A piece in today's Wall Street Journal caught my eye. It contrasts the differences between the US and the Eurozone in terms of the gap between pay increases and inflation. The article suggests that increases in pay and salaries in the Eurozone are matching the annual inflation rate whereas in the US workers fell behind.

According to pay consultants Industrial Relations Services, employees in the UK are suffering from the largest gap between pay rises and increases in the cost of living in nearly 20 years. They report the average wage increase in both public and private sectors is 3.2 per cent, compared to the retail prices index measure of inflation at 4.6 per cent - the largest gap recorded since October 1990.

However looking at take home pay, pay processor VocaLink said its take-home pay index registered its highest level for 2008, showing 4.5 per cent growth in July against 4.3 per cent for June.

The cost of shopping for a basket of essentials is now rising at 24.7 per cent a year according to the Daily Mail Cost of Living Index for August. The increases have put £300 a year on to the food bill of a family which spent £100 a week on food last year. This combined with increases in the cost of heat, light and petrol to push up the total for “must pay” bills by more than £830 a year.

Energy companies have also recently announced price increases of up to 30 per cent, and there have been warnings that another round of price increases is likely in January 2009.

Inflation forecasts for the fourth quarter of 2008, as measured by the Retail Prices Index, range from rises of 2.7 per cent to 5.9 per cent with a mid-point average of 4.7 per cent.

But IT pay is reported however to be rising faster than at any time in the past three years, according to the Computer Economics Computer Staff Salary Survey published last month.

The survey of more than 66,000 IT staff in over 570 workplaces found that basic IT pay had risen by 4.8 per cent in the year to May 2008. The main reason given for this defying of growing economic gloom was said to be demand for high-tech skills, which were running ahead of supply.

This will come as news from another planet for some working in IT. People write to tell me that they have not had a pay increase for a number of years. Well they should join a union like Unite  (I would say that, wouldn't I...).

All of this stands in marked contrast to the rewards available at director and board level. Part-time, non-executive directors of companies of all sizes received pay rises of 15.6 per cent last year, according to the PricewaterhouseCoopers annual guide Non-Executive Director Practice and Fees, although it is poetically described as “reaching a balance between pay and accountability.”

As a union, Unite is strongly in favour of skills and responsibility receiving reward, but pay should reward success and not excess.

You get the feeling sometimes that the organ grinder is being rewarded before we get to hear whether or not there is a tune.

While I was at the EDS lair
I met some people who were not there
They were not there again today
Perhaps they have all departed away

Last week I attended a meeting with EDS, which was more of a virtual meeting involving as it did various parties dialling in as a telephone conference, and a number of presentations made remotely. The people participating in the physical meeting in the room were greatly outnumbered by the virtual participants.

Interspersed with the exchanges on the meeting items were the disembodied squawks from the telephone of “now attending” and “now departing” as virtual participants came and went. In addition, there were no drinks provided at the meeting, not even cold water on what was a baking hot day.

None of this is unique to EDS, nor a precedent in itself. However it does exemplify the apparent virtualisation of human and social interaction at some workplaces, and the increasingly incidental and isolated role that people play in this.

There used to purportedly exist a perhaps apocryphal practice in some US companies where meetings took place in rooms without tables and chairs. The philosophy was presumably that if people had to stand, then the meeting would be much shorter.

I had experiences of two such events at Ford and Royal Mail, although I suspect these were due more to default than design. The equivalent of the arbitration service ACAS in Ireland also had a practice of holding long conciliation and arbitration meetings without food or fluid provided, again on the same principle of reaching a successful outcome sooner than otherwise might be the case.

The world of work will be that much poorer without human and social interaction. Many people meet their partners at work, and their social circles include work colleagues. After all, most of us will spend a third of our lives – probably more in years to come as people retire later – at work.

Taken to its logical conclusion, meetings without people may get the business done more quickly, but at what cost?

We have a glimpse of the future, and it’s not working.

Unite last week held a conference of senior Unite representatives from our membership in the IT sector amongst others.

One of the speakers was Karthik Shekhar from a newly-formed union called Unites, the Union for IT Enabled Services, which is based in Bangalore and represents people working in IT-enabled services in India, with centres also in Chennai, Hyderabad, Delhi, Mumbai and Cochin.

