When it comes to ROI on HR spend, most teams are being asked to do more than ever: lift performance, improve retention, implement AI, stay compliant, support leaders, strengthen culture…. all while budgets are under increasing pressure.

In response, many are trying desperately to stretch what they have, spreading their money across multiple initiatives, while hoping somehow they’ll be able lift their performance in each of them. 

But if you’re looking to optimise your return on investment for HR this year, it pays to remember this: a relatively small number of HR decisions drive a disproportionate share of outcomes. By focusing your investment on these, rather than across everything, you really will give yourself a chance of doing more with less. 

Here’s how.

1. Start with the outcome, not the activity 

Most organisations build their HR budgets around activity rather than outcomes, committing to a cocktail of training programs, systems, engagement initiatives and wellbeing efforts. But, while each of these may have a reasonable case behind them, they’re often funded without a clear link to a specific issue the business is trying to solve.

When this happens, budgets begin to lose their impact. If the underlying objective isn’t clearly defined, every initiative begins to feel equally important and spend gets allocated to activities that are broadly worthwhile but low priority from a business point of view.

That’s why your starting point should be to define, in concrete terms, what needs to change. Is it turnover within a particular team? Persistent underperformance in a critical role? The time and cost of hiring? A gap in leadership capability. In most organisations, the real pressure points are far narrower and more specific than their list of HR initiatives suggests.

Until you’ve clearly identified outcomes, there’s no reliable way to determine where investment will have the greatest effect. Without that, it is almost impossible to isolate the relatively small number of decisions that will drive the majority of results.

2. Focus on the small number of decisions that drive most outcomes

Pareto’s principle – that roughly 80% of results come from 20% of effort – applies to HR just as it does to most things we do in life. So, once you’ve nailed down the outcomes you’re after, identify the high-impact 20% of your HR activities and decisions that drive the outcomes you want. 

For example, if your goal is to reduce turnover in a critical team, the most valuable investment may sit with one manager, one role design issue or one broken process. If the issue is underperformance, the answer is probably not going to be another generic training program. It’s far more likely to involve looking at how expectations are set, how feedback is given and how performance is managed day to day.

And if the issue is productivity, could you cure this by providing your leadership with targeted training on how to get more out of their teams? After all, research from McKinsey shows that organisational health, including management practices and how work is actually run day to day, is one of the strongest predictors of long-term performance outcomes.

Across organisations, the same themes tend to recur. The quality of hiring decisions, the effectiveness of managers, the way roles are structured and the ability to retain key people consistently have an outsized influence on outcomes. These aren’t always the most visible or well-funded parts of the HR budget, but they’re often the ones that matter most.

Rather than trying to improve everything incrementally, focus on identifying and investing in the small number of areas that will make the biggest difference. 

3. Where HR budgets get wasted

Once you start looking at HR spend through this lens, the areas where value is lost become much easier to spot.

One of the most common cash-sucks is broad, generic training programs. These are often rolled out across entire teams or organisations, regardless of whether they’re relevant or whether the underlying issue is capability, accountability or something else entirely. 

Another is investing in systems or platforms which don’t lead to a corresponding change in behaviour. New HR technology can be valuable, but only if it’s adopted and used in a way that improves efficiency or productivity in decision-making or day-to-day management. In many cases, the system is implemented, but the underlying habits remain unchanged, leaving the return on that investment marginal at best.

Employer branding and engagement initiatives can also fall into this category. Organisations invest in how they present themselves to the market or measure employee sentiment, but then do little to address the underlying issues those efforts are meant to surface. 

A similar pattern shows up in the use of perks and benefits. These are often introduced as a way to improve retention or engagement, but they rarely address the specific reasons people leave or disengage (which often has more to do with people feeling their employers don’t make use of their skills). As a result, they add to the cost base without materially shifting outcomes.

That doesn’t mean these initiatives have no value – they often can, especially if the process above has been followed. However, when they’re funded as part of a broad, evenly distributed budget, they tend to absorb resources without delivering meaningful change. When they’re tied to a clearly defined outcome and applied selectively, they can be very effective.

4. Small changes that deliver disproportionate impact

After you’ve set your priorities, the next step shouldn’t be to launch more initiatives, but to make targeted changes that directly address the issue at hand. In many cases, that’s likely to mean making relatively contained adjustments to improve how work is structured and managed day to day.

