People Matters Ltd

7,000 net jobs in multinational sector, but domestic sector sees rise in unemployment in 2011

2012-01-06T09:52:00.003Z

More than 13,000 jobs were created by multinational companies in Ireland in 2011, but 6,000 jobs were lost in the same sector, leaving a net increase of 7,000. This represents an increase of 20% of the number of jobs created by IDA-backed companies in 2010 and the best net job increase for the past decade.

Among the companies creating new jobs were social media, IT, manufacturing, financial services and pharma companies. These included Twitter, Paypal, Intel, IBM, Coca-Cola and Pfizer.

An estimated 145,000 people are employed by companies which were attracted to Ireland by the IDA Ireland and nearly 150 FDI investments were made in this country last year. 61 were multinational companies investing in Ireland for the first time.

The latest figures from the CSO show that the number of people signing on to the Live Register fell by 0.5 per cent over 2011 with 434,784 people signing on in December, matching the figure for April 2011. There was a slight decrease in the standardised unemployment rate by 0.1% to 14.3%. This represents an increase of 0.5% over the 2010 rate when the average rate during the year was 13.7%.

The number of longterm unemployed and on the live register continued to grow during 2011, with the number of long term claimants on the Live Register increasing by 16.4 per cent.

Prospects for Professionals Positive in 2012?

2012-01-06T09:46:00.002Z

A survey of over 500 HR professionals by Morgan McKinley has shown that one in five professional people expect take-home pay to increase over the course of 2012. The study covered HR and other managers working in manufacturing, financial services, IT and professional services, and found that 21 per cent believed salaries in their companies would rise in the coming 12 months. 58 per cent said that they expected their salary to stay at the same level. Amongh those expecting a salary rise the forecasted increase is modest – between one and five per cent.

Only four per cent of managers fear redundancies this reflecting the fact that 47 per cent of managers and professionals had a more positive outlook for their business than at the beginning of last year. 32 per cent saying their opinion had not changed.

Did you use up all of your holidays this Christmas?

2012-01-03T12:12:00.002Z

Hotels.com surveyed 180 people between 8 and 16 December and of these respondents, over half had at least two to three unusued annual leave days in a year. One out of every four respondents said that they were not permitted to 'carry over' leave days from one leave year to the next, but even among those who can carry days over there is widespread non-uptake of holidays and half of those who said they didn’t use up all their holiday days said they felt “resentful” of that fact.

The reasons cited for not taking all holidays was being too busy at work (38 per cent); just not getting round to it (28 per cent); accidentally being left with too many days as a result of trying to save them up (19 per cent); and 12 per cent said they were afraid to take all their holidays because of pressure at work.

Workers will not disclose mental health problems

2011-12-21T16:25:00.002Z

A CIPD/Mind study has shown that only 2 out of every 5 employees say would feel confident about disclosing a mental health problem to their employer and only 1 in 4 respondents say their organisation encourages staff to talk openly about mental health problems.

More than a quarter (26 per cent) said they had experienced a mental health problem while in employment, with women (31 per cent) more likely to say this than men (22 per cent).

Only a third of respondents say their employer supports employees with mental health problems well, while 21 per cent said that it did it badly and 31 per cent said they did not know what support was available.

Stress is the number one cause of long-term sickness absence, but it is not just time lost to absence which impacts on the bottom line.

Christmas Part Do's and Don't's

2011-12-19T15:36:00.002Z

Tis the season of office Christmas parties, tra la la la la, la la la la. Unfortunately is also a time when being jolly fraught with risk as the employer’s duty of care extends to many ‘social’ occasions and events that happen ‘off the premises’ or after normal working hours. Here, we talk turkey about the do’s and don’ts that ensure for a happy Christmas in what, for many, is the last working week of the year.

Is celebrating Christmas at work now politically incorrect? It is a myth to think that workplace greetings of "happy Christmas" have to be replaced with "happy holidays" for fear of offending those of different faiths. Workers are protected from discrimination based on religion or belief, but this does not mean that language or actions have to be neutralised so that a belief system cannot be identified or celebrated. All workers are entitled to dignity in the workplace, which means respecting all faiths. Common sense and a degree of sensitivity for the feelings of others have more place at work than political correctness.

What’s an appropriate present for a Secret Santa? Chocolate willies and other naughty nibbles are best reserved for stag and hen parties. By all means, let employees buy a funny present but get them to think carefully before buying something that might offend. As a sense check, ask givers to put themselves in the recipient's shoes and imagine how they would feel.

What goes on at the Christmas party stays there, doesn't it? Wrong. Although the Christmas party may take place away from the workplace, and even in employees’ own time, it is so closely connected with work that employers remain responsible for much of what goes on. This is why employers can advise their staff on sensible alcohol consumption and insist that their dignity at work policies continue to apply at the event. As an employer or employee you can still be liable for bullying, harassment and discrimination at the Christmas party.

What's wrong with plain old gossip? You'd be surprised. In some circumstances gossip might amount to discrimination and harassment and was the subject of an Employment Appeals Tribunal in the UK when a couple that were seen ‘getting on’ at a Christmas party became the subjective of gossip when the woman became pregnant at a later date - rumours about the paternity of the child. It became all too much for her and eventually she resigned. She successfully claimed constructive dismissal and pregnancy discrimination and harassment.

Can I tell my secretary she/he looks lovely? Yes, you can. Almost everyone loves a
compliment. However, if she – or he – looks offended, or tells you in colourful language to keep your comments to yourself, then you will know not to do it again. If you persist, it could amount to harassment. It is not your intention that counts, it is how the recipient feels about it that is important.

I want to look really attractive at the Christmas party… is this possible without compromising my professionalism? Yes, you can turn all the heads at the party, by looking attractive but do it without compromising your corporate and professional image. Dress appropriately for the occasion and think "accidentally attractive". Then you will turn every head the right way.

I have been infatuated with my boss all year and I really think that the feeling is mutual ... is now the time to make my move? According to statistics up to 58% of us have had an office romance at some stage - so it is only natural that you want to make a move if there has been sexual chemistry between you and your boss. However you need to be really careful and think about if this is what you really want. Consider how your boss would react if you did make a move and what impact this might have on your other colleagues and your career. Think long and hard about what the outcome of such a move would be and whether or not it would be worth it. Overall, the office party is considered part to be an official event (even if the employer is not directly participating, financially or otherwise, so the normal etiquette of the workplace should be observed). If you decide to go ahead make sure that your confidentiality is protected and that you do not become the subject of office gossip or a romance related career crisis.

Can I put Christmas party photos on Facebook? This is not a good idea without the informed consent of the people in the pictures. Assume that someone will tell that person that their photo is on Facebook because, inevitably, a friend will have a friend that has a friend that knows a friend that tells the person. The potential exposure of the photo is limitless, and almost impossible to delete once it’s out there on the internet. The photo’s subject would be entitled to bring a grievance against the photo poster and, depending on the employer’s workplace policies, this may result in the employer having to take disciplinary sanctions against the photo poster. Remember, too, that uploading or tagging workplace colleagues in compromising photos, or employees making derogatory comments about their employer, could taint an employer's reputation, which may necessitate taking disciplinary action, even if employees do this in their own time, on their own computer or mobile phone.

Social Media in Recruitment

2011-05-09T12:30:00.000+01:00

New research shows that more than three out of four (78 per cent) Irish workers are now working outside the office using mobile devices, and forty six per cent of workers report using three or more of devices such as smartphones, laptops and iPads in their work every day (Citrix Systems). The Government keeps talking about creating jobs in the Smart Economy, but the reality is we already have one! Companies such as eBay, Google, LinkedIn and others already have offices here, and Ireland is often used as a test-bed for new applications. It is perhaps not surprising then that 97 per cent of office workers say they already use mobile devices for everyday tasks such as banking and restaurant reservations. And we are becoming a technology savvy bunch too. Four out of five of those who use personal devices for work purposes describe themselves as “do it yourself-ers”. This means they take care of their own IT needs rather than relying on the IT department to manage the device or install new apps. including social media.

In a recession companies place emphasis on hiring staff with networks of existing connections to knowledgeable people, as opposed to just knowledgeable people. Those who have active accounts on social media sites fit that profile. LinkedIn, for example, can be used to keep in touch with current contacts, former employers, for lead generation, and meeting new people in your business or local area. Social networking is all about sharing information, and contacts, with a large number of people. Tweeting shows an ability to ‘converse’ with your peers.

So what is the next step? Skillpages, an Ireland-based internet company, has had thousands of users in more than 50 countries sign up to its social media platform since launch less than a year ago. It enables anyone, anywhere to connect with people who need their skills and also, to find people who have the skills they need. So social networking is no longer just about keeping in touch or even getting in touch, it is about getting that job!

In the early days of these new applications many jobseekers took a very basic approach to using them in their job search, doing activities in much the same way as they always did through other websites, to obtain information and get in contact with potential recruiters. But there is much more to using social and other networking applications than that.

Whether you are looking for a job or in a company people will be ‘googling’ you in order to find out about you:

They will be searching on business networking sites such as LinkedIN to see what your profile says about you and find out about your past work experiences.

· They will look on sites like Facebook to see who your family and friends are, and what you get up to in your spare time!
· They will look at your blog to see what types of attitudes you have and what opinions you are expressing. If you do not have a blog, does that mean you have nothing to say?
· They may visit discussion boards to see what your expertise is.
· They may even follow you on Twitter to see what you are chatting about – as this is the online equivalent of the water cooler.

The default for Twitter and Facebook accounts is now public so potential employers can find out a lot about you apart from what you have on your CV. Before you cry ‘Big Brother’ bear in mind that if you were going to do an interview with an organisation it is likely that you would probably do the same thing to them: You should invest time in obtaining information about the organisation and the person or persons interviewing you. As any good sales rep. knows, it is important to prepare yourself in advance by getting to know the people you are going to meet. Just don’t be surprised if they are doing the same. And remember that jobseekers with private accounts will be competing with other people who want to share their knowledge and expertise with the world.

Census 2011 - Slightly Off the Mark?

2011-04-11T10:21:00.001+01:00

Meet Martina: Since her position at the bank was made redundant last year, she has juggled a number of roles: working and studying part time on a FÁS employment programme; caring for her disabled parents and her children; and spending her spare time on plans to start her own business. On Sunday, 10th April, Martina sat down to fill out the Census form. When she reached questions 27to 34 – the section dealing with status, employment and education – confusion set in.

The CSO tells us that filling in the Census form will help provide data that will assist the Irish government and others to plan for the future, providing an extensive picture of our individual social and living conditions that will map out future policy, planning and decision-making in areas such as health care, education and employment. The resultant analysis will capture a snapshot of Irish society, but how clear, complete and comprehensive will the picture actually be?

On a deeper reading of the Census form, it appears that some questions are framed from a traditional, one-dimensional view of our country and do not reflect the current reality for many thousands of Irish citizens like Martina.

The employment questions highlight the potential for error by making it difficult for Martina to classify her status. Question 27 (how would you describe your present principal status) is the basis of all economic analysis emanating from the census. It groups persons aged 15 years and over, within and outside the labour force, according to their primary economic status. There is, however, no specific designation for participants on state-sponsored programmes. How should Martina and the other 57,762 FÁS trainees, 14,944 apprentices, and the 25,906 people engaged on employment programmes categorise themselves? Do they tick the ‘working for payment or profit’ box, the ‘unemployed’ box, the ‘student or pupil’ box, the ‘other’ box, or all of the above? This lack of clarity may potentially generate insufficient and inappropriate labour market policy responses by trying to categorise the entire adult population into simplified groupings.

An interesting discussion arises when question 29 (do/did you work as an employee or are/were you self-employed in your main job?) is probed. This question is used to assign social class to all at work, now or formerly. If it is such a key economic variable, what is the rationale for excluding students, carers and those unable to work due to permanent sickness/disability altogether? These groups are referred to in question 27, but there is no mention of them in question 29. Where did they go? When it now comes to allocating social class, those formerly part of the labour force are simply omitted. How then do we ascertain their socio-economic status?

This omission is compounded in question 28 which asks those working, the unemployed and retirees to self-declare their present/previous main job, but asks students, carers and those unable to work due to permanent sickness/disability to skip the question on prior occupational status. The 14 per cent of our students in higher education that are mature students, the estimated eight per cent of adults providing non-paid care (one-third of whom work full-time according to the CSO) and the almost 100,000 individuals claiming Disability Allowance may be left wondering how they will be represented in the statistics.

Furthermore, one of the aims of the census is to provide a detailed picture of the occupations of the entire population, assisting analysts and the government to understand the economic infrastructure of Ireland. Yet none of the questions take account of non-traditional employment arrangements. Respondents are unable to highlight the fact that, like Martina, they may occupy more than one role, always having to opt for their ‘principal’ position, defined by the job in which they usually work/worked the most hours (questions 27 to 34). The Census form excludes those who wish to be represented as combining paid and self employment; students who may also work in paid or self employment; and part-time/seasonal/casual workers who are entitled to Jobseekers Benefit or Allowance. Being forced to indicate one designation alone may facilitate the complex analysis process, but it in no way reflects the diversity of occupational patterns that individuals exhibit, particularly in the current economic environment.

On Sunday, 10^th April we are all asked to make our mark, an action that will define our future policies. The design of the employment questions on the Census form is off the mark and has the potential to exclude, or at the very least, confuse those having multiple roles in our society. As a result, it will not paint a true picture of the textured and rich career patterns the population has.

The 2011 Census - What will it tell us?

2011-04-11T10:17:00.001+01:00

There have been regular reports in the media in recent months that say the size of the Irish workforce has been decreasing over the past two years, as more and more non-Irish and Irish nationals leave the country, and that unemployment has been rising starkly. Is this a fair reflection of what has been happening?

The most recent population figures available show that emigration from Ireland in the twelve months to April 2010 was estimated to have remained broadly constant at 65,300 for the previous year. However, the number of immigrants into Ireland fell sharply, from 57,300 to 30,800, over the same period. These combined changes have resulted in an increase in net outward migration from 7,800 in April 2009 to 34,500 in April 2010. While the level of overall migration remained relatively constant during that period emigration among Irish nationals increased significantly as a percentage of overall emigration last year, up from 18,400 in April 2009 to 27,700 in April 2010. This is the highest level of net outward migration since 1989 and there is strong evidence of further net emigration already during the past year and the ESRI estimated that the level of net migration ran at approximately 8,000 per month during the first quarter of 2011. Against this background we have seen a shrinking of the size of our labour force, i.e. those available to work, over much of the past two years.

The forthcoming Census in April 2011 will provide a much more accurate baseline figure for the size of the population, the level of emigration that has taken place and the workforce. It will ask questions about where people live now and where they lived one year ago, as well as nationality and ethnic/cultural background, to give a more accurate and up-to-date, picture. The overall picture to emerge is likely to be one of a population and a workforce that is still growing over the long term, but which has been beset by short-medium term net emigration, particularly among younger, male, Irish nationals.

