Archive for March, 2009

Rise in baldness in teenagers blamed on stress

March 31, 2009
Hair loss (Pic:DM)

Stress from school pressure and family break-up is making youngsters go bald at an alarming rate, it is claimed.

Experts say the number of teenagers losing their hair is up 25 per cent in two years.

Andrew McCarthy, of The Alopecia Clinic in Manchester, has recorded the increase in under-21s seeking advice and treatment since 2007. He said: “Stress is usually the number one cause.”

Neil Shah, of the Stress Management Society, said factors including radiation from modern gadgets, poor diet and lack of exercise played a part.


Richard Reid is the founder of Pinnacle Proactive, Specialising in the Employee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit


Sickness & Absenteeism

March 26, 2009

Richard Reid is the founder of Pinnacle Proactive, Specialising in the Employee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit

AIG Makes Controversial Decision to Pay Out $165M in Retention Bonuses

March 17, 2009

Rich Edson of FoxBusiness reported yesterday that AIG plans to pay $165 million in retention bonuses “at the division that has drawn most of the heat for the company’s near-collapse.” Currently, AIG is 79.9% owned by the federal government after the Treasury Department and Federal Reserve committed up to $170 billion in bailout funding to help AIG stabilize itself.

AIG’s announcement that it will pay $165 million in bonuses comes on the heels of its disclosure last year that it would pay $450 million in bonuses to keep employees at AIG Financial Products, which is the division that focused on the controversial credit default swaps.

According to Edson, AIG recognizes the controversy and it criticism that its bonus payments will attract, but says that the bonuses are a necessary tool for helping the taxpayer-owned company turn itself around and provide a future return on investment.

“We cannot attract and retain the best and brightest talent to lead and staff the AIG businesses which are now being operated on behalf of the American taxpayers,” AIG chairman and CEO Edward Liddy said in a letter to Treasury Secretary Timothy Geithner on Saturday.

AIG said that while it will do everything in its power to reduce the bonus payouts, its hands are tied legally, as it is contractually obligated to pay the bonuses. The company should have more flexibility to reduce bonus payments in 2009, which it says it will do. Government officials have said that they will be “very involved” in making sure that bonus payments are reduced as much as possible.

AIG’s story is, of course, not unique — and raises interesting corporate governance questions.

Many companies that crashed this past year, and that received government bailout funding, face the conundrum of being contractually obligated to pay bonuses and now having to use taxpayer funding to do so. Additionally, now that these companies are being funded with taxpayer dollars, it is imperative that the companies turn around and provide a return on that investment to help the economy recover. Retention bonuses, as stated by AIG, are seen as a necessary tool to ensure that the best possible executive and managerial talent is making the decisions to steer the company’s future course in a profitable direction.

What do you think AIG should do?

  • Is AIG handling this situation the right way?
  • Are these retention bonuses, despite how they look to the casual observer, actually a worthwhile use of the bailout funding?
  • Or should companies like AIG do whatever is necessary to bite the bullet now and moving forward to not give the appearance that poor performance is being rewarded?


Richard Reid is the founder of Pinnacle Proactive, Specialising in the Employee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit

Toyota cutting production and pay

March 11, 2009

Carmaker Toyota is expected to announce cuts in production at its UK factories.

Nearly 4,500 staff at its plants in Burnaston, near Derby, and Deeside, Flintshire, are expected to accept a 10% pay cut as the working week is cut.

The half-day reduction comes just after the factories reopened following a two-week shutdown, with further non-production weeks planned for April.

Motor industry representatives are due in London later for talks over the government’s £2.3m support package.

Carmakers and suppliers have yet to receive any funds from the Automotive Assistance Programme, which was announced in January.

The scheme has now been approved by the European Commission and industry figures are due to find out how to apply for loans or guarantees, which are linked to helping firms become greener, more innovative and productive.

A series of carmakers have been forced to announce cost-cutting measures, including reducing production, freezing pay and stockpiling thousands of vehicles, in the face of a sales slump across Europe.

Tony Woodley, joint leader of the Unite union, said the London talks between industry leaders and Business Minister Ian Pearson would bring vital stability to the sector.