For example, where hiring is a constraint, tightening role definition and selection criteria can have a significant impact on outcomes. A clearer brief, better alignment on what “good” looks like and more disciplined decision-making will usually do more than adding additional sourcing channels.

Where retention is the issue, the most effective intervention is often focused on a small group of people rather than your entire workforce. Understanding why key individuals or teams are at risk, and addressing those specific factors, is far more effective than introducing broad-based benefits that apply to everyone but resonate with few.

In environments where performance is inconsistent, the shift tends to come from how expectations are set and managed. Regular, specific feedback, combined with clear consequences where standards are not met, will typically outperform more formal or infrequent performance processes.

Even relatively simple changes to onboarding can have an outsized effect. Ensuring from the outset that new hires understand their role, priorities and how success will be measured both reduces time to productivity and lowers the risk of early attrition.

What these examples have in common is focus: they are directed at a defined problem, applied in a targeted way and designed to actually change behaviour rather than simply signal intent.

The real key: deliberateness

Optimising HR spend is not about doing more with less in a general sense, it’s about making more deliberate decisions about where effort and budget are applied.

In most organisations, a small number of factors will account for the majority of outcomes. The challenge is identifying those factors early and being prepared to prioritise them over a broader set of well-intentioned initiatives.

That often means funding fewer things, but funding them properly. It also means being clear about what success looks like and measuring whether investment is actually shifting the outcome it was intended to address.

When HR budgets are treated this way, the conversation should move away from activity and towards impact, and from blanket coverage towards focus.

In a constrained environment, that shift is what allows HR to deliver meaningful results without a meaningful spend. 

Want more?

Thinking about building a graduate hiring strategy that works for your business? Talk to us.

Hybrid work isn’t just a trend—it’s becoming the new norm. But offices still matter, especially when it comes to collaboration. 

One European study, the Okta Hybrid Work Report 2023, found that despite going hybrid, many companies aren’t cutting back on their office space. Instead, they’re redesigning it to make it capitalise on the benefits that can come from being together.

In an age where people expect productivity to matter more than presenteeism, they’re also adopting an ‘office first’ approach to hybrid working that gives employees some degree of flexibility but also captures the many benefits that can come from working with colleagues face-to-face  

With that in mind, we look at whether ‘office first’ should become the new normal for Australia’s workplaces, including yours.  

Three types of hybrid work models

The Okra report found that hybrid working now generally broke down into three models.

Fixed Model

In this model, remote working follows predictable patterns. Employees have set days where they work from the office and also days where they work from home. For instance, many employees work every Monday and Tuesday at the office desk and remotely the rest of the week. This schedule doesn’t change; it’s fixed. 

This model is great for planning but can also be a bit restrictive for those employees who favour variety and flexibility. It’s a model that’s favoured by organisations with more traditional views on work-life balance, including many of Australia’s large corporates. 

Flexible Model

In this less prescriptive setup, employees get to pick where they work each day, depending on what they feel suits them best. Got a day of deep work? Stay home. Need to collaborate? Head to the office. This model suits people who like to control their own schedule, but it demands a high level of self-management and requires very high levels of trust.

It’s often favoured in highly skilled professional settings, where productivity can be easily measured through methods such as billable hours. 

Office-First Model

Under this model, employees are expected to be in the office most of the time, but they can still choose to work from home for a portion of their time, maybe a day or two each week. It’s not as prescriptive as the fixed model, though – if an employee doesn’t have to be at the office on a set day to do collaborative work, they can choose to be at home. 

The goal of the office-first approach is often to keep teams aligned and maintain company culture. If management says it’s a day for everyone to be in the office, employees need to be there.

 

The case for Office First

In the post-pandemic world, the report found that it’s the office-first model that was gaining the most traction among Europe’s employers. That’s because it tends to make collaboration easier and more spontaneous. 

If an employee is stuck on a project, they don’t always have to schedule a video call or wait for an email reply. They can instead simply walk over to a colleague’s desk for quick help. This face-to-face interaction can not only solve problems faster but also foster a sense of community and team cohesion. Having everyone in the same space reinforces company culture, something that can get diluted when people are scattered remotely.

