Skills Uncertainty and SM&CR

Research conducted by the CIPD has revealed that three-quarters of the UK workforce are unclear on the skills their employer requires them to have.

This raises an obvious - and worrying - question. How can someone be competent in their role if they don’t understand whether they possess the skills required to carry it out?

How can they be expected to progress and develop, and is the role actually a good fit for them?

Other issues highlighted by the report include a lack of understanding from employees on how to upskill themselves in the workplace and a lack of awareness around the skills they would require for future roles.

Employees that find themselves in this position are likely to feel disengaged with their role, less productive and less confident in their abilities. On a more serious level, they are more likely to make mistakes if they do not have the skills required to match their responsibilities.

CIPD skills policy advisor Lizzie Crowley states that, “the fact employees don’t know what skills they need points to the need for employers to get a lot better at communicating to their workforce what skills are required to enable them to progress within their current organisation.”

There is also the regulatory angle to consider.

The Senior Managers and Certification Regime (SM&CR) will apply to insurance intermediaries from 9 December 2019, aiming to increase personal accountability, improve conduct at all levels and reasonably ensure that firms and staff understand (and can show) who does what.

If the CIPD’s research is an accurate reflection of reality for a large chunk of the UK workforce, then there is clearly work to be done.

There are three elements of SM&CR: the Senior Managers Regime, the Certification Regime and Conduct Rules.

The Certification Regime applies to employees who, while not being classed as ‘Senior Managers’, still have a significant impact on the firm and its customers. Under SM&CR fewer people will be approved by the regulator, but this means that the responsibility for this lies with the firm itself. One of the objectives of the Certification Regime is to emphasise that it is the firm, not the regulator, that makes sure employees are fit and proper for their role.

Firms must assess their employees’ fitness and propriety on appointment and annual certification is needed to confirm that they remain suitable for the job.

The factors they will need to consider include:

  • Evidence of Continuing Professional Development (CPD), including any qualifications obtained and training undertaken
  • Their level of competence

The certificate issued will confirm that the individual is a ‘fit and proper person’ to carry out the Certification Function and will also detail the areas of the business in which the person will be involved.

It is worth bearing in mind that under SM&CR firms will also be required to train their relevant staff on how the Conduct Rules apply to their role. The Conduct Rules will apply to a significant number of employees within a firm on the basis that a wide range of staff have the potential to cause harm.  Only ancillary staff, who don’t carry out financial services roles - such as receptionists and security guards - are outside of the scope of the Conduct Rules.

Much of this appears to be common sense and is general good practice in ensuring that staff remain competent and receive adequate training. If, as the CIPD’s research suggests, employees are unsure what their employer expects of them, more needs to be done to actively provide training and learning opportunities.  It should be happening anyway, but with the arrival of SM&CR it becomes a regulatory requirement.

About the author

Lisa joined RWA in 2014 as an e-Learning Assistant, designing training material for the Aviva Development Zone e-learning platform.

Her role as Head of Content and Communications involves the editorship of RWA Insight. It also includes reviewing e-learning content as well as providing proofreading, copywriting and standards support across the business.

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