More importantly, the 2011 census will also ask about whether people consider themselves to be employed, unemployed, retired, studying, etc. Since the 2006 Census we have had to rely on estimates of the unemployment rate based on two, smaller, monthly and quarterly surveys that take place on a regular basis. The monthly figures that make headlines in the media tend to be these, despite their being based on a benchmark last established in 2006. The published figures rely on Live Register statistics from the Department of Social Protection and these are adjusted each quarter with results from the CSO’s own Household Budget Survey. These two sources only give a partial picture of employment and can only guesstimate the level of employment and unemployment to provide the monthly labour force statistics. As one statistician put it – it’s like sending a rocket into space, and not checking if it is on course for five years : usually the instruments will give you a rough idea of where you are, but you can never really be sure until you return to Earth!

The number of people in employment overall was estimated to have fallen from 2.1 million in 2008, to 1.9 million in 2009, and to 1.83 million by March 2011. Unemployment has continued to rise throughout although it seems to have stabilised sometime between the beginning of this year and now. The last Quarterly Household Budget Survey (for October – December 2010) statistics issued in mid-March showed a seasonally adjusted unemployment rate of 14.7% overall.

It is easy to get bogged down in the detail of monthly and quarterly estimates. The more accurate figures are those that come about as a result of the Census. It is worth noting that the percentage of the labour force unemployed was just 4.5% of the total workforce back in May 2006 when the last, full Census was conducted. In real terms, by April 2011 there were an estimated 1.83 million people employed and the unemployment percentage of the workforce has more than trebled over the past five years to an estimated 14.7%.

An interesting aside here is that direct costs related to unemployment have risen significantly in the past few years. Social welfare expenditure amounted to 15.6% of Gross national income in 2009. Ten years previously it was just 8.2%.

Getting Ireland back to work

2011-03-01T11:38:00.002Z

A new Irish Government takes up office next week after a hard-fought election in which just about every party and candidate claimed that jobs were the number one priority. So if jobs are to be a focal point for the new Government, what can we expect from the incoming Dáil?

Whether any or all of these schemes remain in place by the year end remains to be seen. The leading party in the incoming government, Fine Gael, is proposing as part of its jobs strategy to retain and extend many of the programmes, but as might be expected it has rebranded them and plans to extend the number of places on offer in each:

Its National Internship Programme (23,000 places) will offer part-time, one-year placements in the public service, private sector and voluntary sector for unemployed graduates. The objective is for interns to gain experience while studying for a masters degree or diploma. The payment will include a €3,000 bursary to help fund each individual’s higher education. Among the positions planned to be available will be classroom/teaching assistants in schools and nursing assistants in hospitals. IDA Ireland and Enterprise Ireland will be explicitly mandated to develop 5,000 work experience placements in the companies that they support.
FG’s Second Chance Education Programme (17,000 places) will offer former retail and construction workers that did not finish secondary school either college or back to education placements for two years. Participants will receive a premium payment of €20 per week on top of their social welfare payment, a €500 contribution towards book costs, and a €3,000 completion bonus.
The Apprenticeship Guarantee (700 places) will offer unemployed craft apprentices direct employment by the State, State agencies or semi-State organisations until their apprenticeship is completed. The number here is slightly lower than the outgoing government’s Redundant Apprentice Placement Scheme as the number of apprentices will decline each year over the next five years.
FG’s version of Tús, Community Employment, will also provide 5,000 funded places, again mainly for short-term positions in community organisations.

While the items mentioned above are specific, costed policies Fine Gael’s main employment plank consists of targeted job creation by allowing public-private partnerships and private investments in sectors such as water, telecoms infrastructure, renewable energies, smart-grid, bio energy and forestry. Job creation in these sectors will be funded by the sale of some existing, ‘non-strategic’, state assets e.g. Bord Gais energy production. Costs will be recovered in the longer term by the sale of equipment and services to businesses and the public e.g. water meter installation costs will be billed over time.

Welfare payments are to be reformed to make re-entry into paid work more attractive and to place new responsibilities on the unemployed while in receipt of State support. Among the changes mooted by Fine Gael are a reduction in the frequency of signing on (currently once a month) in favour of a more meaningful schedule of engagement with Jobseekers (for example, an in-depth, quarterly review); a specific focus by the PES to match up available talent on the Live Register with existing vacancies in Irish companies; conversion of rent supplement and other secondary benefits into means related supports that are unaffected by working status (with tapered withdrawal); and a requirement for under 25’s to maintain a Jobs Diary recording search experience and skill enhancement activities, with sanctions for unreasonable rejections of training and job opportunities.

As a final act, it is promised that the Minimum Wage is to be restored to its level prior to 1 February.

The most likely coalition partner, the Labour Party, is proposing to establish a Jobs Fund of €500m to carry out a number of job creation activities. Despite producing a large number of policy documents in recent months many of its proposals lack specifics about how this money will be invested and how it will link to jobs growth. Where they have been specified, they largely follow the pattern outlined by Fine Gael above. Some examples of what the party has said in recent press releases and policy documents include:

Extending the previously mentioned Employer PRSI Incentive Scheme, and extending the exemption period to 18 months, to incentivise employers to employ people who have been on the Live Register for 6 months or more.

A graduate and apprentice work placement scheme similar to those outlined above, but coupled with an earn and learn scheme to combine short-term working with study.

Reducing the qualifying period for the Back to Education and Back to Work Enterprise Allowance to three months, and allowing for greater access to postgraduate courses under the Back to Education Allowance.

Creating Skills Exchanges to tap into the wealth of work experience of those currently unemployed.

While there are some points of differences between Fine Gael and Labour’s policies most are compatible.

It will be interesting to see if the Government adopts any of the suggestions put forward by other parties such as the Greens (who longer have any seats in the Dáil), Sinn Fein and groups of independents such as the United Left Alliance. In contrast to the larger parties’ suggestions many of the ideas for job creation from Sinn Fein, the United Left Alliance and Socialist Party suggest obtaining funding from the dwindling National Pensions Reserve Fund, increased borrowing, or utilising borrowings that might otherwise be used to fund Irish banks in order to finance job creation. The fact that this funding model is unworkable and that many of their initiatives will cost money means that they are unlikely to proceed in their manifesto form. However as some ideas could be low cost or cost neutral they may be adapted by the ruling parties over the coming two years in order to ‘kick-start’ the domestic economy, particularly in services.

Among the plausible ideas suggested by the smaller parties are a national approach to the agrifood industry i.e. one brand such as Kerrygold for all Irish food; building a series of public, local, healthcare centres in preference to large, centralised hospitals which would require a switching of funds; school and crèche building and refurbishment acceleration; and both bringing forward maximising employment on public infrastructure projects such as Metro North and the Western Rail Corridor over the next five years. While these are costly in the short-term both FG and Labour have indicated, in recent days, that they might include some of these proposals in their jobs strategy which is due to be announced in 100 days time.

New Minimum Wage from 1st February

2011-01-27T10:52:00.002Z

The new national minimum wage rate takes effect from 1 February and sets the new rate at €7.65 per hour. The latest data from the Central Statistics Office shows that about 47,000 workers, or 3.1% of the employed labour force, are paid at or below the current adult experienced worker rate of €8.65 per hour. Even after the reduction to €7.65 per hour, the new rate will remain in the top tier of minimum wage rates set by European Union member states and 12% above the rate in Northern Ireland.

Oh for Fas sake!

2011-01-27T10:52:00.001Z

The staff of the Community Welfare Service of the HSE and both staff and responsibility for the policy direction and funding of the employment services and community employment services programmes of FÁS were transferred to the Department of Social Protection on 1 January. The relevant staff and resources, such as buildings, will be fully integrated with the staff and structure of the Department over the coming months. The aim is to provide a more complete service to people on the Live Register. When the integration programme is complete, FÁS will cease to have any role in the provision of employment and community employment programmes and will focus on the provision of training services. This means that, as well as income support, the Department of Social Protection will now focus on assisting people to find employment and to prepare themselves for entry into the labour market by accessing training, career advice, work experience and job placement.

Losing Your Job?

2011-01-27T10:51:00.001Z

Losingyourjob.ie is a useful new resource provided by the Citizens Information Board. This microsite provides public service information for those who are currently unemployed or are becoming unemployed in Ireland.

Dude! Where's my job?

2011-01-27T10:50:00.000Z

At People Matters we often meet people who say there are ‘no jobs’. While the number on the Live Register continues to rise there have been some significant jobs announcements during the past 50 days:

· AA Ireland is recruiting up to 40 employees for its financial services offices in Dublin.

· Citi, which has been operating in Ireland for 45 years and already employs more than 2,200 workers in Dublin and Waterford hired 300 workers in the past 12 months (some on fixed term contracts) and plans to recruit 250 more.

· Irish-owned ClearStream Technologies in Enniscorthy will create 70 new jobs over the next three years in product engineering, research and development, manufacturing, and sales and marketing.

· Food nutrition company Danone announced an investment that will create more than 40 new jobs in food science, engineering and supply chain management in Cork. A major expansion of its processing facility in Macroom will also see up to 200 people employed during the construction phase of the expansion which is set to begin this month.

· Goodman Medical Ireland will create 115 new positions in manufacturing, sales and marketing, and research and development over the next five years in the Mervue Business Park plant in Galway.

· Murex, a French financial software firm, will create 30 new jobs in software development, business development and consulting in South Dublin.

· Quest Software is to set up an international shared services centre in Cork city and 150 new jobs will come on stream over the next three years.

IDA Ireland aims to create 9,800 direct and 6,800 indirect jobs next year through foreign direct investments. Enterprise Ireland’s target is for 6,300 direct jobs and 4,400 spin-off jobs through export-led Irish firms during 2011.

2010-12-07T17:28:00.003Z

In this issue:

The slippery slope; cold comfort; news of trips, slips and falls; cuts; expecting a bruising; and the pain may last not just for days, but weeks, months and years – no, we are not talking about the weather but Budget 2011! The past few weeks have seen the weather used as a metaphor for a series of Government announcements about the way employers, employees and non-employed people will be taxed and receive credits, reliefs and benefits over the next few years. In this special issue we focus on how Budget 2011 (and its successors) will impact you. There is no sign of a thaw on the horizon, get ready to dig deeper!

The shape of things to come was already obvious from early this morning: the most significant news events of the day occurred at 08:00 when a ‘cherry picker’ arrived outside Government Buildings; at 10:40 am with the news the EU Finance Ministers had formally approved Ireland’s €85 billion rescue package; at 11:40 when more independents and semi-detached Fianna Fáil backbenchers announced that they “might not support the Budget unless”; and at 12:40 when Bank of Ireland’s ATM machines froze … and during all of this time Dáil business was officially suspended!

With the prospect of a general election that may see this Budget replaced by a ‘mini budget’ in the first half of next year, based primarily around Fine Gael’s or Labour’s proposals, Minister Lenihan’s Budget speech today may only hold hard for the first half of 2011. Budget 2011 has fleshed out some of the detail of what we can expect from the four-year long National Recovery Plan – at least from the current government perspective – but it is already skating on thin ice.

Against a background of high unemployment, a Live Register that tops 452,000 citizens and political uncertainty we summarise the proposed changes that will affect employers, employees and the non-employed, look at the likelihood of the changes announced today actually being put through, and suggest some additional changes which may be brought in next year.

VAT

There will no increase in the standard rate of VAT (currently 21%) in 2011 or 2012 which will give many businesses and employees an amount of certainty in planning pricing and expenditure over the next two years.

In 2013 the standard rate is set to increase to 22% with a further increase to 23% planned for 2014. The main opposition parties broadly agree with this strategy and it is one of the least contentious issues in this year’s budget. Despite some lobbying from retailers in border areas it is important to note that many other EU countries have similar or higher rates, so the Irish VAT rate will be brought more in line with the rates of our main trading partners over the life of the National Recovery Plan. It is likely to stay at that level in future years.

The lower rate on labour intensive services (i.e. the 13.5% rate) will be left unchanged over the next four years. Should Fine Gael be elected to government in the Spring they promise to make a 1.5% cut in the lower rate in order to re-direct consumer spending away from imports, and into labour-intensive, domestic services such as trades, restaurants, hotels and newspapers.

The National Recovery Plan also proposes, a ‘rebalancing of the VAT system and the application of the zero rate of VAT’. This may mean that some services move to the lower rate or the standard rate. This may see the zero rate of VAT that applies to some personal services and certain products such as books and children’s clothing come into the tax net again.

It makes sense for businesses to front-load expenditure on employment-related capital items into 2011/2012 e.g. if your company provides a company car or van to employees it will make sense to purchase any replacement vehicles within the next two years. Other areas of cost to consider in relation to front loading capital expenditure are spend on machinery, computers, furniture, fixtures and fittings. A case of ‘Buy Now, Get One Cheaper’!

Where an employer is paying for personal services on behalf of an employee, e.g. sponsoring an employee on a college course, consideration should be given to front-loading this spend as well. As the ‘students contribution charge’ is also to rise from €1,500 to €2,000, and further increases are expected in future, there is likely to be a double saving on this.

If the services you provide are currently zero-rated or have the possibility of being included in Fine Gael’s proposed new list of 13.5% VAT rated items get in contact with your trade body and ensure that they lobby government to keep it or include it at the lower rate.

Excise Duties and Air Travel Tax The Minister has signalled that there will be small adjustments to excise duties and licences in 2011 to result in increases of €110m per annum in the tax take which is a slightly larger take than usual. There are three categories of excisable products - mineral oils, alcohol and alcoholic beverages, and manufactured tobacco and excise duties are also chargeable on certain premises or activities (e.g. on betting and licenses for retailing of liquor).

The key changes announced today are:

Duty on petrol will increase by 4 cent and auto-diesel by 2 cent from midnight.

The Air Travel Tax has been reduced to €3 on a trial basis. Minister for Tourism, Mary Hanafin gave strong indications at the launch of Tourism Ireland’s Marketing Plans for 2011 that the Air Travel Tax would be changed. It currently applies to aircraft capable of carrying 20 or more passengers (€10 per passenger) and to airports where the number of passenger departures in the previous year was more than 50,000. The €2 reduction is expected to be followed by the relaunch of a route incentive scheme from the Dublin Airport Authority (DAA) and rebates for airlines on passenger charges by the Authority if certain capacity levels are reached. In their proposed budget announcements both Fine Gael and Labour have also said they would abolish the travel tax subject to deals on re-opening routes with Ryanair and Aer Lingus who account for 80% of passenger numbers through Irish airports and who would be the main beneficiaries of such a scheme. The number of visitors to Ireland in the first nine months of this year amounted to 4.6 million, down 16 per cent on the same period of 2009. Aer Lingus announced a fall in passenger numbers for November today.

