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  • Writer's pictureJoy Beckett

UK law firm introduces pay cut for at home workers



Can we consider implementing this in South African workplaces?

Top law firm in the UK says staff can work from home for a 20% pay cut.

Is this approach problematic or has the era of shaping your own pay been ushered in on the back of the Pandemic remote working solution. Do we finally get transparency on pay and structuring of fit for purpose pay? A move away from roles graded for pay perhaps?

Some research and opinions from the UK market place are suggesting that this is not a one size fits all approach for leaders and staff alike. What it does certainly point towards, is that blended forms of job roles and associated pay is going to be very necessary in the future. How will the measurement of jobs, successfully and fairly be adjudicated?

A top law firm, Stephenson Harwood 1, is allowing staff to work from home full time, but only for a 20 percent pay cut.

Academics from Henley Business School have recently published a report on flexible working which reveals that 27 percent of employees surveyed would be willing to take a salary reduction to work from home full time.

The research suggests that the amount that workers are willing to give up was not trivial, with employees being willing to forgo over £3,300 per annum to be able to do so.

This is a sizeable figure, but to put it into context, the calculation of the average expenditure of commuting by car is £1,768 per annum, and overall, a family spends over £3,700 on transport each year, according to the UK’s Office for National Statistics (ONS) (excluding air travel).

Is lower pay legitimate?

Whilst working from home certainly reduces expenditure costs for employees, as well as affording better time management, there are numerous other issues which nonetheless arise.

Group Legal Director at employment law and HR support firm WorkNest, Donald MacKinnon, says: “Taking this approach to home and flexible working could cause a number of issues for a business, some of which could also be classed as discrimination which can have severe consequences.

For example, if homeworking is being used by a woman because they have caring responsibilities or by a disabled person, then arguably paying them a lower wage for working from home may be indirectly discriminatory..

The employer would need to justify that lower pay is a legitimate and proportionate measure which might depend on whether the employer could show that an employee saves 20 per cent of their wage by working from home.

It could also raise equal pay issues if the same work is being carried out by a female home worker compared to a male office worker. It opens up questions around whether the two roles are comparable.

This is also a very classist /white collar approach. Some jobs just cannot be done at home and these are more often than not blue collar jobs, which can be argued are currently ranked and seen as lower level in an organisation. Is the value we have placed on jobs redundant post Pandemic. Has society changed its view on what jobs add value to a viable and well functioning society? What does this say for creating equitable workplaces, especially in South Africa?

“Ultimately a move such as this could leave an employer vulnerable to potential claims as well as it possibly having an overall negative impact on employee engagement.”

Martin Williams, Head of Employment at Mayo Wynne Baxter said:

“Stephenson Harwood has said it was not expecting many people to take up the offer of working from home full time with a 20 per cent pay cut – which is not surprising as it is a big chunk of money. It makes you wonder why it was offered in the first place.

The question is, if working from home is going to have a detrimental effect on meeting customer demand or quality of the work produced, how does paying someone less overcome that problem?

It is hard to see how taking money away solves any of the issues an employer thinks they might have with people working from home – especially when they are saving money on office space.

If someone has been working from home all this time and it has not had a negative impact on the business, they can make a Flexible Working Request.

An employer does not have to acquiesce to that request, but if the employee has proven that they can work remotely and effectively over the past two years, it’s going to be very difficult for the employer to decline their request.

Having inflexible blanket policies on working from home is not a sensible approach. What employers need to do is to manage employee expectations and consult with staff on a case-by-case basis.”

The above comments have been extracted and shared from an on line article posted by Amelia Brand | May 4, 2022 | HR Strategy News, which has peeked our interest and the need for some South African research. We are seeing a building need in our practice to develop solutions to this dilemma, with many clients facing a huge challenge in getting employees back to the office?

This new hybrid working world certainly puts a lens on performance measurement of jobs and the need to reframe job roles and pay associated with that reframing. Ultimately the type of work being done, will dictate whether it can be done remotely or not. Will this shift the value we place on varied jobs in society? And what of the leadership style and culture of an organisation, how will that influence the direction of continued work from home practices?

This is a start of a series of articles where we hope to discuss this rising challenge of blended working practices in South African workplaces.

1 Stephenson Harwood LLP is a law firm with over 1100 people worldwide, including more than 190 partners. Headquartered in London, United Kingdom, with eight offices across Asia, Europe and the Middle East. In 2014/5 it achieved total revenues of £145 million and profits per equity partner of £763,000 (Wikipedia).

Headquarters: London, United Kingdom

Founded: 1875

Major practice areas: General practice

No. of offices: 8

Profit per equity partner: £763,000 (2014/15)

Subsidiaries: Stephenson Harwood, LLP, Stephenson Harwood LLP, Stephenson Harwood & Lo.

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