Seton HR Solutions are committed to supporting businesses and their people, and as we collectively move through 2025, small and medium-sized enterprises (SMEs) across Scotland face a dynamic and evolving business landscape. HR is at the forefront of addressing these changes, ensuring that businesses not only survive but thrive. Here are what I believe are the top HR challenges that Scottish SMEs need to tackle this year, along with practical solutions to consider:
Cost-of-Living Crisis
Although inflation has seen a further slight reduction, across Scotland there is still an ongoing cost-of-living crisis that may be impacting employees’ financial wellbeing, this has the danger of leading to decreased productivity, morale and potential absence.
Businesses need to consider innovative ways to support their staff, such as offering financial wellness programs, flexible working arrangements, and additional benefits that can be found through employee assistance programmes. These measures can help maintain employee engagement and retention without significantly increasing costs.
Budget Fallout
Last year’s Government Budget has introduced new economic pressures, including increases in the national minimum wage and changes to national insurance contributions. These are significantly impacting organisations now and likely to increase in the coming months.
HR can assist business to review their processes and support with implementing new ways of working that can optimise savings and limit compromising on service delivery.
It is vital that your teams are aware of and complying with new regulations to avoid legal issues and maintain a fair workplace.
Employee Wellbeing and Mental Health
The mental health and wellbeing of employees remain a top priority. The stresses associated with the cost-of-living crisis and workplace changes can lead to burnout and decreased productivity. Organisations should look to introduce wellbeing programs including mental health support, flexible working hours and initiatives that promote a healthy work-life balance.
Positive changes can help towards fostering a supportive and productive work environment.
Compliance with Employment Rights Reforms
The new Employment Rights Bill https://bills.parliament.uk/bills/3737 introduces significant changes to employment laws. This in turn will result in organisations being required to update their policies and practices.
Clearly it is important that staying informed about these reforms and ensuring compliance is essential to avoid legal pitfalls and maintain a fair and equitable workplace. SMEs should ensure they invest in HR support to be able to seek expert advice to navigate these changes effectively.
HR consultants can assist by navigating these changes with you and help implement necessary changes expected in the coming months.
By addressing these challenges head-on and avoiding complacency, Scottish SMEs can create a resilient and supportive workplace that attracts and retains its people. The key is to stay adaptable, informed, and proactive in implementing solutions that benefit both employees and the business. Seton HR Solutions can be your HR partner that works pragmatically with you through the stages. Reach out to get in touch for a no-obligation discussion on how I can help. https://setonhr.co.uk/get-in-touch/
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