Issue 50 June 2017
RECRUITMENT MATTERS The View and The Intelligence
Big Talking Point
Post-election jobs market p2-3
Legal Update p4
Recruitment and the ‘Gig Economy’ p6-7
RECRUITERS URGED TO HIGHLIGHT AGENCY WORKERS’ RIGHTS The REC is urging recruitment businesses to take the lead for informing agency workers of their rights. It has produced a factsheet highlighting the rights all agency workers in the UK receive when assigned to a workplace. Different rights originate from a range of different pieces of legislation and
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regulations, enforced by a variety of different bodies The REC says too often the average person doesn’t understand their rights at work or when jobseeking. It says when people don’t understand their rights it means they risk accepting inappropriate or even unlawful treatment at work and when work-seeking. Workers who
know their rights make for a more engaged, powerful and satisfied workforce. The REC says the factsheet aims to inform key stakeholders of the rights agency workers have. “We’ve seen too many politicians incorrectly state that agency workers don’t get pensions, holiday pay or sick pay,” it says.
Products and Training TREC 2017 - what’s new
The REC has also worked with HMRC to produce a guide that sets out recruiters’ responsibilities for dealing with the new National Living and Minimum Wage increases.
The guide answers some of the questions posed to HMRC and the REC on how to calculate the National Minimum Wage, and tells recruiters where they can find more information. The Agency Workers Rights factsheet can be downloaded for free at www.rec.uk.com/ rights
www.rec.uk.com 16/05/2017 17:07
Leading the Industry
What opportunities does the election present recruiters, asks Tom Hadley, REC director of policy and professional services
TREC is the perfect chance to champion good recruitment, says Kevin Green, REC chief executive
Next month sees the arrival of TREC, the REC’s national conference and flagship event for the Good Recruitment Campaign (GRC). As I travel the country talking to members it’s clear we need to champion good recruitment in all its guises. As professional advisors, we should engage and educate our clients on issues such as diversity and inclusion, employer branding and the candidate experience. In this way we can reposition our industry, moving away from being providers of people, and towards becoming strategic workforce solution experts. To increase margins, we need to provide more value. This seems to me to be quite simple – if we can solve more problems for our clients, then they will value and pay more for our services. The GRC provides our members with the resources to engage employers on a range of workforce issues and demonstrate additional value. The GRC has over 230 organisations signed up to our aspirational charter of good practice. These organisations employ well over 2 million
AFTER THE VOTE-RUSH
employees and include household names such as John Lewis, Kellogg’s, PepsiCo and Santander. We’re seeing more and more members train up their consultants so they’re able to talk to clients about the campaign and the business benefits to clients. TREC on 21 June is a chance to listen and engage with over 200 clients as they talk about the talent issues they are facing every day. It’s an ideal opportunity for recruiters to learn about the challenges facing their clients, and to help develop their offering of creative solutions. The REC will launch new research at TREC about the cost to organisations of getting recruitment wrong – this data and insight will help you show employers why they need to improve the candidate experience and get it right first time every time. I look forward to seeing many of you at TREC next month. If you want to keep up to speed with all things recruitment then follow me on Twitter @kevingreenrec
“AS I TRAVEL THE COUNTRY, IT’S CLEAR THAT WE NEED TO CHAMPION GOOD RECRUITMENT IN ALL ITS GUISES” 2 RECRUITMENT MATTERS JUNE 2017
As well as taking forward a number of snappy messages ahead of this snap election, we have been laying the groundwork for building our relationship with incoming MPs and the next government. Skills, immigration and industrial strategy were just some of the labour market issues that the major parties picked up on during the pre-election rush for votes. Postelection, our approach is to provide practical solutions to some of the major challenges ahead. For example, embedding employability within the school curriculum and building a world-class careers information network that taps into the expertise of recruitment professionals is our solution for preparing future generations of workers for a rapidly evolving employment landscape. A ‘country that works for everyone’ must entail a jobs market that works for everyone. Our industry will play its part in creating a tipping-point on the inclusion agenda by promoting innovative hiring practices and making change happen. A further solution is to evolve the Apprenticeship Levy into a ‘training levy’ that can meet broader training and re-training needs, and be accessed by workers in nonpermanent roles. According to JobsOutlook, nearly half of employers (49%) expect to see an increasing shortage of candidates. As well as radically ramping up the UK skills base, the next government must build an agile immigration strategy that reflects labour market