If HR has felt noisy lately, that is because it is. Employers are hearing about law changes, growing expectations around workplace culture, rising absence levels and more pressure on managers to get people issues right. For many small and medium sized businesses, it can feel like a lot to keep up with.

The important thing to know is this. Not every change has happened yet, but this is not the time to sit back. The Employment Rights Act 2025 is now law, with changes being introduced in stages across 2026 and 2027. Acas is already advising employers to prepare, understand the timeline and review their people processes now.

For SMEs especially, this is the gap between hearing about change and being properly ready for it. That gap is where problems grow. Policies become outdated, managers make inconsistent decisions and businesses end up reacting under pressure instead of leading well from the start. That is why 2026 needs to be treated as a preparation year, not a waiting year.

The law may be changing in stages but employee expectations are already here

One of the biggest mistakes employers make is assuming they only need to act when a law officially comes into force. In reality, expectations shift much faster than legislation. Employees already expect fairer conversations, clearer communication, more flexibility and workplaces that take wellbeing and behaviour seriously. The businesses that get ahead now will find it much easier to adapt as the legal timetable moves on.

Acas has highlighted that flexible working law will be amended again in 2027 under the Employment Rights Act 2025. Current Acas guidance already says employers must accept a statutory request unless there is a genuine business reason not to, consult the employee before making a decision unless accepting in full, and reach a final decision including any appeal within two months. That means flexible working is no longer something employers can treat casually or inconsistently.

For employers, this is about more than a policy document. It is about whether managers know how to have these conversations properly. A weak process or a rushed response can create frustration, damage trust and increase the chance of disputes.

Absence is now a business issue, not just an admin task

If absence is still being tracked in a spreadsheet with little follow up, this is the moment to look at it properly. The latest CIPD data found that UK employees were off sick for an average of 9.4 days over the previous 12 months, up from 7.8 days in 2023 and well above pre pandemic levels. That tells us absence is not a side issue. It is one of the clearest signals of what is happening in a workforce.

Too often, businesses focus only on recording time off rather than asking better questions. Are there repeat patterns? Are managers following up consistently? Are return to work conversations happening? Are people struggling with workload, stress or management issues? Without that wider view, the same problems keep coming back.

Good absence management is not about policing people. It is about spotting issues early, responding fairly and making sure the business has a clear process that managers can follow with confidence. When absence is rising nationally, the employers who manage it well will protect both productivity and people.

Manager training is no longer optional

A lot of HR problems are not really policy problems. They are manager problems.

A business can have a handbook, templates and procedures in place, but if a manager avoids difficult conversations, handles issues inconsistently or says the wrong thing at the wrong time, the damage is done. That is why manager capability has become one of the most important parts of HR preparation in 2026. This is an inference based on the increasing legal complexity set out by Acas and government implementation timelines.

Managers are often expected to deal with poor performance, flexible working requests, absence concerns, conduct issues and wellbeing conversations without much real training. That leaves businesses exposed. It also leaves managers stressed, unsure and more likely to either overreact or avoid taking action altogether.

The strongest businesses are not the ones with the longest policies. They are the ones where managers know how to apply them in real life.

Prevention matters more than ever

Workplace culture is also under sharper focus. Government guidance published in February 2026 sets out that a new employer duty to take all reasonable steps to prevent sexual harassment is expected to come into force in October 2026, alongside an obligation not to permit third party harassment of employees.

That should be a wake up call for employers who still see harassment prevention as a one off policy exercise. Prevention means more than having a document saved somewhere. It means training, communication, reporting routes, leadership behaviour and clear action when issues arise.

The businesses that leave this until the last minute are likely to find themselves rushing. The ones that act now can review risk areas, build manager confidence and create a safer working environment long before the deadline arrives.

So what should employers be doing now

This is the point where practical action matters most.

Right now, employers should be reviewing policies that affect day to day people management, especially flexible working, absence, performance, disciplinary processes and harassment prevention. Acas is already pointing employers towards the coming changes and the standards expected in current practice.

They should also be looking at whether managers are equipped to handle real conversations, not just read a policy. A technically correct process can still go badly wrong if the person leading it lacks confidence, consistency or judgement. That is often where SMEs need the most support. This is an inference drawn from the Acas guidance emphasising consultation, reasonableness and fair handling across several areas.

