Recruiter - January 2017 by Redactive Media Group

Business intelligence for recruitment and resourcing professionals

24 8

8 73

61 8 5

www.recruiter.co.uk

8143 27 6

01_recruiter_January.indd 1

INCORPORATING Recruitment Matters

January 2017

4 9

6 5

41 0 1 2 3 35 4

836

3 4 2 95 1

05/12/2016 12:02

REC.01.17.002.indd 4

02/12/2016 11:23

C R ONT ENT S 44

ING PORAT INCOR itment ru c e R Matters

28 A

NEWS

05 HOT 1OO’s Productivity Top 20 sheds new insight

19 THE BIG STORY Recruiter’s HOT 1OO

This new ranking within the HOT 1OO shines a light on those firms that have made the most progress in the last 12 months 06 Improve management recruitment Recruiters need to up their game to ensure the right sort of managers are hired for today’s workplace 07 Energize stays in touch with maternity staff One recruiter’s strategy to keep hold of top talent while on maternity leave

2O16 is the official 1O-year anniversary of the chart revealing the UK’s most profitable recruitment firms

28 Stars in the legal firmament

32 Off-payroll rules: Shifting the liability What are the implications for recruitment agencies with the new tax reforms?

E COMMUNITY 37 38 42 43 44 48 49 50

TRENDS

12 Insight Resourcing departments the world over need to work harder and smarter

08-09

SSQ: the legal recruiter topping the HOT 1OO chart

07 Star recruit: Honey G, the rapping recruiter who was shown the exit on The X Factor 08 This was the month that was... 10 Contracts & Deals

FEATURES

Social Network Employability Business Advice Careers Will you survive the holiday party? My brilliant recruitment career: Matthew Grady Movers & Shakers Recruiter Contacts The Last Word: Gregory Allen

Tech & Tools Spreading the referrals

C 16 17

INTERACTION Agency View: Adrian Marlowe Soundbites

I M AG E S | A K I N FALO P E/P ETER SEA R LE/SH UTTER STO C K /IKO N

p03_recruiter_contents_JAN NEW.indd 3

WWW.RECRUITER.CO.UK 3

06/12/2016 15:11

REC.01.17.004.indd 4

02/12/2016 11:24

N E WS

UPDATE

WE LCO M E

LEADER

rom national crisis to international crises, 2016 has been a tornado of disruption and stormy momentum with barely a second to catch one’s breath. Positively speaking, Recruiter’s HOT

100 celebrates its 10-year anniversary of

Productivity Top 20 ranking offers new insight into HOT 100 BY COLIN COTTELL

recognising recruiters who stand for efficiency and well-managed businesses. Our amazing associate, Sue Dodd of Agile Intelligence, has keenly observed the decade of excellence by providing two bumper items for us this year – a Top 20 ranking of

“2016 hasn’t always shown recruitment at its best. We must publicly stand and act against exploitative practices”

recruitment companies achieving productivity growth and an extra 10 companies for our HOT 100 list to share the wealth a bit above and beyond. We know you’ll enjoy these additional gems! Our HOT 100/110

companies reﬂect much of what is best about our industry, however we cannot enter 2017 complacent about recruitment’s standing in the outside world. 2016 has not always shown recruitment at its best. As an industry, we must publicly stand and act against exploitative practices, or those practices will continue to deﬁne agencies – for the worst – in the eyes of the UK public and to policymakers. Our industry is, and must be, better than our image would suggest. After all, recruiters have arguably the world’s most meaningful work, of matching people of all abilities and skills with their most vital asset – a job.

DeeDee Doke, Editor

THIS YEAR’S RECRUITER HOT 100 is supplemented by a new ranking, which provides valuable additional insight into the UK’s most profitable and productive staffing companies. The Productivity Growth Top 20, ranks the top 20 UK staffing companies by growth in gross profit (GP), or net fee income per head, when compared to the previous year (see table below). Sue Dodd, director of Agile Intelligence, who compiled both the HOT 100 and the Productivity Top 20, told Recruiter that productivity growth “is a good indicator that a staffing business is really doing something to improve their business”. Dodd advised that long-term membership of the HOT 100, when used in tandem with this new data on productivity growth produced a more complete picture. “Not only Green Park Interim & Executive 40.6% does it give us an insight into the companies that have stayed at the First Call Contract Services 30.3% top consistently, but it also gives us Falcon Green Personnel 28.3% insight into new entrants and those Angela Mortimer 25.2% with evolving business models or Rullion IT Plus 21.2% successful efficiency programmes,” she explained. Cognitive Group 18.7% The top-ranked company in the Forrest Recruitment 18.5% Productivity Growth Top 20 is Green PSR 17.8% Park Interim & Executive Search. Permanent Futures 16.8% The company saw a 40.6% growth Experis 16.2% in productivity with each employee delivering GP of more than £183k, SystemsAccountants 15.8% up from last year’s figure of £130k. Henderson Scott 15.7% In addition to showing the highest Redrock Consulting 15.5% productivity growth, Green Park Randstad Technologies 14.8% Interim & Executive Search ranked second in the HOT 100 overall. WA Consultants 13.5% Second in the Productivity RIG Medical Recruit 13.3% Growth Top 20 is First Call Contract The Bridge (IT Recruitment) 13.3% Services, which saw its GP per head Minstrell Recruitment 13.3% rise by 30.3%. First Call Contract Services is a newcomer to the HOT Resource Solutions Group 12.7% 100, ranking 56th overall. ● Jenrick Engineering 12.3%

WWW.RECRUITER.CO.UK ECRUITE UK K 5

p05_07_recruiter_news.indd 5

06/12/2016 15:20

NE WS

UPDATE

33,274 FOLLOWERS AS OF 6 DECEMBER 2016

Improve recruitment of managers, says Cooper BY COLIN COTTELL

ONE OF THE WORLD’S FOREMOST business gurus has challenged recruiters to up their game by selecting managers who are better suited to today’s “people problem era” of work. Professor Cary Cooper, president of the Chartered Institute of Personnel and Development, and professor of organisational psychology and health at Manchester Business School, told HR and recruiting professionals attending the Richmond Human Resources Forum in London last month, “it is up to you guys” to ensure the right sort of managers are selected for today’s insecure, fast-moving, highstress, heavy workload environment, in which relationships and how people are managed are “fundamental”. “I don’t think we do a good enough job in the way we assess these people over a period of time to know what they are like,” said Cooper. “As a profession, we need to do more to improve the way we recruit for managerial roles.” Cooper said there was a tendency to select managers on the basis of what they had contributed to the bottom line in their previous job rather than their social and interpersonal skills and their EQ (emotional quotient). “Something is going wrong with who we are recruiting,” said Cooper. When faced with the choice of a manager “who had contributed a bit more” [to the bottom line] and another who had “great EQ and interpersonal skills … let’s take [the latter] person”, he said.

6 RECRUITER

p05_07_recruiter_news.indd 6

JANUARY 2017

Selecting the right kind of managers is vital

“We need to do more to improve the way we recruit for managerial roles”

Cooper said that selecting line managers on this basis was vital if organisations are to raise productivity, an issue on which the government is also focusing its attention. “Who can enhance

or detract from productivity? It’s the line manager,” he said. John Kempton, director of HR at Birkbeck College University College, one of the delegates at the forum, told Recruiter that while he agreed with Cooper, ﬁnding managers with the social and interpersonal skills was a challenge. “We are all ﬁshing from the same pond for that group,” he said. “There needs to be a recognition that we are unlikely to get a manager with that fully formed skill set. There needs to be more attention given to managers’ ongoing professional development, as well their induction and probation,” said Kempton. ●

Find more daily news stories at recruiter.co.uk/news 06/12/2016 15:15

N E WS

THOUGHTS FROM…

FR ANCES O’GR ADY GENER AL SECRETARY, TUC

“The Swedish derogation [of the Agency Workers Regulations] is a bloody big loophole!”

PROFESSOR CARY COOPER B USINESS GU RU AND CIPD PRESIDENT

H E A DS H OT S | S AM KEST EVEN/PET ER SEARLE

“No one’s job is secure. We are all contingency workers.”

WAHEED NAZIR STR ATEGIC DIREC TOR – ECONOMY, BIRMINGHAM CITY COUNCIL

“[The issue of] skills is the one thing that keeps me awake at night”

IM AG E SYCO

STA R RECRUIT BEN WHITFIELD, DIRECTOR AT FRESH PARTNERSHIP, ADVISES ASPIRING RAPPER HONEY G TO FACTOR IN SOME CHANGES BEFORE COMING BACK TO RECRUITMENT As Honey G’s tortuous run on the X Factor finally comes to its inevitable end, it’s time to weigh up her options for re-entering the job market. Ms G’s divisive performances on the show suggest, despite a degree in “popular music and

UPDATE

Energize unveils plan to keep maternity recruits in touch BY GRAHAM SIMONS

ENERGIZE RECRUITMENT SOLUTIONS has introduced a flexible communication plan for women on maternity leave aimed at helping the IT & digital recruiter keep hold of its top talent. Speaking to Recruiter, Energize’s learning and IM AGE | ISTOCK development manager Clair Staines said a plan was developed for one of the firm’s consultants who returned to work in September. Staines explained the firm did not want to put the consultant under any extra pressure when she was on maternity leave but kept in touch with her so she felt integrated with the business and up to date with company news, while she was also invited to all of the firm’s social events. The plan was developed to retain top talent when on maternity leave, as well as to offer support tailored around their specific needs. Staines added the consultant in question is being eased back to work at the moment on a 20-hour working week trial basis. “We want to ensure her return doesn’t put any pressure on her because it’s about the long-term growth, not just about ‘well you’ve had your maternity – get back to work’,” said Staines. This approach applies equally to fathers who benefit from flexible working hours, while all members of staff, regardless of whether they have children, benefit from flexible working if required, Staines said. “We make sure that when anyone joins us here that recording”, that her future Perhaps a new career in they are looking at may not lie in pop super tennis coaching beckons. stardom. Novak Djokovic’s a career rather than A return to the industry relationship with Boris a stopgap,” Staines for the former IT recruiter, Becker must surely be where talent is in short under strain after a poor added. “Anyone who supply and where an run at the end of the outgoing personality year. joins our business, I and sense of honour is After all, she was a want them to be here encouraged, could well be former tennis champion on the cards. – and already owns for as long as they I would, however, have a glittering array of want to be here – so to recommend she tones tracksuits – so it wouldn’t downs her dress code; ‘Ali require a new wardrobe. we work in a flexible G in drag’ is not always My main words of way to meet their the best first impression at advice – don’t be a hater, interview. keep it real. demands as well.” ● WWW.RECRUITER.CO.UK 7

p05_07_recruiter_news.indd 7

06/12/2016 15:16

NE WS

THIS WAS THE MONTH THAT WAS… Here is a round-up of some of the most popular news stories we have brought you on recruiter.co.uk since the December issue of Recruiter was published N O V E M B E R •‒‒‒‒‒‒‒‒‒‒→

W E D, 1 6 N O V 2 0 1 6

FRI, 25 NOV 2016

RECRUITERS WARNED AGAINST TAX AVOIDANCE MODELS FOLLOWING RISE IN SUCH SCHEMES

REC TO TAKE NO FURTHER ACTION OVER TRANSLINE

The Guardian claims there has been a spike since last April in the number of firms marketing tax schemes that exploit VAT rules originally designed to benefit very small businesses. The spike coincides with the timing of the government’s closure of a different tax avoidance scheme widely used by the recruitment sector. The newspaper went on to claim it has identified a number of temporary recruitment agencies that have been using the scheme, which it referred to as aggressive tax avoidance, to make what it calls “large windfalls” through contrived finance arrangements. The paper’s undercover footage shows Patrick Griffin of Premier Payco, a provider of the schemes, outlining how workers’ contracts are being transferred from a single recruitment agency into a web of thousands of tiny companies that benefit from the tax breaks. As each mini employment company created in these schemes employs only two or three workers, the taxes it is required to pay on its wage bill are small. That small tax bill can be effectively eradicated by each mini company claiming a £3k government subsidy – the Employment Allowance – which was designed to help very small businesses create additional jobs or increase wages. More: http://bit.ly/2gCLM5D