needs. Our work with leading law firm Fragomen and immigration specialists MPI is aimed at informing the next government’s approach to this hugely sensitive issue. Over the course of the Brexit negotiations, a core focus must be to protect the UK jobs market and ensure that the post-EU landscape is one in which both demand and supply of staff remains vibrant. The REC will feed into this through our Future of Work Commission, which is being chaired by former employment minister Esther McVey. In an age of accelerating change and disruption we need an agile and vibrant labour market that is underpinned by good hiring practices. Building the best jobs market in the world is an aspirational target but is one that must drive government policy over the next term. You can follow Tom on Twitter nt @hadleyscomment
THE INTELLIGENCE WITH REC SENIOR RESEARCHER, MARK HARRISON The Prime Minister’s surprise announcement on 18 April to hold a general election means we are now less than a fortnight away from polling day. A huge amount can change in an election campaign in a very short space of time, but two of the key campaign themes that have emerged so far are (unsurprisingly) Brexit and the NHS. Whilst negotiating the UK’s exit from the EU and ensuring the population’s health both hold huge challenges in their own right, there is significant overlap in how the former could affect the latter when it comes to recruitment. Whilst the majority of NHS staff employed by NHS trusts and CCGs are British, a significant minority come from the EU. According to an April
NDR/NFI % PER EMPLOYEE AND FEE EARNERS INCREASES YEAR-ON-YEAR Whilst both the average monthly turnover per employee and per fee earner declined in the year to February 2017, when compared to the 12 months to February 2016 – by 15.7% and 6.4% respectively – the median recruiter managed to increase its NDR/NFI/GP percentage for both cohorts over the same period. The latest information from the RIB Index, sponsored by Bluestones Group, highlights that,
2017 report produced by the House of Commons Library, 87.7% have UK nationality, with 5.5% of non-British staff coming from the EU. The proportion of staff from EU countries other than the UK is higher when looking at nurses and doctors specifically. EU workers make up 7.4% of nurses and 1 in 10 NHS doctors are from the EU. Before the EU referendum, attraction and retention figures suggested the percentage of EU workers in the NHS was only set to increase. When looking at the numbers that joined the NHS in 2016, there was a higher proportion of doctors and nurses amongst the new joiners than the proportion already in the NHS. 15% of new NHS nurses in 2016 were from the EU and 13% of new NHS doctors. Across the NHS, British workers were leaving at a higher rate than they were joining in 2016; the
ACCORDING TO AN APRIL 2017 REPORT PRODUCED BY THE HOUSE OF COMMONS LIBRARY, OF NHS STAFF 87.7% HAVE UK NATIONALITY, WITH 5.5% OF NON-BRITISH STAFF COMING FROM THE EU
percentage of current staff leaving who were British was higher than the percentage of new joiners who were British, while the opposite was true for EU nationals. However, the EU referendum result and the subsequent fallout may end up pushing down the number of EU workers joining and staying in the NHS. A survey of doctors from the EEA by the General Medical Council found that over half were considering leaving the UK at some point in the future because of the UK’s decision to leave the EU. Due to a combination of new English language testing and the ‘Brexit’ effect, the number of EU nurses registered with the Nursing and Midwifery
Figure 1. Average monthly NDR/NFI per employee and fee earner (£ and %) for the median recruiter, years to February 2016 and 2017
■ Year to Feb 2016 ■ Year to Feb 2017 120,000 24.7%
60,000 40,000 20,000 0 NDR per employee
when taken as a measure across all employees, the NDR/NFI/GP percentage rose from 24.7% to 26.7% year-on-year. When looking at the
NDR per fee earner
performance of fee earners in isolation, the percentage rose from 27.1% to 27.4%. As to what extent this improvement in NDR/NFI percentage was achieved
THERE WAS A HIGHER PROPORTION OF DOCTORS AND NURSES AMONGST THE NEW JOINERS IN 2016, THAN THE PROPORTION ALREADY IN THE NHS
OF NEW NHS NURSES IN 2016 WERE FROM THE EU AND
OF NEW NHS DOCTORS
Council dropped between September and December of 2016; in the six years prior to 2016 there had been a double digit percentage rises. As well as a potential drop in the availability of EU medical staff, there was a 23% drop this year in the number of students in England applying to study nursing after the NHS bursary was abolished. Whoever forms the next government will need to ensure both immigration and domestic policy allows the NHS to recruit the staff it needs.
by trimming headcount in line with declining sales, headcount growth for the median recruiter slowed dramatically during 2017, moved into negative territory in Q4, before returning to marginal yearon-year growth in early 2017. Belinda Johnson runs employment research consultancy Worklab, and is associate knowledge & insight director of Recruitment Industry Benchmarking (RIB) – part of the Bluestones Group. The RIB Index provides bespoke confidential reports on industry benchmarks and trends. See www.ribindex. com; firstname.lastname@example.org: 020 8544 9807. The RIB is a strategic partner of the REC.
