HR & Payroll 2016 predictions

6th January 2016

2016 started with a bang and we seem to be busier than ever. However, each year we look at the trends that will influence the decisions of HR & Payroll managers in organisations of every size over the coming year. These trends generally follow on from government policy and general shifts in the UK workforce, upon which some organisations have already started acting.

Below are our predictions for the coming year, some of which are intrinsically linked but all will affect the way organisations approach their HR & Payroll.


SMEs in particular are acutely aware of the immediate impact of an employee being off sick. This year we expect more organisations to realise that they have an active role to play in ensuring that absence levels and disruption to the business are kept to a minimum.

Stress and mental health-related illnesses are the single biggest cause of employees being off work and this has a significant impact on staff morale and the organisation’s finances. The total costs of absence – which includes sick pay, temporary staff cover, overtime payments etc. – can be as much as 30-45% of the total payroll.

So how can employers prevent absences from occurring in the first place? We expect more employers to recognise the signs of mental health problems or stress earlier and to introduce ‘open door’ policies that make it easier for employees to seek. The most progressive employers will be looking at introducing stress prevention programmes, counselling sessions or other initiatives to prevent problems from escalating.

Regardless of which initiative(s) will be introduced, they will be most effective if the organisation understands and analyses absence level trends: what days of the week are employees off sick, why, does this happen weekly or only a few times a year (the Bradford Factor), and what is the impact on total payroll? Monitoring absence levels within a HR system will put organisations in good stead to introduce the most appropriate and effective prevention initiatives and limit the negative financial implications of absenteeism.

Employee wellbeing

Closely linked to absenteeism is employee wellbeing, which will remain a hot topic in 2016. Wellbeing programmes go beyond sickness or absence prevention; they are conducive to a healthy working environment in which each employee will thrive.

Many organisations might already have some form of wellbeing initiatives in place, for example smoking cessation programmes, charity fundraising activities or time management training. We expect organisations to take a more strategic approach and create wellbeing policies that are tailored to their unique environment, and employers should expect to see a growing demand from employees for wellness programmes which enhance the work/ life balance.

Flexible working

This is a trend that has been gathering pace, especially following the extension of the Flexible Working Regulations in June 2014 which gives everyone with six months’ continuous service the right to request flexible working (see also our Flexible Working blog post).

Flexible working is also no longer simply the domain of working mothers. Increasingly we see fathers wanting to spend more time with family; older employees having to dedicate time to caring duties for their elderly parents; and younger people opting for a portfolio career consisting of multiple part time jobs.

In line with this trend, employees expect more flexibility in other areas of their working lives as well, such as flexible benefits. Employers can make the most of this by providing a benefits ‘pick & mix’ where working parents might opt for childcare vouchers; while entry level workers prefer a gym membership or an advance loan for a train season ticket.

However, with this increased flexibility comes greater responsibility. Employers will expect their employees to be more committed and deliver the right results. We expect employers to come down harder on those employees that flout the flexible working system. We could see an increase in disciplinary cases as a result, which will have to be closely tracked within any HR system.

Learning & Development

There is this saying that you are never done learning and nowhere is this becoming clearer than within the working environment. People no longer have the same job security as they used to and to stay relevant within the marketplace employees have to keep their skills and knowledge up to date.

Then there is a growing trend for apprenticeships. Young people coming in to the organisation will expect a learning framework to get the most out of their apprenticeship programmes.

Those two needs combined will see employers introducing a more formal learning structure within their organisations. But rather than a top down approach, the onus is increasingly on employees to identify knowledge gaps and career aspirations. As a result, an online Learning & Development portal within the HR system can help employees browse courses both relevant to their current roles and which may support future career plans.

Mobile and remote working

2016 will see many organisations continuing to offer mobile and remote working as well as working from home. In order for this to be effective for both the organisation and the employee, there will be more emphasis on digital capability in order for employees to have the required instant access to systems and support where required, regardless of where the employee is in the world.


Employers are becoming more caring as they increasingly work on creating and maintaining a healthy, happy and productive workforce. This truly seems to be the year of the employee.

However, for organisations to be successful in the long run they need to be profitable: without profits jobs will quickly disappear and no one will benefit from that scenario.

From a HR point of view, it’s important to establish a baseline of the current situation and determine the objectives before any absence management, wellbeing or flexible working programme is introduced. HR software can help do this and track business impact over time, for example reduced absence, increased productivity, lower staff turnover, increased employee satisfaction, or an improved company profile amongst workers, to name just a few.

Can employers get the balance right between overall employee wellbeing and profitability? Only time will tell.