8 RECRUITER

p8_9_the month that was.indd 8

JANUARY 2017

→‒‒‒‒‒•

A NUMBER OF TEMPORARY RECRUITMENT AGENCIES HAVE BEEN USING THE SCHEME, WHICH IT REFERRED TO AS AGGRESSIVE TAX AVOIDANCE

The Recruitment & Employment Confederation (REC) has completed its investigation into industrial recruiter Transline supplying workers without a Gangmasters Licensing Authority (GLA) licence, and its failure to pay National Minimum Wage to agency workers at Sports Direct’s Shirebrook warehouse, and will take no further action. REC said that by supplying workers without a GLA licence for two months in 2013, Transline had breached the REC Code of Professional Practice, as well as GLA licensing conditions. However, it said it had taken into account the fact that the GLA chose not to prosecute Transline, and was satisﬁed with evidence showing that this was “an unintentional mistake”. REC said it also accepted that nonpayment of NMW to agency workers, when security searches were carried out at the end of shifts at the Shirebrook warehouse, was an “oversight”. “In light of the evidence and Transline’s commitments to properly correct the errors made, and having found no further breaches of the Code, the REC has closed its investigation,” the statement went on to say. More: http://bit.ly/2gpLDVE

TUE, 29 NOV 2016

CONFIDENCE IS THE X FACTOR FOR HONEY G AND FORMER RECRUITER OLLY MURS The confidence gained in her recruitment career, as well as her love of music, will stand Honey G in good stead following her exit from this year’s X Factor, according to the ex-recruitment boss of a fellow famous former contestant on the TV talent show. It turns out Honey G, the alter ego of Anna Georgette Gilford, managing director of recruitment firm ARG Search, isn’t the only recruitment consultant to have appeared on the TV talent show. Olly Murs, who finished runner-up in the 2009 X Factor competition, previously worked for Witham-based recruitment agency Prime Appointments. On the similarities between Murs and music graduate Honey G, Robyn Holmes, MD at Prime Appointments, pointed towards a love of music and the confidence needed to be a successful recruiter. “Olly worked for us for four years. He went off travelling and then carried on temping for us while he was doing the X Factor. “Personality-wise he was so confident. He always loved his music. Olly would be running around our office with headphones when he went out to lunch.” And Holmes adds Murs hasn’t forgotten his roots in recruitment. “He still pops in, so we keep in contact with him regularly – he nips into the office whenever he’s home.” More: http://bit.ly/2gK2fYA

IM AGES | GET T Y/REX/SWNS/A L AM Y

06/12/2016 11:09

FRI, 2 DEC 2016

Pensioner Joe ‘storms’ interview and lands café job P A 89-year-old jobseeker has “stormed” his interview at a Devonshire café. Joe An B Bartley, from Paignton, Devon, placed an advert in local paper Herald Express a asking for work, claiming he was bored being retired. The owner of the Cantina K Kitchen & Bar had invited Joe to an interview. Updating Recruiter, café owner Kate A Allen said Joe had done really well and was being offered a customer-facing role. ““He stormed it. He charmed everybody, he was lovely. He’s so good with people.” More: http://bit.ly/2fZNQXl

DAYS

←‒‒‒‒‒‒‒‒‒‒• D E C E M B E R

T H U, 1 D E C 2 0 1 6

FRI, 2 DEC 2016

MON, 5 DEC 2015

EU WORKERS STILL ATTRACTED TO THE UK, DESPITE BREXIT

MUCK FINDS NEW TEACHER FOLLOWING SOCIAL MEDIA RECRUITMENT CAMPAIGN

AGENCY WORK ‘CREATES REGIME OF FEAR AND UNCERTAINTY’ SAYS TUC’S O’GRADY

The UK’s vote to leave the European Union does not appear to have adversely affected the volume of EU workers coming to the UK, according to official ﬁgures published today. The government’s migration statistics, released this morning, reveals National Insurance number registrations to EU nationals rose

The remote Hebridean island of Muck has appointed a teacher for its primary school following a successful social media campaign. Last year, Recruiter reported how the tiny remote island had been having trouble recruiting a teacher for the start of the new term. So parents on the 2.2 sq mile island, home to just 61 people, launched their own online search for someone with a love of the outdoors who can cope with the ‘unique’ lifestyle this Scottish island has to offer. The island’s recruitment travails even caused recruitment giant Randstad to offer its services for free to help in the search for a new teacher. New teacher Laura Marriner has now taken up the post, leaving her job with Hampshire County Council and moving with her husband and two young sons to the island. More: http://bit.ly/2fSGbqf

→‒‒‒‒‒•

THE ISLAND’S RECRUITMENT TRAVAILS EVEN CAUSED RECRUITMENT GIANT RANDSTAD TO OFFER ITS SERVICES FOR FREE TO HELP IN THE SEARCH FOR A NEW TEACHER

More: http://bit.ly/2fNTQ6K

Find more daily news stories at recruiter.co.uk/news p8_9_the month that was.indd 9

More: http://bit.ly/2h6wtBN

→‒‒‒‒‒•

to 150,468 in the three months following the UK’s vote to leave the EU in June, up from 140,530 in April-June 2016. Further analysis of the data by law ﬁrm Laura Devine Solicitors shows applications for permanent residence from European Economic Area (EEA) citizens living and working in the UK rose 83% in the two quarters bracketing the EU referendum when compared to the preceding six months.

The Resolution Foundation, an organisation which campaigns on issues around low pay, has launched an 18-month investigation into agency workers. At a London launch event, attended by Recruiter, Lindsay Judge, the think tank’s senior policy analyst, outlined initial foundation research that included ethnic minorities are three times more likely to be agency workers than white workers, and one in 10 of EU accession states and Eastern European-born workers is an agency worker. Judge said the research aims to understand the motivations of agency workers in doing agency work and also to understand why businesses use them and what agencies offer the agency worker. In addition to Judge, speakers at the launch included Iain Wright, MP; Frances O’Grady, general secretary, of the TUC; and Kevin Green, CEO of the Recruitment & Employment Confederation (REC). O’Grady said the time had come for a spotlight on agency work to focus on the question of “What does it take to create a fair jobs market?” She referred to agency work as “creating a regime of fear and uncertainty”.

ETHNIC MINORITIES ARE THREE TIMES MORE LIKELY TO BE AGENCY WORKERS THAN WHITE WORKERS WWW.RECRUITER.CO.UK 9

06/12/2016 11:10

£3.1m

NE WS

CONTRACTS

WAS THE AMOUNT OF OPERATING PROFIT MADE BY OPP, THE TALENT SOLUTIONS FIRM ACQUIRED BY CPP

CONTRACTS & DEALS Harrier Human Capital Talent management business Harrier Human Capital has acquired a majority stake in Oceans Group, an executive search organisation based in Sydney and Singapore. Established in 2010, Oceans Group provides executive search solutions across Australia, Asia and Europe through more than 30 search consultants. Led by Sean Garvey and Andrew Wood, Oceans Group now forms an independent subsidiary entity of Harrier.

ManpowerGroup Global recruiter ManpowerGroup has partnered with LearnUp, a career management platform that provides pre-hire skills development and virtual coaching for entry-level workers. The two firms will work together to help these workers find roles, while providing coaching and developing their skills.

CPP CPP, the exclusive publisher of the Myers-Briggs Type Indicator assessments, has acquired European independent provider of business psychology & talent solutions OPP. CPP revealed it plans to create an internationally recognised brand umbrella for its expanding line of products and services, which includes psychometric assessments. Mergers & acquisitions advisory house Boxington Corporate Finance completed the sale. Deal price was not disclosed. For the year ending 31 December 2015, OPP made an unadjusted statutory operating profit of £3.1m.

The Curve Group Recruitment and HR outsourcing company The Curve Group has been appointed as the exclusive HR outsource provider to event and exhibition organisers mclcreate. The deal sees The Curve Group work on all aspects of HR and the employee lifecycle from defining the people strategy to recruitment and selection; onboarding; learning and development; engagement; reward and organisational design.

TribePad Talent acquisition software specialist TribePad has been awarded a place on the Crown Commercial Service’s (CCS) G Cloud 8 framework for its candidate management system. The CCS works with public sector departments and organisations to ensure maximum value is extracted from every commercial relationship and to improve quality of service delivery.

DEAL OF THE MONTH

People Solutions Group Commercial, manufacturing, driving and warehousing staffing specialist People Solutions Group (PSG) has acquired two divisions of Midlands-based Flex Recruitment Plus. The divisions will become a part of Midland Personnel, a subsidiary of PSG. With 15 offices across

the Midlands, South-West, North-West, Yorkshire and Scotland, PSG has expanded its operations with Flex Recruitment’s OnDemand and OnSite divisions. OnDemand places temporary workers into the office support, logistics and warehousing sectors. OnSite supports businesses,

which use large numbers of flexible, temporary staff for long periods of contracted employment, delivering staffing solutions such as recruitment, management support and training. The divisions’ management team will now work with PSG to support their continued growth.

ZW HR Consulting China-based mid-senior level and leadership recruiter ZW HR Consulting has acquired HR consultancy Intelligent Manpower Corporation (IMC). IMC is based in Taipei, Taiwan, with seven offices across Greater China.

Chartered Management Institute The Chartered Management Institute (CMI) has signed the Armed Forces Covenant giving family members of Service personnel, who are CMI members, greater access to civilian skills and career development. The agreement is an extension of the career support that family members and former members of the armed forces currently receive through the partnership with CMI to develop management and leadership skills including access to professional qualifications, CV help and interview advice, and CMI’s online learning portal ManagementDirect.

Cornerstone Italian luxury menswear brand Canali is implementing cloud-based human capital management software provider Cornerstone OnDemand’s unified talent management suite to recruit, develop and manage its staff. The deal sees Cornerstone provide Canali with advanced technology for designing a talent management solution through the suite enabling it to find the right talent, train new hires, engage new employees with a targeted learning and development experience, as well as provide continuous performance feedback and reward top performers.

SP O NSO RE D BY

N° 1 QUALITY 10 RECRUITER

p10 contract deals.indd 10

JANUARY 2017

Financial & administrative support as affirmed by our award-winning clients

01 260 280 290 www.backofficesupportservices.co.uk

More contract news at recruiter.co.uk/news 06/12/2016 11:24

Payroll â&#x20AC;˘ Credit Control â&#x20AC;˘ Invoicing â&#x20AC;˘ 100% Funding â&#x20AC;˘ Debt Protection

ITâ&#x20AC;&#x2122;S THE NEW YEAR

AND EVERYONE IS TALKING ABOUT... ...MAKING THE SWITCH TO BACK OFFICE SUPPORT SERVICES!

â&#x20AC;&#x153;Since returning to Back Office we have truly realised just how fantastic their customer support is and how good they are with our clients. We really couldnâ&#x20AC;&#x2122;t recommend them enough.â&#x20AC;? &UDLJ /LOO\ 'LUHFWRU 3HUIHFW 3HUVRQQHO /WG

,I SRRU VHUYLFH LV DIIHFWLQJ \RX DQG \RXU EXVLQHVV Â˝QG RXW KRZ HDV\ LW LV WR VZLWFK WR RXU RXWVWDQGLQJ EDFN RIÂ˝FH VHUYLFH &DOO XV QRZ RQ 01 260 280 290

ZZZ EDFNRIÂ˝FHVXSSRUWVHUYLFHV FR XN REC.01.17.011.indd 11

02/12/2016 11:25

TRE NDS

INSIGHT

WORKING HARDER AND SMARTER Resourcing departments must focus on activities that bring the best results, according to a global survey of HR and resourcing managers. Colin Cottell looks at the findings

lack of resource and ﬁerce competition for the best talent is not the ideal scenario for resourcing departments. However, even in this tough environment LinkedIn’s Global Recruiting Trends 2017 report suggests those departments do have options available to improve their performance. The survey of nearly 4,000 HR and resourcing managers and executives across 35 countries by the professional networking platform argues that resourcing departments should focus their attention on activities that bring the best results. The report draws a distinction between budget being spent on responding to short-term needs “and long-term strategic plays” like branding, tools, the candidate experience and upskilling their teams. With 56% of respondents expecting an increase in hiring volumes, but only 52% expecting an increase in budgets, the report highlights the pressure on resourcing and HR departments to spend every pound or dollar effectively. But despite more than a third (35%) of respondents saying a limited budget was a big concern, the report recognises that simply increasing the size of resourcing and HR teams to cope with the extra workload is unlikely to be an option. Indeed, 61% of respondents forecast no change in the size of their team over the next 12 months. The pressure on those staff to work

12 RECRUITER

JANAURY 2017

p12_13_recruiter_InsightNEW.indd 12

smarter is accentuated by a labour market that continues to be ﬁercely competitive, particularly in sales, operations and engineering, with 57% of respondents saying competition for talent is their biggest challenge.