The introduction of a betting tax to ensure online transactions are taxed at the same level as retail bets.

As excise duty, tax and licence increases tend to be introduced in the Budget each year people can do a little by ensuring they spend on items such as alcohol and tobacco prior to Budget Day.

Make sure to fill up your fuel tanks tonight and again before next year’s Budget!

Corporation Tax Ireland’s corporate tax rate stays at 12.5% and remains among the lowest in the EU. The Government has been at pains to explain that the EU/ECB/IMF deal for Ireland does not require changes to this rate. Two weeks ago, however, eight MEPs signed a declaration pushing for Ireland’s rate to increase so the issue has not gone away. The European Commission is planning to propose a corporate tax base harmonisation across the EU, but told People Matters that it could not impose a 25% rate as MEPs have proposed as Commission proposals on tax require unanimous voting. This is one of the few issues on which there has been true cross-party support – even Sinn Fein’s budget plan fails to mention an increase this year!

The extension of the three year corporate tax exemption for start ups is to be extended and the relief will be linked to employers PRSI.

Income Taxes The Minister for Finance stated in the National Recovery Plan that the income tax system will be rebased at approximately 2006 levels over the life of the National Recovery Plan. The 2006 level referred to as a measure of the overall Income Tax receipts and the Minister acknowledges that this outcome can be achieved through a combination of measures including changes to tax rates and bands or restructuring PRSI and the associated levies on income over the next four years. The Plan also states that income tax changes are to be front-loaded so that 65% of the change occurs in 2011:

The after-tax income of a single person earning €55,000 will fall by €1,860 a year, or about €36 a week, a drop of 4.8 per cent.

The after-tax income of a married single-income family earning €55,000 will fall by €2,310 a year, or €44 a week; a fall of 5.4 per cent.

As a result of changes to pension reliefs, the after-tax income of a person earning €55,000 who contributes to a private sector pension will fall by a further 2.5 per cent by the end of 2011.

With the prospect of a general election early in 2011 the changes outlined above may not be fully implemented in reality. One scenario is that Labour and Sinn Fein may have an influence beyond their current size and both parties are proposing a third rate of tax at 48% on joint incomes over €200,000 (single incomes over €100,000). Furthermore Labour has suggested a reduction in the personal credit of €250.

Should Fine Gael make up all or part of the next government it is opposed to proposals to raise either the standard 20% or the top 41% rate of income tax as it feels that combining income tax, PRSI and income levies, the top rate is already 51% for income earned over €36,400 per annum (for a single PAYE worker) and rises to 56% for self-employed people. One of the ‘three pillars’ of Fine Gael’s proposed budget involves limiting tax increases to one-quarter of the adjustment next year, and one-third of the adjustment over four years. Fine Gael proposes no income tax increases in 2011 ‘before recovery takes hold’, and limiting income tax increases to half the levels proposed by Fianna Fáil over the entire four years of the National Recovery Plan.

In the meantime, however, the Minister confirmed that current income tax rates of 20% and 41% will remain in place in 2011.

The Croke Park deal which protects the pay of public service workers remains unaltered in the National Recovery Plan but new entrants to the service will start on 10 per cent less than existing salaries and their pension entitlements will be considerably less generous. Labour has suggested extending the deal with a general wage freeze for all workers whether in the public or private sectors.

Various parties have suggested caps on pay for senior civil servants and politicians (ranging from €250,000 down to €100,000) and the Government has responded by setting a maximum of €250,000 for the President and others. Sinn Fein have suggested a popular concept which is to cap the ceiling of senior public servants in each Department at a multiple of entry level pay e.g. if a new entrant earned €25,000 the head of the Department would earn a maximum of €100,000 - four times the entry level.

Public sector employees will have to work harder too as there will be a reduction of 24,750 in the numbers employed in the public service over the period by 2014 compared to 2008, with half of this having already been achieved over the past two years.

Work practices will be reformed to allow for flexibility and more efficient services.

If you plan to take up a new position in the public sector make sure to sign your contract before the year end.

If you are a public sector worker earning over €250,000 – leave when your fixed term contract comes to an end!

If you are planning to retire from the public service follow the lead of Dermot Ahern and make sure that you do so before changes to pensions come into effect in 2011 (see below).

Tax Bands

The main way that the Government has of increasing income tax in the short term is by widening the tax base. Many of those who do not currently pay income tax can expect to do so in future. The National Recovery Plan states that it is “not sustainable” to have 45 per cent of working people paying no income tax and that a 16.5 per cent reduction in the value of tax bands and credits will be introduced overall.

The lowering of the lower threshold for income tax bands is one of the most significant changes in taxation and is expected to raise €1.245bn in 2011.

The main changes to the tax bands announced today are:

A reduction in the Single/Widowed band from €36,400 to €32,800.

For a person Married One Income it reduces from €45,400 to €41,800; Married Two Incomes* from €72,800 to €65,600 with a maximum transferability between spouses of €45,400 in 2010 and €41,800 in 2011.

A reduction in the One Parent/Widowed Parent band from €40,400 to €36,800.

Tax Credits

Most tax credits remained untouched in Budget 2010 but the National Recovery Plan allowed for some specific changes in the Income Tax Age Credit and the Income Tax Age Exemptions are to be phased out over the next four years. Tax experts have been expecting a 10% decrease in the average value of tax credits in Budget 2011 (about €400 per tax payer). The main aim is to bring 60% of adults within the tax net (the figure is currently less than 50%). The main proposals in relation to tax credits are:

Employee Tax Credit reduced from €1,830 to €1,650.

Personal Tax Credits reduced from €1,830 to €1,650 for a single person and €3,660 to €3,300 for a married person.

Similar reduction for a widowed person bereaved in year of assessment from €3,660 to €3,300.

Reduction in the One Parent Family Tax Credit by €180; the Home Carer Tax Credit by €90; Dependent Relative Tax Credit by €10; Incapacitated Child Tax Credit by €360; Blind Persons Credit by €180 and €360 for a couple.

The additional credit for certain widowed persons is reduced by €60.

The Widowed Parent Tax Credits are reduced by approximately €400 per annum.

The Age Credit is reduced by €80 for a single person and €160 for a married couple.

Age Exemption Limits will reduce for a Single person from €20,000 to €18,000 and double that amount for a married couple (€40,000 to €36,000.

Fine Gael has suggested that a 50% reduction in the income tax age exemption limits and in the age credit, so that those over 65 are taxed on a similar basis to those under 65.

Make sure that you are paying income tax based on the correct bands.

Ensure that you are availing of your full tax credits. Visit http://www.revenue.ie/en/tax/it/leaflets/it1.html#section1 which will be updated with thesechanges in the coming days to see which credits you are entitled to. One of the credits which is frequently unclaimed is the One-Parent Family, Widowed, Deserted, Separated or Unmarried (with qualifying dependent children) credit and Revenue also say that many carers fail to claim their credit. A tax credit at the standard rate of tax (20% in the tax years 2009 and 2010 is available for married couples where one spouse (the 'home carer') works in the home caring for one or more dependent persons, i.e. a child for whom they are entitled to Social Welfare child benefit, a person aged 65 or over, or a person who is permanently incapacitated by reason of mental or physical infirmity and the qualifying person normally resides with the couple for the year. A reduced tax credit applies where the income is between €5,080 and €6,880 in 2009 or 2010. Additional tax relief is available for people who have been unemployed for one year or more and who take up a qualifying job. This relief is also available for persons who have been in receipt of either Disability Allowance, Blind Person’s Pension or Invalidity Pension for 12 months or more, Illness Benefit for 3 years or more or released after 12 months or more in prison.

PRSI and the Universal Social Charge

The Government will extend the existing Employer PRSI Incentive Scheme until the end of 2011 although Labour has suggested an extension of the exemption period to 18 months, to incentivise employers to employ people who have been on the live register for six months or more.

In the last Budget the Minister for Finance said that the existing PRSI, Health and Income Levies will be subsumed into one universal social charge. In reality the Health Levy and Income Levy are to be abolished and replaced by a new Universal Social Charge on a revenue-neutral basis, will be introduced in 2011, at the following rates and thresholds:

0% < €4,004

2% €0 to €10,036

4% €10,037 to €16,016

7% > €16,016

The €75,000 ceiling on PRSI has been abolished as part of this transformation creating an effective increase in taxation for those on higher earnings. New PRSI rates will be introduced for higher earning public servants.

During the National Recovery Plan period there will also be abolition or restriction of the levy charges on Approved Profit Sharing Schemes; Approved Save-As-You-Earn Schemes; Unapproved Share Options; and Share Awards but the timing of these changes has not been agreed yet.

Fine Gael has promised, if elected, to abolish the lower 8.5% rate of employers’ PRSI on staff earning below €356 per week for at least three years in order to reduce employment costs and offset the effect of another of its proposals - not dropping the minimum wage (see below). Sinn Fein supports the idea that the government abolish the PRSI ceiling; abolish PRSI exemption for share options; abolish the income tax exemption for share-option schemes; and adjust PRSI on share-based remuneration and Capital Gains (TASC recommends treating all income the same and as such, PRSI should be applied).

With changes in employment and social welfare circumstances over the past few years many individuals may not be aware that they do not have to pay the levy. For example, many who previously paid for GP and medical expenses themselves but who now hold full medical cards (A 'GP only' medical card is not a 'full' medical card) did not have to pay the levy in 2009 and 2010 and can now reclaim it.

Individuals whose annual income does not exceed €15,028 were also exempt, as were individuals aged 65 or over whose annual income did not exceed €20,000.

Married couples, one or both of whom are aged 65 or over, whose combined income for the year does not exceed €40,000 also qualified for exemption, although this is set to go in 2011.

All Social Welfare payments are also exempt from the Income Levy.

Property and Wealth Taxes

A flat rate 1% stamp duty is being introduced on all residential property transactions up to €1 million and 2% on transactions over €1 million will be introduced from midnight tonight. Reliefs on stamp duties are to go.

Although a property tax is not being introduced in 2011 an interim Site Value Tax will be introduced in the last quarter of 2011 or first quarter of 2012. This tax will apply to all land other than agricultural land and land subject to commercial rates. It will consist of a fixed local service contribution of about €100 per annum per household initially.

The full Site Value Tax will be introduced in 2013 when valuations of sites have been completed and will apply to about 1.8 million households as well as zoned lands that would equate to an estimated further 700,000 houses. The annual Site Value Tax will amount to just over €200 per dwelling (or site) on average. The Minister stated that this site charge will be fixed at €100 per annum for certain categories of households (e.g. pensioners).

For those moving into the housing market for the first time there is the news that most loans taken out on or after 1 January, 2013 will no longer qualify for mortgage interest relief, which is to be abolished completely by 2018. Sinn Fein has suggested that home loans taken out by landlords should not qualify for this relief from 2011 onwards.

There is good news for those who are trading down, however, with the news that stamp duty will be abolished on sales of properties where families are downsizing.

Most parties have proposed an increase in the second home tax of up to €600 per annum. Sinn Fein has also suggested a tiered system for third and subsequent houses e.g. €700 for a third house, €800 for fourth and fifth house, and so on. They have also suggested that the Government examine the introduction of an income-linked waiver for individuals with second homes who cannot sell them in the current climate, are struggling to meet mortgage repayments, or are in financial difficulties.

In its National Recovery Plan the Government said it is committed to the phased abolition of several property-related legacy reliefs (also know as the ‘McCreevy reliefs’) over the four year period of the plan. The main schemes affected by this are: Urban Renewal; Town Renewal; Accelerated Capital Allowances for Hotels; Capital Allowances for Holiday Cottages; Student Accommodation; Multi-Storey Car Parks; Third-level Educational Buildings; Sports Injuries Clinics; Park and Ride Facilities, and General Rental Refurbishment Schemes. In general the opposition parties support these moves (although they differ in how they want the abolitions phased) so they are certain to be implemented. Sinn Fein has suggested an immediate capping of relief at the lower rate of income tax.

Sinn Fein has suggested abolishing the amount of interest that can be offset against rental income for tax purposes while the Labour Party is also suggesting reduction to 25% in the amount that can be offset.

Income tax relief for rent paid for private rented accommodation will go on a phased basis over the next eight years, in line with the time frame for the abolition of Mortgage Interest Relief. Last year the Government paid out €44 million on this relief. Again this is a move which has cross-party support, so there will be no wriggle room.

In its planned budget Fine Gael is suggesting making a pre-announcement that home insulation and other residential and commercial energy saving subsidies will terminate in 2013, leading to a bringing forward of demand in the intervening two years. The Government, however, has introduced a new tax incentive for works that improve energy efficiency instead.

Sinn Fein has suggested going a step further in relation to property by saying it would introduce an income-linked wealth tax of 1% on all assets, including property, in excess of €1 million, excluding working farmland, regardless of residency which it claims would raise €1 billion in tax revenue.

Check to see if you are eligible to qualify for the fixed €100 Site Value Tax when it is introduced.

Given that home loans taken out on or after 1 January, 2013 will no longer qualify for mortgage interest relief there is a period of two years during which those intending to purchase a house can maximise their tax relief on mortgages, although any potential saving would have to be offset against potential falls in overall property prices.

The cost of having an additional home going into the future needs to be considered carefully as the introduction of a site tax and proposed increases in taxation on second homes as well as increased VAT rates on some management company charges will place a taxation charge of at least €500 on most second/holiday homes and other additional properties.

If you are living in a house that is larger than you need over the medium-long term the abolition of stamp duty on down sizing, coupled with the new Site Value Tax, may make a move to a smaller property worthwhile.

Although rent relief is set to go you can still claim it for up to four previous years. The maximum relief for a single person aged under 55 was €400 and it was €800 for a married couple/widower aged under 55. These amounts doubled if you were aged over 55 in the past.

Service charges such as bin/waste charges paid to private operators such as Oxygen and Panda - up to 400 Euros - can be claimed for the past four years also.

The rent-a-room relief remains in place. This exempts household income from renting a room and providing meals, usually to students, by up to €10,000 per annum and can be claimed back for up to four years.

Water Charges

Household water charges will not be levied in 2011 as was widely expected.

The National Recovery Plan hinted that they may not be imposed until 2014 following the introduction of a nationwide meter installation programme. Up to 1.8 million households will need to have meters installed if these charges are to be based on actual consumption and a working group is already looking at how this might be achieved. The National Roads Authority may be involved in this infrastructure project.

Who will pay for the meters (our guess is: consumers) will probably be a matter of extensive debate on the Joe Duffy show over the next couple of years as some estimates put the cost of installation at circa €500 million or €50 per household.