“We know the government have some good ideas about how to support manufacturing and the car industry through this recession,” he said.

“Our concern has been to ensure that we get this support, which is desperately needed right through the supply chain, out as fast as is humanly possible.”


Richard Reid is the founder of Pinnacle Proactive, Specialising in the Employee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit

Baby boom Britain won’t retire quietly

March 10, 2009

For the first time ever, the number of Britons over 65 exceeds those under 16. As the country grows older, the demand is growing for people to be able to work beyond pensionable age. And with advanced years comes growing political power – so the debate about retirement age is set to intensify.

With his Harley-Davidson, his motorbike leathers, his running and his hectic schedule, Bill Kennedy is not the stereotypical British pensioner. But at 70, in good health and with a lot to say, Kennedy is at the vanguard of a politicised and vocal generation of older people that is about to change the face of the nation.

With Britain’s low birth rates and rising life expectancy, with 12 million people estimated to have saved enough for retirement, with an economic recession, a housing shortage and an NHS already under strain – a demographic time bomb is ticking away. A few months ago the number of people aged 65 and over in Britain exceeded those under 16 for the first time – a complete turnaround from 40 years ago when a quarter of the nation was under 16 and less than 15% were 65 or over.

Older people are fitter than ever before and many do not want, or cannot afford, to retire at 65. Last week there was a taste of the fights to come with a series of challenges to the government over age discrimination. At an industrial tribunal in Reading, two judges, Stuart Southgate and Jeremy Varcoe, brought a case against the Ministry of Justice over being forced to quit at 70. Hundreds of similar cases are said to be pending. And in Luxembourg on Thursday the European court of justice ruled, in a test case brought by the charity Age Concern, that while mandatory retirement at 65 is not breaking any European laws, the British high court will now have to decide whether the government is justified in enforcing it.

Kennedy is the chairman of the board of trustees of Age Concern in Bournemouth, the Dorset seaside town that has earned the label “God’s waiting-room” because of the high proportion of over 65s; 23% of the population, compared with the national average of 19%. He believes the political clout of lobbyists for the elderly is rising dramatically and will put pressure on the government to rethink mandatory retirement.

“I was in the armed forces and I had to retire at 56,” Kennedy said. “At that time I was running three or four miles a day and was very, very fit and it seemed ludicrous for the MoD to throw me out. I wasn’t ready to finish working. I ended up running my own consultancy and didn’t actually finish paid employment until 2003 and, although I fondly thought that was retirement, with my voluntary activities I am still very much working.

“A heck of a lot depends on one’s mental ability. If you really have something to offer, something to teach, at the age of 65 then why not keep going and give us the benefit of venerable intellects.”

Kennedy wants those who do retire to take on voluntary work; otherwise, “old age is a hermit-like existence. It’s hard to find volunteers for anything and getting harder. My view is that it’s because of a selfish society. But we’re going to have to change that, because with more and more older people, we are going to need all the help we can get.”

About a third of British firms impose a retirement age on their workers. The employers’ organisation, the CBI, argues a retirement age of 65 is an essential management tool.

But now the “bulge” is coming along, to swell the ranks of Britain’s pensioners. The first wave of the babyboomer generation, taken as those born between 1943 and 1960, are hitting 65 and they are, according to feminist author and academic Professor Sheila Rowbotham, 65, nothing if not a vocal lot with high expectations. “My generation, those 1960s types, are aspirational, indefatigable Peter Pan types, refusing to acknowledge they are getting old,” she said.

“They do have high expectations, confidence and a feeling that they ought to be able to carry on if they want to. The generation before us, who experienced 1930s unemployment and then the second world war, had a fatalistic approach, their lives were so much dictated by outside events beyond their control. But we won’t accept unfeeling or harsh treatment.”

Rowbotham was herself the subject of an outcry when Manchester University tried in vain to terminate her contract when she reached 65 last year.

But retirement has a class conflict, she said, between “the working classes who are rather glad to get out of jobs they didn’t enjoy and the middle classes and people with more interesting jobs who are desperate to stay in”.

