At the beginning of last month, we asked if everyone should take August off. Well, it’s September 1st, the first day after a bank holiday in the UK, which means most offices are filling up again.
I grew up in Canada, so the European notion that most businesses have to cope with mass staff absences because most people go on holiday at the same time has always seemed a bit of a pleasant extravagance. Even in the UK, which pales in holiday time when compared to its European cohorts but is head and shoulders ahead of its North American cousins, August is a quiet month as most staff, particularly those with school age children, head off for vacation.
Seeing everyone return to the office relaxed, smiley, often in new clothes and tanned (even those who stayed in the UK) reminds me of the first day of the school year. All those kids eager, at least for a day, to get back into the classroom. Ok, many of my colleagues are less enthusiastic about the tasks at hand but they are certainly happy to see the familiar faces that they normally lunch or gossip with a few days each week.
Good morning, ladies and gentlemen, and welcome aboard this Schlep Air flight 41108 to Shanghai. We will be pushing back shortly and taxiing to the eastern runway prior to take-off.
In a moment we will be showing you a short safety video, and cabin crew will be on hand to demonstrate a few key features. Please feel free to ignore all that crap. I mean, what’s the point? If we’re going down do you think that kicking off your high-heeled shoes first is going to help?
Some of you may be tempted to put your newspaper down and pretend to pay attention.
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The week of reckoning is almost over. For a cheery reminder of normality, watch the FT’s Richard Edgar prowling the aisles of the new Emirates A380 “super jumbo”. Marvel at the shower in first class! Quake before the endless prairie of economy class!
I’ve just received a claim form asking whether I had bought a long haul ticket from British Airways or Virgin Atlantic between August 11, 2004 and March 23, 2006. If I had, it told me that I was in line for a refund after the two airlines were busted for fixing fuel surcharges.
I rapidly searched through the relevant period on my creaking Palm Tungsten. Damn. I’d flown to New York with Virgin on a ticket bought in May 2006. My disappointment was brief, however: a visit to the official refund website revealed that the payout would only have been £4-£20.
Still, for people whose jobs required them to cross the Atlantic regularly, the sums involved could be attractive. I’m curious to know if such travellers are being told by their employers to hand over the money refunded – something that might affect employees who bought the tickets themselves and then claimed the cost back via expenses.
I guess it is like the old argument about who owns air miles accrued on company business. Employees usually seem to get the benefit of the doubt on that one. But in these hard times, businesses are clawing back cash any way they can. Ripe ground for conflict, I imagine.
Last week I pointed out that McKinsey was offering to take a bullet for Wall Street by suggesting that it might not be a bad idea for investment banks to spend less on consultants.
Now the Sydney Carton of the consultancy world has a new insight likely to please bankers. A couple of its directors have co-authored an article declaring that the best companies view downturns as a good time to make acquisitions.
McKinsey isn’t suggesting that every company will be in a position to find the funds to purchase rivals. But for financially-solid businesses its advice seems plausible – and it certainly won’t hurt the flow of M&A fees into the investment banking industry.
As well as getting rid of staff, financial firms have put the squeeze on their travel and entertainment spending in response to deteriorating economic conditions.
Now McKinsey claims that some US investment banks could save up to $2bn a year by cutting costs in ways that are less likely to antagonise their remaining workers.
The consultant reckons that for some banks, spending on things like real estate, IT and office supplies grew too fast during the fat years and could now be pruned aggressively without sowing discord among the troops:
Inititatives to curb expenditures need not be extremely demoralizing to frontline employees… 80 percent of fixed costs have minimal or no impact on a bank’s employees or culture. Launching initiatives that target these areas, we estimate, could in many cases produce most of the noncompensation savings that banks aim to achieve while reducing the possibility of targeting areas that could damage employee morale.
Hang on a minute. I’ve just noticed the fifth entry on McKinsey’s list of investment bank costs that could be cut with “minimal or no impact on employees/culture”. The entry says “consulting”.
Let me try to get my head around that. Is McKinsey - a consultant – seriously recommending that investment banks consider ways of cutting their spending on consultants?
It looks that way to me. A McKinsey spokeswoman declined to comment.
Many marriages buckle under the pressure of a foreign posting. The expat life often involves one partner slaving away miserably while their unemployed “trailing spouse” – what a soul-destroying label! - flounders in the absence of friends and workplace routine.
I mention this because my colleague Richard Tomkins has written about divorce, London-style in this weekend’s FT. He argues that the divorce system in England is “uniquely favourable” to the lower-earning partner, usually the wife. This is partly because pre-nuptial agreements are currently unenforceable, he says.
What really caught my eye was a quote from Sandra Davis, a partner at Mishcon de Reya, a London law firm. She expresses surprise that more companies posting staff to England do not warn them about the risks of being ordered to fund a massive settlement if their marriage implodes over here, pre-nup or no pre-nup.
Should companies provide divorce advice to expats alongside tips on tax planning? Have any readers been given such guidance?
Personally, I think financial advisers to expats are more likely to be bridesmaids than divorce strategists. In France, for instance, the tax benefits of being married or joined in a civil partnership called a PACS can be substantial. A decent tax adviser would at least lay those options on the table. They might even get a secret thrill if their clients wed.