Focus those budgets Although the report recognises the size of resourcing department budgets is a concern, it suggests that resourcing teams don’t always spend their existing budget as effectively as they might, with a preference for spending it in traditional but relatively unproductive ways, such as job boards/advertising and recruitment agencies. One area of activity that doesn’t get the resources it deserves is employee referrals, says the report. Despite being ranked number one channel (by 48% of

respondents) for providing quality hires, employee referrals are allocated only 9% of resourcing departments’ budgets. According to the report, “referred employees are faster to hire, perform better and stay longer in the company”. It’s a similar story with employer branding, where despite 80% of talent leaders agreeing that “the employer brand has a signiﬁcant impact on their ability to hire great talent”, employer branding receives only 8% of departmental budgets. “One reason for this paradox is that employer branding ROI [return on investment] is hard to measure and most teams cannot show a direct correlation between a stronger candidate pipeline and their branding efforts,” explains the report, implying that this is a prerequisite for releasing the purse strings for this area of activity.

Culture and values

Referred employees are faster to hire, perform better and stay longer in the company

Based on the ﬁndings of LinkedIn’s Talent Trends 2016 Report, the Global Recruiting Trends report goes on to suggest that when differentiating your organisation from the competition in the minds of candidates, culture and values are key, followed by beneﬁts and perks. However, it cautions that focusing your employer branding on these aspects of your organisation won’t

IMAG E | IKON

06/12/2016 09:10

POWER POINTS: BETTER HIRING

be sufficient on its own to persuade candidates to take the ﬁnal step of accepting your job offer. Opportunities for career advancement and challenging work are key factors in swaying candidates’ decisions, it says. “This is a great reminder that your employer branding message should vary, depending on the priority of your audience,” says the report. With the pressure on resourcing departments to do more with less likely to continue, the report identiﬁes automation as a future trend. “Automation would increase the speed of screening candidates, minimise human bias and help assess soft skills more precisely,” it says. Diversity and organisational purpose will also become increasingly important ways for organisations to differentiate themselves from their competitors. The use of big data especially among large organisations is another trend. ●

1 2 3 4 5 6

Length of time new hires stay at the company, time to hire and hiring manager satisfaction are the top three ways recruiters measure their success More than 83% of talent leaders say talent is the number one priority in their organisation Almost 70% of recruiting budgets are spent on job boards, recruiting tools and staffing agencies Talent leaders identify employer branding as the number one area where they wish they could invest more However, more budget is unlikely to be provided for employer branding until there is more evidence to show it delivers a return on that investment Company culture, career growth and challenging work are vital aspects of successful employer branding

WWW.RECRUITER.CO.UK 13

p12_13_recruiter_InsightNEW.indd 13

06/12/2016 09:11

How’s your sales pipeline looking?

Eploy’s Opportunity Management software helps modern recruitment teams get new jobs on quicker, and market FDQGLGDWHV PRUH H΍ HFWLYHO\. Now you can propel your opportunities forward through visual GUDJ DQG GURS SLSHOLQHV Guide your sales team to success with Eploy.

eploy.co.uk/opps

REC.01.17.014.indd 14

06/12/2016 09:18

T R E N DS

TECH & TOOLS

Spreading the word Making the most of your referrals SUE WEEKES

Recruiters have more tools and technologies than ever to put together an effective referral programme. Dan Kirkland, head of operations at applicant tracking software (ATS) developer TribePad, recently listened to a talk on social media by the Manchester United group managing director Richard Arnold, who said the club could reach more than 1bn people through 12 channels. “Although this is an extreme, if you ever needed to be convinced by the power of social media [for referrals], this is a great example,” says Kirkland. Referrals can reduce recruitment costs and convert to great hires but Kirstie Kelly, director of strategic operations at recruitment technology ﬁrm LaunchPad Recruits, says she struggles to think of an organisation that has got their scheme “working like” magic. “Not all employees have evolved their thinking about how to ﬁnd great talent,” she says. “Some don’t even share their internal vacancies with employees.”

F IVE KEY POINTS

➊ SOCIAL UPS AND DOWNS There is no doubt that social media can bring scale to a referral programme. Kirkland says employers should enable staff to use their social media accounts to spread the word and share jobs – ensure the ATS supports social sharing. He warns that social media can also dilute the quality of referrals. Historically, a referral was a direct and close contact of the referrer but with some having thousands of connections, sharing a job with an entire network could unwittingly encourage lower quality candidates to apply. Kirkland recommends looking at more advanced platforms that allow staff to share jobs only with relevant connections. “So they may compare your staff members’ connections with the job specification and only share the advert with connections that are a good match,” he says.

I L L UST RAT I O N | SH UTTER STO C K

p15_recruiter_techandtools.indd 15

➋ AUTOMATED

ASSESSMENT AND MATCHING Consider building assessment technology into the programme. Kelly says this will reassure employers who are still nervous that referred candidates may expect to “buck the system”. “Employers sometimes fear that they have to meet someone who may turn out to be a poorly qualified candidate.” Kirkland adds that automated matching software is also likely to feature in more referral programmes in the future, which could suggest relevant matches. “Prioritised not just by skillset but also by how many ways they are connected to that person,” he says, explaining that algorithms could analyse the level of contact between two people to determine how close a contact they are. He adds that software could also assess emotional intelligence, personality and sociability as an indicator of how well they would fit in.

➌ TECHNOLOGY OPTIONS

➍ INCENTIVISE

➎ COMMUNICATION

Explore what functionality and scope your existing ATS offers for referrals and talk to your provider. There are also dedicated employee referral systems (see below) that make it easier to implement and automate a programme, and that can integrate with an ATS, as well as social media channels. Kelly says that while such tools can be of great practical help, they are also good for selling the benefits of a referral scheme. “Some have a point-scoring system so an employee can measure themselves against a peer in terms of the number of referrals and the cash value associated with them,” she says.

Traditionally, a referral which converts into a successful hire results in a cash reward for the referrer but Kelly suggests this isn’t necessarily required. “Some people believe peer-to-peer recognition is more important,” she says. Kirkland suggests considering tools to gamify the referral system and to offer a range of incentives. He warns that any rewards must be tracked: “If your tool doesn’t support tracking then you will be fending off disputes from your staff, arguing that they referred a hire and you owe them a reward. So tracking is key in your incentivised referral schemes.”

Employers must accompany their referral system with an effective communications strategy. Employees should understand exactly how it works and the proposition for them. “Ensure the process doesn’t fall flat. Keep reminding people it is there and champion it,” says Kelly. “Remember it is a marketing exercise, too. Businesses that put a true marketing skillset into recruitment are the ones that will succeed in the future.”

AND REWARD

AND MARKETING

E M P LOYE E R E FE R R AL SO FTWAR E Systems such as Zao and Zalp are designed to make it easier to implement and automate a referral system. As well as integration with an ATS and social media, the more advanced platforms will provide the ability to gamify your referral process, conduct quick and easy email campaigns, match referrals to roles and track and analyse referral activity. WWW.RECRUITER.CO.UK 15

06/12/2016 09:12

INTE R AC TIO N

VIEWPOINT

Modernisation and the gig economy Lessons from Uber BY ADRIAN MARLOWE

essons can be learned from the Uber taxi case, in which the Employment Tribunal decided that drivers have worker rights, despite Uber’s best efforts to maintain that they were self-employed. Documentation alone cannot determine the legal relationship. As is usual in these cases, the Tribunal conducted a reality check as well as reviewing the contractual terms. In the tax world this was eventually the approach under IR35, where substitution clauses, once seen by some as the cornerstone of ‘outside IR35 status’, have little impact on their own, although it took HM Revenue & Customs a while to establish the point. There is an old adage: ‘If it looks too good to be true, then it probably is.’ Uber appears to be a great model. However, it relies upon passengers using the app to pay Uber, not the driver. Uber then pays the driver gross. Most people prefer to be paid gross, so it is an excellent way for Uber to attract drivers and save on employer National Income Contributions (NICs) too. Would this work if Uber had to operate PAYE? Unsurprisingly, in all of these Uber-style models the worker must be ‘self-employed’, as direct payment gross to the worker is an essential feature. However, genuine self-employed individuals are normally ‘in business’; clearly these Uber drivers were not. The aim of a business is to make a proﬁt, but here the idea of proﬁt rather than pay just doesn’t stack up. Although they have

+ ADRIAN MARLOWE Chairman Association of Recruitment Consultancies (ARC)

16 RECRUITER

JANUARY 2017

p16_17_recruiter_agency_soapbox.indd 16

There is an old adage: ‘If it looks too good to be true, then it probably is’

overheads to meet, the drivers provide personal services. Also, is it realistic to believe that Uber has no obligation to provide work, and that no one exercises any direction, supervision or control? This tri-partite model – Uber/customer/driver – appears novel, but is it? Of course, the technology makes it look new and fresh; modern ‘ﬂexible labour’ lifestyle choices add to the allure. However, turn the clock back 40 years. Similar gross pay, tri-partite arrangements existed, namely temp worker supply. If for ‘Uber’ you read ‘agency’, for ‘driver’ you read ‘worker’, for ‘passenger’ you read ‘hirer’, you can see that Uber is essentially a supply agency, and the agency tax rules, which originated in the 1970s and were last updated in 2014, squarely apply. As ‘workers’, these drivers have basic statutory rights, such as holiday and sick pay. This must cost Uber, not least in administration, as they reportedly have 40,000 drivers on their books. However, what if HMRC decides that Uber is nothing more than a clever agency operator engaged in tax avoidance? Will HMRC enforce the agency tax rules and seek the back tax and NICs? What about next year’s Apprenticeship Levy? Could it be curtains for Uber? Just because Uber has achieved phenomenal success, it doesn’t mean that technology is the answer to everything. Gig is currently being considered within two industry reviews. If, as a result, new methods are to be carved out with special rules in the name of modernisation, to avoid ‘curtains for Uber’, then let us in the recruitment industry have some special treatment too. After all, we invented the ﬂexible workforce, and it is hard-working, regulated agencies that need the government’s support, to change its approach and simplify the rules applying to them. We, at the Association of Recruitment Consultancies, urge the government to recognise that technology is a means, not an end. ●

IMAG E | SH UTTER STO CK

06/12/2016 09:12

I N T E R AC T I O N

SOUNDBITES

WEB CH AT

CYBER CRIME IS TIP OF THE ICEBERG IN RECRUITMENT INDUSTRY In response to your article ‘Recruiters urged to keep data secure following PageGroup breach’ (14 November), there by the grace of God... This is going to become a more common story in the recruitment sector as CRMs and back-office platforms are effectively a goldmine for cyber criminals. Candidate CVs coupled with bank details, scanned passport image and payslips are just the collateral cyber criminals need for financial and identity theft. The comment from Page appears disingenuous: “We’ve asked them to delete the data they’ve stolen and they’ve told us that they have done so.” Get real or get a better PR officer!

“What challenges and opportunities lie ahead for your business in 2017?” DAVID MOREL CEO/ FOUN D ER , T I G ER RECRUI T MEN T

“The opportunities we will be focusing on in 2017 are expanding strategically to mitigate any worst case scenario of Brexit where our key clients end up relocating some of their operations. Also, as a business that sees the potential Brexit opportunities, we will look to diversify into markets within our area of expertise of secretarial/administrative where the effects of any fall-out will be limited. There is an opportunity for us to continue to build marketshare with a clear strategy in 2017.”