And finally, businesses should be asking themselves a simple question. If an employee raised a concern tomorrow about absence, poor performance, flexibility or behaviour, would we know exactly what to do and would every manager handle it in the same way?

If the answer is no, there is work to do.

Final thought

HR in 2026 is not just about compliance. It is about readiness.

The legal changes matter, of course. But what matters just as much is whether a business has the structure, confidence and consistency to deal with people issues well. The employers who use this year to tighten up processes, train managers and act early will be in a far stronger position than the ones who wait until a problem lands on their desk.

That is where good HR support makes a real difference. Not by making things more complicated, but by making them clearer, fairer and easier to manage before they become bigger problems.

References for this blog:

Acas. (2025) Acas welcomes Royal Assent for new Employment Rights Act. 

Acas. (2026) Employment Rights Act 2025. 

Acas. (2026) Statutory flexible working requests. 

Acas. (2026) The right to request. Statutory flexible working requests. 

Acas. (2026) Considering a request. Statutory flexible working requests. 

Acas. (2024) Code of Practice on requests for flexible working.

CIPD. (2025) Workplace absence levels soar to nearly two working weeks per employee each year. 

CIPD. (2025) Health and wellbeing at work 2025. 

Personnel Today. (2025) Lloyds Banking Group to target underperformers for job cuts. 

A conversation with Norrie Cook, Head of Investment, The FSE Group – Large Debt Fund for Scotland

Kicking off 2026 strong, Fiona from The HR Practice welcomed Norrie Cook to a LinkedIn Live session to break down what it really takes to secure growth funding in Scotland. From the inside view of The FSE Group’s £40 million Investment Fund for Scotland (Large Debt), Norrie shared insight after insight for scaling businesses looking for loans of £100k to £2 million.

What is the Investment Fund for Scotland?

Unlike traditional banks, this fund focuses on future potential, not just historical financials. The fund is split into three pots: equity (via Maven), small loans (via DSL), and large debt (via The FSE Group).

Norrie’s team works across Scotland, deploying capital to help SMEs scale up, hire, innovate, or expand. It’s designed to plug the gap for businesses that are too risky for banks but not looking to give away equity.

What Makes a Business Investment-Ready?

Here’s what Norrie and his team look for:

🔹 A clear, costed growth plan (not “I need £500k” – more “Here’s what we’re doing, and what it will cost”)

🔹 A credible, capable leadership team with a plan they can deliver

🔹 Strong financial management (even a fractional FD is a huge asset)

🔹 A funding strategy that makes sense and stacks up with the numbers

“We lend based on your future. The numbers back the story, but the story is everything.”

Where the Money Goes: People First

Roughly 60% of the funding The FSE Group provides goes to people – hiring, training, leadership development, or bringing in key team members like FDs or sales staff.

Other uses:

• Moving premises or expanding sites

• Investing in equipment or systems

• Funding upfront costs for new contracts

Funding can be structured to suit the reality of scaling – including repayment holidays or drawdowns in stages.

Common Mistakes Businesses Make

🔹 Not knowing where to get funding

🔹 Assuming debt is unaffordable

🔹 Being unprepared with the right financial info

Norrie’s advice? Treat it like any big opportunity. Get help. Use your accountant, an FD, a business advisor. Spend a bit to prepare well and you’ll save more in the long run.

“You invest in training your staff. Why wouldn’t you invest in getting the right funding?”

What Happens After You Get the Money?

Unlike a bank loan, this is not a “see you later” deal. The FSE team:

• Keeps in monthly contact

• Helps spot early risks or new opportunities

• Can even issue a second loan if growth takes off

Scotland’s Business Opportunities in 2026

AI and automation: Don’t fear it. Use it to unlock time and capacity

Export mindset: Your market is bigger than Scotland. Think global

Energy transition: Huge opportunity in renewables and related supply chains

Space tech: Scotland now produces more satellites than any country in Europe

And across all sectors? Apprenticeships and early-career training are essential. Businesses that invest in people will win.

Final Thought: Don’t Go It Alone

Whether you’re preparing for funding or planning your next growth phase:

• Build your team with different strengths

• Use Scotland’s rich business ecosystem (from Scottish EDGE to local banks)

• Ask for help early

“Think of your business like a football team. You don’t need 11 goalies – you need a balanced squad. Your job is to be the coach.”

