Wage rates are also set to increase in April 2023 (the latest rates are available here). Commitment to pay employees an inflation-based pay-rise can be risky for an employer, as a dramatic rise in inflation could impact on a number of your business costs as well as leaving you with an unaffordable pay bill (which could in turn affect job security for employees). However, employers should still be aware that employees may be feeling the impacts of inflation.

Now we will shift our focus to looking at future trends within the sphere of HR. While no date has been set for its introduction, the Government has confirmed that employees will be given the day one right to request flexible working. In the Government’s December 2022 response document, they highlight that employees will be able to make two flexible working requests in any 12-month period and employers will have to respond to a request within two months, down from three. Employers are also now required to consult with their employee, as a means of exploring the available options, before rejecting their flexible working request.

CIPD chief executive Peter Cheese] said: “We’re delighted the Government is bringing in a day-one right to request flexible working. We’ve been calling for this change as it will help create fairer, more inclusive workplaces and improve access to flexible jobs for many people.

“Older workers, those with caring responsibilities and people with health conditions are among those who will, particularly benefit.”

Is your business ready for these changes to flexible working? We would recommend creating a dedicated flexible working policy. By creating a clear policy, employees will understand how best to work with the organisation when making a request. This document can outline the following: assorted options for flexible working, how to make a request, business requirements that reasonably need to be met, and potentially any trial periods.

A trend that seems very likely to continue in 2023 is challenges to hiring staff. The Hiring and Workplace Trends report 2023 notes that a large and widening post-pandemic participation gap amid rising economic inactivity rates including long-term sickness will continue to constrain the supply of labour well into next year. And in the longer term, an ageing population means the size of the UK workforce will shrink.

What can employers do? Organisations should aim to stand out from the crowd, create recruitment packs to show off the benefits of working for their company, and ensure the recruitment process is agile and effective. Review your salaries to ensure they meet market rates and offer flexible working where possible. The Hiring and Workplace Trends report noted that the desire for flexible work continues unabated and ranks highly as a top employee priority, notably for older workers who are considering re-entering the labour market to top up earnings.

Here at ViewHR we are here to support employers, whether you are planning for what is to come, or are dealing with challenges that are facing your currently. Please contact us today for an initial consultation to find out more.