PHIL TYKE

DAVID LAWRENCE I think this is the tip of the iceberg. I was speaking to an IT head of an SME recruitment firm who advised that they were hacked but didn’t want to go public for fear of mass reputational damage. SME recruiters without the resources of PageGroup simply won’t have the tools or sophisticated IT infrastructure to know if they’ve been hacked or not. ADAM FAIRLEY

STAFFING LOOPHOLE IN GERMANY? In response to your article ‘Staffing companies operating in Germany can get round new regulations’ (17 November), surely equal pay provisions already exist under the AWR? MARK BULMER

It should be pointed out that the above comments are relevant only for staff leasing, which can only be undertaken with the correct AÜG licence. Contracting has come out of the legislation change relatively unscathed after much lobbying. Yet it must now be clear upfront on what basis the relationship is based as it’s no longer possible to change from ‘contractor’ to ‘leased’. To answer Mark... my understanding is that in a German court, German law is likely to be observed so the difference between the equal pay provision in this legislation and the AWR, although contradictory, is not likely to prove an issue. APSCo Germany holds events on this subject; indeed Thomas Leister [of Osborne Clarke] is a regular speaker! TREMAYNE ELSON, MANAGING DIRECTOR, APSCO GERMANY

CEO, V IN E RES OURCES

“Our biggest challenges as an internationally operating recruiter come from ever-changing compliance regulations and politics from the countries in which our global clients are based. The impact of Brexit has yet to be seen. However, I believe Europe and the UK are too important to each other to break ties. We are seeing exciting new opportunities from growing industries such as Big Data and the Internet of Things (IoT), boosting demand for certain technological competencies in these areas. Sourcing talent will continue to get easier but it’s the craft of recruitment that will be the differentiator.”

KERRY HOPE D I REC TOR , CA ST L E EMP LOY MEN T AG EN CY

“We will be recruiting across all seven of our divisions and, in particular, expanding our education and food manufacturing divisions. We’ll also be revamping the way our consultants work, away from the old style 360 and into a new 120 model. A consultant who sells, delivers and resources is 360. As of January we will have someone who sells, someone who delivers and someone who resources. It helps to prevent burnout of consultants. Creating a 120 model will deliver this. This will really allow staff to excel in sales, delivering or resourcing. These are exciting times ahead.” WWW.RECRUITER.CO.UK 17

p16_17_recruiter_agency_soapbox.indd 17

06/12/2016 11:25

REC.01.17.039.indd 39

06/12/2016 09:22

543 6

2 1

RECRUITER HOT 100 COMPANIES 2016

4 2 2 1 0 9

3 6 1

7 1 3 5 3 89 54 2 8 26 3 3

p19 Hot 100.indd 19

2016 – a year of turbulence 2016 WAS A YEAR that will

↗

live long in our memories.

DOMINIC MORLEY Managing director, Head of Corporate Advisory and Broking at HOT 100 sponsor Panmure Gordon

It started with a wobble in China, ended with a Trump victory and had Brexit thrown into the mix for good measure. During what has been a turbulent and

uncertain 12 months, the UK recruitment industry has however remained resilient. This is testament to the quality and strength of the businesses featured within this year’s Recruiter HOT 100 and is cause for signiﬁcant optimism during 2017. Panmure Gordon is a leading mid-market corporate adviser. Like many of the businesses within this year’s HOT 100, we have built our reputation on long-term relationships and exceptional levels of service. We have deep expertise in the recruitment sector acting as the trusted adviser to leading names such as Penna, Harvey Nash and InterQuest. With our strong relationships, from large international players to specialised privately-owned organisations, we have built up a wide network and broad understanding which has enabled us to become one of the leading voices in the industry. Teaming up with Recruiter has allowed us to extend our network within the sector and we look forward to following the progress of the many exciting businesses within this year’s Recruiter HOT 100 through 2017 and beyond. WWW.RECRUITER.CO.UK 19

06/12/2016 14:43

4 6 3 15 58 1 7 8 0 7 2 8 2 7 5 9 3 4 6 36 4 4 91 5

RECRUITER HOT 100 COMPANIES 2016

2 7 39

8 4

1 1 8 6 4

0 23 8

p20-27 Hot 100.indd 20

4 311 6

2016 marks the ofﬁcial 10-year anniversary of the Recruiter HOT 100. To celebrate, we’ve added 10 bonus companies to our list – so welcome to the 2016 Recruiter HOT 110. Hopefully, the 10-year bonus brings a little cheer at a time when it would be all too easy to sink into a ‘glooms-day’, if not doomsday, mentality.

7 5 6 2 7 4

7 15 6

0 2 5 7 3

06/12/2016 12:34

RECRUITER HOT 100 COMPANIES 2016

0 4

p20-27 Hot 100.indd 21

The entry threshold for this particular HOT 100 stood at £86,910 – a full 6.2% or £5,700 below last year’s group of companies still evolving, all the better to identify the best managed ‘people organisations’ which are developing the most productive companies – together these factors exemplify the recruitment industry success story. Yet this year’s report heralds a change – the bar for entry has fallen. The entry threshold for this particular HOT 100 stood at £86,910 – a full 6.2% or £5,700 below last year’s group of HOT 100 companies. Aggregated average productivity growth of this HOT 100, like for like, only fell slightly. Employee expansion was more cautious than last year, reﬂecting the uncertainty in the air, yet sales and gross proﬁt (GP) still were unable to keep pace. Some big names that dropped out last year have returned, with SThree, Hays and Pertemps all in the lowest quartile of the HOT 100. This, by nature of their size, had the effect of reducing the aggregate average GPH, compared with that of last year’s HOT 100. Yet the results still

6 O 6 %

Average sales growth for HOT 100 companies in this year's survey

spanned individual growth ranging from +41% to -36%. Calendar 2015 proved a year of only slight growth on average across the whole UK recruitment industry with its sales value rising by just 3%, according to the Office of National Statistics, despite incorporating all those additional employer costs, duplicated reporting of managed services’ growth and pay rate inﬂation. Comprising mainly calendar 2015, the 2016 HOT 100 list grew its sales at 6%, but individual company sales growth ranged from +68% to -27%. Among the specialisation HOT 10s, Public Sector was the strongest performer, followed by IT. The HOT 10 Professional recruiters together posted GP growth of 8% following its 18% bounce back last year. Conversely, HOT 10 Technical recruiters managed just 1.1% growth, as the oil & gas downturn offset gains in other construction & engineering business.

↗

panning the General Election, political leadership changes and last summer’s round of unexpected happenings, 2015 and 2016 have seen nearly two years of intense political upheaval and considerable uncertainty in the UK, capped by the present prospect of Brexit negotiations into the foreseeable future and geopolitical concerns heightened by the recent US election. Yet UK industry has continued to generate economic growth and jobs, ably assisted by a recruitment industry increasingly equipped to match the right people and skills with the right companies. Over the past decade, the HOT 100 has outlined leading trends and by analysing the collective and individual performances of the most productive recruitment companies in the UK. The single key performance indicator (KPI) of gross proﬁt per head (GPH) encompasses so much about how a company operates measuring its ability to extract, sustainably, the optimum performance from its own people. This year we take it a step further: from these 110 companies, we have singled out the companies achieving the top 20 percentage gains in productivity. This gives an insight not only into the companies that have stayed at the top consistently but also into new entrants and those with evolving business models or successful efficiency programmes. While long-term of ng-term membership m the HOT 100, 00, as featured last year, remains a strong in indicator that a company is doin doing a lo lot of things right, examining this in tandem with productivity uctivity improvements imp vements paints an n even more rrounded view w of their success. also reﬂects that uccess. It als these companies do not simply mpanies d mply rely upon a high value specia specialisation ion to propel their success. cess In short, this report is itself elf

Agile Intelligence Agil igen has Agile Intelligence Int compiled the HOT 100 Report compile eport on behalf beha of Recruiter to determine which companies determi p are bes best at leveraging g their intellectual assets. ellect asset measuring By m suring the gross ross profit fit (net (n fees) es) per p employee this indicates ind s how ho effectively ctively organisation an or ation usess the own people to skills of o all its ts ow generate a prof profitable return ene n for stakeholders. lders

All in-house employees workers or ((excludess temp w contractors) are included c tors) ar – not just in the calculation alcu fee-earners; fe ners; this is a standard senior management eme key performance indicator ndic or (KPI). Notwithstanding ng wild w cards, companies emerging strongly strongly, c anies emerg especially featuring e ially if featu g rregularly, rly, are primarily pri ily those that operate the at op he most productive set-up, balancing pr alancin

and the need for f well-trained l-tra the motivated stafff against ag costs. need to minimise mi ise c companies derive Which co panies deri most ‘added de value’ from om their own employees e ployee (before before allocating overheads) rhea heads) yet stilll engender the he right atmosphere overr the long a ong term erm to encourage enc profitable and sustainable s sales approach? roach Take a look at the 2016 HOT 100 016 HO 0 chart. cha WWW.RECRUITER.CO.UK WWW.R R.CO.U 21

06/12/2016 12:35

RECRUITER HOT 100 COMPANIES 2016

↗

At least 73% of companies had the potential to mitigate temporary margin erosion with increased permanent fees

76% Increase in workforce for HOT 100 companies

productivity was achieved by only 29% of constituents, compared with 49% last year, indicating that the full beneﬁts of previous expansion have not yet been achieved. The continued headcount growth in this year’s HOT 100 has compounded that factor and constrained productivity for several companies. The underlying demand for recruitment services is dependent upon a buoyant labour market, and the latest signals suggest a slowdown both in absolute jobs growth and churn activity. 2017 could require good quality training and considerable tenacity if all those recently hired recruiters are to reach their full potential.

KE Y FINDINGS 2016 HOT 100 group sales turnover rose 6.3%, above the whole recruitment industry sales turnover growth of just 3% reported for calendar 2015 by the Office

of National Statistics. This year’s HOT 100 accounts for more than one third of ‘real’ industry sales turnover estimated from official data by Agile Intelligence. Like for like, comparing this group against their own ﬁgures for the previous year, overall headcount was increased by a solid 6.9% and this translated into a commensurate 6.2% rise in GP with productivity not quite holding par as GPH fell marginally by 0.6%. Gross margin was unchanged. Like for like: ● The 2016 HOT 100 ﬁrms collectively reported an increase from their previous year in latest available sales of 6.3% to around £16.1bn. ● HOT 100 combined GP reached £3.1bn, a gain of 6.2% versus their prior year. ● HOT 100 companies’ in-house headcount rose 6.9% to total 31,661 employees. ● Productivity (GP per employee) for this group of HOT 100 companies fell by 0.6% over the year to an

↗

On aggregate, the 2016 HOT 100 saw widespread individual growth (in the 2015 or 2016 reporting yearend it represents) as 73 companies posted a rise in net fees. The average size of the 2016 HOT 100 member firms jumped to 317 employees with the re-entry of the largest players, and a massive three-quarters of constituents oversaw some net organic expansion of their internal workforce. While the gross margin held steady within the HOT 100, analysis of the wider industry indicates further modest erosion. As mentioned, gross margin, aggregated across the whole of the HOT 100, was flat. With the permanent market estimated to have outperformed the temporary market this does suggest some, albeit unquantifiable, loss in temporary margin. However, at 46%, just below half of the HOT 100 still reported an actual rise in gross margin. Examining closer, 27 – compared with 26 last year – of the 2016 HOT 100 earns gross margin below 15%, indicating almost entirely temporary activities. This means at least 73% of companies had the potential to mitigate any temporary margin erosion with increased permanent fees. Tellingly, the dream growth combination of both employees and

Methodology The data has been rigorously filtered by turnover, gross profit and employee numbers; details available on request. The companies featured in this edition employ almost 32,000 in-house staff and generate £16.1bn of industry sales revenue; many more were evaluated as part of the overall analysis. Latest available accounts have been used – dated 2015 or 2016 for all companies – a few companies are excluded 22 RECRUITER

p20-27 Hot 100.indd 22

due to filing timings. Companies filing abbreviated accounts and not providing their full figures separately are excluded. Increasingly, with the internationalisation of many UK recruitment firms, group accounts are now used for UK corporations where these prove more up to date — examples would be Hays, Harvey Nash, Robert Walters, PageGroup and several IT recruiters. Companies operating primarily overseas have been excluded, although

UK engineering specialists placing talent worldwide are included. The UK operating companies of overseas-based groups eg. Adecco, Randstad or Hudson may be included. Two prominent exclusions from the analysis are Manpower and Reed due to accounting differences which invalidate comparisons. Furthermore, companies combining temporary employees in their employee count are not included as this

grossly underestimates their performance. The most specialist of search, or headhunters, are omitted for a variety of reasons: incomplete disclosure, overseas business, incompatibility and a shortage of data for peer group comparison. • Disclaimer: while every effort has been made to ensure accurate reporting and analysis no guarantees are made regarding the information portrayed in this document.