Need help getting funding-ready? At The HR Practice, we work with ambitious Scottish businesses to build leadership teams, strengthen people strategy, and support growth with confidence.

Let’s get you investment-ready. Reach out today.

In Fiona McKee’s recent HR Unlocked Live conversation, she was joined by Sean McGrath, CEO of Entrepreneurial Scotland Foundation and Advisory Board Member at Scottish EDGE, for a thought-provoking chat about what it really means to think entrepreneurially.

Sean opened with a bold statement: “An entrepreneurial Scotland is a prosperous Scotland.”

And it’s a mission he’s spent years proving - not just through funding or programmes, but by nurturing the mindset that drives growth.

Entrepreneurship Is a Team Sport
Sean’s message was clear - leadership and entrepreneurship are not solo pursuits.  “You’re playing rugby, not tennis,” he explained.

The best leaders don’t try to be the smartest person in the room. They listen. They surround themselves with people who challenge them, and they recognise that confidence comes not from pretending to know it all, but from being deeply grounded in what you do know.

He spoke passionately about building both internal and external teams - mentors, peers, and networks who help you navigate the rough terrain of business growth.  “Nobody does it alone. You need an internal team and an external team. Your network is your external board.”

Developing the Right Kind of Leaders
Entrepreneurial Scotland focuses on developing leaders with curiosity, resilience, empathy, and ambition - qualities Sean believes are often undervalued in traditional business thinking.

He spoke about how many of the barriers to growth are internal, not external.  “We’re brilliant at undermining ourselves. Imposter syndrome doesn’t stop at graduates - CEOs feel it too.”

Entrepreneurial leaders, he explained, are the ones who see opportunities where others see problems, and who are willing to take calculated risks to move their businesses forward.

Rethinking Risk
Perhaps Sean’s most powerful insight came near the end of the conversation:  “Risk and opportunity are two sides of the same coin. If you limit your risk, you automatically limit your opportunity.”

It’s a lesson that hits home for any leader trying to grow in uncertain times. In Scotland - a nation rich in innovation but often cautious by culture — Sean encouraged a mindset shift.  “Your job as a business leader isn’t to eliminate risk. It’s to take the right risks - the educated, calculated ones - that allow your business to grow.”

The Takeaway
Entrepreneurial leadership isn’t about starting a business; it’s about building the courage and curiosity to keep moving forward.

It’s about reframing failure, finding strength in community, and knowing when to take that next brave step - even if it feels uncertain.

As Sean put it: “Reframe your relationship with risk. Embrace it. Understand it. Don’t bet the ranch - but know that growth never comes without it.”

Scottish EDGE is one of the most exciting competitions in the UK for early-stage businesses. Twice a year, entrepreneurs across Scotland pitch their ideas in the hope of securing funding and support that could transform their growth.

But EDGE is more than just money. It’s a window into what makes a business succeed, what judges and investors really look for, and how leaders can set themselves apart.

Following my conversation with Evelyn McDonald, CEO of Scottish EDGE, here are the biggest lessons any business leader can take away.

What Makes EDGE Different?

Unlike many funding streams, EDGE isn’t confined to one sector. Winners range from bean-to-bar chocolate makers like Bear Bones Chocolate to robotics, AI, and cancer detection technology. What they share is a unique selling point – something that makes them stand out in their market.

Another key difference is the funding mix. EDGE provides a combination of grants and loans, as well as detailed feedback to every applicant. Even if you don’t win, you leave with insights to improve and return stronger next time.

And critically, support doesn’t stop with cash. Winners gain access to a network of trusted partners in HR, legal, IP, and more – helping them avoid pitfalls as they scale.

Traits of Successful Founders

EDGE judges don’t expect perfection. They know early-stage businesses come with gaps – whether in funding, expertise, or team structure. What matters is whether leaders recognise those gaps and have a plan to close them.

Passion also counts. Evelyn noted that enthusiasm for your idea is often what convinces others to buy in, from employees to investors. Alongside that, strong applicants can:

• Explain what their business does, clearly and concisely

• Identify who their customer is (and prove there’s demand)

• Show they’ve sought advice or built a support network

Common Mistakes to Avoid

From years of running EDGE, some pitfalls come up again and again:

• Not being able to describe your business. If judges don’t understand what you do, they can’t support you.

