Sinead Morgan: A Winter of Discontent — managing a hybrid workforce during an energy crisis
Sinead Morgan, senior associate at RDJ LLP, considers the challenges for employers in handling remote working during an energy crisis.
The hybrid working revolution triggered by the Covid-19 pandemic has been credited for accelerating innovative working practices such as remote working by years, if not decades. There has been much discussion around the difficulties of managing remote or hybrid employees. These challenges are likely to be exacerbated by the current energy crisis and the further complications it may bring.
Once employers decided to embrace the remote model of work there was a clear effort on the part of business and the government to embed a remote working culture into their organisations. Many employers rolled out remote or hybrid policies and engaged with their employees to agree arrangements and set expectations. Those arrangements appear to be evolving as time passes. In circumstances where remote working was thrust onto employers, many are now taking the opportunity to re-evaluate whether those arrangements continue to work for their business and their employees.
The government has also issued the National Remote Work Strategy, established work hubs in rural areas and has offered tax credits through the Remote Working Relief Scheme. The Right to Request Remote Work Bill 2021 was drafted but has made slow progress through the legislature due to a backlash for employee organisations who criticised its pro-employer stance. Recent indications from the government suggest that substantial changes will be made to the draft legislation as a result of those negative reactions. Given the delays in enacting the Bill, we have seen many employers pressing ahead and issuing their own remote or hybrid working policies to their employees.
Experience suggests that the key challenges for managers in managing hybrid workforces revolves around ensuring equal treatment between office-based versus remote staff, addressing lack of engagement with employees and new health and safety issues raised by remote work. These issues continue to develop, with both employers and employees both “finding their feet”. At this point, many employers have invested heavily in home office setups for their employees and employees have become accustomed to a more flexible way of working. A future of work which could not have been imagined in 2019 has become a reality overnight.
Such a significant change was always going to be difficult and teething problems were anticipated. However, the challenges thrown up by the current energy crisis and the prospective “twindemic” of the remnants of Covid-19 and the flu season was not foreseeable. Employers may now be faced with the task of balancing a series of conflicting priorities during this winter season while maintaining employee engagement.
Rising Energy Bills
Both employers and employees are facing rising energy bills. These increases have primarily impacted on the price of oil and gas as well as having knock-on effects on other goods and services. Earlier this year the government made the decision to reduce public transport fares by 20 per cent, with a 50 per cent cut for the cost of tickets for those under 25. Those savings were retained in the budget meaning that the price of public transport is one of the few variables which is unlikely to rise substantially in the short term. Households have also been awarded a €600 energy credit over the next 6 months, the first of which is to be discharged shortly. Additional supports have been provided to businesses in the form of a Temporary Business Energy Support Scheme covering 40 per cent of an organisation’s energy increases (with a monthly cap of €10,000) once eligibility criteria are met. Despite a windfall budget given the current rate of inflation, it is anticipated that the supports provided to employers and employees may not bridge the gap. As such, it is entirely possible that soaring energy bills and reduced public transport prices may tempt hybrid employees may back into the office this winter. Employers may also try to reduce their costs by rolling back slightly on the hybrid model or trying to achieve savings in the office by other means which could lead to conflicts between employers and employees.
A further difficulty may also arise this winter in relation to working temperatures. There is a difference between what employees may believe is a comfortable workplace temperature and the minimum allowable temperature in the workplace. General research suggests that the optimum room temperature should be 21 to 22 degrees Celsius. However, Regulation 7 of the Guide to the Safety, Health and Welfare at Work (General Application) Regulations 2007 sets the minimum temperature for a sedentary worker, such as an office employee at 17.5 degrees. If employees are attending at the office employers must maintain minimum temperatures in that workspace. Cost savings could be achieved by reducing the number of people coming into the office, closing off floors and moving employees closer together and/or reducing the room temperatures once they remain above the minimum threshold.
It has been suggested by recent media reports that the temperature in public sector offices will be capped at 19C during the winter months to conserve energy. Other measures which have been proposed are reducing unnecessary heating of low occupancy spaces, optimising heating timers and thermostats and reducing use in peak times or turning off the heat one to two hours before closing time. Given the uncertainties employees are facing at this time, if employers take these steps and the temperature falls below the required 17.5 degrees, health and safety issues could arise resulting in discontent within the workforce and/or industrial relations action.
There has been much discussion of a possible “twindemic” this winter. All indications by the government are that future Covid outbreaks would be managed by using preventative measures such as good ventilation, hygiene measures and advice to stay at home if symptomatic. Many of these measures starkly contrast with other actions which might be taken by employers to achieve energy efficiency such as closing off floors of a building, grouping employees together and closing windows to retain the heat within a building. If there are Covid outbreaks this winter employees may be understandably reluctant to share crowded personal spaces. Employers may face the unenviable task of balancing health and safety risks and “balancing the books”, two interests which appear on the face of it to be mutually exclusive.
The Great Resignation
Surveys suggest that employee attrition is at an all-time high. Recent statistics published by PWC indicate that 56 per cent of employees were likely to seek a new employer within the next 12 months with many citing money concerns and the cost-of-living crisis as the reason to make a move. Meanwhile, demand for candidates remain high. By contrast, the CIPD/IRN survey indicated that the struggle to retain staff remains an issue for employers. The survey’s results indicate that many employers have been managing the issue through pay rises and the provision of additional benefits. Interestingly, 72 per cent of those interviewed had implemented pay rises in the past 12 months. A further 50 per cent of employers had used retention payments or countered offers by new employers in order to retain staff and another 51 per cent were planning to offer employees a pay rise in the next 12 months. Other organisations introduce more alternative or progressive benefits to retain staff such as paid paternity leave or miscarriage in an effort to maintain staff levels.
With spiralling costs for employers and employees, high employee attrition, reduced employee engagement and a skills gap facing employers it remains to be seen how long this momentum can last. It is rare that employers have been required to balance such a wide range of interests and face such diverse challenges while remaining profitable. It is certainly an unenviable task. It remains to be seen how these conflicting priorities will be managed by employers in winter 2022.