We set aside a portion of our profits each year to fund pay reviews. The reality was that we'd had a difficult couple of years and the additional provision for the retrospective holiday pay meant that we made minimal profit that year. The meant that the pot for pay reviews was much smaller.I'm not sure the argument that you had to pay your staff more for work done meant you couldn't give them such a big pay rise is a great argument.
But I do kind of agree that onerous employment rights doesn't automatically mean employees benefit.
Like minimum wage for example - if a company can't afford the cost it means less employment.
Everyone got a smaller pay rise as a result, some got nothing. My co directors and i reduced our salaries by £10k each to help fund the rises we did pay.
Those who hadn't done much overtime or was on a salary lost out. But that was the reality of that year.
The following year, when the costs were crystallised and we knew what exactly what the ECJ ruling had cost us, the salaried staff pay review went back to normal levels, but the site engineers who accounted for the bulk of the holiday overtime claims didn't get a rate increase as they'd effectively got one through the back door. We pay a higher overtime rate than our competitors, so the new holiday pay arrangements hit us disproportionately hard and pushed the effective site engineers rates up disproportionally.
I like to think that we pay our staff well and fairly. But the reality of business is that the business can only pay what it can afford to pay if it is to stay in existence. Unfortunately, there is a perception that business owners, directors and senior managers are fat cats in it entirely for themselves and businesses can just afford to suck up whatever new regulation is applied. The reality is somewhat different.