• Ignoring competition. Saying “no one else is doing this” is rarely true – and easily disproved. Better to acknowledge competitors and highlight your edge.

• Inflating the market. Claiming you’ll capture “a small slice of a £40bn global market” is less compelling than proving traction with real customers.

Why EDGE Matters Beyond Funding

Even if you’re not applying, there’s huge value in engaging with EDGE.

• Attending finals shows you what a strong pitch looks like – and what judges ask.

• Networking with winners, partners, and advisors builds your ecosystem.

• Watching others pitch can sharpen how you talk about your own business.

And for those who do win, the benefits go beyond the cheque. Many report a huge confidence boost, credibility with investors, and stronger customer trust.

Stories That Inspire

Evelyn shared two standout success stories:

• Callum Murray, Amquis: Initially supported at pre-trading stage, Callum went on to secure multiple EDGE awards. Today, Amquis employs over 70 people and provides industry-leading compliance software. EDGE itself is now a customer.

• The Gin Bothy: Applied for a small sum, but judges saw greater potential and doubled the award. The business went on to scale into new markets, grow exports, and expand their team.

Both examples prove that with the right support, small beginnings can lead to national – even global – success.

Final Thoughts

Scottish EDGE isn’t just about funding – it’s about backing people, ideas, and potential. The lessons apply to all of us:

• Be clear about what you do and who you serve.

• Recognise your gaps and build support around you.

• Don’t wait for perfection – progress beats hesitation.

• Remember that innovation doesn’t have to mean tech – it means standing out.

As Evelyn reminded us, “At EDGE, we don’t say no – we say not yet.”

For business leaders, that mindset is worth adopting. Success isn’t about having it all figured out. It’s about showing the passion, clarity, and adaptability to keep moving forward.

Social media. It connects us, promotes us, markets us, and sometimes blurs the lines between personal and professional in ways we didn’t see coming.

I’m Heather Offord, Director of Clarity Consultants, and I recently recorded a video for The HR Practice exploring what happens when your online life at work and at home starts to overlap. Whether you're an employee wondering if you need to accept your manager’s friend request or an employer unsure about what's appropriate for staff to post, this blog will help you navigate the messy middle.

For Employees: Where Do You Draw the Line?

If you're an employee, you're likely asking:

• Should I post about work?

• Do I have to be ‘always on’?

• What platforms should I use for what?

Let’s break it down.

1. Understand Your Platforms

LinkedIn is widely accepted as a professional networking platform. Platforms like Instagram, Facebook, Twitter/X, TikTok, and WhatsApp tend to lean personal, but every company is different.

Check which platforms your employer is active on. You don’t have to be active on all of them. Instead, you can set clear intentions: for example, "LinkedIn is my work platform, everything else is personal."

2. Know Your Company’s Social Media Policy

Every company should have a social media policy. Ask for it if you haven’t seen one. It’s your guide to what’s expected and acceptable. If there isn’t one in place, encourage your employer to create one.

3. Set Your Privacy Boundaries

Look at your privacy settings and decide what’s public vs. private. For example, I use LinkedIn for business and keep my personal Instagram and Facebook pages locked down to just family and friends. I don’t accept client or employee requests on personal accounts, and that’s OK.

4. Don’t Be ‘Always On’

Just because social media and WhatsApp run 24/7 doesn’t mean you have to. You're under no obligation to reply to messages or emails outside your contracted hours. Set those expectations early, switch off notifications, and protect your time. Flexible working doesn’t mean round-the-clock availability.

For Employers: Model the Boundaries You Expect

Boundaries go both ways. If you're an employer, you have a responsibility to set the tone.

1. Be Clear with Expectations

What should employees post about? What’s off-limits? Don’t leave it to guesswork. Create a clear social media policy and make sure everyone knows where to find it.

2. Lead by Example

Don’t message staff out of hours and expect an instant reply just because they’re online. Keep your own posts professional on business platforms and avoid putting pressure on others to share or engage.

3. Respect Personal Space

Some employees will love to shout about your business online. Others will want to keep their private life, well… private. That’s completely fine. Allow people to opt out of work-related platforms and group chats without guilt.