Unites was established in September 2005 with the objective of organising people working in call centres and outsourcing organisations into an independent, dynamic, modern trade union, to effectively engage in social dialogue on behalf of members with other stakeholders in the industry in India.

There has been much said and written about the development of the IT industry in India, most of it from the viewpoint and perspective of companies and employing organisations. It was informative to hear at first hand from an organisation representing the workforce, and to hear about developments which are not normally featured.

Unites told us about some of the downsides of the IT industry’s growth including the heavy workload, prolonged working days, pressure to complete projects before deadlines, unhealthy food and irregular eating habits, having to travel across the continents at short notice and being away from families for extended periods.

Shekhar also referred to reports that India is facing an obesity crisis amongst its newly-wealthy middle-class, alluding to IT professionals.

The advent of a more global work culture has been characterised by increased work pressure, and an increasing need for performance in the workplace has led to increased stress. This lifestyle, we were told, increases the chances of developing heart disease 10 to 15 times, and the average age a person may suffer from heart attack in India has reduced from 40 to 30 as reported in India Times Health.

In addition, 1246 cases of divorce relating to people in the IT sector were filed in 2006 in the matrimonial courts in Bangalore as reported in Rediff India Abroad.

Financial freedom, lack of time at home, erratic working hours, work pressure, financial security, and stress are seen as the main reasons for this. Companies are being encouraged to take the initiative and ensure that employees get more time at home.

This will sound remarkably familiar to many in the UK, and shows that people working in the IT sector in India face some of the same pressures as those working in the UK.
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Of course there have been many benefits and improvements which have flowed from the development of the IT sector in India, but it is important to recognise that there are downsides accompanying the upsides.

Everything has a price – and that price in India as in the UK is often borne by the workforce. The emergence of a modern trade union for IT professionals in India – as with Unite in the UK - may help in addressing this.

Redundancy is an ever present fear even in the IT sector - and with the current so called credit crunch, probably an increasing fear just now.

Under existing employment legislation, in a redundancy situation involving more than 20 potential redundancies, employers have to consult with employee representatives; either trade union representatives where there is a trade union recognised, or elected representatives from amongst the workforce where there is no recognised trade union.

Where an employer fails to consult meaningfully, it is possible to bring a legal claim against that employer, and if successful obtain a sum of money for each person affected. This is called a protective award.

In a case recently decided at the Court of Appeal (Northgate HR Ltd v Mercy), the Court confirmed that if an employer fails to consult properly, only the employee representatives and not individual employees can bring a complaint.

This is an important ruling, and highlights the difficulties and problems for non-union representatives who may not have the necessary skills and resources to pursue a claim. Furthermore, it takes some considerable strength of character for someone acting as an employee representative to bring a legal claim against the employer they may still be working for, with the understandable fear – based on some real likelihood in my experience – that they may find their name in the list of people to be made redundant in a future redundancy programme.

This case further emphasises the value of access to skills and resources in a redundancy situation.

I saw reference in a recent article to a comment that skills should be “demand led”.

But should they – and in any event, whose demand? Employers or employees?

A recent visit to a telecoms products warehouse in Northern Ireland illustrates this only too graphically. The company has just introduced a new SAP-based system to replace the previous software. One of our Unite members told me that he had asked to go on SAP training so he could gain the competence and skill to  be able to use the new system and put in for a higher level job to secure promotion..

He was told that as his present job doesn’t require such skills, he could not go on the training course. Naturally without the training, he does not have the skills and competences for the higher-level job and thus is denied the opportunity for  promotion.

Although things are slowly changing in the UK, the British disease over many years is a failure to invest adequately in people at work, both equipment and skills.

Just look at the following quotations:

•    “The case for action is urgent and compelling…Our intermediate and technical skills lag behind Germany and France..”
•     “Firms need to change or upgrade…skills…our methods and attitudes contrast markedly with …Germany and France..”
•    “Other countries are making an immense effort to train more scientific and technical manpower…we are in danger of being left behind..”
•    “The development of technical education is the greatest need of this country.”
•    “The greater part of what is taught. does not seem to be the proper preparation for …business”

The above were written in 2006, 1981, 1945, 1924 and 1776 respectively. All are taken from official reports apart from the last, which is from Adam Smith’s The Wealth of Nations.

Even now – and this is as true for the IT sector as anywhere – we have a just-in-time approach to skills development, as we do for the supply of products and services.

The UK is never going to be able to compete against the rapidly-expanding economies of India and China either in goods or services on pay costs. Nor should we. There is no mileage in a race to the bottom, lowering our pay rates towards those, for example, of Eastern Europe or south east Asia, not that pay rates in these areas are remaining static in any case.

The only way – and the only sustainable way – now and for the future will be for the UK to compete on skills and the quality of our goods and services.

Just-in-time skills – or demand-led skills – is the wrong way to approach this, implying that we can develop the required skills at the time they are needed. Wrong – this will be too late.

We have to think and plan ahead, preparing in advance for the needs of tomorrow and not just today. Needs-led and not demand-led.

If you work for an IT company and have experience of being bullied, then unfortunately you are not alone.

In research carried out over the three months to February 2008, nearly two thirds (65 per cent) of the 860 Unite members surveyed in the electronics and IT sectors reported that they had experience of bullying at work, and more than half (55 per cent) said they had witnessed bullying in their workplace. This is also borne out by a further survey carried out by the Work Life Balance Centre and Coventry University, reported recently in the human resources journal Personnel Today, which highlighted the IT sector as being one of the sectors with the worst incidence of bullying.

Bullying at work is deeply destructive of workplace relationships and undermines people’s health, confidence and ability to cope. In the Unite survey, we found that more than one in five of respondents said they had to take more than a month off work as sick leave because of their experience of bullying.

We know from our schooldays that there is usually a bully in every playground, but most people do not get up in the morning to go to work intending to bully their work colleagues. It is the working environment that creates the circumstances where bullying arises, and all too often is then tolerated or accepted as a feature of working life.

Bullying is organisational and can only be adequately combated by an organisational approach. At the very least, employers should have a clear statement that bullying will not be tolerated, have procedures in place on bullying and harassment, send a strong message from the top of the organisation that complaints of bullying and/or harassment will be taken seriously, and provide training on how to apply and operate the policy, in particular for managers.

Sixty per cent of respondents in our survey reported that their employer did not have an anti-bullying/harassment policy, and even where such policies were in place, nearly a quarter said they had not received any information or training about the policy. In addition, and as borne out by our survey and experience, all too often people are reluctant to make a complaint because they do not believe this will be seriously considered, or even worse they are too scared of the consequences.

Employees and their know-how are the key assets of most IT companies and it is vital that employers improve the way in which people are treated. Since workplace bullying was recognised as a problem more than a decade ago, many organisations have adopted policies to address the issue. However, a policy is no use unless all parties work together to take on the challenge.

The Dignity at Work Partnership has been established with funding jointly from the Department of Business, Enterprise and Regulatory Reform and Unite to tackle the problem of bullying and harassment in the workplace. The aim of the project is for employers and employee representatives to work together to find ways of addressing the issues around bullying, and develop sound practices based on sharing of experience.

I have been reading a fascinating publication by e-Skills UK which the sector skills council recently published called Technology Counts – IT & Telecoms Insights 2008. This brings together a series of research reports aimed at providing insight into the current and future landscape of the sector.

The age profile of the IT sector is changing quite dramatically. Whereas in 2001 nearly one third of people working as IT and telecoms professionals were under 30, this has dropped to just over one in five in 2007. The image of IT as being a young profession has to be rethought.

Added to this is the alarming drop in people going in for computing degrees, down by 50 per cent between 2001 and 2006. While it is the case that only around half the annual graduate intake each year has a computing or telecoms degree, this is nevertheless a disturbing trend.

The continuing decline in the proportion of women in IT and telecoms further demonstrates that the sector is not one which women find attractive – and this situation is deteriorating. The proportion of women has dropped from 22 per cent to 18 per cent over the period from 2001 to 2007. This compares to the overall UK workforce being 47 per cent female.

These trends should be deeply worrying to everyone with an interest in seeing the IT and telecoms sectors survive and thrive. Productivity in the UK lags behind that in France and Germany, never mind the US. The informed consensus is that the largest contributory factor to this is the adoption and exploitation of IT. If we do not improve this, our productivity and competitiveness will suffer.

We must look seriously at how we can change this, not just for the future of the IT sector in the UK, but also for the future of the UK economy.

Are you one of nearly five million people doing an average of more than seven hours overtime every week for free? All that unpaid overtime is worth £5,000 a year. If you did all your unpaid overtime at the start of the year you wouldn’t get paid until 22 February. The TUC has named this date “Work Your Proper Hours Day” in your honour.

