Long-service versus encouraging a healthy turnover of staff in the FM sector

Dave Kentish’s response to the question below originally appeared in FMJ

In today’s transient society fewer employees are staying with their employers for long periods of time. Do you think it is important to encourage long service? What are the advantages to long-service versus encouraging a healthy turnover of staff? Does rewarding long-service go against age discrimination principles?

Many young people coming into the workplace now have a very different view of what they expect from a career than previous generations, and many companies who are looking to hire them have a very different view of how they will benefit the most from the talent they bring in.

As with all things in life, it is about balance. Having people in your organisation who have served you well for many years and display the attitude and values of the company will have a great influence on the younger staffers who will be (as all young people generally are) running on enthusiasm, looking to make their mark and sometimes making decisions without checking the facts first. ‘Dynamic’ is the word normally associated with these ‘young’ns, and their drive is to be applauded. It makes others sit up and think, and it brings a new vibrancy and energy to the business. Coupled also with their understanding of technology, the emerging generation can enhance the capabilities of a company.

The importance of having long-term staff is that they truly understand the nature of the business. They know how each department works and who does what. In short, they know all the wrinkles.

A company that looks after and rewards loyal staff will have a high retention rate, lower recruitment fees and a stable and consistent approach to the business. That being said, no company can function in a fully effective way if there is no new blood coming in. Sourcing talent from outside the business can bring fresh ideas and new ways of doing things, which in turn result in higher performance and growth.

This is the tricky bit, because this is where the balance comes in. People look at fast growing high tech businesses, run by t-shirt wearing geeks and think, ‘wow! we must get these people into our business, just think what they could do for us!’

It’s a good point. The question has to be though, that if you have a business full of young, very bright and forward thinking people, you have to consider how that energy and inventiveness is harnessed and directed towards the business model of the company. To do that requires experienced, people-centric and commercially astute individuals to whom the newer members of the team can turn to for advice and mentoring. New people coming in, if hired not just for their knowledge and qualifications, but also for their attitude, flexibility and personal values will, if guided in the right way, become the talent pipeline for the future.

Many companies who give long service rewards to maintain a loyalty factor with their staff, are having to rethink this strategy because of the age discrimination laws which came into force in October. This is not my area of expertise, but it appears that under a five-year period of employment, long service payments are exempt, above that, the company has to provide evidence that the payment is of benefit to the company. Now it may be that five years could well be the average time for people to stay at a company, but rewards for loyalty should still be given as they signify the value to the company that the employee has contributed. Delivered in the right way it becomes another reason for this person to want to stay.
Looking to the future, today’s workforce certainly wants to experience fresh challenges and perhaps even have completely different careers during their working lifetime. And as their personal circumstances change, so will their job preferences.

What about the companies that they work for? How many of those companies will still be around in years to come? Technology, an evolving mobile workforce, coupled with ever-changing global demands on service and products, will inevitably affect how a company hires and rewards their staff, which in turn will have an impact on what the workforce of the time will be looking for in a career.

I believe that successful companies will always have their people at the heart of everything that they do. They will understand the balance needed to have a fully blended, multi-talented and motivated workforce. Young, old and everything in-between is what’s important. Length of service will become something that has a natural start and finish, always evolving to the benefit of all.

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