The recession will add its own problems to the mix, with people losing out in worthless pension funds and investments or unable to release equity from houses they had hoped to downsize, having to work longer just to survive. “That will be quite problematic because unemployment among the young is rising and so it’s quite bad if you have old people pitted against young people.”

And an age-power shift will affect more than the economy and political lobbying. A grey pound will change consumer culture. Materialism and fashions dominated by youthful energy and sexual imagery could disappear under the weight of what economist George Magnus calls “boomerangst” – the interest of babyboomers in the implications of their ageing and an older society.

Magnus has published a book, The Age of Aging, looking at how demographics are changing the global economy as western and rich countries age, with not enough children being born to act as a workforce to support the elderly, and poorer, developing countries find themselves with a younger, thriving population and fewer older dependents.

Magnus, senior economic adviser at UBS investment bank, predicts the phenomenon will not be helped by trying to force people to retire at 65. “In a rapidly ageing society we need to scrap it by virtue of the economics alone,” he said. “It’s a hindrance to the kinds of changes we are all going through over the next few years and beyond … It’s probably not having any impact at the moment, but it most certainly will as the years go on,” he said.

“The European court of justice’s decision will probably catapult the debate forward and certainly all of a sudden we are starting to see people wake up to this, not just economists, but everyone.”

In Japan, by 2050, 38% of the population will be over 60, and China is not far behind. In Britain at the moment we have four people of working age to support each person aged over 65 – by 2050 that will be two to one.

The median age of the world’s population – where half are younger and half older – is 28. By 2050 it will be 38. And most of the babies will be born in the poorest parts of the world.

Centenarians are the fastest growing age group; in England and Wales their numbers have increased 90-fold in less than 100 years. In 2007 there were 9,300 people who reached their 100th birthday and by 2032 there are expected to be 58,400.

“Within the next five years more than half of the elecorate will be aged over 50,” said Magnus. “They are more vociferous and they will want their views heard and acted upon.” The “bulge” is only going to last about 30 years before the demographics right themselves and the babyboomers all go to “the great retirement home in the sky” said Magnus. “By 2040 you will see the economic pressures diminish although we may have a few lingering social ones.”

At a bus stop in Wimborne Road, Bournemouth, four pensioners with a combined age of 286 years are waiting in the shelter. Frank is going home after a fruitless trip to the bookies. He gestures to a sign above a charity shop across the road. “Brain injury, multiple sclerosis, cancer, dementia, Huntington’s disease, stroke,” it reads. “I was just looking at that and thinking, ‘well, that about sums it up’,” says Frank, 72, a retired butcher, “but I’m in that kind of mood with this cold weather; it can really get you down and makes you feel old.”

“Cheery chappy,” laughed a grey-haired woman of 66 who would rather not give her name. “I think positive and make sure I’m active and getting about town and such – I have to. I look after my mother and my grandchildren and I’m working, just not getting paid. Retirement doesn’t really mean anything except money gets tighter. I don’t think there’s any rest for me in this world, but I’ll get it in the next!”

A 69-year-old frail-looking woman is astonished at being asked her opinion on anything. The other man is 81 and, at first, did not want to talk. When everyone is finished he quietly agrees the buses are good and Bournemouth is fine, but his wife has recently died, he has no family to speak of, and he had to force himself to leave the house this morning.

Further along Wimborne Road, in the small and cramped Age Concern offices, head of community services Sarah Carroll and her staff are also facing some sobering issues. Health problems that come with old age are seeing a change. “There is a huge rise in the number of older people with depression. Why that is I don’t know, but it’s certainly increased hugely even in the last year,” said Carroll. “We try to reach these people but there are huge waiting lists for our services. Isolation remains a problem. Generally people … are unaware of their entitlements.”

Services are stretched, though, and no matter how many new clubs and projects charities such as Age Concern start in communities, there are waiting lists for “absolutely everything … And there is no funding for information and advice and that is fundamental to everything else we run. In January we had the highest number of calls on record over bills and fuel. People are taking more notice and becoming more aware.”