JANUARY 2017

06/12/2016 12:35

Company/ trading n ame

▲

190,858

171,312

SSQ

21.6

16.1

Legal

▲

182,813

130,000

Green Park Interim & Executive

5.9

4.6

Public sector, charity/social enterprise, retail, HR, financial services

▼

174,537

178,670

Sheffield Haworth

22.7

20.2

Financial services: executive search, interims

173,375

135,086

Falcon Green Personnel

3.5

2.3

Construction

▼

172,150

170,682

TRS Staffing Solutions

3.4

3.8

Engineering/technical into oil & gas, rail, transportation, construction, energy

▲

162,312

146,651

LA International Computer Consultants

16.6

14.8

▲

156,375

148,628

Mayday Healthcare

24.9

21.1

Healthcare

Parent gro (where d up if name) ferent

Gross pro per emp fit previousloyee year (£)

1 2

Gross pro employe fit per latest yee ar (£)

Rank

Change

Gross pro latest ye fit ar (£m) Gross pro previous fit year (£m) Sector coverage

RECRUITER HOT 100 COMPANIES 2016

Fluor Corporation

▼

154,188

133,127

SystemsAccountants

5.6

4.1

Finance systems, finance transformation, EPM, BI, ERP

▲

152,598

134,452

WA Consultants

3.7

3.8

IT & technology

▲

149,457

145,462

Morgan Law

9.0

7.3

Healthcare, public sector, charity/not-for-profit, education, Housing Assocs

▼

145,599

145,935

Vector Resourcing Holdings

5.4

Technology

▲

145,344

130,301

Euroforce People Solutions

3.3

2.6

Skilled staffing, textile & automotive manufacturing sectors

▲

144,341

119,099

Rullion IT Plus

10.8

8.9

IT & telecoms, business change & transformation

▲

142,836

126,040

The Bridge (IT Recruitment)

3.3

2.8

▼

140,235

160,616

Interact Medical

7.3

6.9

Locum doctors including niche technical skills

▼

137,778

140,091

NES Global Talent

84.6

82.4

Technical/engineering, power, infrastructure, chemical, life sciences

▼

132,415

149,974

Odgers Intermediate*

70.4

69.7

Executive search, interim managers

▲

131,681

116,806

Resource Solutions Group

28.4

22.3

IT, business change, financial services, public sector

▼

131,615

146,874

Penta Consulting

12.2

12.9

IT & telecoms

▼

130,375

132,457

The SR Group

32.1

27.3

Legal, compliance, HR, marketing, tax, treasury & executive search

▼

129,327

140,458

Walker Hamill

6.7

Accountancy & finance, debt & structured finance, private equity and M&A

▲

128,366

124,504

Elite Associates Europe

4.6**

4.4

Luxury retail, temp beauty & fashion, retail ops, head office, senior exec

▼

126,115

158,431

NRL

9.8

12.0

Technical, construction, oil & gas, petroleum & energy

▼

125,704

136,780

GatenbySanderson

13.3

11.9

Executives in health, education, government

—

124,843

125,010

CMA Financial Recruitment

4.0

3.9

Accounting & finance, executive, HR

▲

124,219

108,220

Randstad Technologies

4.0

4.4

IT, telecoms

122,434

108,065

Minstrell Recruitment

2.4

2.2

Civil engineering, mech & electrical, trades & labour, rail, facilities management

▲

119,413

101,373

PSR

5.0

3.9

Construction, building, civil engineering & infrastructure, residential

▲

119,137

103,149

Redrock Consulting

5.0

4.7

IT & telecoms

▲

119,020

182,182

Options Resourcing

4.6

4.0

Construction,building services,maintenance,tech,engineering, office, sales

▲

116,762

98,340

Cognitive Group

2.3

2.1

Microsoft Dynamics Technology

▼

116,026

123,511

Investigo

18.9

18.3

Accountancy, finance, change management, property, procurement

▲

114,719

99,144

Henderson Scott

4.4

3.5

IT and sales & marketing

▼

113,584

132,532

People Source Consulting

5.6

5.7

IT & technology

▲

113,534

103,537

The Rethink Group

▲

110,855

107,879

Randstad Education

▲

110,523

105,500

▲

109,663

115,719

▲

109,041

98,615

Modis International

▼

108,414

127,255

Caritas Recruitment

Rullion

Randstad Holding NV

19.5

Business & tech, executive, life sciences/pharma, engineering & commercial

18.4

17.8

Education

Shorterm Group

12.3

10.3

Engineering, aerospace, auto, constr, rail, power, logistics, supply chain

Coyle Personnel

15.9

14.9

Tech, constr, medical, rail, highways, energy, pub sector, comm,industrial

Adecco SA

10.7

10.3

IT - dev, SAP, infrastructure, aerospace, defence & engineering, digital

nGAGE Specialist Recruitment

7.6

6.5

Social care into public, voluntary & private sectors

107,143

108,751

Airswift (pro rata)

90.0

93.2

Oil & gas/energy

106,635

99,511

Advantage Resourcing UK

22.4

21.9

Technical

▲

106,165

103,068

Next Ventures

7.8

7.2

SAP, digital,oracle

▼

105,684

121,655

McGinley Support Services (Infrastructure)

13.3

16.1

Construction/infrastructure

105,050

116,743

William Alexander Recruitment

2.7

2.3

IT & business change

▼

104,890

109,256

Randstad CPE

Randstad Holding NV

29.6

26.9

Construction, property, engineering

▲

104,327

108,023

Badenoch & Clark

Adecco SA

32.9

32.8

Finance, accountancy, banking, legal, IT, HR & marketing

▲

103,709

105,570

La Fosse Associates

9.1

7.3

IT, technology, digital at all levels including executive search

▲

103,499

104,265

Goodman Masson

14.3

12.7

Finance,banking,commerce, compliance, public sector, audit

▼

102,830

121,587

G2V Recruitment Group

12.9

12.2

IT, engineering, oil & gas

Key:

▲

p20-27 Hot 100.indd 23

▼

Down

– Unchanged

N New

formerly Odgers Group until May 2016

19.8 Randstad Holding NV

WWW.RECRUITER.CO.UK 23

06/12/2016 12:35

Gross pro latest ye fit ar (£m) Gross pro previous fit year (£m) Sector coverage

▲

102,509

92,632

PPF

9.3

9.4

▲

102,240

111,196

Oil Consultants

5.1

5.2

Oil & gas

102,210

122,349

Resourcing Group

10.2

Built environment, public sector

▲

101,899

105,585

Orion Electrotech

5.3

Technical, aerospace, construction, oil & gas

▼

101,821

110,353

Oakleaf Partnership

5.3

4.9

Human resources

101,674

78,048

First Call Contract Services

5.7

5.3

Print & mail, food-packing, processing; warehouse & logistics

▼

101,653

134,249

Interim Partners

3.7

4.4

Interim executives

▼

101,605

121,585

CPS Group (UK)

3.0

2.7

IT, ERP, engineering

100,667

n/a

Parity Professionals

6.0

n/a

100,015

92,545

Nigel Wright Consultancy

6.7

6.1

FMCG, industrial, manufacturing

▲

99,971

94,469

Venturi

2.9

2.4

IT: business intelligence, development, infrastructure, quantitative analytics

▲

99,322

98,591

Oliver James Associates

21.1

15.8

Finance services/commerce & industry, actuarial, ARC, change management

▼

99,262

101,766

Randstad Care

8.3

7.8

Social care, nursing, allied health professionals

▼

99,197

106,224

Red Commerce

15.6

16.1

99,032

91,268

Prime People

12.3

10.2

Construction, built environment, energy, environmental, insight, analytics

▲

98,906

97,767

GCS Recruitment Specialists

7.7

7.2

Technology, financial services, engineering

98,643

101,517

Gattaca

73.0

54.8

Engineering & engineering technology, IT, professional, education

▼

98,264

104,657

Hallam Medical

5.3

3.6

Primary care & community nursing

▲

98,139

98,110

Harvey Nash

90.3

84.9

IT, finance, interims, executive search

▼

97,735

103,791

Aspire

8.5

8.6

Media, marketing, communications including digital, graduates, editorial

▲

97,543

102,681

Phaidon Holdings

25.7

21.7

Financial services, professional services, energy, STEM

▲

97,323

98,415

PageGroup*

556.1

532.8 Financial services, legal, eng, IT, retail, sales , energy, HR, construction

New Street Group

Randstad Holding NV

Drivers

▲

97,275

100,263

Portland Resourcing

3.1

3.4

IT, SAP

▲

96,959

98,067

PSD Group

23.4

Executive, finance, engineering, hospitality, HR, IT, supply chain, retail

96,924

92,569

Morson Group

64.9

60.0

Engineering/technical, IT, scientific

96,847

77,367

Angela Mortimer

10.7

10.1

Executive and office support

96,125

82,314

Permanent Futures

2.4

1.6

Education, care, manufacturing perms

▼

95,867

116,535

Montash

3.8

4.2

IT: BI, data & analytics, security, ERP, CRM, scientific technologies

95,437

84,199

RIG Medical Recruit

6.9

4.6

Radiography, occupational therapy

95,197

84,742

Jenrick Engineering

2.2

2.0

Engineering

94,941

81,739

Experis

40.0

34.7

IT, finance & engineering professionals

▼

94,563

116,985

Fircroft Engineering Services

60.5

68.1

Technical/engineering into oil & gas, automotive, mining, energy, commercial

94,410

92,235

Premier Group UK

6.1

5.5

IT, media, engineering

▼

94,384

111,844

Petroplan Holdings

10.6

11.7

Oil & gas, energy

93,761

126,847

Kintec Group

6.8

7.0

Technical (engineers) & geoscientists into oil & gas, built environment & rail

▲

93,510

93,795

CD Sales Recruitment

3.9

3.8

IT sales, software sales

93,363

91,435

Tangent International

6.3

6.0

Professionals into IT & telecoms, engineering

▲

92,518

96,439

Cornwallis Elt

▼

92,494

110,250

Eden Brown

nGAGE Specialist Recruitment

▼

92,490

105,372

Rullion Engineering

Rullion

▲

90,333

97,062

IPS Group

▲

89,502

93,942

IDPP Holdings

2.6

▼

89,390

104,542

Contract Scotland

▲

89,112

93,736

Finegreen Associates

Accountants in Demand

▲

88,640

93,743

Ajilon (UK)

Adecco SA

12.1

14.2

IT, other professional sectors

88,383

87,745

SThree

235.7

218.2

Banking & finance, energy & nat resources, IT, pharma & biotech, public sector

87,572

86,615

Hays

810.3

764.2 Finance, construction, health, pharma, educ, IT, legal, oil & gas, professionals

87,498

90,430

Pertemps Recruitment Partnership

57.5

53.4

Multi-sector

▼

87,256

136,806

Eames Consulting

11.4

8.9

Actuarial, audit, broking & underwriting, change, compliance, risk, technology

100

86,910

85,915

Office Angels

30.1

30.4

Secretarial, admin & office staff

Key:

▲

p20-27 Hot 100.indd 24

▼

Down

– Unchanged

Manpower

Cavey Dale Group

Adecco SA

3.1

Technology, change management within banking, insurance, digital & media

15.5

14.1

Built environment, public sector

7.9

8.0

Engineering/technical

5.8

6.1

Underwriting, risk, insurance, broking

2.8

IT & telecoms, executive, technical sales, interim

3.4

3.1

Technical/professionals into construction & engineering

1.8

1.9

Public/private healthcare

formerly Michael Page International

Parent g (where droup if ferent name)

Gross pro employeefit per latest ye ar (£) Gross pro per emplofit previous yee year (£) Company/ trading n ame

Rank

Change

RECRUITER HOT 100 COMPANIES 2016

N New

06/12/2016 12:48

Gross pro latest ye fit ar (£m) Gross pro previous fit year (£m) Sector coverage

Parent g (where droup if ferent name)

Gross pro per emplofit previous yee year (£) Company/ trading n ame

Change

Gross pro employeefit per latest ye ar (£)

Rank

RECRUITER HOT 100 COMPANIES 2016

101

86,856

78,249

Extrastaff

5.5

4.5

Driving & industrial

102

86,665

73,138

Forrest Recruitment

5.4

4.6

Office & commercial staff

103

86,494

79,119

Champion Employment

4.1

3.9

Office, industrial, drivers, accountancy, technical, sales, catering, HR, IT

104

86,279

85,161

InterQuest

23.8

23.2

Information security, analytics, digital, IT & telecoms

105

85,738

83,331

Gravitas Recruitment

8.7

6.9

IT, actuarial

106

▼

85,681

89,018

Randstad Financial & Professional

9.7

10.1

Finance, accounting, legal, interims

107

85,449

90,944

Teacheractive

7.4

5.4

Education

108

84,601

85,716

Robert Walters

234.4 215.3

Finance, legal, HR, IT, sales, marketing, support, supply chain, tax

109

84,327

86,970

Eximius

6.2

5.6

Energy, financial, law

110

84,275

96,904

Education Placement

9.2

9.1

Education

↗

recruiters, continuing the theme of diversity evident throughout the HOT 100. Across the HOT 100 companies, a massive 76% expanded their workforce either organically or by acquisition, compared to 67% saw growth combination in previously. This signals a much employees and broader spread of organisations productivity choosing to grow headcount. However, only 47% increased GPH versus last year’s 73%, the lowest for some years. Furthermore the dream combination of expanding workforce and rising productivity was achieved by just 29% of the 2016 HOT 100, versus 49% last year and 35% the previous year. Two-thirds of these 29 firms employed over 50 people, reflecting the profile of the HOT 100 companies, with the honours evenly split like last year, as similar percentage representation is seen in both camps.

29%

The breakdown was: ● Nine (29%) of the 31 ﬁrms had less than 50 employees ● 20 (29%) of the remaining 69 ﬁrms employ above 50 employees ● Margin distribution of 2016 HOT 100 versus previous issues suggests the battleground is in the middle ranging from 15% to 40% margin with the number of companies either side of this range just slightly ahead. Versus last year, constituents increased sharply in the 15% to 20% range at the expense of 20% to 40% margin earners. The long-term trend on the chart shows strong rises in low margin (<15%) almost exclusively temporary/contract players and in the 15% to 20% range where a small permanent market presence is also common. Higher margin (>50%), driven mostly by perm, is little changed but the bands from 20% to 50% have all lost ground.

↗

aggregated average £98,568 to stand almost 10% below last year’s HOT 100 group average. However, a simple average of each of the GPH ﬁgures, negating the lower quartile high-weighted skew by those large employers, stood at £110,092 – just 2.2% below the 2015 HOT 100. ● HOT 100 average gross margin was unchanged for these companies at 19.4%, with any shift in the business mix towards permanent fees offset by temporary margin pressure. ● This HOT 100 group in the past year added £182m in net fees, with an additional 2,035 staff at an incremental gross margin of 19%, making an incremental £89,400 additional GPH. ● Whilst still solid, this is a weaker performance than we reported last year when the incremental margin was clearly driven by permanent fees and this incremental GPH, especially, is substantially below recent years. ● Entry level GPH (ranked 100) to the 2016 HOT 100 was £86,910, standing £5,700 below the prior year threshold for the ‘cut’ which was at £92,632. Examining the extended HOT 110 the ‘cut’ was £84,275, indicating the closeness of the ‘following pack’. ● That following pack of 10 bonus companies comprises three generalists, two technology, three professional and two education

Randstad Holding NV

Calculations Gross margin is the gross profit [GP] (or net fees) as a percentage of sales turnover. GP is a combination of permanent fees (at virtually 100% margin) plus the profit on temporary supply after subtracting payroll and other ‘temp’ employment costs.

The mix of business between temporary and permanent placements influences the level of gross margin as does the trend in temporary pricing and employment related costs. With larger contract

business notoriously competitive compared with SME or ad hoc placements, the type of business and delivery model/cost structure play a crucial part both in determining temporary margin and also bottom line profitability. WWW.RECRUITER.CO.UK 25

p20-27 Hot 100.indd 25

06/12/2016 12:48

RECRUITER HOT 100 COMPANIES 2016

↗

● 4% of the HOT 100 are almost exclusively permanent recruiters but around nine companies are regarded as permanent specialists, and a further five firms have a highly predominant permanent mix. The strategic expansion into the Interims market, highlighted last year, appears now to have stabilised. ● Permanent market showed growth during much of 2015, increasing its share of the business mix as temporary market growth eased. However by late Q3 and into Q4 there was ample evidence from several quarters that the permanent market itself was faltering amid economic and political uncertainty. ● Most represented group (24 companies) has moved down a band to those companies with margin between 15% and 20%, ie. substantial temporary but mostly with a modest presence in permanent fees. ● Biggest losers: again the 30% to 40% margin band shed more companies in the HOT 100 – from 11 down to just eight constituents; five years ago there were 20 in this band.

● Most gains: the 15% to 20% margin band gained the most for reasons provided above. ● 27 agencies now achieve gross margin below 15% with still 11 of these below 10%.

4 O 4 %

of HOT 100 firms are almost exclusively permanent recruiters

13%

of HOT 100 firms employ 20-30 staff

Company trends: productivity (GPH) growth less certain as recent years’ expansion policy not paid off The bar for success this year dropped sharply to £86,910 GPH, as previous expansion failed to deliver sufficient return before further headcount increases were undertaken during the 2015 reporting period. The number of constituents gaining in productivity also fell to 47% (73% last year), while only 29% of companies achieved both headcount and productivity growth, versus 49% last year. Of these 29 firms, IT has gained relative ground against the other key sector groups but all sectors saw a marked reduction: Professional’s eight this year was roughly half of last year’s 15; Technical was down to five from 10; Public Sector also down to five from 10; and IT down to 10 from 13. The remaining company still being the same blue collar skills specialist.

Among the leaders, the top HOT 10 sees six companies achieve productivity growth, while simultaneously expanding headcount, led by SSQ, newcomer Falcon Green ranked 4th, LA International, Mayday Healthcare, SystemsAccountants and Morgan Law. Exploring this theme further, several companies deserve special mention for being included in both the top 20 of the HOT 100 and the new Productivity Growth top 20 table. Combined, this suggests a considerable achievement. Green Park, Falcon Green, Rullion IT Plus, SystemsAccountants, WA Consultants, The Bridge (IT) and Resource Solutions Group all achieved strong productivity growth either to maintain their position in the top HOT 20 or to join it for the ﬁrst time this year. These indicate companies that are moving forward quickly from their present position. Office or industrial recruiters such as First Call Contract Services and Angela Mortimer have also displayed exceptionally strong improvements in productivity and feature highly in the new growth table.

H O T 1 0 0 C O M P A N I E S B Y G R O S S M A R G I N B A N D (in accounting year)

30 2007 2008

2009 2010

2011 2012 15

2013 2014

Source: Company accounts

2015

0 less than 10%

10% to 15%

15% to 20%

20% to 30%

30% to 40%

40% to 50%

more than 50%

Gross market band range 26 RECRUITER

p20-27 Hot 100.indd 26

JANUARY 2017

06/12/2016 12:39

RECRUITER HOT 100 COMPANIES 2016

Job type profile The HOT 10 profile still retains a good mix of permanent and temporary recruiters without any of the major multi-sector or generalists. SSQ and Sheffield Haworth are now the only two near exclusively permanent recruiters. TRS, LA International and WA Consultants are all mainly contractor-based models with the others offering a mix of both permanent and temporary business. Size profile Among the large corporate groups in the HOT 100, where it makes sense to separate out the UK subsidiaries these have again been listed individually – Randstad and Adecco again have five and four listed respectively. The nGAGE (formerly HCIG) stable again has three companies in this year’s HOT 100. Overall, 21% of HOT 100 companies employ more than 200 staff compared with just 14% last year, while those employing from 100 to 199 staff stood at 21% (20%) of constituents. A further rise was seen in the very smallest firms with 13% employing between 20 and 30 staff versus 11% last year. Conversely, the

30–49 band fell sharply to 18% (29%) and the employee band 50 to 100 rose just slightly to 27% from 26% last year, sustaining last year’s decline. This all points to a productivity push from some of the UK’s largest recruiters, reentering the HOT 100, countered only by the very smallest, often emerging companies. Office/Industrial/Trades/General Staffing This ‘sector’ has sprung a surprise in the 2016 HOT 100. Rumours of its demise were clearly exaggerated. Several re-entries are seen, helped by the lower entry threshold this year producing six companies in the main HOT 100 and a further three in the anniversary bonus 10. At 12th sits Euroforce, specialising in sourcing skills tradespeople from across Europe into furniture, textile and automotive manufacturers in the UK. Drivers specialist PPF at 51st, First Call (packaging, processing, logistics, print & mail) reached 56th and office specialist Angela Mortimer returned at 76th. Pertemps (98th) and Office Angels (100th) then followed while Extrastaff, Forrest and Champion

21%

of HOT 100 firms employ more than 200 staff

18% of HOT 100 firms employ 30-49 staff

stood at 101st, 102nd and 103rd respectively. The reasons for inclusion were varied; Euroforce expanded its GP faster than its employees, while others saw a mix of efficiency drives to reduce headcount and business model streamlining (PPF, First Call & Angela Mortimer) or simply beneﬁtted from the lower entry threshold – despite the trend in many of their core sectors towards commoditisation and volume delivery models. Six out of the nine drove gross margin up through a variable combination of increased perm mix, higher margin temporary client mix and disciplined pricing but in all cases it is the improvement in people productivity that has catapulted them into the HOT 100. Whether their presence is sustainable in future years is likely to depend on the extent of any return of the HOT 100 entry threshold back towards last year’s heightened level. It may well be that now the generalists have led the way other sectors must follow in order to remain competitive in the fast changing world of work in the UK.

Conclusion and outlook Confidence in the recruitment industry faltered as the year progressed best illustrated by a lowly 3% growth in official industry sales turnover. Last year we suggested that the industry might take a break from hiring and that a slowdown in expansion rates could well result; this trend is evident in our 2016 HOT 100 report. Headcount growth slowed, the productivity average of the HOT 100 actually fell, and the threshold for entry was lower. The benefits of the prior year’s headcount expansion did not quite fulfil expectations as new fee-earners presumably matured yet productivity still shifted backwards. The response was muted

with activity levels later in the year affected by a sharply weakened oil & gas sector together with the uncertainties surrounding the political process and economic outlook. Initially, business mix adjusted to a maturing cycle, subduing top-line sales growth, as permanent fees picked up across several sectors during the first half of 2015. Yet a late slowdown in permanent hiring and some likely erosion of the temporary margin cancelled out any overall rise in the HOT 100 gross margin, as was seen the previous year. For the wider industry, analysis suggests a further drop of at least 50 basis points in gross margin totalling around a third of all margin over the past 10 years.