Check your ‘site’ for any leaks or damage and have these repaired while plumbing costs are low. A dripping tap might add up to 50 per cent more and a cracked pipe may lead to several thousand percent increases in consumption.

Install water butts to capture rainwater from the roof and downpipes – this ‘grey’ water can be used for external purposes e.g. watering the garden, washing the car.

Consider if grey water from washing machines, baths, etc. can be recycled e.g. used to flush toilets. You will need to have such as system installed by a registered contractor.

Planes, Trains and Cars

The influence of the Green Party has been felt in fiscal matters during recent budgets and not just in relation to water. Among the changes that have occurred in recent budgets are increased charges on fuel, the introduction of a Carbon Tax and changes to VRT and Motor Tax which are now linked to CO2 emissions, as well as tax-related incentives for reducing energy consumption and insulating homes and businesses.

A carbon tax of €15 per tonne of CO2 emitted was introduced in the 2010 Budget and the National Recovery Plan proposes to double this tax by 2014, with a €10 per tonne increase in 2012, and a further €5 per tonne increase in 2014 giving a cost per tonne in 2014 of €30.
Interestingly both Fine Gael and Labour have both said that, if elected, they would reduce the increase proposed in the four year plan by €5 per tonne i.e. to €25. This might prove contentious if they had to form a coalition with the Green Party.

In real terms the planned charge increase will give rise to a 4 cent movement in price on a litre of petrol and 4.5 cent on a litre of auto diesel by 2014. The National Recovery Plan also outlines the likelihood that further changes in VRT and Motor Tax will be linked to CO2 emissions too. Recently, for example, it was announced that the ‘off-the-road’ vehicle tax exemption is to be scrapped. Transport Minister Noel Dempsey claimed that the exemption, which allows vehicle owners to avoid back tax on a vehicle if they can sign a declaration in a Garda station that it has been off the road since it was last taxed, is costing the State up to €75m per year. Mr Dempsey claimed there was “significant evidence” that some owners are fradulently declaring their vehicle was off the road when it wasn’t.

There have been increases in VRT relief on electrical and hybrid vehicles but an increase in the VRT flat rate for commercial vehicles from €50 to €200.

The car scrappage scheme will be extended for another six months.

Consider making a switch in office and home heating and energy to alternatives such as wind, solar or thermal power, particularly if you are based in a rural area.

Consider replacing existing cars and vans with lower emissions vehicles when they are due for replacement.

The type of fuel used by vehicles is important and consideration should be given to switching to lower CO2 fuels – diesel and LPG may give lower tax per kilometre, and alternatives such as biofuels may be worthwhile if you have a significant number of vehicles.

Ensure the full range of travel expenses are being claimed by employees.

Increase use of public transport in place of own-vehicles.

Purchase of annual public transport commuter tickets (these need to be purchased this month in order to obtain the full benefit).

Avail of the cycle-to-work scheme to purchase bikes and cycling clothing and equipment.

If your business is located in the centre of Dublin encourage the use of city bikes.

CAT and CGT

In recent years, the rates for Capital Gains Tax (CGT) and Capital Acquisitions Tax (CAT) were increased from 20% to 25%. The National Recovery Plan provides for a broadening of the base of CGT and CAT. There seems little agreement among the political parties as to how reform of CGT and CAT should occur and it is likely that this issue will be kicked into the latter part of 2011 or even 2012.

Fianna Fáil has said that in 2012, the single rate of CGT will be changed to a system of different rates of CGT for different levels of gains. Labour has suggested a structure where the first €50,000 would be paid at 25%; the next €50,000 at 30%; and the balance at 35%. Fine Gael has said that in relation to properties it would prefer to have a low (5-10%) rate of Capital Gains Tax on the site values of primary residences rather than an annual recurring property tax. The Labour Party has suggested limiting GCT for businesses to €3 million. Sinn Fein is suggesting an immediate increase in CGT to 35%.

A similar system to that proposed for CGT would be introduced by Fianna Fáil and the Green Party for CAT where the current tax-free thresholds will be reduced. Opposition parties have suggested a cut in Capital Acquisitions Tax thresholds (Fine Gael by ‘at least 20%’ and Labour by 25%); and an increase in the rate (Fine Gael suggest from 25% to at least 30% while Labour has said the structure it would like to apply would be the first €50,000 over threshold at 25%, the next €25,000 at 30% and the balance at 35%). Labour also proposes capping CAT for businesses to €3 billion and for farmers to 75%.

The National Recovery Plan also provides for the abolition or restriction of CGT, CAT and stamp duty reliefs and exemptions. However, Fine Gael has suggested that in relation to properties the 7% and 9% rates of stamp duty for families trading up and down should be reduced to 2% for at least two years to stimulate transactions in the property market.

DIRT

The Government has increased DIRT by 2% to 27% and 30% on long-term deposit accounts. Fine Gael, Sinn Fein and Labour all propose to increase DIRT to 30% in order to encourage higher levels of household consumption in 2011.

Minimum Wage

One of the most significant changes proposed in the National Recovery Plan in 2011 is that the minimum wage will be reduced by €1.00 to €7.65 per hour. The change is expected to come into force in May 2011 if the current Government is still in power and it is a requisite for reporting to the IMF and ECB if Ireland is to continue to draw on their funding. Opposition parties have attacked this element of the four year plan strongly and this change may not be implemented next year if the situation can be renegotiated with the fund holders. Today the Minister announced that those on the minimum wage would not come into the tax net.

Over the coming years other employment agreements which are linked to the minimum wage will be reviewed which could see a reduction in overtime and special pay rates for working at weekends and on public holidays.

Employers will now be able to claim the ‘inability to pay’ exemption clause in respect of the minimum wage more than once, lifting a previous one-time cap on such claims.

Artist’s Exemption

Artist’s exemption from income tax will be restricted to €40,000 in earnings. This can apply to books, plays, musical compositions, paintings or pictures, or a sculpture.

Although the exemption threshold has been lowered it may be worthwhile considering if any of the work that you do might qualify for the exemption. In recent years the Revenue Commissioners have been more flexible in their interpretation of what constitutes art.

Education Fees

The Government has announced an increase in registration fees for third level students to €2,000 for a first member of the family, and €1,500 for subsequent members.

The Labour party has suggested a new scheme where a person would be entitled to claim back their income tax from their last two years of work in order to offset their loss of income while undertaking full-time study in an authorised institution. This scheme would initially be limited to 2,000 applicants, on a first come-first served basis. Only annual income up €50,000 would be eligible for a tax refund.

Labour is also opposed to the proposed charge for Post-Leaving Certificate (PLC) courses.

Other Reliefs

Last year, Revenue paid back €102m on medical expenses alone and the political parties appear to be trying to outdo each other in their rush to get rid of tax reliefs. What seems certain at this stage is that income tax relief for trade union subscriptions will go; employees in many former state agencies which were privatised (such as Eircom and Aer Lingus), financial institutions and other organisations will see tax exemption on Approved Share Options lost in 2011; and benefit-in-kind exemption on employer provided childcare will also go in 2011, adding substantially to the cost of availing of childcare at workplace crèches and playschools.

Other reliefs that may fall under the axe (depending on which parties are in power this time next year) include relief for patent royalties; tax relief on loans to certain companies; relief on share purchases by employees, etc.

Although some reliefs are going others remain in place. Many people fail to claim each year and it is possible to claim for up to four years ‘in arrears’ for many reliefs. Reliefs to consider include: Medical expenses (which can include GP visits, doctors’ bills, hospital treatments, x-rays, ambulance transportation, maternity care, prescription medicines, physiotherapy, laser eye surgery, treatment of other eye problems, food and drink for coeliacs, and more); dental expenses (for procedures such as veneers/crowns and root canal treatment). Trade union subscriptions of up to €70 per year. Again this used to be at 20% and can be claimed back over the previous four years. Qualifying tuition fees (up to 5,000 Euro per year, with relief available at the standard rate); Flat-rate expenses depending on your profession. Childcare services in the home. Although the income from this is relatively low (average ‘pay per hour’ is just over five Euro according to the recent ‘Growing Up in Ireland’ report) childcare services provided up to a value of €15,000 are exempt from income tax. This may make additional sense as the relief on providing childcare facilities in the workplace is to be lost over the next few years.

Pensions

Existing pensioners face little change over the next 12 months as no changes are expected in the State Pension in 2011 although the four-year, National Recovery Plan does not preclude such changes in future years. The plan reiterates a decision to increase the qualifying age to 66 in 2014 and to up to 68 by 2028.

Existing public service pensioners, however, will face cuts for the first time, with an average reduction of four per cent in their pensions for those earning more than €12,000 per year. Public service lump sums will also be subject to a deduction.

For those currently working and saving for a pension there are some significant changes in the pipeline. The rate of tax at which the pension contribution qualifies for tax relief is currently the marginal tax rate. Relief will continue to be available at this marginal rate for 2011 but it will reduce to 34% in 2012, 27% in 2013, and from 2014 the tax rate will be the standard rate of tax of 20. Should Fine Gael be in power after the next election they propose a further change by cutting tax relief on schemes offering pensions greater than €60,000. Labour has similar proposals in mind, but has not yet specified the amount of the cap.

The relief offered on both PRSI and the health levy will be scrapped for pensioners in 2011.

A number of steps are being taken to reduce the tax advantages of having a large pension. These are aimed particularly at company directors and business owners who have used pension savings as tax shelters and have amassed large personal pension funds running to several million Euro.

The ceiling for a tax deduction for pension contributions is being reduced from €150,000 to €115,000 in 2011. This will further reduce the level of tax deductible contributions that an individual can make to fund his/her pension. There is also a proposal to reduce the maximum value of funds which an individual can have in a pension scheme. This currently stands at €5.4m but it is likely to be considerably reduced – Fine Gael has nominally suggested a maximum of €1.5 million for private sector workers but Labour has simply suggested ‘a cap’. All ex-gratia termination and pension lump sum payments in excess of €200,000 are also to be taxed according to the National Recovery Plan (although Fine Gael has suggested a higher limit of €250,000).

An alternative the Government’s plans has been proposed by Fine Gael which says it will make tax savings of a similar scale through a combination of a temporary, annual 0.5% contribution for all private pension funds with an equivalent reduction applied to public and private sector defined benefit entitlements; abolition of PRSI relief on employer pension contributions; and PRSI/health levy relief on employee pension contributions.

Fine Gael has also proposed to increase the "deemed distribution" rate on large (Annual Retirement Funds ARFs) to avoid their use for inheritance tax planning; and applying from 2012 marginal rates of income tax, rather than Capital Acquisitions Tax, to ARFs on the death of the beneficiary to avoid their use for inheritance tax planning. This could be accompanied by a one year window in 2011 for beneficiaries to accelerate withdrawals from ARFs at a tax rate of 35%, leading to a windfall for the exchequer at a crucial time.

If you are in a position to accelerate your pension payments into 2011 in order to maximise the tax relief available.

With more and more pension payment being brought into the tax net it might be worth considering if alternative forms of investment might yield a better return in the long run e.g. investments in natural resources, commodity trading, property, classic cars, wine, etc.

Social Welfare Reforms and Payments

Social welfare expenditure will be €3 billion lower in 2014 compared to spending for 2010 (the Department's Budget for 2010 is €20.9 billion). Scheme savings within this Department will be required amounting to €760 million in addition to savings of €100 million from labour activation measures in 2011. Three reports on structural reform were released on the same day as the National Recovery Plan which will assist with key areas of structural reform of the social welfare system. The reports are accessible on www.welfare.ie'. Savings in social welfare expenditure will be achieved through a crack down on welfare fraud, structural reform and new employment programmes to cut the number of people on the dole. The crackdown on fraud will be aided by the roll out of a new public services card next year for welfare recipients and increased use of new technology, such as automatic telephone contact with those on job-seekers’ allowances, may be moved forward.

For Budget 2011 the expectation was that there would be an average 5% reduction in welfare payments as many consumer costs have reduced in recent years. The Minister for Finance announced the establishment of a National Welfare Index by the CSO to help decision making in this area.

Child Benefit is to be reduced by €10 for the first child, and €20 for third and subsequent children.

The fuel allowance is to be increased by €40 this year to counteract the effects of cold weather.
Fine Gael has suggested reducing social welfare payments for those ‘with the capacity to work’, beginning with a €6 weekly cut in 2011 and rising to €18 by 2014. Working age payments to carers, the blind and the disabled would be maintained at current levels.

Existing funding relief for pensioners, in areas such as the TV licence fee and free travel schemes, will eventually be frozen at 2010 levels.

Citizens over 65 will also have to pay for passports from 2011 (the current charge is €80).

Fine Gael has suggested cutting the rate at which Rent Supplement is paid by 10% and the length of time that it is paid to six months. After six months, families with housing requirements will be transferred to local authority Rental Accommodation Schemes.

A final thought

The National Recovery Plan contains over 140 pages of aspirations for the next four years, replaces the old system of well-timed leaks to test public opinion and brings some certainty and stability to the budgetary announcement process. There were few surprises in this year’s Budget announcement but the Government may find it difficult to pass all of their proposals through the Dáil in the coming days and weeks. With the prospect of a general election in the first quarter of 2011 making many sitting TD’s look over their shoulders some have already said they will not back the Budget proposals.

There is already wide disagreement among the political parties about the size of the savings needed – ranging from six billion from Fianna Fáil, the Green Party and Fine Gael, through 4.7 billion from Sinn Fein and 4.5 billion from the Labour Party, to zero among some independents! Smaller parties may hold the balance of power in the coming general election, so their proposals must be seen as ‘waiting in the wings’.

In the meantime, as Senator Shane Ross is fond of saying: “Who’s going to pay for it all? The tax-payer, that’s who – you and me”!

C: Sue Mulhall, M. Ed., BBS, Dip. PM., MCIPD
C: Mark Campbell, PG Cert AP, MBA (Tech Mgnt), BSc (Mgnt), MMII
A: 30 Delbrook Park, Dundrum, Dublin 16.
P: +353 (01) 296 1578
E: admin@peoplematters.ie
W: www.peoplematters.ie
R: Registered Number: 346834
V: Vat Number: ie6366834w
B: peoplemattersltd.blogspot.com

This blog and the information it contains is private and confidential and is intended for the addressee only. The unauthorized use, disclosure, copying or distribution of this e-mail or any of the information it contains is prohibited and may be unlawful without the prior permission of People Matters Ltd. Please help save natural resources by considering the environment before printing this blog.

News from People Matters Ltd. December 2010

2010-12-01T09:06:00.002Z

In this issue:

As the snow-plough driver gave us a lift in early this morning we decided to issue our December Newsletter before the November employment statistics emerged.

This month, in our Focus section, we take a look at some important seasonal employment issues such as what is happening to FÁS; who wins the title for the Grumpiest Santa this year: and why are so many Santas unemployed in 2010?