Social media is a brilliant tool for connection, but only if it’s used thoughtfully. Whether you’re an employer or an employee, it’s all about clear communication, mutual respect, and healthy boundaries.

Here’s what to check:

• Employers: Do you have a social media policy? Is it up to date and accessible?

• Employees: Have you seen the policy? Do you understand what’s expected?

• Everyone: Are your platforms set up to reflect your work and personal boundaries?

If you’re unsure where to start or need training to get it right, The HR Practice can help. Don’t leave it to chance. Set the boundaries now and make social media work for everyone.

You can watch the full video here: https://youtu.be/EH1AJ2yI_7M

Advice for Employers Managing Parental Leave with Confidence and Compliance

Supporting new parents at work is not only a legal responsibility, but also an opportunity to build a workplace culture based on trust, flexibility, and fairness.

At The HR Practice, we’re often asked by employers how best to manage maternity, paternity, and shared parental leave. Below are the most common areas of confusion, along with guidance on how to stay compliant and supportive.

When should an employee notify you they are pregnant?
By law, employees must inform you by the 15th week before the expected week of childbirth. That said, creating an open and supportive workplace can encourage earlier disclosure, which helps with planning and ensures health and safety assessments can be carried out promptly.

What are your responsibilities for paternity leave?
Eligible employees are entitled to up to two weeks of Statutory Paternity Leave. This can be taken in one block or as two consecutive weeks within 52 weeks of the birth or adoption. Employers are responsible for processing these requests correctly and ensuring Statutory Paternity Pay is handled in line with the rules.

How does Shared Parental Leave work?
Shared Parental Leave (SPL) allows parents to share up to 50 weeks of leave and 37 weeks of pay. It can be more complex to manage, so it’s important that your policies are clear and up to date. Managers should understand the process and ensure all requests are documented, consistent, and supported.

Can an employee on maternity leave be made redundant?
Yes, but only in very specific circumstances. There must be a genuine redundancy situation. You must also offer any suitable alternative employment if it is available. This is an area where careful planning and legal advice is essential to avoid potential claims.

Are you prepared for flexible working requests?
Since April 2024, all employees have the right to request flexible working from day one. As an employer, you must consider requests fairly and provide a written outcome. It’s not about saying yes to everything, but engaging in open, fair conversations about what is possible.

Tips for managing maternity and paternity leave well

• Start with a clear handover process

• Offer KIT (Keeping in Touch) days where appropriate

• Let employees lead communication during leave

• Provide support during the return to work

• Train managers so they understand your policies and obligations

Final thoughts from Fiona
Good maternity and paternity support is built on three things: clarity, compassion, and compliance. Employees who feel supported are more likely to return and stay. Those who don’t may leave, and the cost of replacing them can be significant.

If you’re not sure whether your current policies or processes are fit for purpose, we’re here to help.

Need advice on parental leave or HR compliance?
Get in touch with The HR Practice
This email address is being protected from spambots. You need JavaScript enabled to view it. | www.thehrpractice.co.uk

Being a working mum is a juggling act, one that many of us are all too familiar with. From managing careers to raising children and handling the inevitable mum guilt, it’s a journey filled with highs and lows. In our latest LinkedIn Live, I had the pleasure of discussing this topic with two incredible women: Marianne McJannett, Head of Employment Law at Bellwether Green, and Laura Maginness, founder of The Glow Club and co-founder of the Scottish Growth Summit. We delved into the realities of balancing career ambitions with family life, sharing personal stories, strategies, and advice for working mums everywhere.

The Power of Organisation and Support Systems

For both Marianne and Laura, the key to managing their careers and family life comes down to organisation and strong support systems. Marianne, who has been working in employment law for 15 years, credits her ability to balance both worlds to careful planning.

“I think ahead, but not too far ahead. Every Sunday, I map out the week ahead, who needs to be where and when. And having a support system is crucial. We’re lucky to have grandparents nearby who help out, as well as excellent nurseries and after-school services.”

Similarly, Laura highlights the importance of not being afraid to ask for help.

“So many women try to do it all themselves, but I’ve learned to reach out to friends, family, and my wider network when I need support. And beyond logistics, I also ask for advice, just having a group of people you can turn to makes all the difference.”

