Earlier this week, 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. With recommendations for the Government, businesses, communities, charities and individuals, JRF’s comprehensive strategy is the first of its kind to propose a long-term roadmap for ending poverty in the UK.
In the first of two responses from the business community, John Telling, Group Corporate Affairs Director at outsourcing specialists Mitie, gives his views on the recommendations and explains what steps Mitie is taking to tackle poverty in the workplace.
“The business of business is business”, as the American economist Milton Friedman once famously declared. So, why should businesses care about tackling poverty? At Mitie, the answer is simple: because our organisation is only as strong as its people.
Sector: Support services
What they do: Outsourcing and facilities management
Location(s): UK wide
Typical relevant roles: cleaners, admin assistants, catering staff, security officers.
According to the JRF, more than half of people in poverty live in a household where someone is in work. An employee who is distracted by concerns that their paycheck won’t cover the bills, or one who doesn’t know how many hours they will be offered from one week to the next, is unlikely to be the most productive or engaged member of staff.
So what action should employers take? JRF has recommended that employers adopt a wide range of employee-friendly employment practices in order to reduce poverty and improve employee engagement and wellbeing. These evidence-based recommendations reinforce the six key areas for action that businesses, including Mitie, identified through BITC’s Beyond Pay Inquiry last year.
Pay, security and job design: getting the basics right
As a large outsourcing company with over 60,000 employees, some of the recommendations are easier to implement than others. Take the thorny issue of pay, for example. This is a challenging issue for our business as we don’t commission the services or wage rates, our clients do. In any case, we offer two bids for any tender – one set at the higher voluntary Living Wage and the other at market rate. We take these steps to encourage our clients to pay more, but in a slow-to-no growth economy this is often not possible for them.
Mitie at BITC
Find out more about Mitie as a BITC member company
But there are other areas we do have control over. The National Living Wage set by the Government does not extend to under 25’s. We don’t think it’s fair to differentiate on age, so we have taken the decision to implement, where possible, this rate for workers of all ages.
Increased job security is another area highlighted by JRF as critical for low income employees. We’re on the brink of introducing a new employment contact that guarantees a minimum number of hours for our security relief team. Unlike full-time security officers, relief staff see their hours vary from one week to the next as they cover absences, such as sickness and holidays - often with short notice. This new employment contract will go some way towards giving our relief staff the security of income they need.
Alongside job security, job design can also make a fundamental difference to our low-income workers. To give you an example, typical hours for cleaners have always been early morning and late at night. In consultation with our clients, we are looking at ways to change this, by offering cleaners the opportunity to apply for roles with longer shifts during normal office hours. This can have the added benefit of reducing transport costs and increasing total pay for employees. Not to mention the cost savings to the business from increased staff retention.
Training and progression: giving employees the skills to succeed
Access to training is another important part of the puzzle. At Mitie, we’ve spent a lot of time developing high-quality apprenticeships as a means of training new staff and up-skilling existing employees, particularly those in roles traditionally regarded as entry-level. As part of that, we are supporting our staff with key skills, such as English and maths, helping to improve their progression prospects.
Nevertheless, developing routes to progression for all employees - particularly hourly or part-time workers - can be challenging. To remain competitive, it’s important we develop efficient management structures which keep our costs down. This can mean that for some of our low-skilled jobs, such as cleaners and security officers, the opportunities to progress into a management role are small. So, what else can we do to support our low-income workers and increase productivity?
Targeting low paid employees
Another area that JRF has highlighted in their recommendations to employers, is the provision of fringe benefits targeted at low-income workers. At Mitie, all our people are given access to the ‘MiDeals package’, which is a range of negotiated discounts which employees can use to purchase household goods and items. A third of our workforce have taken this up, and we believe this has a positive effect on our employees overall wellbeing; helping us to retain our employees as a result.
The key to all these interventions is effective communications and line management. It’s no good offering benefits packages and training opportunities if staff are unaware of them. And in a business like ours, where supervisors manage around 150-200 people across multiple sites, interaction with front line staff can often be the hardest challenge.
One of the ways we are trying to address this barrier is through our new MiLife platform, which advertises vacancies, gives employees access to their payslips, as well as information about benefits and training opportunities, is designed to ensure all our employees have access to the information they need to feel connected to the business. For those that don’t have access to a smart phone, we ensure hard copies of our internal magazine are available throughout our branches.
How businesses can support JRF’s recommendations
Ultimately, for Mitie, all these actions are simply part of our drive to behave as a responsible business. I’m sharing them with you today not to boast of Mitie’s efforts but to point out that, whilst we’re making good progress, there’s so much more to be done.
Employers need to view this issue holistically and look across the broad range of ways they can support their employees as outlined in JRF’s Anti-Poverty Strategy. It’s not just the contract or the pay, not just the benefits packages or the training opportunities, but how you act completely as a business, for the benefit of all your staff. Once employers understand that, we’ll be one step closer to a poverty-free UK.
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.