To lighten matters up on snowy December days we have a short, interview-related, Christmas Quiz to test you.

We also have some interesting new research related to pay and job prospects in our Research and Resources section.

Focus:

Xmas Tales Christmas always seems to be a time when tales of naughty Santa’s and Scrooge-like employers emerge. In our annual round up of seasonal good(and bad)will stories we bring the latest news on one of the contenders for the Grumpiest Santa of 2010 (a sort of Xmas-Factor competition) and take a look at Santa’s employment prospects for this year.

FÁS forward: The Minister for Social Protection introduced the Social Welfare (Miscellaneous Provisions) (No.2) Bill 2010 on 19 November which allows for the full transfer of the Employment Services and Community Services Programmes and the integration of FÁS staff within his Department. Many of these programmes are currently the responsibility of the Minister for Education and Skills and their transfer is mainly administrative. The more significant change is the integration of FÁS staff into the core civil service. This follows a move in September which saw the transfer of the Community Services Programme and the Rural Social Scheme from the Department of Community, Equality and Gaeltacht Affairs to the Department of Social Protection). Minister Ó Cuív said: “The FÁS programmes and staff transfer is intended to provide a more streamlined response to the needs of unemployed people by integrating income support through the social welfare system, with supports for activation and preparation for returning to work.”

Cost of non-employed: The Minister for Social Protection also offered some interesting insight into how the Government perceives the cost of individual unemployment as part of an announcement related to the ‘four year plan’: “The net saving to the State for every ten thousand number reduction in people claiming jobseekers payments could save €120 million (or €12,000 per head). When the extra PRSI income and tax income is added to this saving, the saving can become as high as €200m (€20,000)”.

Grumpy Santa Title: No, its not Minister O Cuiv! The leading contender for this year’s Grumpy Santa goes to the one employed by Evesham Market Town Partnership in England. Last year they booked a “brilliant Father Christmas” according to Town Manager Lew Hammond, “but he failed to turn up”. To make up for that the Town Partnership promised shoppers a switch on of Christmas lights which would be a truly festive affair in 2010. Plans boasting a Christmas grotto with entertainment from puppets, showmen, live music and Morris dancers were released in early November. Come the day, cometh the man: Santa rode in his sleigh on cue but shoppers were disappointed when the red fellow distributed just a few sweets, only spoke twice to children, and had his head down for most of the event.

Lew Hammond, commented: “This was an unfortunate thing that should not have happened as we were just trying to protect the spirit of Christmas. This year Santa turned up but he was inept, sullen and incommunicative - indeed everything a Father Christmas should not be! It was a disaster. Father Christmas has now been sacked and the fee (GBP 250) cancelled. We have also been given an extra GBP50 for the poor performance - that’s a first, too. We haven't had damages awarded before."

Unemployed Santas? The number of Santas facing unemployment is expected to increase this Christmas. The Bonifatiuswerk of German Catholics – a church aid organisation – has begun calling for "Santa Claus-free zones” in Germany’s city centres. The organisation sees Santa as "an invention of the advertising industry designed to boost sales" and as "a representative of consumer society who has little to do with the historical figure of St Nicolas." They hope to spread the word to other European countries during December.
Cold comfort for Santa: A shopping mall in the US has gone a step further, sacking Santa and elf employees who have not had the flu vaccine. Bah Flu-bug!

A Christmas Interview: In these times of high unemployment many people who would not normally do so are applying for part time, seasonal jobs. Dundrum Town Centre recently advertised for a ‘Santa’ and a ‘Mrs. Claus’. They received hundreds of applications and whittled those for the ‘Santa’ position down to three: a local politician; a generous lawyer; and the real Santa Claus were called to interview! On the lift on the way up to the interview room the interviewer had set a test: She placed a fifty Euro note on the floor to see how interviewees would react. All three candidates got into the lift and one-by-one they noticed the note lying on the floor. Which one picked up the note, handed it over to the interviewer, and got the job? Santa of course, the other two don't really exist!

Christmas Quiz

Good news for Googlers (employees of Google) in Ireland with the announcement that they are among the few who will receive a substantial pay rise (averaging 10 per cent) and a bonus this Christmas. Before you dispatch a CV to Google looking for a new job it is worthwhile considering if you would be able to answer their interview questions. Instead of a traditional Christmas Quiz we are asking you the 12 most popular interview questions asked and problems which people have been requested to solve during interviews by Google. The only rule is that you cannot google the answers. Try these:

How many golf balls can you fit in a school bus?
How much would you charge to wash all the windows in Dublin?
In a country where people only want boys every family continues to have children until they have a boy. What is the proportion of boys to girls in the country?
How many piano tuners are there in the entire world?
Why are man-hole covers round?
Design an evacuation plan for Dublin.
How many times a day do a clock’s hands overlap?
Explain the meaning of dead-beef. (Hint: Only software engineers should attempt this one, most other people won’t have a clue).
A man pushed his car to a hotel and lost his fortune: What happened?
You need to check with your friend, Adam, that he has your correct phone number. You cannot talk to him directly, but must send him a written message, via your arch nemesis, Eve. What should you write on the card to ensure that Eve does not find out your number?
You are a captain on a pirate ship and the crew gets to decide how the gold is divided up. If fewer than half agree, you die. How do you ensure that you get a share of the booty and stay alive?
You have eight balls the same size, seven weigh the same and one weighs slightly more. How can you discover which is heaviest using a balance and only two weighings?

If you find these questions too hard, keep them aside and do one each month for the next 12 months – that way you will know if you really still want to work for Google when they announce another bonus around this time next year! If you cannot wait until then don’t worry, we will publish some suggested answers in our January newsletter.

Research and Resources

This month we have news of one of the few employment polls Ireland has managed to top this year; we have some pre-budget tips that might save you money courtesy of taxback.com; bring you the latest statistics on employment, pay, working conditions and hours worked; and bring you news of ‘Plain English Day’.

Ireland tops employment poll: Unfortunately, it is in the militancy league! Ireland lost 170 days per 1,000 employees to strikes and other industrial disputes last year. The strike over proposed pay cuts by public servants in November 2009 accounted for most of the lost days and placed Ireland well ahead of Spain (83 days), Malta (47 days) and the UK (19 days). (Eurofound)

Prebudget Tips: Get it now, before its gone. Website www.taxback.com has come up with a list of tax reliefs it says you should ensure that you claim before Budget Day on 7 December. The reliefs which many people fail to claim each year include: Bin charges paid to private operators (up to 400 Euros could be claimed for the past four years); rent relief (the maximum relief for a single person aged under 55 is €400 and it is €800 for a married couple/widower aged under 55; these amounts double if you are aged over 55); medical expenses (which can include GP visits, doctors’ bills, hospital treatments, x-rays, ambulance transportation, maternity care, prescription medicines, physiotherapy, laser eye surgery, treatment of other eye problems, food and drink for coeliacs, and more); dental expenses (for procedures such as veneers/crowns and root canal treatment); trade union subscriptions (which can be claimed at 20% and can be claimed back over the previous four years); qualifying tuition fees (up to 5,000 Euro per year, with relief available at the standard rate); and flat-rate expenses depending on your profession. Last year, Revenue paid back €102m on medical expenses, €44m on rent and €4.2m on trade union subscriptions.

Taxback also point out that many people are failing to change their tax status when they marry or become single parents, meaning they do not get appropriate tax credits. If you have been made unemployed during the tax year, have decided to leave the country or have not worked a full tax year you may also be due a refund.

Fall in the Live Register? The headline (or unadjusted) figure in the October Live Register shows a drop of 12,864 on the previous month's (September) total, bringing the Live Register down to 429,553. This decrease was the highest October monthly decrease in the Live Register since October 1996 and the lowest monthly total since December 2009. The CSO anticipates a further fall in the November figures which will be issued later today.

Unadjusted September and October figures nearly always show a drop as students return to education during those months while November’s figures usually show a fall due to people taking up part-time work in retail and other seasonal employment. Many commentators expect the Live Register to rise again when most of these fixed-term contracts finish in January and February 2011.

Statisticians cautionary over Seasonal Adjustment: There was also a fall in the seasonally adjusted October Live Register figure to 443,000. This is a decrease of 6,600 or 1.5 per cent on September 2010. Statisticians have been quick to point out, however, that these minor adjustments may not spell the end of rising unemployment just yet. The figures are a mathematical adjustment and are not based on actual survey numbers. There has been a very significant rise in the overall unemployment rate over the past two years pushing the number on the Live Register to nearly half a million people. As a result mathematicians say the normal methods for calculating ‘Seasonal Adjustment’ cannot be relied upon when they turn from negative to positive until the CSO has a full, twelve months of Live Register figures on which to base it.

You can tax us, but leave our coffee alone! A pre-budget survey asked workers what work “treat” they will refuse to give up post budget 2011. Over half (52 per cent) of employees said they will continue to indulge in a morning coffee, over a third (34 per cent) said they will still buy lunch (rather than bring in a packed one), while 14 per still plan to go for after-work drinks with colleagues. (Irishjobs)

Pay cuts, what pay cuts? The result of the latest CSO Household Budget Survey show that average weekly earnings fell by just under four per cent over the past 12 months. However, the hourly pay rate (the key to competitiveness) has hardly changed at all during the same period. This may be one of the reasons why the IMF and ECB have encouraged the Irish Government to reduce the minimum wage.

Cuts in pay and hours worked have not fallen evenly across all workers. A private research study carried out recently found that overall 48 per cent of Irish workers had not suffered any form of pay cut and 35 per cent actually recorded an increase up to the end of 2009. Workers in the public sector seem to have fared worst overall, with an average pay reduction of six per cent in 2009. Even so, this is more than twice the number who reported a cut than the number in the private sector where the average drop in pay was just under three per cent in 2009. However, it is estimated that a further one per cent decrease will have occurred in the private by end of December, 2010 while the Croke Park Agreement has prevented a further pay cut for public sector workers this year, thus narrowing the gap. (CSO, IBEC, and Amarach)

Pay cuts not applied universally: Only 37 per cent of workers in the public sector claimed to have had a real cut in pay last year (2009), leaving 63 per cent without a cut. Although there is no comparable figure available for the private sector the total average pay bill of private sector companies decreased by 10 per cent in 2009 and it is expected to have dropped by a further three per cent this year. While 25 per cent of companies reported introducing pay cuts in 2009, only 15 per cent claim to have made cuts in 2010. (Amarach Consulting, ESRI, Grant Thornton, IBEC, NESDO).

Latest pay-cut figures: The most recent survey of both public and private sector workers by Irishjobs during October and November of 2010 found that half (54 per cent) of respondents said their pay was down compared to this time last year, but almost one in five (16 per cent) told the recruitment website that their pay had gone up this year. A third (30 per cent) said it remained the same. (Irishjobs)

Jobs and hours rather than pay cut back in private sector: Although on the face of it may seem that public sector workers have got a raw deal during 2009/2010 figures from the ESRI estimate that 60 per cent of private firms cut jobs in 2009 while in the public sector only a small number of those on fixed term and temporary contracts lost their jobs. Workers in the private sector also saw a 2.2 per cent decrease in their average working week to 30.9 hours per week (not a concern if they were on a salary, but a significant reduction if they were paid an hourly rate). Irregular earnings (such as overtime payments, bonuses and expenses) in the private sector dropped by nearly seven per cent during the same period. (CSO/ERSI)

Pay prospects for 2011: IBEC estimates that pay will increase by just 0.2 per cent in 2011 and that the national pay bill will increase by just 0.3 per cent. Despite anticipated tax increases in the Budget just 22 per cent of employers expect to increase pay next year.

The recent Irishjobs survey found that one in 20 Irish workers said they could accept a cut of 10 per cent or more in their salary in 2011 without it having any significant impact on their expenditure. One in ten (11 per cent) of workers said they could accept a salary cut of 5-10 per cent and one in three said they could tolerate a cut of one per cent. However, over half of workers (55 per cent) said they would not be in a position to accept any cuts in their income if they were to continue to meet their outgoings.

Job prospects not positive for redundant public sector workers: Some employees in public sector organisations such as the HSE may be looking forward to receiving a large redundancy payment from their employer before taking up a new position in the private sector, but they have been warned to ensure that they have a war chest to tide them over for several years. A survey has revealed that an overwhelming majority (87 per cent) of private sector employers believe that public sector workers are unrealistic about finding jobs and need to market their skills potential employers more effectively. Most private sector employers rank candidate’s private-sector experience as ‘very important’ when hiring. (Hays)

Plain English Day: The Budget debate on 7 December is bound to produce some new acronyms and unclear phases so we should be thankful that Friday, 10 December is the day when the Plain English Campaign is encouraging us to drop the jargon and to shred any documents that contain gobbledygook that come across our paths. Their latest newsletter reminded us of a classic pieced of pensions-related gobbledygook sent to an employee from Cumbria County Council in response to a query back in 1991: '

‘In regard to your recent enquiry regarding your entitlement to retirement benefits if you were to be retired under the Voluntary Redundancy Scheme; when the added years awarded to you under the Scheme exceed 6.2/3rd years, there is a reduction of an amount equal to 30% of your redundancy payment in respect of each year (and part year) of service in excess of this. The amount is deducted from your additional lump sum, but if the said amount is greater than the additional lump sum, the outstanding balance is capitalised and deducted from the additional pensions. When the added years awarded are 6 years 243 days or less there is no reduction in your compensation.'

Budget 2011

Watch out later in the month for a special Budget edition of our newsletter. We will not be covering the entire Budget but rather highlighting the main things which employers and employees need to do to plan for 2011 and beyond.
No Christmas Cards from People Matters? Don’t expect a Christmas card from People Matters this year. It’s not that we are cutting back, but we prefer to make a contribution to charity each year instead. Over the past 12 months we have been supporting the children’s charity Barnardos and we are making an extra contribution to this worthy charity this month. We are also taking part in Barnardo’s Annual Santa Dash (it will be more of a stroll in our case) which takes place, weather permitting, in Marlay Park on 12th December. Give us a wave if you are there.

Contact us:

C: Sue Mulhall, M. Ed., BBS, Dip. PM., MCIPD
C: Mark Campbell, PG Cert AP, MBA (Tech Mgnt), BSc (Mgnt), MMII
A: 30 Delbrook Park, Dundrum, Dublin 16.
P: +353 (01) 296 1578
E: admin@peoplematters.ie
W: www.peoplematters.ie
R: Registered Number: 346834
V: Vat Number: ie6366834w
B: peoplemattersltd.blogspot.com

This blog and the information it contains is private and confidential and is intended for the addressee only. The unauthorized use, disclosure, copying or distribution of this blog or any of the information it contains is prohibited and may be unlawful without the prior permission of People Matters Ltd. If this blog is of absolutely no interest to you, and/or the fact that you have received it is merely an irritation, we would be grateful if you could notify us so that we can take you off the database, stop sending you future editions and/or re-send it to the correct address. Please help save natural resources by considering the environment before printing this blog.

