Last month, the Joseph Rowntree Foundation (JRF) launched its strategy to solve UK poverty – the product of several years’ worth of research into the complex and underlying factors causing poverty in the UK.
In the second of two responses from the business community, Sadie Lofthouse, Head of Human Resources at regional brewing company Adnams, discussed the importance of establishing the right mindset in the fight against UK poverty.
JRF’s new strategy to tackle poverty takes a joined-up approach where employers play a vital role. As a medium-sized business that employs just over 450 people, it could be easy for us to think we’re too small to make a difference. But regardless of size, the decisions we make as a business can have a direct impact on people facing poverty.
Consider, for example, the question of whether to outsource or keep in-house. It’s a dilemma we found ourselves facing as the sponsorship and events side of our business began to grow. Outsourcing would certainly be the simpler option, but an awareness of poverty and its impact on our people helped us to see things differently.
Sector: Food and Beverage, Retail & Hospitality
What they do: Produce beer and spirits and run a small number of hotels and shops
Location(s): London and east Anglia
Typical relevant roles: kitchen porters, waiters, bar staff
By staffing events with our existing workforce we have been able to build expertise and boost the earning potential of our workers – giving those on the lowest incomes the chance to increase their take-home pay. Our employees are the best brand ambassadors we could have and love talking to our customers and consumers so it works for all. Developing this mind-set is crucial if business is going to be part of the solution to poverty in the UK.
But where do you start?
It pays to look at pay…
In the hospitality business, customer experience is crucial. Getting this right starts with engaged and productive frontline staff. If our workforce is distracted by financial concerns, they are unlikely to be working at full capacity or with the enthusiasm needed to deliver a high level of customer service.
So, as part of a five year plan to improve our customer experience, we made the decision to alleviate some of those concerns and motivate our hospitality staff by lifting their pay. To facilitate this we reduced and redistributed the bonuses paid to our senior team. Losing 4% of your bonus is not going to have a huge impact if you’re earning £60,000, but it will make a big difference if you’re at the bottom end of the wage scale. Communicating this well within the team was crucial to gaining everyone’s support.
Raising pay presents challenges for any organisation, and at Adnams that was no different. However, once we realised we didn’t have to make every change overnight we were able to make progress towards the position we’re in now, where all of our staff are paid at least the voluntary higher living wage when gratuity is taken into account.
If we ever doubted the business case, we were wrong. Since lifting pay, we’ve had better retention and engagement of staff across the board - our ratings on TripAdvisor have gone up and we’ve seen a spike in positive feedback about our customer service. What’s more, we’ve been able to use these successes to motivate those in customer-facing roles to improve their performance.
…and to go beyond pay.
While pay is a good place to start, it isn’t the only indicator of poverty. As we learnt from our involvement in BITC’s Beyond Pay Inquiry, there are so many other factors that can contribute to poverty - meaning we can’t simply assume that someone on £7.20 an hour is struggling while someone who earns £11 is not. That’s why it’s important we take a look at the influence we can have through other business practices too.
Take contracts, for example. Like many other businesses in the hospitality sector, we did use a few zero hours contracts to accommodate the unpredictable, seasonal nature of our business. But once we started to look at this issue more closely, we quickly discovered that for most staff there was a relatively regular pattern to working hours. So we moved all our existing staff onto contracts that guaranteed a minimum number of hours a week, and we now discuss minimum hours with all new starters.
We need to talk about poverty
Whether it’s pay, contracts, or routes to progression – it’s important to think about the areas where your business can take the initiative. Culturally, there’s still a lot of work to be done to increase understanding and remove the stigma attached to poverty. You only need to look at the progress that’s been made on awareness around mental health to see where we could be in five or ten years’ time. For now though, I think a more realistic approach is to acknowledge the difficulty of discussing the subject and make sure you’re ready to reach out.
At Adnams, we believe our line managers are the greatest internal communications tool we have. They’re trained to ensure every employee knows about the support available to them, whether that’s showing them how to access our online training platform, or making them aware of the support on offer via our partnership with the Licensed Trade Charity.
It’s also important that our managers have the right attitude towards performance. Having an appreciation of how someone’s circumstances outside of work might impact on their working day is an important part of valuing employees on the basis of character and what’s being delivered to the business.
It’s all about mind-set
Developing a poverty-conscious mind-set is not something that happens overnight. Taking action on things like pay and progression can be challenging, but these are inevitable growing pains on the path to becoming a more sustainable business.
Coming back to our people, we’re proud to see the impact of our approach reflected in some of our most senior members of staff. Our COO, Karen, for example, started Adnams as a cleaner. As a single parent she was only able to work evening shifts, but once her children went to school she got a job in our transport office. She quickly progressed through logistics, procurement and transport to the position she’s in now.
Examples like Karen remind us that businesses can play a powerful role in tackling UK poverty. Having the right mind-set is half of the battle.
You can find all of JRF’s recommendations for business here. To find out more about in-work poverty, take a look at at BITC’s Beyond Pay report or read about what else BITC is doing on the issue of employment.