But the workers are also finding that demand for the traditional elderly services, such as drop-in tea mornings and lunch clubs, are being equalled by demand for advanced yoga sessions and computer classes. “People are healthier and happier to work longer. If people’s minds are active, people should be allowed to do that, feeling fulfilled,” said Carroll. “We find a lot of retired people who volunteer here, people who want to pass on their skills, find a lot of fulfilment. We never ask anyone how old they are, not our staff and not our volunteers. It’s a model others could think about.”

The DIY chain B&Q has made employing older people a deliberate aim. In 1990 it owned a store staffed entirely by over-50s and a study by Warwick University found the shop had higher profits and less absenteeism. Having recognised the benefits of working with people of mixed ages, B&Q employs 34,000 people, spanning 16 to 94 years of age, with more than 25% of its workforce aged 50 or over.

B&Q’s diversity manager, Leon Foster-Hill, said: “There are clear business benefits to employing a workforce that is age diverse and reflects our customer profile. We have found that older workers have a great rapport with the customers, as well as a conscientious attitude and real enthusiasm for the job. We firmly believe that our active policy of recruiting older workers has directly contributed to the success of our business.”

Flexible working is the key to keeping a diverse workforce, he said. Sydney Prior is 94 and works at the company’s New Malden store in Surrey. He has worked for B&Q for more than 16 years, as a customer adviser. “Working gives me the chance to put my knowledge and experience to good use, advising customers on their gardens.” It gave, he said, “youngsters the chance to learn a little from an old-timer like myself”.


Richard Reid is the founder of Pinnacle Proactive, Specialising in the Employee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit

£7 minimum wage for Glasgow council staff

March 9, 2009

A crackdown on staff absenteeism will fund a scheme which will see more than 600 lower-paid council workers in Glasgow receive a rise in salary of up to £1,100 a year.

Steven Purcell, the leader of Labour-controlled Glasgow City Council, told the party’s Scottish conference yesterday that he is to set up a “Glasgow Living Wage” of £7 an hour – far above the current minimum wage of £5.73.

The move is expected to cost about £1.2million but Mr Purcell believes that the money will be recouped through disciplinary measures against staff who have poor attendance records at work.

The crackdown will see fewer overtime payments and could include dismissal for those who persist in taking time off work for no good reason.

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But the scheme is expected to receive a less than enthusiastic welcome from other Scottish councils, who will come under pressure from unions to implement similar payments and from many in the private sector where wages and salaries could be frozen, or even cut, this year.

Cities such as London and Oxford have already established similar “living wage” schemes, but Glasgow will be the first in Scotland. The council will be asking its contractors to pay their staff the same minimum rate.

Mr Purcell said it was unacceptable that almost one in five of Glasgow’s workers were paid less than £7 an hour. “The Glasgow Living Wage has the potential to make a huge difference to thousands of families across the city,” he said.

The council can only enforce the new minimum wage on those it employs but Mr Purcell hopes that other employers in the city will follow suit.

“We will work with employers in the public, private and voluntary sector to encourage them to pay low-paid workers a decent wage,” he said.

“Whilst there are clear social and economic benefits to Glasgow, the introduction of a living wage can also provide real benefits to employers in terms of staff morale, productivity, and quality.”

The annual Survey of Household Earnings 2008 calculated that there were 394,000 jobs in the Glasgow City Council area, of which 20 per cent were paid less than £7.14 an hour. In terms of part-time employees, 40 per cent are paid less than £6.64 an hour.

There are 681 staff working for Glasgow City Council who earn less than £7 an hour. A spokesman for the council denied that there would be pressure on other local authorities and small to medium sized businesses to follow suit.

“We are not asking other councils to do this and the last thing we want to see is small companies going to the wall. This is aimed at getting major employers in both the public and private sector to follow our lead or aspire to follow our lead.”

The initiative will mean that the salaries of the council’s lowest paid workers will increase from £12,200 a year to £13,340. April 1 will be the 10th anniversary of the introduction of the national minimum wage.


Richard Reid is the founder of Pinnacle Proactive, Specialising in the Employee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit

It’s a jungle out there

March 8, 2009

Earlier this week British research suggested workers were becoming increasingly prepared to accept longer hours, pay cuts, reduced benefits and even unacceptable behaviour from their managers, as long as it meant they kept their jobs. Now it’s the turn of American workers to have their say, and the results are not pretty.

