The start of a new year has brought fresh challenges for employers. Gemma O’Connor outlines six of the biggest hurdles ahead and what organisations can do to prepare
The pandemic may be all but over, but some of the sweeping changes and challenges it brought to the way we work look likely to stay. Here are six of the biggest hurdles facing employers in 2023.
Increased labour costs
According to recent Peninsula Group research, the cost of doing business remains a key concern for employers as we enter 2023, and understandably so. While inflation in Ireland has come down one percent since October 2022, companies are still feeling squeezed by the cost of living.
Further, a new survey conducted by Peninsula found that 72.3 percent of business owners listed rising costs as their number one concern going into the new year.
And while energy costs continue to impact the cost of living, which is having a knock-on effect on the cost of employment, the Government's Temporary Business Energy Support Scheme is now in place and will go some way towards alleviating these concerns.
Return to the workplace tension
As last year drew to a close and memories of COVID-19 restrictions became more distant, more employers asked their staff to return to the workplace. Not all workers were happy to do so, however, instead demanding permanent working flexibility.
This conflict looks set to persist in 2023.
Hybrid working arrangements have been the answer for many employers and their staff. Whether a hybrid model will continue to be a long-term policy for employers remains to be seen.
Recruitment and retention
Last year’s economic recovery following COVID-19 lockdowns combined with labour shortages to give employees increased bargaining power in the labour market.
This trend saw leadership teams spending more time on recruitment and retention. Despite this increased spend, employers may regain the upper hand if Ireland slips into recession this year.
Right to request remote work
Government confirmed last month that the planned Right to Request Remote Working Bill would be shelved.
Provisions allowing employees to request remote work will now instead be part of the Work Life Balance and Miscellaneous Provisions Bill, which is progressing through the legislative process.
The following conditions will attach to the right to request remote work according to the latest draft legislation:
- Employees will be required to have completed six months continuous service before they can avail of the right to request remote work.
- Employers will get a period of four weeks (with an option to extend to up to eight weeks) to consider a request before approving or denying it.
- Employers must consider both parties' needs when considering a request and provide staff with the grounds for a refusal.
- The Workplace Relations Commission is expected to produce a Code of Practice to assist employers and employees with handling requests.
It is expected that the Bill will be passed into law early this year.
Employers must familiarise themselves with the new law and be prepared to handle employee requests. Ignoring requests may lead to employees bringing claims to the Workplace Relations Commission.
Statutory sick pay
The new statutory sick pay scheme came into effect on 1 January 2023. Employers should ensure that they are prepared to comply with their obligations under this new scheme. For example:
- Reviewing payroll processes to ensure the new sick leave payments will be adequately reflected in payslips. Failure to keep proper records is an offence and attracts a maximum fine of €2,500).
- Reviewing employment contracts and policies to see if existing sick leave policy needs to be updated. No action may be necessary if the terms of the existing policy are more generous than the statutory payments outlined above.
- Notifying staff in writing about any changes in employment terms required under the statutory sick pay legislation.
New public holiday in February
Finally, a tenth public holiday becomes a permanent date in the calendar in 2023. St Brigid's Day falls this year on Monday 6 February 2023.
Employers should ensure payroll is up to date and staff receive the appropriate paid leave or relevant alternative entitlement for this new public holiday.
Gemma O'Connor is Services and Operations Manager at Peninsula Group