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BIG TALKING POINT
WITH THE GENERAL ELECTION LOOMING, RECRUITMENT MATTERS ASKS: WHAT DOES THE REC WANT TO SEE FROM THE NEXT GOVERNMENT? Although slightly unexpected, the general election on 8 June offers us an unrivalled opportunity to engage with and influence the political landscape on behalf of the recruitment industry. It’s never easy, but we have one clear advantage in our locker: our ability to do business as an industry has a fundamental impact on the labour market. And it is jobs that transform lives and economies. The UK jobs market is currently riding high, with more people in work than
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ever before. But there are a series of unknowns on the horizon that could impact this in the near to long term, and that the next government will have to take very
seriously. The most obvious of which is what sort of Brexit deal will the politicians be able to negotiate? This will influence not only future trading conditions but also our ability to access people and talent. At the REC, we have set out our ‘asks’ of the next government, whatever its political persuasion, in an updated ‘Manifesto for Jobs’. We believe the government’s ambition should be nothing short of building the best jobs market in the world.
GIVE EVERYONE THE CHANCE TO SUCCEED THROUGH WORK It is individuals who make our businesses thrive, so the first building block of creating the best jobs market in the world should be how we give everyone the chance to succeed through work.
To do this, we need an education system that really supports young people to understand the world of work. We think the government should ensure that there is enough time, space and resource in the school curriculum for careers advice and employability sessions, and all young people should be given work experience. Careers advice shouldn’t stop the moment we leave fulltime education, especially as there is no such thing as a ‘job for life’ anymore. Recruiters frequently cite labour and skills shortages as the biggest barrier to finding talent and so we need a government that is committed to social mobility by developing inclusive hiring practice. And if the government is truly serious about getting more employers to invest in training, then they have to look at reforming the Apprenticeship Levy so it can be used to train the growing number of people who choose to work as a temp, contractor or freelancer.
by industry experts, rather than Whitehall mandarins. A broad cross-section of industry representatives should be brought together in an advisory committee that reflects the dynamics of today’s modern labour market. In particular, we would like government to consider the needs of our flexible labour market. Theresa May’s government made a start by commissioning Matthew Taylor’s Review into Modern Employment Practices, but if they really want to get to grips with the labour market, they have to start with our tax system. It is unlikely but due consideration has to be given to revising how income tax and national insurance contributions are collected, and a brave government would look at root and branch reform rather than more tweaks, which can have several unintended consequences. If you need evidence of this – just look at the successive reforms to IR35 and we would argue it still isn’t fit for purpose.
DRIVE BUSINESS GROWTH THROUGH SKILLS
BOOST LOCAL JOBS MARKETS THROUGH AN EFFECTIVE INDUSTRIAL STRATEGY
Changing workforce demographics and new technologies are already affecting the jobs market. This influence is likely to grow over the next Parliament. To address this, we want to see the next government commit to a comprehensive industrial and skills strategy that is not only informed by business but devised and led
An industrial strategy should consider not just different types of jobs and working, but the region in which those jobs are based. Talk of a ‘northern powerhouse’ and the potential for IndyRef2 in Scotland
are strong indicators of the importance of ‘place’. The next government should conduct a detailed review of how Local Enterprise Partnerships (LEPs) are currently delivering, and then task each region with delivering local industry and skills needs. Local politicians also have a role to play by actively championing good recruitment and inclusive hiring practices to improve workplace productivity. We also want to see the public sector play a leadership role by promoting good practice in their supply chains. We already have a strong partnership with Jobcentre Plus, and the next government should look to build on this to help local employers access the staff they need and local jobseekers access the jobs they want.
