The benefits of employee ownership trusts in residential child care

Halliwell Homes is going from strength to strength after its first year as an employee ownership trust (EOT).

Halliwell Homes restructured as an EOT in 2022 to support its longstanding mission to “improve the psychological wellbeing of children in the looked-after sector”.

“A specialised service like ours needs a stable and experienced workforce to deliver our Restorative Parenting Recovery Programme and to ensure that the children step down to mainstream school and family placements after two years at Halliwell,” says managing director Rob McKay.

“This new ownership structure aligns the best interests of the children with the best interests of our staff, a higher level of staff engagement and retention means more consistent and knowledgeable practice with the children” he adds.

What is an employee ownership trust?

An EOT is a government initiative which gives business owners the opportunity to sell their shares to a trust created to hold shares on behalf of employees and company directors.

Halliwell has appointed Gary Davie, an expert on employee-owned businesses, to the trust’s board, to ensure the company is being run in the best interests of staff.

“Statistically organisations with EOT-led models have proven to have a better engaged workforce and more highly committed employees, which leads to better staff wellbeing,” says Paul Bliss, therapeutic practice director at Halliwell Homes.

Job security

In a sector where venture capital and private equity-backed buyouts are common, employee ownership provides stability.

“We now have a stable ownership backdrop to support the ongoing consistency and quality of the Halliwell Restorative Parenting Recovery Programme”, says McKay.

“We believe that this is the best structure to deliver and develop a specialist residential child care service, because potentially it’s the most stable for everyone involved, including the local authorities who place children with us.”

Financial benefits

As indirect owners of the company, staff now have a stake in its progress and performance. In the future, they will also be able to access tax-free dividends.

That is something we will be able to do that other organisations can’t, as a way of rewarding staff for their commitment and hard work,” says McKay.

“Dividends will increase with long service, encouraging staff retention.”

Staff engagement

Staff at employee-owned businesses have input into how the organisation is run, giving them a sense of ownership.

“It is a legal but also an ethical requirement, and is highly valued by employees,” says McKay. “We know from experience that staff input can inform better practice and ways of working, which ultimately benefit the children placed with us.”

Halliwell has introduced a range of new ways to communicate with staff and receive feedback, from regular staff newsletters to six-monthly presentations to all staff.

“We are opening up more communication channels within the business and as the EOT becomes established there will also be staff representation on the board,” says McKay.

“The first 12 months of the EOT has helped us to improve staff retention and to achieve full staffing during 2023, despite the challenges of recruiting in the sector since the pandemic.

“We believe that the new ownership structure will also support further improvements in the consistency and overall knowledge and experience or our specialist practitioners and education staff.”

New benefits

Employees have already provided feedback on proposed new benefits through the first rounds of staff presentations and feedback sessions.

“We’ve implemented a number of staff initiatives that have helped with staff recruitment and retention,” says McKay. “We took up a range of ideas that the staff told us would be the most impactful.”

Acting on feedback, Halliwell has introduced two new annual bonus schemes linked to long service: a “Halliversary” bonus of up to £500, which staff receive on the anniversary of their first day at the company, and a bonus received on the staff member’s birthday.

Other new benefits include staff wellbeing initiatives such as subsidised gym membership, access to free in person counselling and psychotherapy, increased annual leave and improved weekend and holiday overtime rates.

Halliwell says that, as far as it’s aware, it was the first company in the children’s residential care sector in recent years to make the move to employee ownership.

“Residential care can be a challenging as well as a rewarding sector to work in, there has never been more pressure on staff,” says McKay. “We think this is a way of differentiating ourselves and supporting our staff more effectively. We want Halliwell to be a great place to work and we know that the longer our staff are with us the better it is for their professional development and for the children placed with us.”

“The positive impact of the EOT was recently reflected in Ofsted’s comments about a Halliwell home in an “outstanding” inspection report,” says Bliss.

“Children who have complex emotional needs and who have experienced extreme trauma make remarkable progress from their starting points… The staff group is stable, and staff work tremendously well together to provide consistency for the children.” (Ofsted inspection report, November 2023)

Find out more on the Halliwell Homes website.