The latest American Workplace Insights from recruitment firm Adecco suggests workplaces are becoming increasingly brutal, competitive places where it is not so much about survival of the fittest as survival of the most ruthless.

In fact, 28 per cent said they would be prepared to do something dishonest to keep their jobs, included blaming co-workers for mistakes, blackmail and even flirting with a superior.

And the most ruthless and desperate of all in this climate were post-1982 Generation Y workers, with more than four out of 10 saying they would be happy to stoop to dishonest behaviour if it meant protecting their job.

And within that generation it was men who were most prepared to lower the behaviour bar, with 44 per cent of those aged 18-35 saying they would be prepared to do something dishonest.

This climate of desperate financial and job insecurity had also led to a sharp rise in the number of U.S workers suffering from stress and anxiety, with a fifth of those surveyed saying the recession had had a negative effect on their mental health.

This finding was supported by research published this week by the American Psychological Association arguing that eight out of 10 Americans are now suffering economy-related stress, and that employers are as a result seeing a surge in demand for counselling and services such as Employee Assistance Programmes.

The Adecco research found nearly half of those polled expected their pay and compensation to stay either the same or decrease this year.

And, surprisingly given the climate of lay-offs, more than eight out of 10 said their managers were not paying any more attention to their work and performance than before the crisis.

Nearly three quarters believed President Obama’s stimulus package for the U.S economy would work, yet 15 per cent also said they were now actively saving as much as they could as a defence against possible unemployment.

As people become ever more desperate or, in the climate of lay-offs, angry and disgruntled, the issue of corporate dishonesty is also raising its head.

Research published this week by insurance firm Kroll, has warned British managers that the recession will expose organisations to a heightened risk from fraud and corruption.

The survey also concluded that many companies did not have adequate insurance in place to protect themselves from any claims that might arise as a result.

Richard Abbey, head of Kroll’s London financial investigations practice, said: “The recession is contributing to the increase in fraud. Previously honest employees may be compelled to exploit corporate weaknesses as a result of their own financial situation or low morale; or a well-intentioned worker or ‘corporate saviour’ could juggle numbers to try and mask the company’s true financial position from other stakeholders.

“Companies are more likely to pay closer attention to their balance sheets during tougher times, which means that the chances of fraud being uncovered are far greater. While controls help reduce risk, the majority of frauds are still uncovered by accident or as a result of whistle-blowing. This has to change,” he added.

Consultancy Deloitte, too, last month reported that more than nine out of 10 UK companies had experienced at least one information security breach in the past 12 months.

In the U.S the Justice Department and the FBI have also admitted that corporate fraud is now moving up their agenda, with more than 530 cases of alleged corporate malfeasance currently being looked into.

The key to keeping fraud (and other dishonest activity) at bay, of course, is managers but, all too often, it is lax or complacent management oversight that is in fact at the heart of the problem.

Back in September, for example, another survey by Kroll directly blamed a sharp increase in fraud and corporate crime on a combination of the tougher economic climate exacerbated by weak controls and complacent managers.

The average company loss to fraud had risen by a fifth over the past three years, it added.


Richard Reid is the founder of Pinnacle Proactive, Specialising in the Employee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit

CIOs getting serious about social networking

March 7, 2009

Benefits outweighing risks?

Most IT directors were sceptical of social networking at first. But that’s now changing, says the Corporate IT Forum’s Ollie Ross.

Let’s face it, IT directors are always going to be cautious of investing in technologies that they consider to be fashionable, rather than the ones they can prove make a difference to the bottom line – and who can blame them?

CIOs must consider many different factors when rolling out a new technology and they have to check things rigorously and be 100 per cent sure of the value.

Social networking is no different. Facebook is now five years old and over those five years, IT chiefs within the Corporate IT Forum have been carefully watching it – and the social networking phenomena more broadly – grow up and mature.

They’ve been trying to understand the business benefits – as well as the risks – and have been keeping a close eye on the cultural changes that have been taking place in wider society and within their organisations.

And now it seems they’ve reached a decision.

Around a year ago it was common for IT chiefs within the Corporate IT Forum to put blanket blocks on staff accessing social network sites. Broadly, social networking was considered a distraction or fad that would soon move on – not any more.