BOOST OVERSEAS OPPORTUNITIES AND MAINTAIN A STRONG GLOBAL VOICE ON LABOUR MARKET ISSUES Over the course of the Brexit negotiations, a focus for the next government must be to maintain the health of the UK jobs market and to ensure that the post-EU landscape is one in which both demand and supply of staff remains vibrant. Boosting opportunities for UK firms to export goods and deliver services
in overseas markets will further accelerate business growth and fuel UK job creation. To do this, the next government should work with the recruitment industry and business to test any proposals for new trade deals and replacing free movement. Shortly after the election, we will be publishing new, in-depth data analysis on how EU nationals participate in the UK labour market now and scenarios for a post-Brexit immigration system. Evidence like this should inform government’s approach to the Brexit negotiations and its next steps. Maintaining and enhancing a strong jobs market should be front and centre when it comes to each political party setting out their manifesto promises. And if they take on board the suggestions in our Manifesto for Jobs, they will have done just that. You can keep track of all the latest election news and what it means for recruiters by following the REC blog at www. rec.uk.com/ corporateblog
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RECRUITMENT AND THE ‘GIG ECONOMY’: WHAT HAVE WE LEARNT SO FAR? By Abena Darko – Legal Advisor Self-employment is on the rise. The government estimates that as much as 15% of the UK workforce is now self-employed and it is almost impossible to escape the increasing scrutiny of employment status and the so-called ‘gig economy’: the term used to capture the prevalence of shortterm, individual pieces of work or ‘gigs’ carried out by individuals, often on a selfemployed basis. For many, this type of work means freedom and flexibility – self-employed individuals can choose when and where to work and are not bound by minimum notice periods. But, unlike workers and employees, they are not subject to the National Minimum Wage and aren’t entitled to holiday pay, sick
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pay, statutory parental pay or leave, or to be automatically enrolled into a pension scheme. They also tend to pay less tax. The Work and Pensions Select Committee recently found in their report into employment status and the gig economy that many selfemployed individuals are being left exposed to exploitation and poor working conditions, albeit by a small number of businesses. These alternative methods of working, they say, could also strain the public purse by reducing tax revenue and creating an over-reliance by self-employed individuals on the welfare state in place of income through suitable employment. The report also identified that many of these self-employment contracts fail to stand up in court, as we
have already seen in recent months with successful legal challenges of employment status by Uber drivers and a Pimlico Plumber. What is clear from all this is that businesses and individuals need greater clarity and guidance from government. Perhaps politicians could take a cue from the recruitment sector? In contrast with other businesses, there are already clear rules in place for recruitment businesses that also provide flexible working solutions by engaging and supplying agency workers. By definition, an agency worker is someone who has a contract of employment or worker contract and who is supplied to work under a hirer’s supervision and direction; therefore, under existing legislation they
cannot be self-employed for tax or employment law purposes. Additionally recruitment businesses are required to agree terms with agency workers, which set out whether they are an employee under a contract of employment or a worker under a contract for services – there should be no ambiguity as to their employment status. Where the terms are not an accurate reflection of the working arrangements, they risk being challenged in court. That said, recruiters do need to be careful when it comes to engaging internal recruitment consultants on a ‘freelance’ basis. Recruiters typically perform their services personally and cannot substitute their services with that of another individual. They are often presented to clients as internal staff members and subjected to control. As such, they are unlikely to be classed as genuinely selfemployed. At the very least they are likely to be workers and could even be regarded as employees if there is an obligation for them to accept work, restrictions on their ability to work for other recruitment businesses at the same and a liability to face disciplinary action or other sanctions if they refuse work.
BEHIND THE SCENES AT THE INSTITUTE OF RECRUITMENT PROFESSIONALS
Daniel Saddi is the manager of Contact R&D/ Engineering at Redline Group
WHAT I KNOW The key thing in a recruiter’s toolkit Having met with Redline’s talent acquisition manager to discuss the ‘key attributes’ individuals require for the next phase of Redline’s growth, this question is fresh in my mind. I find that most managers look for ‘experienced’ recruiters because of their immediate knowledge to do the job. I tend to seek out a motivated attitude, intrinsic desire and true intent to succeed. Attitude is everything You can teach anyone how to recruit (almost!), but it’s impossible to teach them to be consistently optimist, to get in early or stay late to fulfil that promise you made. Once you have that mind-set, you are well positioned to learn that which gives others the perception you are ‘experienced’. Skill and will What I’m trying to describe is simply defined by Robin Fielder as skill and will. In order to be an effective recruiter you need to have a good mix of both. The skill to organise yourself in a highly complex multifaceted role, know what to say and when to say it, and the WILL to put in the hard yards and get back up when it all goes wrong. So whether it’s your first day in recruitment or you’re a seasoned pro, you’ll probably realise that the people you find inspiration from balance aptitude and attitude with ease.