She also prioritises being present whenever possible.

“My daughter is five, and she’ll just take my phone off me if she sees me working when we’re meant to be spending time together. That’s a reality check! So I try to be as present as possible and tackle my to-do list at another time.”

The Challenges of Being a Working Mum

Juggling motherhood and career inevitably comes with its challenges. One of the biggest hurdles? Time.

Laura, who runs a business membership and hosts events, finds that scheduling is like a “jigsaw puzzle.”

“I run events during evenings and weekends, which are sociable times for everyone else, but not for me! If my husband isn’t available, then it’s a full-on balancing act to make sure my daughter is taken care of.”

For Marianne, the hardest part was returning from maternity leave and feeling like she had to be back to 100% immediately.

“My line manager at the time gave me some of the best advice. He told me, ‘Give yourself six months.’ And he was right, after about six months, things clicked into place. It wasn’t about ‘getting back to my old self,’ it was about adjusting to my new self as a working mum.”

That mindset shift was key: you don’t go back to who you were before kids, you evolve.

The Ever-Present Mum Guilt

Mum guilt is real.

Marianne shared a moment that so many of us can relate to.

“This morning, as I was leaving, my daughter turned to me and said, ‘I don’t like you.’ And I thought, ‘I don’t really like me much right now either, but here we are.’ It’s hard when you have to drop them off early, pick them up late, and you see how exhausted they are by Friday night.”

So how do you cope with it?

Laura tries to reframe the narrative in her mind, and for her daughter.

“When she says, ‘I wanted to go home instead of after-school club,’ I turn it into a positive. ‘Who did you talk to today? What was fun?’ And I remind her (and myself) that I’m working hard to give us a good life and opportunities.”

For those of us with older kids, there is light at the end of the tunnel.

Fiona, our host, reflected on her own children’s perspective.

“I used to feel guilty about working so much when my kids were young. But as adults, they’ve told me they actually admired it. They saw me working hard, getting my Master’s degree while raising them, and it gave them a strong work ethic.”

Leadership and Career Growth as a Working Mum

Being a mum changes your leadership style. Marianne and Laura both emphasised the skills motherhood has enhanced: patience, negotiation, flexibility, and empathy.

“I’ve never had a team member throw themselves on the floor in Aldi, screaming, trying to pull things off the shelf,” Laura joked. “But those moments as a mum teach you extreme patience and negotiation skills, which come in handy in business!”

Marianne has also learned the importance of boundaries.

“I set boundaries at work the same way I do at home. I know what my working hours are, when I need to leave, and I stick to it. That discipline has helped me thrive in my career while maintaining a family life.”

Advice for Future Working Mums

So, what advice would they give to women who want both a successful career and a fulfilling family life?

Marianne’s Advice:

1. Make it a partnership. If you’re raising children with someone, the responsibilities should be shared.
2. Keep the conversation going. Parenthood is an evolving journey, keep discussing your priorities as a family.
3. Learn from others. Every working parent does things differently, and there’s no single ‘right’ way.

Laura’s Advice:

1. Redefine success. Success doesn’t have to mean 12-hour workdays, it can be working half-days with maximum impact.
2. Cut the unnecessary. Focus on what truly moves the needle in your career.
3. Know that you CAN do both. Being a mum doesn’t mean the end of ambition, it enhances it.

The Takeaway

Balancing motherhood and career is challenging, but it’s absolutely possible. With the right support, organisation, and mindset shifts, you can build a thriving career while being a present, loving parent. And let’s be honest, mum guilt might never fully go away, but with time, perspective, and a little self-compassion, we can learn to manage it.

A huge thank you to Laura and Marianne for sharing their experiences and insights! If you have any thoughts or questions, drop them in the comments, we’d love to keep the conversation going.

Running a business is a balancing act, and often, HR is seen as an extra cost that is a nice to have rather than a necessity, especially where budgets are tight.

However, poor HR practices don’t just impact workplace culture—they can seriously hurt your bottom line. In this blog, we’ll explore the financial risks of ineffective HR practices and how aligning HR and finance strategies can save your business money.