This month, the Forum recently held a workshop session in which IT chiefs from more than 30 large businesses all considered the benefits and risks of social networking. Without exception, all of the businesses were serious about understanding more about the technology. And not just about whether their peers were allowing access to such sites (or not) but rather why and how other businesses were actively adopting social networking tools.

CIOs now see that such networks are here to stay. What had led to this shift?

As with any technology, there are both push and pull factors to its adoption. IT chiefs realise that large proportions of their younger members of staff – the so-called Gen Y – consider messaging over Facebook to be as natural as picking up the phone.

And so IT leaders have realised that social networking is an important factor in attracting and retaining the best talent.

However, mostly they’re interested because they’ve recognised there could be major benefits.

For example, the CIO of one large company taking part in the event pointed to the example of a high street name that had successfully set up a Facebook page to generate a buzz around the launch of a new consumer product – with great results. The campaign led to Facebookers independently setting up their own groups around the product and recruiting their friends into the campaign. That’s priceless PR.

Another IT chief described how his company had developed their own version of microblogging siteTwitter to communicate corporate information inside the business and to encourage staff to share ideas.

IT directors can really see the benefits of social networking for internal collaboration. They understand how important it is to generate new ideas between different virtual communities and many see social networks as perfect places for this to happen.

Social networking is becoming embedded into recruitment and retention processes too. An HR director taking part in the workshop explained how his company had created a Facebook page to attract graduates. The mini-site allowed existing members of staff to talk to candidates and gave HR the chance to check out the online profile of candidates applying for a job.

After they were hired, the new starters were able to help and support each other via an internal social networking site.

These examples all show how embedded social networking is becoming in businesses. But of course, with benefits come risks.

CEOs are understandably concerned about the reputational impacts of staff using and sometimesmisusing social networking sites. They’ve read the national newspaper headlines about staff making unfortunate comments about customers on Facebook groups and when that happens, the CIO, HR director and head of PR all get the call to sort it out.

Executives have also realised there is practically nothing they can do to control a member of staff setting up a networking group about where they work, in their own time on their own computer.

Companies understand that rules and regulations are pretty powerless – here, education and guidance are important.

So are the risks worth taking? Many businesses think so. The first step is to understand that social networks are here to stay – and then to understand where the challenges lie, what the opportunities are, and what checks and balances must be put in place to ensure risks are reduced and benefits are realised.

We all know it’s going to be the companies with the new ideas and innovations that are going to prosper in a recession. Many business chiefs now suspect that social networks are important to make these ideas flourish.


Richard Reid is the founder of Pinnacle Proactive, Specialising in the Employee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit

Employer Pays Employees To Lose Weight in the US

March 6, 2009

“Immuno Laboratories has developed a program to increase the health of employees by providing a financial incentive to either lose weight or lower cholesterol. Studies have shown that healthy employees can lead to reduced healthcare costs and increased productivity.

Fort Lauderdale, FL (1888PressRelease) March 04, 2009 – In response to spiraling healthcare costs and the challenging economy, Fort Lauderdale based food sensitivity testing lab, Immuno Laboratories, has created the “Slim, Trim, You Win!” employee wellness program. This program not only helps to potentially reduce corporate healthcare costs by making a more “healthy” employee, but also provides employees with the opportunity to earn extra income.

The “Slim, Trim, You Win!” program will commence on March 1, 2009 and go through Memorial Day. Employees can choose whether they want to improve their weight or lower their cholesterol. For those choosing weight, at the start of the program they will participate in a weigh in. For those choosing HDL/LDL cholesterol levels, an initial blood test will be provided by the employer to determine base lines. Employees have the opportunity to earn $10 for either each pound lost or every point their cholesterol levels drop.

The “Slim, Trim, You Win!” program will be supported by a corporate intranet site full of information to help the employee determine body type, eating and exercise plans. Employees are also provided with a personalized portal to track their weight loss over the term of the program.

Worksite wellness programs are becoming increasingly popular as statistics are showing the many benefits, not only for the employee, but for the company as well. A review of 73 published studies of worksite health promotion programs published in the American Journal of Health Promotion shows an average $3.50-to-$1 savings-to-cost ratio in reduced absenteeism and healthcare cost*.