The report found that another advantage was that mentoring and career development often thrive in the office environment in a way that’s just not possible online. In-person interactions give employees a chance to observe how their leaders manage challenges or even just run a meeting. These subtle, everyday learnings can be hard to pick up in a remote setting. 

For those new to a field or looking to climb the ladder, being physically present can offer invaluable lessons and networking opportunities.

 

The broader organisational impact of choosing a hybrid work model

The report noted that in European organisations, choosing the right work model is often a collective, board-level decision involving multiple stakeholders, not just a matter for HR.  

This C-suite collaboration makes it essential for various departments to align their objectives and challenges and to reach some agreement on what is going to work best in the interests of the whole organisation.

In doing so, many take the view that employee wellbeing comes first. And this doesn’t necessarily mean allowing employees to work remotely whenever they feel like it. Instead, the emphasis on collaboration that comes from an office-first approach can significantly enhance team dynamics and overall productivity. This, in turn, offers a well-rounded employee experience that prioritises both wellbeing and work outcomes.

 

How to decide if office-first is right for you

Every workplace now has to choose which model suits the kind of work they do. For some, such as manufacturing, hospitality or retail, the nature of the work means that face-to-face has to happen. For others, though, it’s more subtle. 

Before jumping on the office-first bandwagon, we recommend considering several factors and how they impact your business.

By weighing these factors, you’ll get a clearer picture of whether an office-first model benefits you.

 

Implementing an Office-First approach

If people are used to having the freedom to choose, they might find some resistance to moving to office first. If that’s the case, here are our tips for transitioning effectively. 

Announcement: Clearly communicate the shift to an office-first model and the rationale behind it.

Transition Period: Offer a grace period for the team to adjust to the new setup.

Office Layout: Redesign the office space to maximise the benefits of in-person collaboration. Show everyone why being in the office matters so much. 

Flexibility Clauses: Despite being office-first, consider built-in flexibility for special circumstances.

Review: Periodically assess the effectiveness of the new model. Make tweaks as needed.

Implementing office-first isn’t just a policy change. It’s a cultural shift that demands clear communication and a thoughtful approach. By considering the nuances and involving your team in the decision-making process, you can make the shift as seamless as possible.

 

Want more?

If you’d like to know more about implementing an office-first approach in your workplace, get in touch. 

The ‘Closing Loopholes’ Bill could be about to change Australia’s workplace laws in the most significant way since the Fair Work Act was introduced. 

If the Bill passes through both houses, the Albanese government will be able to implement its workplace relations agenda, changing everything from the rights of casual workers to the laws around industrial manslaughter and from minimum employment conditions through to the definition of employment itself.

We explore how the Closing Loopholes Bill will impact your organisation if it becomes law.

 

What is the Closing Loopholes Bill?

The Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 aims to introduce some of Labor’s workplace relations-based pre-election promises, as well as some of the outcomes agreed at last year’s Jobs and Skills Summit. 

While the Bill may not be law yet, it will likely pass through parliament in some form after February next year, after a Senate Committee Report. (Although independent Senator David Pocock, whose vote is likely to be needed, supports splitting the Bill). 

That means all organisations should start preparing now. Here are some of the key provisions you need to know about. 

 

A re-written (and more onerous) definition of casual workers

Over the past couple of years, several high-profile court cases attempted to define what constitutes a casual employee. Then, in early 2021, the Morrison government stepped in, legislating that the written contract – rather than the patterns of behaviour – should be paramount.

The Albanese government wants to change this – by introducing a new test that considers the totality of the relationship between employer and employee. The idea behind this is to end what the government calls “the permanent casual” to look at “what’s really going on”. If passed, the test will require employers to continually assess their workforce and the nature of the way they engage employees to make sure they are genuine casuals.

This could impose a real burden on employers in sectors that rely heavily on a casual workforce, such as retail and hospitality.

 

A new definition of employment itself?

Another area the government is targeting is the distinction between employer/employee and principal/contractor. Again, this has been a long-litigated and contentious area of employment law.

Under the government’s proposed definition, we’ll see a return to a test based on many factors, effectively expanding the definition of who counts as an employee. This also reverses recent High Court authority, including WorkPac Pty Ltd v Rossato [2021] HCA 23 and Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1, both of which adopted a narrow definition of who was an employee.

