Monthly Archives: December 2016

New Legislation and New Obligations

New legislation on paternity leave will come into effect in Ireland on 30th September. In advance of that, employers need to understand their obligations under the Bill and what they should expect from employees who want to take this leave, writes Ciara McGuone from the Small Firms Association (SFA).

The Paternity Leave and Benefits Bill 2016 enables a “relevant parent” to take two weeks’ paternity leave within the first 26 weeks of the birth/adoption of the child. The Act defines a “relevant parent” as a person (other than the mother of the child) who is the spouse, civil partner or cohabitant of the adopting mother or sole male adopter of the child, or in any other case, the father of the child, the spouse, civil partner or cohabitant of the mother of the child, or a parent of the child as defined under section 5 of the Children and Family Relationships Act 2015. From this definition, it is clear that the Bill encompasses a wide range of circumstances and also makes equal provision for same sex couples. The paternity benefit is paid by the Department of Social Protection at €230 per week and employers have the option of providing a further top-up to the father’s paternity benefit to bring it up to their regular salary if they so choose.

What are the Paternity Leave Entitlements in Other EU Countries?

Ireland has certainly been lagging behind other EU countries in the area of paternity leave – most notably Sweden, where paid paternity leave has been in place for over 40 years. The UK, where paternity leave has been in place since 2003, also recently introduced shared parental leave. This means that mothers in the UK are able to share a large portion of their paid maternity leave with their partners, giving families more flexibility during the first year of birth/adoption of the child. As such, when looked at in the overall European context, the paternity legislation in Ireland is long overdue and realigns the rights of Irish employees with those of our European counterparts who have been afforded paternity leave for many years.

 

What are the Key Considerations for Employers?

  • Employers should update their company policies and procedures accordingly to reflect this change (i.e. draft a paternity leave policy / update current leave policies).
  • This proposed legislation ensures there will be no statutory obligation on an employer to continue to pay the normal salary during paternity leave. Employers will have the option of providing a further top-up to the “relevant parent’s” paternity benefit if they so choose.
  • There will be no change to employers’ PRSI to fund this proposal, which limits the potential additional costs for businesses.
  • There is a provision in the legislation that employees will be expected to give their employers at least four weeks’ notice of leave, which will allow employers to plan accordingly. In addition, the two weeks’ leave must be taken in one continuous period, which should help to minimise disruption for employers rather than this leave being broken into days or hours.
  • Research has shown that mothers who are supported at home in the weeks following their child’s birth tend to be healthier and to have lower incidences of post-natal depression. This additional support will help the mother’s transition back to the workplace.

Hire the Best Talent

We hear that a lot in recruitment. The gravity of a hiring decision often leads hiring managers to hesitate when faced with the decision to hire or not to hire – so they wait instead. This last-minute hesitation is often a mistake.

The very best talent often have more than one offer on the table, and they don’t usually want to hang around. Cpl’s recent employment monitor found that 50% of jobseekers have turned down a job offer because the process took too long. To make matters worse, sites like Glassdoor invite users to submit reviews of companies they have interviewed with in the past. That means one candidate’s negative experience could cause others to resist applying because they think your business moves too slowly.

 Why Do Companies Move So Slowly?

The common factor in most “slow” recruitment processes is fear. Hiring a new employee is a big investment and most hiring managers are careful that they invest that money in the right place. However, that determination to make only the right decision often leads to no decision at all.

Instead, businesses will ask a great candidate to attend multiple interview rounds to get peers to rubber-stamp the decision. This can cause as many problems as it solves. If you ask your boss to meet a candidate to confirm they’re the right person, what do you do if you get the wrong answer?

Fear of missing out can also lead to companies simply hitting “pause” on a hiring process. You find a candidate you really like, but maybe you met them very early in the process and think “It couldn’t be this easy”, or you have seen a CV that looks a bit better so you wait until you nail down that interview. The problem with both situations is it leaves a great candidate in limbo – often for weeks.

 

How Do You Speed Up the Process?

The best way to make your hiring process more efficient and avoid these mistakes is to ask yourself the right questions.

  1. If you met the perfect candidate tomorrow, would you hire them?
    Your answer is the perfect litmus test on your need to bring in a new hire. If you hesitate or answer “No”, then you’re not really ready to start the process. If you start now, and you do meet someone good, you are only likely to frustrate them with slow updates and drawn out timelines. Avoid advertising the role or talking to candidates until you know you’re ready to hire someone tomorrow. That way, when you meet the perfect candidate, the decision will be easy.
  2. Would you really hire your second choice?
    The option of “holding” a good candidate in hand while you look for other options seems attractive but it only offers false security. Besides the fact that this “on-hold” candidate might go somewhere else, there is also a psychological issue with hiring them. The moment you put them “on-hold”, what you’re really saying is they’re second choice. It will be difficult for you to ignore that fact if you do hire them – it will always feel like a compromise. When you get that instinct to look at “who else is out there” you need to ask yourself – “Am I stalling or do I just not want to hire this person?”
  3. What really matters to you?
    Finally, make sure you have a clear understanding of the key criteria in your next hiring, right at the beginning. Beyond the minimum requirements, like skills and years’ experience, what are the factors that will make this hire a success? Personality, background, culture fit – the factors that make your role and your business unique should be the ones you focus on.