“I TEND TO SEEK OUT A MOTIVATED ATTITUDE, INTRINSIC DESIRE AND TRUE INTENT TO SUCCEED”
Jamie King is OEM sales & marketing manager at Redline Group
Q&A What is your background? I came to technical recruitment from a background in management in the hospitality sector. I always had a natural affinity for sales and an ability with people that meant I could build rapport at all levels, I could empathise with the needs of client and candidate alike, and I could influence people from a position of knowledge. What challenges did you face? I won’t pretend to you that the concept of technical recruitment wasn’t daunting. I had no engineering background, no understanding of design or manufacturing methodology and frankly I was a bit of a dunce when it came to getting my head around why certain bits of technology even existed. How did you overcome that? I was tenacious in my approach. I told myself that I didn’t just need to understand technology to be good at my job – I genuinely wanted to know. I spoke to as many people as I could. Every conversation was like an hour in the classroom. I always had more questions. I always wanted to know more and I wanted to be recognised for that knowledge as an expert. What would you say to yourself on your first day? The most important message I would want to give myself on my first day is to relax a little! Recognise that while this job is hard work, it is hugely rewarding, and that it is just as important to enjoy it as it is to do well. It’s no real surprise to any of my colleagues, managers or directors that I started getting my best results when I took the pressure off myself and allowed myself to have some fun with it.
To keep up to date with everything the Institute of Recruitment Professionals is doing, please visit www.rec-irp.uk.com
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Products and training
TREC 2017 – WHAT’S NEW FOR 2017? The Talent, Recruitment and Employment Conference (TREC) takes place on 21 June in London. Recruitment Matters spoke to REC head of HR & projects Steve Othen about the agenda for this year WHAT’S DIFFERENT ABOUT TREC THIS YEAR? TREC is even bigger and better this year. In terms of keynotes, we are happy to welcome back Matthew Syed, as the feedback we got on his talk at last year’s event was phenomenal. The Good Recruitment Campaign now has more than 230 signatories, so it’s going to be great to meet with HR, talent acquisition and recruitment professionals from companies of all shapes, sizes and sectors.
WHAT HOT TOPICS ARE ON THIS YEAR’S AGENDA? We’re going to be talking about emerging talent (including apprenticeships), wellbeing, candidate experience, workforce
planning, flexible hiring, employer brand, social sourcing as so much more all under one roof. The other big thing about this year is that we will be launching our new research Getting it Right, which will be looking at how you can avoid the cost of bad recruitment. This report will be available free to all delegates on the day.
WHAT SETS TREC APART FROM OTHER HR CONFERENCES? The main thing that differentiates TREC is that it’s practitioner-led – which means the takeaways are real and practical, it’s engaging. This means you’ll get to have your say and have your questions answered. In addition, we
have a mix of established speakers and people that you rarely see speak anywhere else, which is a great balance.
WHO ARE YOU LOOKING FORWARD TO HEARING FROM? I am really looking forward to hearing from Dave Coplin (our second keynote) about technology. When we asked our GRC Advisory Panel for speaker recommendations, Dave was mentioned by at least three people, so we were delighted when we were able to arrange to get him to speak.
HOW CAN DELEGATES MAKE THE MOST OUT OF TREC? Choose your roundtable topics: With so much to
discuss on the day, make sure you chose your topics as early as possible to avoid disappointment. Network: TREC is the only time we bring the membership of REC and GRC together under one roof, make sure you make the most of it Engage: The big thing about TREC is the opportunity to engage, get involved in the conversations throughout the day to make sure you don’t go home without getting your questions answered Feedback: Every year we adapt TREC based on common feedback that we receive, make sure you complete the feedback forms so we can keep making the event even better Bring your clients: The topics at TREC not only allow you to hear client challenges first hand, but also allow you to bring clients to a truly relevant event at a great price. Plus, if they sign up to the GRC beforehand, they may be entitled to a free place too. There is still time to register for TREC 2017. Visit www.rec.uk.com/TREC17 or call 0207 009 2100 to book.
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The official magazine of The Recruitment & Employment Confederation Dorset House, 1st Floor, 27-45 Stamford Street, London SE1 9NT Tel: 020 7009 2100 www.rec.uk.com
© 2017 Recruitment Matters. Although every effort is made to ensure accuracy, neither REC, Redactive Publishing Ltd nor the authors can accept liability for errors or omissions. Views expressed in the magazine are not necessarily those of the REC or Redactive Publishing Ltd. No responsibility can be accepted for unsolicited manuscripts or transparencies. No reproduction in whole or part without written permission.
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