Tied in with this are new ‘same job, same pay’ provisions. These give the Fair Work Commission authority to make orders preventing employers from undercutting the wage provisions of enterprise agreements by using labour-hire workers.

If passed, the new provisions could also impact several sectors, especially those that rely heavily on contractors.

 

Stronger penalties for underpayment

New ‘wage theft’ provisions in the Closing Loopholes Bill will make deliberately underpaying employees a criminal offence. 

The Fair Work Ombudsman will handle any initial investigation and has the power to make ‘snap’ entries. If they find something amiss, the Commonwealth DPP can take legal action based on information from the Australian Federal Police. Prosecutions can start up to six years after the alleged offence, and the penalties are severe – up to 10 years in jail for individuals and fines that could go as high as $7.8 million for companies.

But there is a safety net. The FWO is offering a “cooperation agreement” for businesses that self-report wage theft. This agreement serves as a ‘safe harbour,’ protecting you from further prosecution. 

So, while the Bill brings more accountability and stringent rules, it also provides an avenue for rectification for those businesses and individuals that find they have breached the Act.

 

Greater protections for gig economy workers

The FWC will also be able to set fair minimum standards for ‘employee-like’ workers, such as those working through ride-sharing and food delivery apps. They’ll also be able to hear claims concerning unfair deactivation or termination from a service.

This further regulates one of the most controversial and vulnerable workplace sectors and one that is growing more important to the overall economy. 

 

New rights for union workplace delegates

There are new rules around workplace delegates’ rights and protections, including in employer disputes. Workplace delegates will be allowed ‘reasonable access’ to workplace facilities, as well as to communicate with current and potential union members about industrial matters. 

A general protection will also apply to workplace delegates. This includes preventing employers from unreasonably refusing to deal with them. Employers are also prevented from obstructing workplace delegates or misleading them.

Workplace delegates also receive paid time off for training in their role, unless they’re employed by a small business.

 

Tougher anti-discrimination laws

Stronger protections will apply to workers who face discrimination as a result of family or domestic violence. This aims to bring the Fair Work Act into line with federal anti-discrimination legislation.

 

Industrial manslaughter

Industrial manslaughter laws already exist at the State level. The Closing Loopholes Bill will introduce a federal industrial manslaughter office that could land an individual 25 years in jail. Meanwhile, companies could face fines of up to $18 million if they’re found to be reckless or grossly negligent. 

 

In short…

These are just some of the changes that the Closing Loopholes Bill aims to introduce. If enacted, it will bring about new responsibilities for most employers and change the definition of many workplace tests.

That’s why it’s vital you stay on top of the legislation, especially if you have a high number of contractors or casual staff. 

If you’d like to know more about the impact this is likely to have on your workplace, get in touch. 

New legislation allowing employees access to 10 days of Paid Family and Domestic Violence Leave (FSVL) applies for large business from today, 1 February 2023. What does this mean for employers?

Firstly, what’s changed?

What is FDV?

Violent, threatening or other abusive behaviour by an employee’s close relative, a current or former intimate partner, or a member of their household, that:

Who is included?

When can it be accessed?

Full-time, part-time and casual employees may apply for FDVL if:

What evidence is required?

An employer can ask their employee for evidence that shows the employee took the leave to deal with family and domestic violence
If the employee doesn’t provide the requested evidence, they may not get FDVL
The evidence has to convince a reasonable person that the employee took the leave to deal with the impact of family and domestic violence

Types of evidence

What about Confidentiality?

New regulations prohibit employees from including information concerning FDVL on employees’ pay slips (Regulations)
This includes information about the employee taking FDVL, including leave records as well as any evidence provided by the employee
Payroll systems must be set up to ensure non-disclosure in leave records and on payslips
Pay slips must not mention FDVL, including any leave taken and leave balances

What are the obligations of an employer?

What should employers do now?

We recommend that all businesses take the following actions immediately:

We are here to help you with any of these changes. Reach out if we can offer you support.

The year’s end is fast approaching, but there are still several HR-related things you need to do before everyone clocks off for the summer break. To help, we’ve created this checklist of the six things you should do to get your HR function right before 2023 arrives.