Are you a twit?

2009-07-01T12:09:00.001+01:00

In some sectors, such as technology and public relations, using web-based tools such as social networking sites (LinkedIn, Facebook and Bebo) as part of your job hunt has become very popular over the past couple of years. Twitter is the latest online bug to catch on and is currently in vogue, but if you have not heard of it don’t worry, there are (only) an estimated 30 million users of Twitter worldwide at present, compared with approximately 150 million people who are on Facebook, so it is still a nascent application.

Twitter is a free service that allows users to publish short messages of 140 characters or less, so it is similar to the average text message on a mobile phone in size. These messages are read (usually on a computer or a mobile phone) by "followers" — people who make a conscious decision to subscribe to your messages and have them delivered to their own Twitter home page or PDA. Each message you post is known as a "Tweet". The easiest way to understand it is to go to www.twitter.com, click on the "Join the Conversation" button in middle of the page and get twittering by following a well-known celebrity (we recommend Stephen Fry’s, which is one of the more popular and active ones). Joining Twitter has value for many people.

From a job-seeker perspective, however, Twitter is just another tool that can help employers and employees to connect, alongside snail mail, email and telephones. It can also be a big waste of time if people in your sector or your function do not use it. Even if they do, you need to understand how the medium works and how best to utilize it.

People in a particular industry (say engineering or software development) often use Twitter to keep up with news, opinion and happenings in their field, but job searching is ‘on the fringe’ of what Twitter is really about. So you have to be careful about what you do, when you do it and who you do it to. Twitter has swiftly developed its own twitiquette!

If you do want someone to think about you when a job opening arises, you need to get that person to follow your tweets. When you first join Twitter, you will be prompted to look for friends in your Gmail, Yahoo, MSN, Hotmail or AOL accounts so you can begin following them if they are already on the service. This means that your existing network of contacts can be used right from the start and you can invite people to follow you.

Another way to get going is to identify the key people in your industry who are twittering and watch their updates closely to see what types of topics and projects interest them the most. You can use a search facility to identify those who have similar interests to your own, and can scan their public profiles to see if you should be following them. Start following others, and then invite them to follow you.

You have to build your follower list on Twitter before you need them and one Twitter expert advised us that those in Silicon Valley who have used it for job purposes claim you need to build a database of up to 500 twitter followers before you can even attempt to start using it for job search purposes. One Irish politician we know tried to use Twitter to attract votes in the recent elections, but found that only 12 people (mostly journalists) followed them! Not only was it ineffective, it was also embarrassing.

If you do decide to follow people in your industry and you'd like them to follow you back, make thoughtful replies to their tweets and supply them with valuable content and insights. Avoid messages like “I’m going to a meeting or conference on …”. A good way to show mutual respect is to share links to useful content you read on websites, blogs (including your own) and other sites that might be of interest to the person you are following e.g. “interesting article on PR in the technology sector on Ireland.com business pages today”.

So much for the do’s, what about the don’ts? Do not, as one of our clients did recently, overtly use the network to try to set up lunches, meetings and interviews at the start. Another sound piece of advice is to avoid bad mouthing previous (or current) employers.

Above all, do not become a bird-dog. A bird-dog is someone who is singular in their approach to others on twitter - the online stalker. Being on the receiving end of a bird-dog is equivalent of being cornered by someone you do not want to talk to at a networking meeting, or having a job-seeker constantly nagging you on the phone. Twitter carefully!

How are you performing?

2009-05-26T14:34:00.000+01:00

A recent study by Mercer highlighted the fact that managers in the public service have been rewarding civil servants with positive performance appraisals and rewards that are well above average. While this is costing the tax-payer a substantial sum, poor practices in employee reviews are not restricted to the public sector: many employers end up over-paying because managers and supervisors are simply not trained in how to run performance reviews or how to use them for positive effect.

One of the outputs of the Government Benchmarking process of recent years has been the introduction of the PMDS (Performance Management Development System). Put simply, the system uses a combination of interviews and a written questionnaire to evaluate the performance of workers in the civil service and other public sector bodies. Workers are then given an overall rating on a five point scale, with a score of one allocated to the worst performers and five to the highest performers. Critics of the Public Service’s PMDS highlight what goes wrong in many performance management processes: Of 19,000 workers’ performances reviewed in its initial operation, only 18 scored a one, and just 285 scored a two, on the five point scale. Those who score a one do not normally receive a pay increment, but those who score a two receive a pay rise and are only denied the opportunity for a promotion for a year. This leaves the vast majority of civil and public servants (those rated 3 – 5) earning increments of between 500 Euro and 6,000 Euro on top of the five per cent pay award given under the social partnership agreement this year.

A review by the designers of the Irish government’s PMDS found that the main reason for this over-payment was simply that the system was not being implemented properly. As designed, between 20 and 30 per cent of employees were expect to be graded a four, for example, whereas in practice more than 50 per cent of civil servants were assessed at that level. In one government department, 40 per cent of staff were awarded a score of five! Although these figures relate to the public sector, similar patterns have been found on similar schemes in the private sector. Part of the problem is that those conducting the appraisals are unable to give bad news to workers, and that is not surprising as workers on the receiving end also give appraisals a bad review: ETS HR consultants did a survey which found that with 38 per cent of workers are generally dissatisfied appraisal processes carried out by their employers (rising to 53 per cent in the manufacturing sector).

Anecdotal evidence suggests that many managers in both the public and private sectors have not being properly trained in how to use performance management systems. Many feel embarrassed and unprepared when carrying out performance interviews. Often, they score performance low in confidential written statements, but then give positive reviews during face to face interviews and appraisals. Usually, if an employee ‘deserves’ a lower grade, the manager awards a three or four and counter-balances this by sending the employee on a training course to ‘upskill’ in the area they are performing badly in, so that they can claim to have done the right thing. The net result is sometimes a confused and unmotivated workforce, and a significant over spend on rewards.

So how can you avoid this happening with your performance management system? ETS suggests that companies need firstly to automate some parts of performance management – anything from setting objectives to rewarding high performance could do away with paperwork and meetings, leading to a greater focus on results, more quantitative measures and fewer qualitative grades. Employers also need to invest in performance management and staff appraisal training.

An important first step is to get managers and supervisors to explore staff appraisal, its benefits and the types of systems available. These managers and supervisors then need to take control of the performance management and appraisal meetings by knowing the steps to take before, during and after the meeting. This leads to identifying which results really need to be focused on, what really motivates staff to perform, and what is involved in learning how to recognize that there are different personality types who can be managed in different ways.

Where staff are underperforming managers need to learn how to close the performance gap through coaching using counseling models. They also need to equip themselves with appropriate communication techniques for positive performance management including active listening, appropriate questioning, constructive feedback and positive body language. Allied to the review process is the importance of recognising when appraisal and positive performance management is not enough, and knowing when to activate the disciplinary process.

I have been made redundant, what should I do next?

2009-05-14T15:09:00.002+01:00

The first and most important thing to say is that you are not alone. Large numbers of people are unemployed or underemployed at present, and for some there are few prospects of full employment in the short term. There is an old saying that ‘what you resist persists’ and sometimes denying what is happening around you prevents you from moving on. For some, the current economic crisis can be turned into an opportunity to do things that they would not normally attempt at this stage of their lives. Here are some suggestions we have made to those in this position recently:

Work for free: Do you know anyone who works for a charity or an under-funded social agency that could do with some help? Do any of your neighbours run a small businesses who might appreciate a few days of your time to help with things like planning, administration, telesales or even cleaning? Offer your services for a few days here and there, particularly to people who work in your area of interest. It will get you motivated, will help you to fill in the days while you continue with your job-search, and may even lead to other opportunities.

Go back to school: Take this opportunity to reskill or upskill. There are plenty of courses out there that you could take, and for once you have the time to do them. Look at online courses as well as evening classes and weekend workshops as you can attend these without it interfering with your job search and you can continue with them when you start working again. Even if you do not want to go on a formal course go online and study something for free or get a good self-learning book from the library.

Consider setting up your own business: Buy a good guidebook or go on a course with your local enterprise board. Even if nothing comes of it will be an invaluable experience and a good way to learn whether or not you are cut out for going it alone.Set aside a year to try a different job: You have time on your hands so why not have a go at something you have always wanted to try but could not find the time to do? Avoid ‘pie-in-the-sky jobs’ and focus on something you already have an interest in e.g. a hobby or sport.

Drink and Drug Abuse - What can employers do?

2009-05-13T15:19:00.002+01:00

Employer groups estimate that the employment costs related to drink and drug use are rising at about 10 per cent per annum. The main reason for this is that drink and drug consumption have increased dramatically in Ireland during the Celtic Tiger years: Alcohol consumption increased by 17 per cent over the past decade according to the Health Research Board, and there was an even bigger increase in drug abuse – estimated at 30.5 per cent over the last 10 years by the National Advisory Committee on Drugs. Although alcohol sales have fallen off in recent months for financial reasons the rate of drinks-related incidents at work has remained high as, literally, increased stress is driving more and more workers to drink and drug abuse.

The biggest problem and cost for employers is absenteeism: According to one survey 63 per cent of workers have phoned in sick after getting drunk the night before (Portman). More worryingly, 80 per cent admit to having been hung-over while at work in safety critical industries such as agribusiness. In high risk industries, such as construction, up to two thirds of workers say that they have turned up late at work after drinking the evening before, while 40 per cent say they have been physically drunk while at work (NUIG). In a recent pre-employment test 50 per cent of recruits were found to have taken intoxicants (EAP Institute). So the problem of drink and drug related absenteeism is widespread.

The other significant issues is that problem drinkers and drug users:

Generally perform worse at work (50 per cent of those in the NUIG survey said their drink and drug use led them to perform poorly).
Change jobs more frequently.
Are more prone to injury.
Are more likely to have depression.

While it may appear at first to be a trifling piece of legislation to introduce, failure to proceed with a Ministerial Order allowing employers to fully test for drink and drugs in the workplace, is costing the Irish economy an estimated 500 million Euro each year. The main reason for the delay in its implementation is that the Government agreed to further discussions on planned regulations with the unions prior to introducing the regulations. Clearly other events on the social partnership agenda have overtaken the need to introduce these at present and the Order is unlikely to be introduced this year.

Despite reservations expressed by civil organizations about workers’ rights many companies are now taking matters into their own hands. Alcohol and drug testing have become particularly prominent in safety-critical sectors, amongst American-owned companies and in the transport sector. In the absence of a formal Ministerial Order, however, employers cannot automatically assume that drink and drug testing will work in their favour. Recently, the Labour Court found for an employee who took an unfair dismissal case after he had been laid off, despite him failing a random drugs test. Although he tested positive for a cannabis-related substance the employee, and his union, argued that the level was low (not critical) and the employer did not have a code of practice in place on drug and alcohol testing.

Action on the Ministerial Order does need to be taken soon as apart from the direct financial cost to employers, where death or serious injury occurs as a result of actions or inactions by employees under the influence of drink or drugs, employers could face jail sentences or fines of up to three million Euro.

Employers need to have a clear drug and alcohol policy and a code of practice in place and this should be communicated to all employees.

Which personality do you show at interview?

2009-03-27T09:54:00.001Z

A desire for employer approval drives over half the workers in Europe to adopt a different personality at work than in their home lives (according to a recent survey by psychology consultants OPP). The research highlights the fact that many of us, perhaps rightly, lie about our personality, our strengths and our weaknesses at interview. Are we right to do so, or should we be more open and honest about our failings when asked?

Picture the scene: You are at an interview and you are asked if we have any weaknesses? “Oh no”, you say, “if I do have a weakness, it is that sometimes I am too tenacious and do not know when to give up”. Does this type of answer sound familiar? Many people tell ‘white lies’ about their personality at interview, only to find that when they get the job there is a significant mismatch between what they are expected to do and what they are willing to do. Nearly half those polled in a recent OPP study (49 per cent) claimed that they have adopted a different personality to their normal one during an interview. The trait is more prevalent among Irish workers than other European workers, with 61 per cent of Irish employees saying that they lead a double life.

The reasons why workers wear personality masks at interview and at work are varied, but chief among them are that they feel it makes them more appealing at interview; positions them as being more effective in their jobs; helps give the impression that they will fit in better with their future team; and enables them to project and image that fits in with the organization’s culture.

While the advantages of adopting a different persona are obvious, it can also lead to a great amount of stress: Imagine you a naturally introverted, shy and reserved person, but convince someone at interview that you are an outgoing, gregarious person who loves nothing better than selling and driving a bargain. You subsequently get a job offer for a sales position, with an attractive base salary and a new company car. Then, during the first three months of the job you spend the day driving around, under-performing in sales presentations, losing out on commission, and coming bottom of the office league when monthly sales targets are released. Would you be happy in this situation? Probably not, so the obvious answer is to balance selling your strengths with over-selling your potential at interview.

Research indicates that the trait most Irish employees suppress is their fun-loving side while the trait that is most accentuated is their decisive side. Interestingly, studies of why Irish people are hired internationally often show that interviewers consider our fun-loving side to be our key advantage over other nationalities, which suggests we may be selling ourselves short!

Candidates who lie about their personalities can pose a problem to potential employers: The cost of hiring a person with an inappropriate personality can be as much as three times annual salary, so recruiters and interviewers need to be aware of masks skewing the interview results. Psychometric and other tests can help, but many of those who can wear personality masks at interview can usually adapt to other tests too.

The important thing, for interviewers and interviewees alike is to be honest in their dealings with each other when it comes to describing the personality traits they are seeking and which they can provide.

How can I recession-proof my CV?

2009-03-13T09:59:00.001Z

The short answer to your question is that a CV should always contain the same types of basic information (contact details, work experience, education and personal) but you should also tailor your CV to reflect the context in which it is being sent. More importantly, you should prepare a different CV appropriate to every job to which you apply. Think for a moment about the direct mail that gets posted to you or the leaflets that come through your letter box at present. The products and services they offer are the same as they always were, but you will probably find that the mail highlights low price, value-for-money, cost-savings, etc. Your CV should do the same. Of course, it is not just your CV that should change, but your whole approach to job search as well. Here are 10 things you can do to stand out from the crowd:

Become more creative about your job search: Do not restrict yourself to positions advertised in newspapers and on recruitment websites. There has been a marked reduction in the number of these in recent months – partly because there are fewer jobs (a 20 per cent reduction in the past quarter alone), but also because companies do not need to advertise when demand for jobs outstrips supply. Recruitment agencies say that even when their clients have positions available they are not approving spend on advertising at present. This means many have jobs that are not appearing in the press or on websites.