This once again emphasises that the HOT 100 really are the outperformers. Looking ahead the outlook is trickier than ever to forecast. The prospect of Brexit has led to such uncertainty that most economic models cannot truly operate. Headlines across the industry still try to assume ‘business as usual’, and in some ways that is all that companies can do. However, the smartest are undertaking scenario planning while in the short term assuming that the job market will be affected by an economic slowdown and adapting accordingly. Longer term, some demographic and technology trends will shape the world of work stretching well beyond

the Brexit fall-out. Technology application continues to advance. Global skill shortages are well documented and underpin the demand for recruitment services. Nevertheless there are also risks as the people relationship model of recruitment is encroached by disruptive technology. With virtually unpredictable economic headwinds likely, HOT 100 companies will have ample opportunity to demonstrate their resilience as the industry meets the challenges ahead. The first task must be to ensure that newly hired consultants are well trained and prepared for a tough environment if overall industry productivity growth is to resume. WWW.RECRUITER.CO.UK 27

p20-27 Hot 100.indd 27

06/12/2016 12:40

STARS IN THE LEGAL FIRMAMENT

Fresh from a rebrand, legal recruiters SSQ tell Colin Cottell how operating under their competitors' radar helps them thrive during boom times as well as when things get chaotic IM AGE | AKIN FALOPE

p28-30 Hot 100-SSQ.indd 28

06/12/2016 11:47

RECRUITER HOT 100 COMPANIES 2016

many other sectors, which go through regular cycles of boom and bust resulting in a roller coaster ride for recruiters, “the law is wonderfully cyclical in many respects”, says Shilton. The happy outcome for SSQ is that demand for lawyers remains constant through thick and thin. As Shilton explains, while economic booms spawn “enormous demand” for transactional lawyers, in tougher times the market shifts, resulting in more demand for employment lawyers and disputes lawyers. In bad times too, “there will be people forced to move upwards and downwards, and we can move them”, while “senior lawyers can move at any time”. “We thrive on boom, and we thrive on chaos, and the chaos that exists in several markets right now because of Brexit and because of America [the election of Donald Trump]. Out of chaos we can make serious money,” adds Quarry. While the unique characteristics of the legal market are undoubtedly factors in SSQ’s success, they don’t explain why it has consistently outperformed other legal recruiters who, after all, operate in exactly the same sector. “We create our own market,” says Quarry. “Rather than wait for a job fill order, we go to clients with propositions as to why you need these lawyers for business reasons.” A case in point was 2016, when SSQ provided the staff to launch two offices for clients in Germany. Quarry says: “We took these propositions to the clients because we are close to senior management and understand their strategy. Our approach was, ‘If you agree that this jurisdiction should be on your radar, here is the solution, here is a team’.” The firm also takes advantage of long-standing relationships with senior lawyers, who in many cases have entrusted their career moves to SSQ. “This gives us the ability to cascade the relationship down to our colleagues who are doing associate recruitment, for example.” In this way, Quarry says they can bypass HR. These an often o senior lawyers have clients who need lawye w r will also so ha lawyers, says. yer ers, s, he h say sa One erentiates itself from ne way w y SSQ SSQ diff ffer eren e competitors mpet p pe ors is th tthatt it it ssticks to legal. Itt ha hass never been to other such en tempted temp tem emp mp t stray tray r into ra into o oth othe e areas, e su suc c as finance “We knitting,” Quarry anc n e or or IT. T. “W W st stick ic ick c tto the ek n ng,” Qu says. Indeed, but a mi mile Indeed Ind eed,, the eed t term rm ‘an ‘an inch ‘a h wide w m i deep niche’ might well d wel elll have have been be invented n ed d for fo o SSQ, which across legal S SS ic ch provides provide rov ovide id s staff ff right i ro o the he e le leg g spectrum from paralegals and associates, up to spe sp p para aral ocia ciates te tes e ,u senior lawyers, partners and General Counsels. se s, pa part ar However, Qua Quarry has taken uarry rry r believes eves tthat SSQ ha en niche to division, o a new new level, lev l with h its interim erim er im div n,

↗

n meeting Gareth Quarry and Nick Shilton at the London offices of legal recruiter SSQ (previously known as Shilton Sharpe Quarry), neither is wearing a tie. But this does not suggest a more casual approach to business for these two solicitors-turned-legal-recruiters. Remarkably, given the competitive industry in which they ply their trade, little else has changed since 2012 – except the recent rebrand of their corporate identity to SSQ – when the company topped Recruiter’s Hot 100 as the UK's most profitable staffing company based on gross profit (GP) per employee. Four years on – after taking top spot again in 2013, second in 2014 and 2015 – Shilton and Quarry and SSQ are back on top of Recruiter’s Hot 100, with each employee delivering an impressive £191k of GP or net fee income. Founded in 2003 by Shilton and Gavin Sharpe, another lawyer, before being joined by Quarry in 2005, SSQ has enjoyed relentless growth. Between 2010 and 2015, GP more than doubled to £21.5m. In 2016, the company opened an office in Dubai, bringing its international network of offices to 21. In the last four years staff numbers have grown from 75 to 120. “Most of our competitors just have no idea about the goldmine [that] legal is. We have been very fortunate that legal has been off most big players’ radars,” says Quarry, barely disguising his incredulity of how few others have realised how lucrative the sector is. Neither Quarry, SSQ’s executive chairman, nor Shilton, the firm’s CEO, who is in charge of day-to-day running of the business, have made that fatal error. With several thousand lawyers working g in London earning more than an a £1m a year, according to Shilton, ilton, and SSQ being remunerated mune u rat on the basis of 30% to 33% gross 333% of o first-year year ea ear a gr g os compensation, “we nsat we ccan trade extremely mely profitably”, bly” ly”,, says says Quarry some relish. Quarry with w h. If such fat margins are s re enough to makes ess other recruiters’ mouths rrec e ruiiter t s’ m hss water, h er,, th er tthere h are further herr reasons r nss for for or Quarry Quar Qu Qua and Shilton, hilt ilt lton, lt on n who firstt met at legal gal a recruiter Quarry Dougall back in ruiter rui t Qu ter the 1990s, Unlike 90s,, to 90s t be e cheerful. cheerr chee Unlik Unl ik

WWW.RECRUITER.CO.UK WW R ITE RU K 29 2

p28-30 Hot 100-SSQ.indd 29

06/12/2016 11:52

RECRUITER HOT 100 COMPANIES 2016

"We thrive on boom, and we thrive on chaos, and the chaos that exists in several markets right now because of Brexit and because of America [the election of Donald Trump]" Nick Shilton COMPA NY

Founded 2003 by Nick Shilton and Gavin Sharpe; Gareth Quarry joins in 2005

Gareth Quarry 1982-86 trainee solicitor/solicitor 1988-2002 Quarry Dougall/The QD Group, founder and chief executive 2002-05 angel investor in various businesses after selling Quarry Dougall to TMP Worldwide 2005 – present executive chairman, SSQ – on expiry of restricted covenants from TMP Worldwide

Nick Shilton 1995-97 trainee solicitor/solicitor 1997-20022 oug /TM Worldwide Quarry Dougall/TMP 2003 – present EO SSQ, CEO 20155 20144 Gros 21.57m £16.1mm Gross profit £21.57m Prof 3m £4.5m Profit before tax £7.03m taf afff 120 staff

30 0 R RECRUITER UITER

p28-30 Hot 100-SSQ.indd 30

which although launched back in 2012, is only now beginning to gain real traction. “I would now say ‘an inch wide and two miles deep’,” he says. SSQ recently placed “a bunch of interim lawyers and paralegals” in Shanghai. And Quarry believes this is only the start. He predicts that in 10 years, the split between interim/temp and permanent in law will be 50:50, compared to 95:5 in favour of perm today. “The law is decades behind pretty much every other sector in its use of temps,” adds Shilton. Not only does SSQ’s interim division allow it to cover every aspect of the “legal firmament”, it also is “a crucial counter-cyclical product in its armoury”, allowing it to cater for clients’ increasing demand to be able to flex numbers. Although the UK and London, where half its 70 consultants are based, remains its core market, over the years SSQ has built up its international business. Starting in Europe, its network includes offices in China, New Zealand, Russia, South Africa and Dubai. Shilton says the company carries out rigorous research of prospective markets, including talking to clients about their strategic plans, to generate legal recruitment ‘hot spots’. Then, there is the task of finding someone suitable from within SSQ or a local to open the office. Quarry says the fact SSQ is not beholden to a private equity house or a bank but funded entirely from the funds of its shareholders ent encourages this approach. “It is personal enc nal expenditure, so it means we are rigorous expe orous about testing it [prospective are testin ospective markets], and d then we ar very patient abo about how we grow it out,” he says. ery p says Recognising need to deliver a unifor uniform Rec ng the ne service across multiple servi tiple jurisdictions, risdictio s, means that tha recruiting the rightt staff itself is a priority re sta for itse for the company, Shilton. Compared to the mpany, says S ton. Co recruitment Shilton recrui nt sector as a whole hole Shil n says the process is “more deta detailed more rigorous”. proce d and mor i takes a “pretty Once hired, Shilton hilt says SSQ take patient approach”. “We We will llose money on pretty much every

consultant we hire in the first year,” he adds. However, such patience appears to pay off, with the churn rate for fee earners with more than a year’s experience hovering at around 10%. While Shilton expresses pride in the firm’s achievements, he is clearly a driven man. “The growth potential of the business is absolutely massive,” he says. “There are a whole bundle of interesting jurisdictions we have hitherto stayed out of.” In addition there are opportunities to exploit areas such as compliance that are closely linked to legal. The firm has its eyes set on the US – by far the world’s most important legal market, where SSQ already operates through a relationship with a US legal recruiter, although it has yet to set up its own office. “We will do the States,” says Shilton, where SSQ already operates through a relationship with a US legal recruiter, although it has yet to set up its own office. “There are several other jurisdictions post-Brexit under consideration in Western Europe, where we are in active discussions.” Shilton is also confident that the firm is well placed to take advantage of an expected wave of consolidation among law firms, a trend he expects to take decades. Shilton says he can see GP going well beyond £30m over the next couple of years, although “our ambitions go well beyond that”. “It’s a question of building the business nes out,” he adds. Although Quarry “took a step back from Alth business” two years ago, and n now plays a the b largely advisory role, he hass lost n none of what larg ‘entrepreneurial he describes as his ‘en neur insecurity’, nse says also drive drives Shilton something thatt he say hilton and SSQ’ss manag management team. “It the rest of S nt te It drives day. You are only as goo good as your next us every day re onl xt the minute you don’t have that fire deal, and th n’t h e you may as well business, y ell give up your bu ess, because you will start going bac backwards,” he says. With Shilton’s and Quarry’s ambitions rry’s am tions still unsated SSQ’s success, there seems litt little ated despite ite SSQ ccess, ther chance h nce of o that. hat ●

JANUARY 2017

06/12/2016 11:59

Issue 45 January 2017

RECRUITMENT MATTERS The View and The Intelligence

The BIg Issue

Legal update and the IRP

Events and Training

Looking ahead to 2017 p2-3

REC Membership in 2017 p4

Tax in 2017 p6-7

IRP Awards results p8

ENDING RISK: REC ANNOUNCES “DRAMATIC” MEMBERSHIP CHANGE The trade association has announced an agreement with HR and workplace expert Croner to give REC members access to legal expenses insurance as part of their membership. From 1 January 2017, recruitment firms with a turnover of up to £10m will automatically receive Croner Legal Expenses Insurance as part of membership. This means that 97% of REC members stand to benefit from the partnership. REC members with turnover of more than £10 million will be able to access the insurance with a minimum 25% discount.