1. Take stock

With limited time left between now and the end of the year, you should map out exactly what needs to be done. That means, of course, factoring in routine HR tasks such as payroll. But it shouldn’t just be about doing the bare minimum. There’s still probably enough time to get other, more strategic things done too. That could include things like developing recruitment and training plans, working on employee engagement strategies (it’s going to continue to be one of the biggest issues next year) and other important HR tasks.  

2. Prioritise

That said, you’re unlikely to get absolutely everything you want to complete before the break, so work out what your main priorities are and what you need to do to make them happen. Use the tried and trusted technique of ranking each task as ‘Urgent/Non-urgent’, ‘Important/Not important’, and focus on those that are urgent or important. 

If some of your big picture stuff is important but can wait until the New Year, work out what you can realistically do this year to progress it, so that you don’t have a mountain of work to come back to once the holidays end.

3. Communicate

This can be an unproductive time in some workplaces as people get that ‘end of term’ feeling. But, as a business owner or manager, you can’t afford to let things slide. So let people know your expectations between now and the end of the year. Don’t be oppressive about it – you want people to be happy AND productive But you need to make sure they also get through the work that has to be done. You should also let people know your expectations around the holiday period. Are you closing down for a while? Do you expect people to take leave? If so, let them know. 

Over-communicating is always better than under-communicating. 

4. Throw a party

You’ve probably organised your workplace party by now. But if you haven’t, there’s still time to do something. No matter how small your workplace, or busy you are, celebrating the end of year is an important point in the calendar and something your people deserve. 

Even if it’s just a lunch or some informal drinks, make sure you get people together before the holidays start to reflect on, and celebrate, the year that was.

5. Say thank you

Speaking of which, this is the time of year you need to say thanks (and your office party/lunch is an important part of that). For many of us, 2022 has been another trying year, and it’s important you let people know they’re appreciated. 

Saying thank you is important for your workplace culture, as well as for employee productivity and wellbeing. 

It’s also important for you as a manager or owner, because it boosts your productivity and wellbeing too. As the Harvard Business Review notes, “Gratitude is good for you.” 

So compile a list of the highlights of the past year, who’s been involved in them. And celebrate them either at the end-of-year function or in a company-wide communication. (Or both.) Just be sure to thank everyone for their efforts this year.

6. Get your HR ready for 2023

Finally, it’s worth remembering that while the year may change, the work goes on. There’s nothing worse than arriving back from holidays with a pile of work on the proverbial desk. So, going back to step one above, gear up for what lies ahead by drawing up a list of what needs to be done in 2023. 

Make headway into it now if you can, before you go on leave. And plan out what you can’t get through so that you don’t place yourself under unnecessary stress when you arrive back in the new year.

Want more?

Have a great holidays. If you’d like to know more about HR strategies for the rundown to the end of 2022, get in touch. 

Employers often use restraints of trade to try to stop employees from taking their confidential information to a competitor and gaining an unfair advantage over them. But just how enforceable are they? 

A recent New South Wales Court of Appeal (NSWCA) found that whether a restraint of trade is enforceable depends on whether you’re trying to protect a legitimate interest, as well as factors such as their duration and an employee’s seniority.

The background to the case

The case started with a familiar scenario – a senior sales manager left his employer to work for a competitor. However, his employment contract contained three clauses: a confidentiality clause, an ‘exclusive employment clause’ (this said he must devote his time and attention to the employer during business hours and promote its best interests), and a restraint of trade.

The restraint of trade clause was one of the typical ‘cascading’ ones that employers sometimes use that allow for ‘12 months’, ‘9 months’, ‘6 months’, etc, in the hope that a court will enforce the most reasonable duration.

When the employee left and worked for a competitor, the employer alleged he broke all three of these clauses in his contract. 

He then failed to comply with the notice of termination clause of the contract, which provided for three months that he would not work in direct competition. Instead, he started working for the competitor within four weeks of leaving. He also helped the competitor poach a more junior employee who was subject to a similar restraint of trade clause. 

The proceedings

The former employer brought proceedings in the Supreme Court of NSW (the NSWSC)  alleging the employee – and the employee he poached – had breached their employment contracts. It received interlocutory orders (that is, temporary orders), which prevented the employees from working for the competitor until the court decided the case.

The court eventually handed down a decision in the employer’s favour. It found:

The employee appealed the NSWSC’s decision in the NSW Court of Appeal. 