*Aldana SG. Financial impact of health promotion programs: a comprehensive review of the literature. Am J Health Promotion. 2001;15(5):296-320;


Richard Reid is the founder of Pinnacle Proactive, Specialising in the Employee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit

Employers experience budget cuts, escalation of workloads and higher stress levels

March 4, 2009

Employers experience budget cuts, escalation of workloads and higher stress levels to cope with recession, according to latest CIPD/KPMG quarterly survey

In a further sign of the deteriorating state of the economy, the latest quarterly CIPD/KPMG survey of 892 employers shows that around two-thirds of UK employers have either experienced an organisational budget cut in 2008 or are about to experience one.

The cuts look set to affect travel, fringe benefits and the opportunity to work overtime in particular which include significant differences between the private, public and voluntary sectors.  For instance, three-quarters of private sector employers (74%) have reduced their travel expenses, compared with 50% in both the public and voluntary sectors.  The recession also appears to be encouraging more employers to adopt greener working practices.  Almost two thirds (62%) have increased their use of tele/videoconferencing while forty three per cent have increased their use of public transport.

While redundancies have understandably been making the headlines, ‘surviving’ employees have also been affected by the credit crunch.  While a majority of HR professionals feel less secure in their jobs, around half say that employee workloads and stress levels have increased in their organisation.  Staff motivation does not appear to have deteriorated however, which could be a sign of higher levels of job insecurity or indicative of the increased effort employers are making to communicate regularly with their staff.  A majority of employers say that they are communicating with their staff more regularly during the credit crunch; with almost three in five reporting that they are using more regular communication from their chief executive or senior management.

Gerwyn Davies, Public Policy Adviser at the Chartered Institute of Personnel and Development (CIPD) comments:

“While our greatest sympathy should be reserved for those who are losing their jobs during the recession, the effects on surviving employees should not be overlooked.  Individual workloads and stress levels look set to rise during the course of the year, placing a greater onus on managers and leaders to communicate regularly and check that workloads do not become unmanageable.  This is particularly important against the background of higher levels of job insecurity and lower pay awards.  It is pleasing to see so many employers upping their game on communications.  This could make all the difference in building the resilience to get organisations through the recession.”

Tim Payne, Head of HR at KPMG comments:

“It’s no surprise that organisations are reining back on non-essential spending and scrutinising their policies carefully. What is important is that policy changes are made sensitively and in a way which preserves goodwill.  Firms don’t want to alienate staff at a time when employee goodwill is a vital commodity.  Employees understand companies need to manage their costs – but they still expect leaders to communicate clearly with them when changes are made.”

Key findings:

· Almost half (48%) of employers surveyed say individual staff workloads have increased as a result of the credit crunch. A similar number (46%) say employee stress levels have increased. In general, employers see little impact from the credit crunch on issues such as absenteeism, staff engagement or productivity.

· Private sector employers, understandably, are more likely to have felt the impact of the credit crunch at least to some extent on their job security than public or voluntary sector workers (65%, 54% and 48% respectively).

· 38% of UK employers have reduced business travel. Over two-thirds (69%) of organisations that have reduced business travel spend have reduced travel expenses, while three-fifths (60%) have reduced international travel. Other reductions have also been seen in the use of private transport, for example taxis (mentioned by 64%) and in the use of first class travel (65% have decreased).

· When broken down, over three-fifths (68%) of private sector employees say they have decreased the use of first class travel, compared with 54% in the public sector and 40% in the voluntary sector. Two-thirds (66%) of private sector employees have cut international travel, compared with 38% in the public sector and 25% in the voluntary sector.  Three-quarters (74%) have reduced travel expenses, compared with 50% in both the public and voluntary sectors.

· 62% have increased their use of tele/videoconferencing and 43% have increased their use of public transport. Over half (55%) have reduced client entertaining.

· Twenty per cent of employers have reduced or cut the availability of free drinks or biscuits at meetings


Richard Reid is the founder of Pinnacle Proactive, Specialising in the Employee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit