With a large decentralised workforce and an 80-strong HR team, construction firm Skanska UK has shaped its reward and benefits to align with its progressive purpose and values.
From introducing the first green car policy, to embracing flexible working and salary finance, Harvey Francis, executive vice president at the firm, explains the thinking behind the employer’s rewards and benefit strategy.
How long have you been in your current role?
I’ve been at Skanska 16 years and I’ve been executive vice president for 15. I’ve worked with four CEOs and seen the business go through a number of different cycles, and in addition to my responsibilities for HR I look after communications, customer experience, and strategy and planning. At one point, I also oversaw IT for three or four years. So the role has changed quite a lot and continues to evolve which makes it constantly stimulating.
Skanska is quite a decentralised organisation, our parent group is in Sweden, so the business units have a lot of autonomy. For example, at Skanska UK we set our own people strategy as well as working with the group. But essentially, we’ve put in place the strategies and plans that are right for our own local UK unit.
How big is your HR team and how many employees are there in the organisation?
We have about 3,300 employees and around 80 people in HR.
When I joined the business I restructured the HR function around the original version of the Ulrich model. We have HR business partnering (HRBP), which has solid reporting lines into HR and dotted lines into the operational unit managing directors. We have a number of subject matter expert teams, so we have reward and benefits, talent capability and we also have an HR service delivery.
Skanska, and construction more generally, is a very relationship driven environment, so it values the slightly higher touch service, particularly in HR business partnering. Even with 80 people it’s never quite enough to go around.
What benefits are currently offered to your employees?
In addition to salary, some people participate in a short term incentive, which is an annual bonus plan. We have a long term incentive called the Skanska employee ownership programme (SEOP), which in essence is a share purchase and matching scheme and that’s a global scheme. Everything else is local [to the UK business unit].
For some roles in the organisation, we offer company cars. Back in 2008/09, we introduced what I believe was the UK’s first green car policy. We set a cap of 130 grammes of Co2 emissions, which was very much in line with our values and our purpose in terms of our environment credentials. We felt it was important that those benefits were aligned.
EV First
At the end of 2020, we introduced EV First, which is our electric vehicle (EV) company car policy. We agreed as an organisation that all new company cars ordered would be either fully electric or hybrid. For hybrid cars we decided diesel engines would not be an option because we know that these are some of the worst polluters in terms of particulates when it comes to the environment and breathing. That’s been very well received, people like driving EVs at the moment. There’s advantages from a tax perspective and there’s some really nice cars.
To encourage the adoption of fully EV and hybrid cars, when we moved to our new headquarters at Leavesden Park just over a year ago, one of the requirements was the ability to put in an EV charging array. At our previous headquarters, Maple Cross House in Rickmansworth, we had more than 60 spaces with EV charge points. At our new site we’ve got 100 charging points, and we don’t charge for them. People can plug in and charge their cars, which is a really good benefit for your electric car.
A lot of people have a view on EV, but there is definitely a view that EV is better for the environment than driving petrol or diesel cars. So this is a really good manifestation of our values in practice and how you join your values up with the benefits proposition.
Cost of living crisis
We have a voluntary benefits platform run with Reward Gateway to offer employee discounts across a wide range of retailers and service providers. We run our share ownership plan enrolment through that platform as well.
When the cost of living really started to hit, we introduced salary finance into the organisation. This means employees can take short term loans through the payroll, have access to other loans at more advantageous rates, and receive payroll advances.
The benefit has been very well received and it is now firmly embedded in our portfolio. The platform also has financial advice, including financial planning, which has also had good take up.
How do you communicate your benefits and reward to your workforce?
We have an annual total reward statement online, which quantifies the value of both the list of cash equivalent benefits but also some of the less tangible values in terms of training. We also have an online booklet.
What are your current challenges?
Construction is a project, essentially it’s a series of contracts that change. That can mean quite a lot of uncertainty. It’s different to a manufacturing business where you can more broadly forecast demand. Construction is much more difficult to predict and forecast. So I would say that of all the industries I’ve worked in, from a skill set perspective, construction requires a lot more management judgement because of the forecast element to it.
In terms of people, one of the enduring challenges for us is ensuring that we have enough and that we have the right level of competence. So the right people, in the right place, at the right time. In a projects based organisation where there’s a lot of uncertainty, a lot of ambiguity, lots of moving parts, that’s quite a challenge. So, we make sure that we do a good job of strategic workforce planning, which is also linked to our succession planning.
Still male dominated
One of the other challenges for us is around inclusion and diversity. Construction is still a very male dominated sector. We’re making good headway, we’re now about 26 percent female, which is certainly at the forefront of the industry. We’re proud of that, but we’re not satisfied, so we need to keep going.
The key to having greater diversity is that you have to be more inclusive. If you’re not inclusive and you’re hired from diverse backgrounds, they probably won’t stay because the culture is not set up to help them succeed.
We have a lot of focus on diversity within our succession planning and also within our hiring to make sure that we are attracting the widest and most diverse possible group of talent.
Skills feeder routes
A big challenge around attracting skills is that some of the core feeder routes into our industry, such as built environment and civil engineering degrees, are not yielding the levels of diversity that we would hope.
As a result we now do a lot more with apprenticeships, a lot more with trade bodies, while still keeping a greater focus on graduates. Broadening the entry routes is key if we know that the traditional graduate route is less diverse than we would like.
What we’ve also seen post Brexit is that some vacancies have been harder to fill, particularly around the trades. There has definitely been a talent drain back to other parts of Europe post Brexit, which is really disappointing.
What are the hot topics for HR?
Diversity and inclusion remains very much at the top of the agenda. But it looks different for different companies. If you’re in a sales and marketing environment where you’ve got call centres, sales reps, diversity is probably easier to come by. I spent 10 years at BT and there were much greater levels of diversity in the front end sales and marketing business.
The other thing is the adoption of, or making more of, hybrid working, and where that is going to settle. I think the majority of companies are accepting that the old ways have gone forever. You still see some of the more traditional banks, and even one of our competitors, ordering all office based staff back to the workplace full time. We haven’t done that.
In the autumn of 2020, we implemented ‘Flexit’ when the pandemic started to drive changes in ways of working. My view was that when the lockdown lifts, if everybody just comes back to the office, then we’ll have missed the opportunity to make the shift [to more flexible working]. Flexible working also helps attract a more diverse set of people because you can be more flexible.
We believe that every role has an element of flexibility in it in terms of where you do your role and when you do your role. We provided guidance for teams and line managers and asked them to consider three things when thinking about work patterns. Those were: the requirements of the business and your customer; the requirements of the team; and lastly, the requirements of the individual.
We measure it every year in our engagement survey and more than 60 percent of our workforce have had a conversation with their line manager about Flexit. It provides a framework for local leaders to make their own decisions about how best to do it rather than having a mandate from the centre that says everybody will come into the office three days a week.
What’s the best employee benefit you’ve ever had?
Private medical insurance, which, from a family perspective, I’ve had to use a number of times over the years. And you can’t put a price on the value of that. But it is an expensive benefit for an employer to provide. The other one is my EV company car. I love it as a benefit.
If you had an unlimited budget, what employee benefit would you like to introduce for employees?
I’d give health care to everybody.