The first thing to do is cast your search net wider and deeper: Read the newspapers and search the Internet to find out which industries and companies are planning to expand and which remain the most profitable (over 800 new jobs were announced last week alone). Find out what roles they are filling. Network with your contacts – both directly and via social networking websites such as LinkedIn, Facebook and Bebo. Attend industry conferences, breakfast briefings, meetings, training events, etc. Be seen and heard.

Customize your application process: With email, people have fallen into the habit of writing one-line cover notes that just say ‘my CV is attached’, but a well written cover e-mail or letter will make your job application stand out from the rest. Instead of writing an email, consider if you could telephone the employer and tell them why you should be invited in for an interview, then follow up your call by sending in your CV. Few people do this and much of getting a job is about doing what the masses aren’t.

Aim to get your CV on a maximum of two pages: All managers, and particularly HR managers, have less time to read CV’s at present, so don’t waste it for them. Remember to emphasize what you can do for them, rather than what they can do for you. Don’t bother listing useless facts such as ‘I was head of the debating team at school’ if that was 20 years ago. Use the KISS principle – Keep It Simple Stupid.

Keep the contact information (your name, postal address, phone numbers and email address) to a minimum. Save space by, for example, putting your postal address on one line (rather than three or four) and your home/mobile phone numbers on one line. Do not add any other personal details such as hobbies to your first page – keep them for page two.

Provide a summary of your key achievements, skills and qualifications at the start: Make it easy for the reader to assess whether or not they need to read your entire CV as quickly as you can. Begin the CV with a short description or some bullet points that summarise what you have to offer: Begin with a statement about your current or most recent role e.g. ‘Experienced Production Manager with 15 year track record of successfully coordinating operational teams’. Ensure that you also highlight your key skills in the summary e.g. ‘A person who has excellent negotiation, influencing and selling skills’. Add any significant or recent qualifications to the summary e.g. ‘Holds FETAC Level 7 Award for Tourism Management’.

List each job you have done in reverse chronological order: Make the Job Title, Employer Name and Dates of Employment clear e.g. ‘Marketing Manager, XYZ Ltd., 2002 – 2009’.

Do not try to tell them about everything you did for each organization: Selectively describe key areas where you have achieved or made a difference e.g. ‘Introduced team working in place of piece working in order to save costs and increase output’. Emphasize areas where you have grown revenue or reduced costs e.g. ‘Grew sales by 12 per cent per annum over the last three years’. Show evidence of success where you can e.g. ‘Reduced production finishing costs by 18%, benchmarked against German plant which reduced costs by only 11% during the same period’. Use quantitative as well as qualitative information where possible.

Include both formal and informal education in your CV: Often it is a long time since we were awarded a degree or diploma, but we have updated our skills with short one-day courses that should be included. List these in a simple to read format e.g. College, Dates, Award or Training, without giving too many details.

Show that you take responsibility for your own, on-going education: We recommend that anyone in a redundancy situation considers doing a short-term course that keeps themselves busy and helps them update/upgrade their skills. Employers like to see an on-going commitment to learning, and it also gives you an appropriate answer at interview when you are asked: What have you been doing since you left XYZ Ltd.? If you are an avid reader of business books, for example, tell your potential employer that you have been self-educating.

In your personal information section show that you are a rounded person: If you are unemployed for a significant period of time consider volunteering to help fill the gaps in your CV. Above all, make sure that you have some information that gives the impression that you are a good all rounder.

People Matters provides one-to-one coaching to those who have been made redundant and are seeking advice on job search. Each coaching session includes discussions on career direction, writing a winning CV and preparing for interview success. A half-day (four hour), one-to-one coaching session costs only 250 Euro! Employers often pay for coaching sessions on behalf of those whose roles are being made redundant and full and half day training events can be organised with us. To book a session or find out more call us on 01-296-1578 or email admin@peoplematters.ie.

Flexible Time Working

2009-03-02T09:54:00.000Z

One of the buzzes in human resources at the moment is the concept of flexible work-time. While the concept is not new, the way that it is being applied is different in these recessionary times. Here we explain what it is and why employers and employees should consider it as an alternative to pay cuts and redundancies.

What does the phrase ‘flexible work-time’ mean? Put simply, it is where the employer asks both the owners/directors/managers and employees in a business to voluntarily change their terms and conditions of employment for a specified period of time.

What does it involve? New employment contracts are drawn up or, more likely, a letter of agreement is signed between both parties. These specify that terms and conditions are changed for a specified period of time, after which the ‘normal’ contract terms and conditions are returned to.

What terms and conditions are changed? Those that are modified are usually to do with hours/days worked with a pro-rata change in pay. The new terms allow the firm to ask volunteers to work additional hours when required e.g. working on a Saturday for those who normally work a five-day week; and to reduce hours worked when not needed e.g. working a four-day or three day week; using their leave in a particular week or month; or taking unpaid holidays on particular days when they are not required e.g. Good Friday. In non-busy periods e.g. during the Summer school holidays, staff can take long periods of leave (up to 12 weeks) at 25 – 50 per cent of their normal pay. Usually there are clauses about how much advance notice must be given by both parties.

How long should the period of time the flexible time contract be? That depends on the organization and the industry it is operating in. We are hearing of cases where flexible futures are specified for 6, 12, 18 or even 24 months. It does not really make any sense to go beyond a short time-scale as the main reason for adopting a flexible time contract is to reduce costs, flex costs and create short-term certainty.

What are the benefits to the employer? The main benefits to employers are cost savings, and perhaps more importantly, flex-costing. Flexible work time allows employers to optimize their use of the workforce by having ‘all hands on deck’ when they are needed, but not having a surplus of people underutilized when the business is not busy. For this reason, flexible work-time is generally more appropriate for service industries where the rate of work is not constant, but is usually predictable over the short term. A good example is St. Patrick’s Day which falls on a Tuesday. Many employees with families would also like to take the Monday off, and many employers may prefer to close their business on that day as there will be fewer customers. Another significant benefit is that the company retains top talent who might otherwise leave if pay cuts alone are made. This means it is poised to ‘get back to work’ when the upturn comes.

Are there any benefits to employees? The most obvious benefit is job security in these uncertain times. Recent research has shown that many employees would prefer to take a cut in pay or reduction in terms and conditions in preference to losing their job. The most important aspect, for most employees, is trust. It is usual, for example, to include a ‘maximum salary loss’ condition in a flexible work-time contract e.g. the maximum salary reduction is capped at 20% for each calendar year the agreement is in place. It is important to ensure that the revised contract relates to changed conditions for a specified period of time (usually no more than a year) and that it does not preclude any nationally agreed pay increases (or decreases) agreed by the social partners. In most cases the same benefits continue to be provided e.g. use of a company car, commuter ticket tax saving scheme, paid gym membership as these cost the same regardless of when they are used. In organizations where flexible schemes have already been introduced many employees have commented positively on the fact that it is allowing them to spend more time with their families or to use the time off to return to studies.

What is the People Matters verdict? The economic outlook for 2009 and 2010 is very uncertain and firms need to be as flexible as possible in order to respond. It is important to reduce costs in the short-term, but not risk losing talented staff who will be difficult to replace in the medium term. A voluntary flexible work-time contract or agreement to cover the next year or so is a pragmatic approach to adopt.

The True Cost of Redundancies

2009-02-02T12:27:00.001Z

Last week the CIPD called for employers to delay making people redundant. They suggested that companies need to hold their nerve in the current downturn and make redundancies only as a last resort. The reason: Employers are not calculating the true cost of redundancy. We examine their advice and ask: Should you lay off making redundancies?

Businesses should be making more careful decisions about redundancy and taking into account plans for recovery by calculating the cost of retaining staff against laying them off according to John Philpott, the CIPD’s chief economist. With the cost of making an employee redundant averaging 18,000 Euro senior management should be asking themselves, what else could we be doing with that money? There is a need to balance the cost of redundancies against the potential benefits of retaining staff in the current environment.

Surely keeping employees on gives rise to a cost in itself? Of course it does. There is the cost of salary to start with, and also ‘hidden’ costs such as training, providing parking spaces, light and heat, etc.

But that is also where companies need to think creatively. They need to ask: What are the costs of letting staff go? These include making redundancy payments and ‘golden handshakes’, but should also (according to economists) include the costs of re-employing those same workers or others on the upturn.

Creative companies are offering staff sabbaticals instead. Permanent TSB, for example, gave some of its employees a two year ‘holiday’ and guaranteed jobs for workers on their return. This is a win-win situation, as the employer saves money in terms of redundancy and recruitment costs, and the employee has a chance to travel or do something alternative with their time secure in the knowledge that their job remains open to them on their return. The cost of making the average employee in an Irish bank redundant, and then hiring someone to replace them in two years time is approximately 50,000 Euro. By offering a sabbatical both parties can benefit.

Another option is to introduce short-time working or reduced hours. One professional services firm People Matters works with has reduced the number of hours their staff work in the week. Many of their employees are using their increased free time to study and learn new skills using facilities at the employer’s premises. The company is also using the opportunity to carry out maintenance of the office premises. Honda, Toyota and Nissan plan to halt production at their plants later this year and use the time for overhaul of their plants. HP has asked employees to take holidays in March and April (when their plant is less busy) and avoid the Summer shortfall in employees. This also avoids them having to employ part-time staff as replacements. Pay freezes and wage cuts, while unpopular, offer a better alternative to losing a job or losing a valuable staff member. One fashion retailer has asked employees to take a 10 per cent pay cut and most staff have shown a willingness to take the cut in preference to being made redundant.

According to the CIPD’s Philpott companies need to work out the real cost of redundancy before making any hard decisions. He has suggested a formula for calculating the RCoR (Real Cost of Redundancy). Before deciding on any redundancies People Matters recommends using his formula as a way to calculate the true cost:

RCoR = (N x R) + (X x H) + (X x T) + ny(H + T) + Wz(P-N)

Where:

N = number of people potentially being made redundant
R = cost of redundancy payments (circa 18,000 Euros)
X = number of people who will need to be hired in future
H = hiring costs (circa 16,500 Euros)
T = induction/training cost (average 3,500 Euros)
Y = percentage quitting post redundancy
W = average monthly staff salary
Z = percentage reduction in output among remaining employees due to low morale
P = number of people employed prior to redundancies

Advice for Lone Parents

2009-02-02T12:25:00.001Z

My wife passed away last year and I am now a lone parent. Since last September I have been responsible for looking after our two children (aged 5 and 7). I had to give up my fulltime job in the bank and financially things are tight. I realise that the two Children will grow up fast and when they both in fulltime education I may have the opportunity to do more work. Have you any advice?

According to the CSO, there are over 189,000 lone parent families (including widowers) in Ireland, and of these 85,000 are in receipt of social welfare support through the One Parent Family payment (OPF). Just 2 per cent are male, and 12 per cent are separated – so you fall into a ‘category’ that is often the least informed about supports. The first thing to do, in the short term, is make sure that you are receiving the Child Allowance and One Parent Family payment even if you are working. You may also be eligible for certain other allowances such as a family income supplement, the early childcare benefit for your five year old, a back to school allowance for books and clothing for your seven year old, as well as rent/mortgage interest supplements, etc.

In many countries governments make financial payments to one parent families, but this stops and recipients are obliged to return to work when their youngest child is anywhere between three months of age (in the USA) or five years old (in the case of Australia). Ireland has one of the best systems in place: One Parent Family support is made from the time a child is born until the age of 18 or 22 years of age, if in full time education. There are no conditions set regarding working while receiving this payment. It is a means tested payment and a lone parent can earn up to €146.50 per week without loss of the benefit. Income between that and €425 assessed at 50% and a reduced rate of OPF is payable. Contact the Department of Social Welfare - www.welfare.ie - and arrange to have yourself means-tested for the benefit. Incidentally, a campaign to combat fraud with one parent families last year realised almost EUR 142million.

Research has shown that there is little active engagement by government departments and voluntary help groups with recipients of OPF supports, unless they seek it themselves. This is particularly true among men. Yet there are some excellent on-line supports available. Four good sources of information are the Department of Social Welfare website - www.welfare.ie, the One Parent website – www.oneparent.ie, the website of One Family – www.onefamily.ie, and an independent website – Solo.ie. Visit these sites and get your hands on a new information booklet detailing family supports and services across a range of Government Departments and agencies.

A new research report, Lone Parents and Employment: what are the real issues? was recently published by One Family. Another useful report was written by UCD. They contain useful, general advice. One of the key results of these reviews is that two-thirds of those in receipt of the OPF are working, but in low paid, part time work.

The Family and Community Services Resource Centre Programme commenced in 1994 and since then 107 Family Resource Centres have been established nationwide. The activities supported by the Resource Centres are designed to meet the needs of the local community and include the provision of: information, advice, training and practical assistance to community groups including child-care facilities for those attending courses provided by the project and after-school clubs. Visit your local Resource Centre and find out what they have to offer.

Lastly, as you say, you need to think about the medium-longer term. Your youngest child will be going to school fulltime in September 2009, and now is a good opportunity for you to consider returning to fulltime work. An obvious first place to start looking is with the financial sector, but with the current economic situation, you may want to look to other industries where you can utilize the same skills. Career direction coaching may help you to establish what your strengths are, where your motivations lie and how to set goals for yourself in the coming year.

Have you still got the January blues?

2009-02-02T12:23:00.000Z

Well there is an explanation. Dr. Cliff Arnall, a health psychologist at Cardiff University, has devised a formula to work out the worst day of the year and according to his formula, Wednesday, 21 January is the blues day for 2009. His calculation is based on the expected poor weather, debts owed for seasonal spending, the time since Christmas, the period of time before you abandon New Year's resolutions, the dates when motivation levels seems to be at their lowest and the timing for the need for action to escape the blues. In other words, today!

So to cheer you up, in this issue, our Career Doctor answers an interesting career query from a parent on employment and benefits and in our Research and Resources section we provide you with some interesting snippets of information that you may find useful in the workplace.

Decluttering your worklife

2009-01-12T16:18:00.001Z

Over the Christmas and New Year holidays many people take time out to consider if their career is going in the right direction and vow to make a change. Then they return to work, find their ‘inbox’ is full and just get on with the old job! So how can you avoid making the same mistake again this year?

In Kensington High Street, London serious and minor traffic injuries dropped by 60% in one year. “Wow” you might think, “that is some improvement: what miraculous road safety improvements did they install”? In fact, what they did was remove the previously installed road safety improvements, including 95% of the traffic signs and the guard rails along the pavement. The fall in injuries was due to drivers being less distracted and paying more attention to other road users, whilst pedestrians were more cautious before charging across the road. In other words, by decluttering their world, drivers and pedestrians alike had become more focused on the real risks and concentrate on key issues . Is there a parallel for this in our work lives?