1. The Financial Risks of Poor HR Practices
   When HR isn’t done right, the costs quickly add up. Common issues include:

• High Staff Turnover: Replacing an employee can cost up to £30,000, factoring in recruitment, training, and lost productivity.
• Legal Non-Compliance: Employment tribunals and regulatory fines can run into thousands, damaging both finances and reputation.
• Payroll and Pension Errors: Incorrect payroll and pension processing can lead to fines, penalties and disgruntled employees.

Real-life example: A small business that faced a tribunal for unpaid overtime ended up paying more than £10,000 in fines and legal fees—a cost that could have been avoided with proper HR systems.

2. Compliance Isn’t Optional
   Failing to comply with employment laws can be a costly mistake. Key areas to watch include:

• National Minimum Wage (NMW) compliance.
• Accurate payroll processing.
• Pension Auto-Enrolment compliance.
• Adhering to new legislation, like the Neonatal Care Leave and Pay Act, coming in April 2025.

Tip: Finance and HR teams should regularly review policies to ensure compliance with changing laws.

3. The Payroll and Pensions Pitfalls
   Even small payroll errors can snowball into big issues:

• Overpayments: These are hard to recover without damaging employee trust.
• Underpayments: Can lead to fines or HMRC investigations.
• Pension Errors: Missing auto-enrolment deadlines or contributions can result in penalties.

Investing in accurate payroll software or outsourcing payroll management is a cost-effective solution.

4. The Hidden Costs of Employee Turnover
   Replacing an employee costs more than you might think. Break it down:

  Recruitment fees.

• Time spent interviewing and onboarding.
• Productivity dips while a new hire gets up to speed.

How to reduce this: Strong HR practices, like effective onboarding and career development programmes, can reduce turnover rates.

5. Bridging the Gap Between HR and Finance
   HR and finance don’t work in silos—or at least, they shouldn’t. Collaborating helps businesses:

• Forecast costs like recruitment and training.
• Set aside budgets for legislative compliance.
• Create cost-saving strategies, such as employee retention programmes.

Tip: Regular meetings between HR and finance can uncover opportunities to optimise processes and cut unnecessary costs.

Conclusion: A Partnership That Saves Money
Good HR isn’t just about employee satisfaction; it’s about protecting your business’s financial health. By addressing inefficiencies, ensuring compliance, and fostering collaboration between HR and finance, you can avoid costly pitfalls and set your business up for sustainable success.

💡 Need help? The HR Practice and Clarity Accounting (Scotland) Ltd can help you create a compliant, cost-effective strategy that supports both your people and your bottom line.

Katie Gilmour
Operations Director
Clarity Accounting (Scotland) Ltd

This email address is being protected from spambots. You need JavaScript enabled to view it.

HR Unlocked: The Realities of Employee Ownership with Fergus Aitchison

From Engineer to Managing Director

“Part of our vision is to create a company of lasting value on behalf of our employees. We wanted to allow the staff who had helped us build the business to share in its future success.” – Fergus Aitchison

 

Why MHB Consultants Chose Employee Ownership

“We could have gone with a trade sale, but we would have lost our brand identity. A management buyout would have put a lot of financial risk on the leadership team. Employee ownership allowed us to maintain our culture while rewarding the employees who helped build the business.” – Fergus Aitchison

 

How Does Employee Ownership Work?

• Employee Trustee – Represents the staff.
• Director Trustee – Oversees the company’s leadership.
• Independent Trustee – Provides external governance.

“We’re trying to set the mindset that we are all co-owners. That comes with accountability, responsibility, and the opportunity to share in the company’s success.” – Fergus Aitchison

 

The Challenges of Employee Ownership

“At first, some employees thought they’d have a say in every operational decision, which isn’t the case. The trust can represent employees, but leadership decisions still sit with the board.” – Fergus Aitchison

 

Lessons Learned & Advice for Businesses Considering Employee Ownership

• 20% fully embrace the model
• 60% like the idea but need guidance
• 20% don’t engage with it
  Focusing on the 80% who want to be involved helps drive the right culture.

“You won’t get everything right on day one, and that’s okay. Employee ownership is a journey, and it’s all about adapting and improving along the way.” – Fergus Aitchison

 

What’s Next for MHB Consultants?

“Employee ownership sets us apart from competitors. It helps attract and retain staff, build engagement, and create a culture of shared success.” – Fergus Aitchison

 

Final Thoughts: Is Employee Ownership Right for Your Business?