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Five top tips for those forced to make redundancies

Redundancies are an unfortunate aspect of running a business. In many cases it is an unavoidable task with many companies having to slash operating costs in the current economic climate to remain competitive.

However, it is also important that small and medium-sized enterprises (SMEs) deal with the process in a professional manner to ensure they don’t leave themselves liable for claims against unfair dismissal.

Here are five top tips for SMEs forced into making redundancies for the long term survival of their business.

Ensure redundancies are genuine business decisions

Making redundancies is a major decision for both parties and consequently businesses must make sure they have sound, genuine business reasons for making staff redundant. It should not be used as an excuse to get rid of under-performing employees as this can be managed in an entirely different manner, avoiding legal action against the business.

Calculate how many redundancies required from the outset

It is important that any business knows how many redundancies it is required to make from the outset. This is because the redundancy procedure differs depending on the number of staff likely to be laid off. These include notice and consultation that must be given in cases of redundancies of more than 20 employees.

Oversee a thorough skills matrix

In the event SMEs are required to reduce staffing levels it is important to assess the skillsets of their employees with a thorough pool selection. SMEs should assess the skills of employees within robust, clearly defined pools or groups to further guard against claims of unfair dismissal.

Communication is the key

As difficult as any redundancy situation may be it is vital to communicate strongly with teams and individuals affected. Managers should be prepared to field awkward questions and discussions with frustrated staff. Losing your job is one of the most stressful situations a person can face so be sure to show understanding and compassion.

Adhere to redundancy payments

Finally, it is also crucial to follow the necessary payment procedures. Adhere to redundancy payments for employees with two or more years of service – the final figure is calculated by combining the age of the employee, their length of service and their standard weekly wage. Be sure to document every payment as all business practices come under increasing scrutiny during a redundancy period.

More business advice for SMEs

Beginner's guide to writing a business plan
Essential guide to email marketing
The best time to relocate your office


Four reasons office productivity can fall

Office productivity can fall if staff become unhappyEvery business strives for high levels of office productivity – this can boost the bottom line directly. But many companies become frustrated as productivity levels dip over time, despite serious and strategic attempts to keep them high. At the heart of productivity losses are unhappy staff – staff that are not happy in their jobs often find it harder to motivate themselves, keep on top of their work and achieve the highest standards.

Here are four of the most common reasons productivity can fall due to staff unhappiness:

Workplace stress
Stress in the workplace can significantly affect productivity, particularly if the stress is continuous. This is especially true in the current post-recession climate where record numbers of employees report feeling very stressed in their current positions. This is no doubt due to the increased burden placed on businesses to compete efficiently and regain market share, leading to employees having to take on more tasks than ever before. Yet the stress caused can zap motivation and make employees dread coming to work, something that will kill productivity in record time and quickly spread throughout your organisation.

Personal problems
Although managers cannot solve personal problems, they can respond in the most appropriate way. Often employees just want understanding at difficult times – this can in itself reduce stress levels. Managers may be reluctant to give staff time off for personal problems out of fear it will start a precedent, but in the long-term it can be worth giving staff one or two days off to sort out their issues if it means productivity does not dip in the long run. Managers should open up communication channels with staff and encourage communication of personal problems.

Poor communication
When staff feel ignored or unimportant productivity can fall heavily – communication should be strong between all people in the business, including teams and individuals. In addition, good communication should include socialising as well as discussing business. If employees do not feel comfortable in each others’ presence, and able to communicate openly and freely without fear of being reprimanded, depression can set in, causing drops in productivity. Encourage social activities, both in and out the office, and also regular coffee breaks during the working day.

Employees that feel stuck in a rut often lose their drive and enthusiasm, which can have massive effects on productivity. Whilst there are always parts of a job that are unpalatable, it’s important that employers work hard to keep staff engaged. There are numerous ways to do this, including promotions, salary increases or involvement in new projects – the effort may soon significant at first but the effects can have a rollover effect to all employees making it a superb investment that can potentially offer a high return.

Take a look at our post on three things employees find it hard to say.