The appeal: Are restraints of trade enforceable? 

The Court of Appeal noted that restraints were only enforceable insofar as they protected an employer’s reasonable interests for a reasonable amount of time.

In this case, the employer had a legitimate interest in protecting its confidential information from a competitor, including its marketing plans and potential weaknesses in its product. As the employee was senior and privy to this information, it was, therefore, reasonable to restrain him from a competitor for nine months.

However, it also noted that the employee he helped poach was more junior and did not have any awareness of the company’s confidential information. It wasn’t reasonable to restrain him from working for a competitor because he could not damage its legitimate interest. 

The Court of Appeal also found that the employee breached his notice of termination provision. He had also breached his contractual and fiduciary duties to his former employer when he helped poach the employee.

The Court of Appeal also found that because the competitor had encouraged the employee to breach his fiduciary duty, it, too, was liable.

What the case means for you as an employer

There are times you can rely on restraints of trade to protect your confidential information, but they need to be proportionate, and they can’t be used as a ‘catch all’ to try to limit who employees can work for. You’re also far more likely to find they’re enforceable against senior employees.  

It’s always a good idea to have restraints drafted properly by your legal adviser. It’s also often a good idea to use ‘cascading’ clauses – based both on duration and geography – so that a court will enforce appropriate terms rather than ‘striking out’ an unreasonable restraint. 

Also. if you’re hiring an employee from a competitor and they have a restraint, proceed with caution. If possible, have your legal adviser check their restraint over before you sign them up.

Want more?

If you’d like to know more about restraints of trade, get in touch.

Alternatively, you can read the full decision here. 

 

In the age of LinkedIn profiles and email, it’s tempting to think that there’s no need for a cover letter. I’d argue the opposite is true. In fact, when it comes to human resources, I think it’s more important than ever. It’s a great opportunity to demonstrate how you’re the perfect candidate for that new job you’ve always wanted.

Are cover letters required in HR anymore?

I could be going out on a limb here, some HR professionals have declared the cover letter dead. And figures from a Jobvite survey last year in the US show many job applicants agree. Actually, 47% of Americans didn’t use a cover letter when they applied for the job they’re currently in.

Also, the younger you are the more likely you are not to bother with one. With 58% of those aged between 18-22, don’t send a cover letter.

This is certainly a trend here in Australia when we recruit for our clients or for ourselves at Catalina Consultants. Many applicants leave off a cover letter, assuming their CV or LinkedIn profile will do all the convincing for them. But it’s not a wise idea.

I’m not saying it’s impossible to get a job without one. Many people succeed in getting a job based on their CV alone. And some companies using an online system for applications allow no space to add one. So there are circumstances in which you safely say you won’t need a cover letter.

But in most situations, speaking from experience in HR, if you leave a cover letter out you run the risk of someone who values them ignoring your application altogether just because it is undifferentiated from the pile other applications they’ve received.

Why we need cover letters for talent recruitment

That’s what a good cover letter does. It shows why you’re different to everyone else who’s applied. Explains why I should read your CV in the first place. It draws the connections between what you’ve done – your education, skills, experience and past career – and the job you’re applying for.

In doing so, it makes the HR department or recruiter’s job easy by doing the heavy lifting and letting you explain yourself up front so that you’re on the front foot when it comes to helping them form an opinion of you.

What it does for talent recruitment

While a CV is somewhat formulaic and static no matter what the job is, a cover letter is bespoke. It lets you talk about the specific role and argue your case. Why choose me?

It’s no easy task to write a good one (which is one of the main reasons I think many people prefer to skip it altogether). But here are the key characteristics I think a good cover:

Make your cover letter recruitment worthy

I know, I know. It’s hard to do all of this in four paragraphs. When I said it wasn’t going to be easy I wasn’t lying. But use your judgement. The right ingredients for your cover letter will depend on you personally, the job you’re applying for, and the company and industry it’s in. The nice thing about cover letters is there’s no right or wrong: it’s about introducing yourself and presenting yourself in the best possible light so you have the best chance of showing you’re a good fit for the role and snaring yourself that all-important interview.

Keen to find out more?

If you’d like to know more about what to look for in a cover letter or have any questions about HR or talent recruitment, then get in touch.