If you are an senior IT professional or IT manager, it is even worse. You are working an average of nearly 10 hours additional time each week, worth up to £10,000 a year.

On this day, take a stand by arriving for work on time, taking a proper lunch break and leaving on time. If you’re a manager, why not thank your staff for all the extra effort they put in at work.

In the UK we work the longest hours in Europe. Here's why:

• the law that protects against very long hours is weaker in the UK
• most people don't know about the laws we do have, and they're not enforced
• more and more people do the kind of jobs where overtime is not paid
• and we've just got into the habit where employers expect, and staff are prepared to work, very long hours. It's the dreaded “long hours culture”.

Long hours are not good for us; they cause stress; they're bad for our health; they wreck relationships; they make caring for children or dependents more difficult; and tired, burnt-out staff are bad for business.

It doesn't mean that we should turn into a nation of clock-watchers. Most people enjoy their jobs and find them fulfilling. But there's a need for give and take at work. Putting in some extra hours when there's an emergency or a sudden increase in orders is one thing. The problem is when it turns to all take. Long hours become the norm, not the exception, and even longer hours are needed when a real crisis comes along.

There’s more information and advice on our web site, where you can:

• find out whether you have a long hours problem by taking our quick quiz
• help us to find the best and worst bosses across the country for managing long hours
• post a message on our Work Your Proper Hours rant blog. We’ll publish the best stories on the site.

Visit: www.workyourproperhoursday.com

As thoughts turn to those summer holidays, thoughts also turn to paying for them.

Latest figures from sector skills body e-Skills UK for the last quarter of 2006 show that the average gross weekly pay for an IT professional in the UK was around £34,500 per year gross. However this is somewhat below the average advertised pay rate for a permanent post of £38,500 per year gross and around half the advertised pay rate for a contractor of £64,000 (£1,230 per week gross).

Of course, these averages cover a wide range of IT jobs, and as is usually the case with averages mask a wide variation in pay.

If you work in the north east, north west or Northern Ireland, then you are likely to take home up to 30 per cent less than those employed elsewhere.

And if you are a woman, then you are likely to earn some £56 per week or nine per cent less than your male colleagues on average throughout your career, with the pay gap peaking in your 40s. Perhaps this goes some way to explaining why working in IT appears to be increasingly a turn-off for women?

We are even receiving reports from some employees that they have not had a pay increase for a number of years.

As you head for the sun, whether in Bournemouth, Benidorm or Bermuda, are you being paid what you are worth?

Amicus – the largest private sector union in the UK - supports a policy of managed migration. In principle, it is recognised that where it is not possible to find the necessary IT skills in the UK, then it is appropriate to seek to obtain those skills from outside the UK.

At the same time, employers should not treat the scheme as an opportunity to put short-term profits before investment. They should use the time that they employ work permit holders as a period in which they are able to train UK resident personnel.

Work permit scheme

However we have seen a huge increase in the number of work permits granted for IT occupations over recent years. In 2005, 30,000 overseas IT workers came into the UK via the work permits system, compared with 1,800 ten years earlier in 1995. Between 2001 and 2004, some 110,000 work permits were issued in total for IT occupations, representing no less than 20 per cent of the total work permits issued for all occupations, despite the fact that IT occupations represent only 3.5 per cent of the workforce.

Pay rates

From pay data information available to Amicus, 66 per cent of IT work permit holders are paid less than the equivalent of £30,000 per year. Given that the average salary of an IT professional is £32,500 in the UK, on the face of it the majority of IT work permit holders would appear to be paid less than the industry average salary.

Effect on IT professionals

The question which needs to be asked is whether the skills represented in these figures are not available in the UK, which would be a justifiable use of the work permit system, or whether these companies are bringing in non-resident work permit holders at below going pay rates in the UK, which would not.

The need for investment in skills and learning

While the work permits route is readily available and can be used to bring in required skills, there will be less incentive for UK employers to provide the necessary longer-term investment in skills development and learning. This will have serious long-term consequences for the IT industry, as the necessary skills are not available or in short supply, and overseas competitors’ staff are trained in new technologies, which in turn serves to reinforce the process of international outsourcing (offshoring) by moving IT projects beyond the UK. The result is that resident staff are not trained in new technologies, and the UK skills base is undermined and eroded.