Tips for buying an existing business

In some situations, buying an existing business can help you grow your business faster. You can buy your way into new markets, new products and new employees. Buying an existing business has many advantages, but there are also some drawbacks. A business owner may wish to sell a profitable, well-run business for many reasons, so selling does not automatically indicate a problem. However, you should not assume an existing business is self-sufficient and profitable. Potential buyers must conduct adequate due diligence to discover the true short and long-term financial and marketing position of the company before buying it.

The Pros

  • Easier purchase financing because of the company’s proven track record
  • Existence of an established customer base, allowing early and ongoing sales
  • Existing profitability, allowing for the generation of regular income
  • An established marketplace
  • The ability to focus on improving products and services because operating facilities and employees are in place
  • Established stocks
  • The former owner’s expertise and knowledge of the company and its markets
  • Existing business records to guide decisions
  • The initial financial outlay is known and may be less than that for starting a similar business from scratch.

The Cons

  • Inheriting hidden and unknown problems or financial burdens
  • Being stuck with the company’s bad reputation
  • A less-than-ideal location
  • Facilities and equipment that may be outdated or in need of repair
  • Difficulty merging two business cultures.

Buying a business is a complicated process involving many types of skills. You should retain professional advisers, including a qualified solicitor and an accountant, before you embark on this challenging but rewarding journey.

Get Your Business Plan Right

Business plans are dead — or are they? For many entrepreneurs, the business plan is an outmoded document and start-ups rarely think they need one to get by. But the fact is that a business plan isn’t simply a paper document; it can be a very valuable tool and a roadmap for even the smallest or earliest-stage idea, writes Connor Sweeney from InterTradeIreland.

A good business plan can foster alignment of ideas, set the tone for the business and even help with the brand messaging. And by preparing one, a company can identify a clear and definite plan of action to implement the business strategy where every member of the team knows their clearly defined role.

Without a plan, a business is essentially rudderless, and day-to-day activities are likely to be haphazard and reactive, in stark contrast to those businesses that implement a well thought-out and structured business plan.

So, how can you prepare a strong business plan?

1. Presentation
Make sure your plan is easy to read – include headings, paragraphs, tables and graphs if appropriate. Include some white space. You must attempt to keep the reader interested throughout the entire document. Try to avoid the use of industry jargon – not all readers of the plan are as conversant with industry language as you are. Avoid the use of acronyms without first explaining what they stand for. This is especially important if the industry in which you operate uses acronyms as standard. Do you know what a PIP is? It’s a Programme Implementation Plan, but you could possibly have been guessing for ages if you hadn’t been told. Small things like that frustrate the readers of a business plan. Try not to do that!

 

2. Remember the objective
What is the purpose of your business plan? Is it primarily to raise finance? What type of finance? If it’s equity then you should tailor the output to an investor’s point of view, i.e. a return on their investment after a period of programmed development and a sale to maximise their investment – usually via a trade sale for cash. If you are using the business plan to approach a lending institution (bank) for funds then you need to tailor the plan slightly differently – they are interested in the business’s ability to repay. You should prepare the plan with this in mind. Think about the business idea from the reader’s point of view. Why would they have an interest in this project?

 

3. Keep it to an appropriate length
An investor may have to read a lot of business plans. The more concise and to the point that a plan is the better. The plan should only serve to get you, the promoter, in front of an investor to make your pitch for funds! Make sure that your executive summary (the most important part of the plan) is no longer than 2-3 pages and that the whole plan is less than 25 pages using a font size 12. Oh, and don’t use the executive summary to introduce new ideas – they should have been addressed in the main body of the text. Write the executive summary last. The best plans are the ones that have been distilled down from their original full size version to a clean, concise document. If you have additional information, it can go in an appendix.

 

4. Verification
Make sure that what you say in the plan is correct. Use your prior trading experience, and provide external data and research results to back up what you say. Don’t fall into the old trap of overstating the size of the market. When estimating the size of the market, if you achieved 100% of the market sales would your turnover be what you claim the market size to be? Also, don’t fall into the “We’ll achieve 5% of the global market” trap. How are you going to do this? That’s what the reader wants to know!

 

5. Leave enough time to prepare it properly
Don’t rush the job. If it is prepared in a hurry, it will look like it has been! Get it ready and then leave it alone for a few days before revisiting it. Get someone else to read it – it’s amazing what a second pair of non-industry eyes will do. Often, business owners will look at the first draft of their business plan after a year or so and be amazed how amateurish it looks. Your first attempt will probably be the same! Don’t be put off; everything can be improved with a bit of work.

The key to a successful plan is one that catches the eye of the investor, gets the financials right and has enough detail on the route to market.