Hans Monderman, a Dutch traffic engineer was famous for his hatred of traffic signs. Referring to a traffic sign that indicated a bridge ahead on a flat road, Monderman asked why it was needed , “…when you treat people like idiots, they’ll behave like that,” he said. Are we in danger of letting distractions turn us into idiots? Often, we make the same type of mistake at work – we create ‘messy’ environments that distract us from the important tasks.
Management thinkers around the world are noticing that some businesses and some business people are thriving in the recession, while others are merely striving. Why? In many cases the ‘thrivers’ are ridding themselves of all the paraphernalia of distraction and focusing on what matters. Managers need to focus on the job that needs to be done, not on the clutter.

At Birmingham Airport recently I was observing a salesman I knew well. He was what some people call a “a Blackberry Tart” i.e. someone who is a slave to their mobile technology. He arrived into the departures lounge where he immediately took out his Blackberry and fiddled with it for five minutes, trying to make a connection. Then, agonizingly, he worked his way through reading long e-mail messages and ‘typing’ replies using a stylus, before rushing to switch everything off in time to board the plane. Had he not been so distracted by this gadget he might have noticed that one of the biggest buyers in his industry was sitting right next to him in the lounge – a unique networking opportunity to say hello to a large customer had been missed and, what is more, the customer had noticed. Perhaps the man would have been better off if he decluttered his briefcase, left his Blackberry alone and focused on the real task of winning customers.

In the current economic downturn many clients haves asked us to advise them on how they can declutter not just their job, but their whole career. A significant number of people are changing from fast-track to slow-track careers; others are taking a year’s sabbatical; yet more are taking a year off to travel. Several of our clients are returning to full-time or part-time study. With little prospect of a growth in the economy in the short-term this may be a good time to consider taking a year out to redirect your career. The important thing is, not to declutter too much, to hold on to the important things and build on them while letting go of the excess baggage.

Scrooge employers alive and well

2008-12-18T14:05:00.001Z

Cautionary Christmas Tale: A care worker, who was employed by a nursing home for several, had relatives from abroad who visited every Christmas. She, therefore, could not normally work on Christmas day. This had been the position each year since she took up her post four years previously. In early December she was told that she was rostered to work on Christmas Day.

She brought the fact that she would be unavailable to the attention of the Director of the Home who said she need not panic as she had over two weeks to arrange cover for the Christmas day shift. By the 21 December, however, the worker had failed to arrange for another employee to provide cover for Christmas day.

The Director gave her the choice of working the Christmas day shift or being dismissed. The following day, having been informed that the employee would not work Christmas day, the Director summarily dismissed the worker. The Director argued that it was up to staff to organise cover once the roster had been posted.

The Employment Appeals Tribunal ("EAT") found that responsibility for staff cover ultimately rests, irrespective of inter-staff arrangements, with the management of a business i.e. the employer and that the sanction of dismissal was, as a result, disproportionate. It awarded the Claimant 15,000 Euro under the Unfair Dismissals Acts 1997-2001.

Employers must balance the timing of all annual leave against the need for the employee to reconcile work and any family responsibilities; opportunities for rest and recreation available to the employee; and the need to consult with the employee at least one month before the leave is to be taken. For some industries where employees are expected to take mandatory holidays it is important that employers provide for this in the contract of employment.

People Matters keeps a databank of workplace research and information which may be of interest to employers and employees. For more information call us on 01-296-1578 or email admin@peoplematters.ie.

Christmas parties pose problems for employers

2008-12-18T14:02:00.001Z

Alcohol consumption has increased by 17 per cent in Ireland over the past decade according to the Health Research Board, with many commentators saying there has been an even bigger increase in drug abuse – an increase estimated at 30.5 per cent over the last 10 years (National Advisory Committee on Drugs). The Irish Medical Journal estimates that alcohol and drug abuse cost the Irish economy half a billion Euro each year.

The biggest problem for employers, particularly in this Christmas week, is simple absenteeism: 63 per cent of Irish workers claim to have phoned in sick after getting drunk the night before. 80 of workers in so-called, safety critical sectors admit to having been hung over while at work; 50 per cent say their drink and drug use led them to perform poorly; and 40 per cent say they were physically drunk while at work (NUIG). In a recent pre-employment test 50 per cent of new recruits were found to have taken intoxicants (EAP Institute).

Where death or serious injury occurs as a result of actions or inactions by employees caused by drink and drug taking employers could face jail sentences or fines of up to EUR 3 million.

Although many companies have done away with the traditional Christmas dinner dance this year, many employers and employees have organised informal get-togethers this week. Christmas parties often give rise to bullying, discriminatory and disciplinary behavior which reflects badly on the company, causes disharmony among employees and leads to financial costs being incurred. One area which is often overlooked is in relation to the entertainment provided at such parties. There is a famous case in the UK (Burton and another v De Vere Hotels Ltd 1997) which held the employer vicariously liable for the discriminatory acts of a third party (the comedian Bernard Manning) during a Christmas Party.

Any complaints made subsequent to a Christmas party should be treated seriously and investigated promptly (preferably before the Christmas and New Year break). If necessary, the disciplinary procedure of the company should be invoked.

This year many employers have put in place a ‘Gift Policy’ to ensure employees stay within the law when giving and receiving gifts. Although gifts are primarily given around Christmas time, such as policy should apply to all gifts given and received throughout the year. The concern is that giving and receiving gifts may lead to accusations of bribery, corruption, fraud and abuse. An employer should watch for signs that an employee is acting under pressure or in an unethical manner as a result of giving or receiving gifts.

Consistency and uniformity are the keys to a successful Gift Policy. The policy must reflect the normal practice in the industry and be consistent across all of the company’s departments and at every level of the organization if employers are to avoid inequality. Employers can give employees a ‘gift’ valued at up to €250 without the employee having to pay Benefit in Kind, but there are rules and regulations in relation to this which are worth checking out at www.revenue.ie.

What are transferrable skills?

2008-12-18T14:00:00.000Z

The term “transferable skills” was made popular by Richard Nelson Bolles, author of What Color Is Your Parachute? A Practical Manual for Job-Hunters and Career-Changers in the 1970’s. It is just as relevant today as it was back then. Put simply, as we move through life we all gather, grow, learn and develop new skills. Transferable skills are simply the ‘mobile skills' that we take with us through life. They include skills you may have learned in different jobs, at college and in your hobbies, social or community life. As a first step, write down all the skills you have that first come into your head.

Recruiters and interviewers will often use a checklist of skills to match a candidate’s suitability to a position. Anticipate what skills might be needed for the position that you are being interviewed for.

Job adverts and job descriptions will also give details of the skills the company is looking for in a candidate or promotional prospect. Make this information work for you. For example, if the role description says that communications are important, write down any times when you have used communications skills, expression, transmission and interpretation of knowledge; where your writing skills came from; how you learned to speak effectively; examples of when you expressed ideas clearly; your abilities in negotiating, persuading or editing. Dissect the job advertisement or description and match it to your skills set.

Work back over old jobs, break down your roles, and match your day to day tasks with the identified transferable skill. You might even spot a pattern emerging which will give you a strong indication of your key strengths. It is a good idea to check with your peers if they also see these skills as key strengths. Confirm what your strong skills are.

The final step is getting those skills across to an employer in a succinct way. There is no point, during an interview, in stating “I have excellent organizational skills” without being able to prove it! If you quantify that statement by explaining how you were in charge of a successful project in your previous job then that will help confirm that skill. Summarise your key achievements in your personal and professional life into short anecdotes that you can bring out in your interview.
Santa and the elves have great transferable skills: like the ability to deliver a large number of packages overnight – ideal for An Post.

We provide three different career coaching sessions: Career direction, writing a winning CV and preparing for interview success. Each of our two-hour sessions costs only 170 Euro and we can provide a voucher for those who wish to give a Christmas present of a new career to someone they know! To book a session or obtain a voucher call us on 01-296-1578 or email admin@peoplematters.ie.

Finance Bill offers opportunities to reward employees

2008-11-21T10:05:00.003Z

The publication of the second Irish Finance Bill on 20th November generally made bad news for employers and employees alike. Much of the focus has been on the introduction of the income levy and some pundits estimate that increases in taxation will amount to approximately 2,500 Euro for the average family next year. But as we approach the time for annual pay reviews, what last-ditch efforts can employers make to sweeten the bad news to employees?

The Bill brings in the various measures announced in the Budget, the principle change being the introduction of an income levy. For lower-paid workers it may be appropriate to lower gross income so that it falls below the limit of €18,304, thus avoiding the one per cent levy altogether. The drop in income might be made up by using some of the processes below.

Is now the time to buy your employee a new car or van? Existing fleet vehicles will maintain the current method of calculating the assessable benefit in kind which is based on a percentage of the original market value of the car, with a reduction in the percentage assessable where the employee has incurred high business mileage in the tax year. But the BIK rules are changing so that new cars with lower CO2 emissions will be those with lower Benefit in Kind payments. In the case of one sales representative, for example, her employer is thinking of replacing a three year old, 2 litre, petrol-engined car (with an original market value of 25,000 Euro) with a new, 1.4 litre, diesel-engined car that has the same power and performance and an original market value of only 20,000 Euro. The company is availing of the competitive prices being offered by car retailers (lower original market value); lower fuel, insurance, motor tax and NCT costs; and contributing positively to the environment. It is also rewarding the employee with a new car, reducing the overall cost of BIK payments they have to make at the same time.

That same employer is located in Dublin city centre where it is affected by the introduction of a Benefit In Kind of €200 for car parking (or €100 in certain cases of shared car parking spaces) in the main urban areas. One way the company is thinking of offsetting this cost to employees is to arrange a car-sharing scheme so that the 50 car parking spaces provided become shared. Under the Bill shift work employees starting or finishing work after 9pm or before 7am will have the part of the year during which they are on shift work disregarded for the purposes of the levy, so the employer is also looking, as part of a move to promote more flexible working, at requesting more employees to do shift work and night-time working.

The Bill confirms the introduction of the new scheme for the provision of bicycles and safety equipment up to a maximum cost of €1,000 (in a five year period) by employers. The exemption applies to expenses incurred by an employer on or after 1 January 2009 where employees agree to use the bicycle to cycle to and from work and between work places. Employers can use this to reward employees in lieu of salary.

A Salary Sacrifice scheme for employees who purchase annual commuter tickets for public transport is already in existence and this might encourage some employees to leave the car at home and take the train, bus or tram instead. Salary sacrifice arrangements are where the employee agrees to forego part of their salary to cover the costs associated with the purchase of the annual ticket. With the new Bill, bicycle/safety equipment may also be purchased using a salary sacrifice scheme. This scheme is particularly useful for those employees already cycling to work and to support the green environment.

There are increases in the mortgage interest relief for first time buyers, yet for many young employees, the main problem is obtaining mortgages and loans in the first place. Is your business in a position to offer employees better guarantees to help them persuade mortgage lenders to give them a mortgage? In one case we are aware of an employee had been refused mortgage approval because their partner was on an on-going, seasonal contract. The couple asked the employer to change this to a fulltime contract in exchange for a small drop in pay. The fixed contract enabled the couple to obtain mortgage approval.

In another case, an employer acted as guarantor for a credit union loan to enable an employee purchase a motorbike to get to and from work.

For more information on coaching training in how to carry out annual reviews and pay reviews call us on 01-296-1578 or email admin@peoplematters.ie.

Performance reviews

2008-11-14T16:30:00.000Z

A recent study by Mercer highlighted the fact that managers in the public service have been rewarding civil servants with positive performance appraisals and rewards that are well above average. While this is costing the tax-payer a substantial sum, poor practices in employee reviews are not restricted to the public sector: many employers end up over-paying because managers and supervisors are not trained in how to run performance reviews and how to use them for positive effect.

One of the outputs of the Government Benchmarking process of recent years has been the introduction of the PMDS (Performance Management Development System). Put simply, the system uses a combination of interviews and a written questionnaire to evaluate the performance of workers in the civil service and other public sector bodies. Workers are then given an overall rating on a five point scale, with a score of one allocated to the worst performers and five to the highest performers. The Public Service’s PMDS highlights what goes wrong in many performance management processes. Of 19,000 workers’ performances reviewed in its initial operation, only 18 scored a one, and 285 scored a two, on the five point scale. Those who score a one do not normally receive a pay increment, but those who score a two receive a pay rise and are denied the opportunity for a promotion for a year. This leaves the vast majority of civil servants (those rated 3 – 5) earning increments of between 500 Euro and 6,000 Euro on top of the five per cent pay award given under the social partnership agreement this year. A review by the designers of the PMDS found that the system was not being implemented properly. As designed, between 20 and 30 per cent of employees were expect to be graded a four, for example, whereas more than 50 per cent of civil servants were assessed at this level in practice. In one Department, 40 per cent of staff were awarded a score of five.

Anecdotal evidence suggests that many managers in both the public and private sectors have not being properly trained in how to use performance management systems. Many feel embarrassed and unprepared when carrying out performance interviews. Often, they score performance low in confidential written statements, but then give positive reviews during face to face interviews and appraisals. Usually, if an employee ‘deserves’ a lower grade, the manager awards a three or four and counter-balances this by sending the employee on a training course to reskill in the area they are performing badly in. The net result is a confused and unmotivated workforce, and a significant over spend on rewards. So how can you avoid this happening with your performance management system?

Employers need to have invest in Performance Management and Staff Appraisal training. An important first step is to get managers and supervisors to explore staff appraisal, its benefits and the types of systems available. These managers and supervisors then need to take control of the performance management and appraisal meeting by knowing the steps to take before, during and after the meeting. This leads to identifying what really motivates staff to perform and involves them learning how to recognize that there are different personality types who can be managed in different ways. Where staff are underperforming managers need to learn how to close the performance gap through coaching using the GROW model. They also need to equip themselves with appropriate communication techniques for positive performance management including active listening, appropriate questioning, constructive feedback and positive body language. Allied to the review process is the importance of recognising when appraisal and positive performance management is not enough, and knowing when to activate the disciplinary process.

For more information on coaching training in how to carry out performance evaluations call us on 01-296-1578 or email admin@peoplematters.ie.

People Matters Ltd.

2008-11-13T16:38:00.000Z

People Matters Ltd. was established in 1999 by Sue Mulhall and Mark Campbell. Sue’s background is in Human Resources and she worked in both the public and education sectors. Mark’s background is Marketing and Communications and he has worked in both the professional services and education sectors.

The company provides human resources, marketing and communications consulting, training, coaching, research and writing services to organisations and individuals.

Based in Dundrum, the company provides services mainly in the Dun Laoghaire Rathdown area, but has also expanded into providing services nationally and internationally (mainly in the UK).