@RECPress RM_JAN_17-NEW_V2.indd 1

As part of the deal, REC members will receive legal cover for employment disputes, legal defence, tax protection, property protection and personal injury. REC members will also gain access to Croner’s Tax, VAT and Health & Safety Helplines, a business diagnostics tool, and a salary benchmarking tool, plus discounts on a range of other Croner products and services. Large agencies within REC membership will save £18,000 per annum as part of the new deal. Medium-sized businesses can expect a saving of £11,000,

and small agencies will gain £6,000 a year. REC chief executive Kevin Green says the offer “dramatically improves” REC membership. “Even a regulated business can find itself faced with the worry and expense of a tribunal case, tax enquiry or legal dispute. Now, REC members will have a safety net,” he says. “Croner are experts at helping companies reduce risk, save time and control costs, giving you time to focus on the big picture. We’re delighted to offer this to REC members, who will benefit enormously.” Croner Group CEO Alan

Price says the agreement is an exciting step for REC members. “We are delighted to be partnering with such a wellrespected and professional organisation as the REC. The REC has long been a driving force championing the needs of the recruitment industry, whilst Croner has led the way in the field of employment law. The combination of these two organisations makes for an exciting partnership,” he says. “One of the REC’s goals is to ensure that employers reach the best talent and get the right people to help their businesses grow. “At Croner, with more than 70 years of experience in the field of employment law, we know only too well the cost of recruiting and retaining employees. “This partnership is one that will enable the REC’s members to access a range of Croner’s services at a significantly preferential rate. We look forward to developing this relationship for many years to come.” Recruitment Matters takes a closer look at the new Croner offering on pages 4-5.

www.rec.uk.com 05/12/2016 12:40

Leading the Industry

THE VIEW

We have our eye on social mobility, says Tom Hadley, REC director of policy and professional services

The resilient recruitment industry will be ready for a tough 2017, says Kevin Green

As 2016 ends, we can look back at an eventful year. Who would have predicted Leicester City winning the Premier League, the UK Voting to leave the EU and then Trump winning the US presidential election? These were such long odds that a £5 bet a year ago would have netted you £12 million! This just goes to show we are living in interesting times. For the recruitment industry, it’s been a tough year. The market has continued to grow but at a slower pace and candidate availability has been a huge issue as skills and talent shortages bite in many sectors. The impact of the EU referendum in June certainly slowed permanent hiring as clients got very twitchy and delayed hiring decisions. The good news is that since September the jobs market has responded positively with continued jobs growth and falling unemployment. We’ve also had a lot of government intervention this year: the planned introduction of the apprenticeship levy, changes to IR35 in the public sector, caps in the healthcare sector and introduction of the National Living Wage. As we look forward to 2017, it’s clear that as an industry we need to influence the political environment in which we operate. The Government

2 RECRUITMENT MATTERS JANUARY 2017

RM_JAN_17-NEW_V2.indd 2

MOVING FORWARD

has asked Matthew Taylor CEO of the Royal Society for the encouragement of Arts, Manufactures and Commerce to lead a review into the employment landscape in light of increasing gig working. This will include a review of employment practices and regulation in our sector. What this means is that the REC is more important than ever before. We will fight hard on behalf of the industry while also making sure we have our own house in order. What we need members to do is make sure they pass the online Compliance Test before the end of the year, promote the Good recruitment campaign to your clients and use the Jobs transforms Lives toolkit to talk up the value of the industry. Recruiters will respond to the challenges ahead. We are resourceful, agile and resilient. So while next year may be the toughest for some time, we will thrive because what we do matters to businesses and individuals. I will be touring the UK again next year so why not follow me on Twitter @ kevingreenrec for news of when I am in your city. I am keen to hear members’ views. My email is Kevin.green@rec.uk. com or via twitter @kevingreenrec

Recent discussions with ministers and shadow ministers confirmed that social mobility, skills and industrial strategy will remain hot topics over the coming year. We will position our industry’s voice at the forefront of these debates in 2017 and work with policy makers to build the best jobs market in the world in the UK in the post-EU era. Speaking at the recent CBI conference, the Prime Minister reiterated the government’s commitment to “developing a modern industrial strategy that will back Britain’s strategic strengths”. Whilst this may well drive growth in sectors such as advanced engineering, life sciences, creative industries and professional services (good news for specialist recruiters), the challenge is to ensure that new initiatives are underpinned by a skills strategy and a progressive immigration policy. Our regular data and feedback from REC members will ensure that we feed into this. On the inclusion agenda, one specific priority for government is to help a million people with disabilities into work. We hosted the launch of the Disability Confident scheme here at REC HQ and it was encouraging to hear the Minister Penny Mordaunt recognise the role REC members can play in making this happen. We will build on this in 2017 by encouraging members to sign up to Disability Confident. Jobs transform lives; nowhere is this more salient than in providing more opportunities to under-represented groups. The recent ‘State of the Nation’ report by the Social Mobility Commission showed that only one in eight children from lowincome backgrounds is likely to become a high-income earner as an adult. Alan Milburn, Chair of the Commission, underlined “the growing sense that we have become an ‘us and them’ society”. Political developments in the UK and the US have shone the light on how this feeling of being left behind can be reflected at the ballot box. With inclusion, progression and aspiration identified as key priorities, there are huge opportunities to showcase the role of our industry in helping people get a job, then get a better job. There are too many operational and external challenges for 2017 to be seen as heavenly for most recruiters. However, we’ll be knocking on the door when it comes to championing our industry’s contribution to the economy, labour market and wider society.

You can follow Tom on Twitterr ment @hadleyscomment

www.rec.uk.com

05/12/2016 12:40

1.4%

THE INTELLIGENCE

The only thing that we can say with any certainty about 2017 is that it will be an interesting year. By end of March 2017, the Prime Minister is scheduled to trigger Article 50, to kick start the negotiating process for the UK to exit the European Union. How this will impact on economic conditions in the UK and more specifically on the recruitment industry is less certain. Economic forecasters suggest that there will be a slowdown in the economy but not a recession. In November 2016 the Office for Budget Responsibility forecast that the economy will grow by 1.4% in 2017, due to lower investment, weaker consumer demand and higher inflation. Other

STAFF COSTS PEAK AS REVENUES AND NFI CONTINUE TO DECLINE The latest information from the RIB Index, sponsored by Bluestones Group, shows that the median RIB member had, by the end of Q3 2016, experienced four consecutive quarters of negative year-onyear turnover growth (Figure 1). Had legislation governing the use of travel & subsistence costs, which saw many umbrella employees return to agency payrolls, not changed in April 2016, this decline would undoubtedly have

www.rec.uk.com

RM_JAN_17-NEW_V2.indd 3

forecasts include the Bank of England forecast of 1.4%, and the European Commission and the Organisation for Economic Cooperation and Development (OECD) forecast of 1% growth. The forecasts above have been revised downwards to take account of the political and economic uncertainty of the negotiation process next year. Nonetheless, next year is likely to be followed by a period of growth in 2016, with the GDP performance exceeding expectations for the third quarter of 2016. The Bank of England expects that the annual GDP growth rate will come in at 2.2% for 2016. In terms of the recruitment industry, the REC forecasts continued growth, with the expectation that the value of the industry will grow between 3.25% and 7.75% in 2016 and between 2.7 and 6.7% in 2017.

THE OFFICE FOR BUDGET RESPONSIBILITY FORECAST THAT THE ECONOMY WILL GROW BY 1.4% IN 2017, DUE TO LOWER INVESTMENT, WEAKER CONSUMER DEMAND AND HIGHER INFLATION.

THE REC FORECASTS CONTINUED GROWTH, WITH THE EXPECTATION THAT THE VALUE OF THE INDUSTRY WILL GROW BETWEEN

A number of assumptions inform our forecast for the industry. Much like the wider economy, forecasts for 2017 suggest a slowing of the labour market. The PWC forecast that employment growth will fall from 0.9% in 2016 to 0.5% in 2017. Independent forecasters in the Treasury report, published in November 2016, on average, predict that the unemployment rate will edge up to 5.3% in November 2017 from 5% in November this year. There are some downside risks that are a result of muted wage growth, which, in part, stems from stalling productivity and business investment.

IN 2017

Figure 1: Recruiter turnover versus last year (%) – quarterly average 40

3.25% 7.75% 2.7% 6.7% AND IN 2016 AND BETWEEN AND

■ Upper Qtile ■ Median ■ Low Qtile

30 20 10

WITH REC SENIOR RESEARCHER, NINA MGUNI-JONES

7.3%

In November, the Office for Budget Responsibility forecast average earnings growth at 2.4% for 2017, which is marginally higher than the 2016 earnings growth of 2.2%. However, with inflation forecast to hit 2.3%, real wage growth will be nominal. Our data suggests that hiring intentions for the next 4 to 12 months remains steady. In JobsOutlook, 26% of employers plan to increase the number of permanent staff. Therefore, as we head towards 2017, the only thing we can forecast with some certainty is uncertainty. spiked in Q3, to a level that was 9.1 percentage points higher than in the same period last year. For the lower RIB quartile, they have now been making an operating loss for four consecutive quarters.

-2.79% -2.9%

-10

-5%

-5.9% -14%

-20 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016

been more severe. Of greater importance was the performance of the underlying net fee income (NFI). For the median RIB recruiter, NFI moved into negative territory (versus last year) in February 2016 and has remained there since. As a consequence, it had experienced three consecutive quarters of

lower NFI than prior year by the end of Q3 2016. With all bar the lower quartile of RIB recruiters increasing headcount in 2015, the pace slowed in H1 2016 and finally, in Q3 2016 reached -0.2% against prior year numbers. There appears to be more work to do, however, as total employee costs, as a percentage of NFI,

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; info@ribindex.com: 020 8544 9807. The RIB is a strategic partner of the REC.

RECRUITMENT MATTERS JANUARY 2017 3

06/12/2016 10:53

THE BIG ISSUE

MEMBERSHIP 2017 Being a member of the REC means knowing your business needs are being met every day. The REC’s 2017 membership offering is the most exciting and comprehensive ever produced, thanks to its new strategic alliance with leading business provider Croner. REC members will have access to Croner’s world-class suite of business tools and services, including Croner Legal Expenses Insurance. It meets the cost of expensive disputes giving you time and energy to focus on the big picture.

NEW FOR 2017: INCLUDED IN YOUR MEMBERSHIP LEGAL EXPENSES INSURANCE Even a regulated business can face the worry and potential expense of a tribunal case, tax enquiry or legal dispute. Croner Legal Expenses Insurance is the ultimate safety net. It saves your business money by managing your risk, giving you peace of mind. What does legal expenses insurance cover? Disputes The cost of dealing with employment disputes can paralyse any business. Croner Legal Expenses Insurance ensures your interests are protected when facing: • Employment disputes, both costs and expenses • Employee civil legal defence costs • Compensation awards • Investigation and disciplinary hearings • Representation costs and expenses

4 RECRUITMENT MATTERS JANUARY 2017

RM_JAN_17-NEW_V2.indd 4

ENDING YOUR RISK REC membership will be the most comprehensive ever offered. Recruitment Matters editor Michael Oliver takes a look at the new offering and finds out what REC members will enjoy as part of membership in 2017 Legal defence Your business and employees can rest easy knowing they will benefit from Croner legal cover, including: • Criminal pre-proceedings • Criminal prosecution defence • Data protection and information • Commissioner requests • Wrongful arrest • Statutory notice appeals • Jury service and court attendance

• Property protection • Personal injury All REC members with turnover up to £10 million will receive Croner’s Legal Expenses Insurance offering. Members with turnovers of £10 million-£100 million+ can access Legal Expenses Insurance at preferential rates.

Tax protection Tax investigations can be lengthy and cumbersome. Croner Legal Expenses Insurance protects you by covering: • Tax enquiries • Employer compliance disputes • VAT disputes

I-PORTALS – BUSINESS ESSENTIALS, HR & HEALTH & SAFETY Croner’s i-portals offer access to a vast resource of materials and advice on every aspect of managing a business, including every aspect of health & safety, HR and employment law not covered via the existing REC legal services. REC members can access Croner’s i-portals through their Membership Hub.

Other coverage Croner Legal Expenses Insurance manages risk, ensuring your business never misses a beat: • Statutory licence appeals • Contract disputes

Additional advice helplines The REC’s legal helpline is your first point of call for any employment law issue. It will be made more robust in 2017 with the addition of three new helplines from Croner.

Croner’s team of tax, HR and employment experts will be able to provide specialist advice, free for all REC members. Settlements & forecast All recruitment businesses need a complete understanding of pay settlements and forecasts to plan ahead. REC members will be able to access Croner’s monthly settlements & forecasts report through the new Croner i-portal. It provides updates on pay trends across a number of sectors and regions. SalarySearch Salaries and benefits are the heart of any recruitment conversation. Croner SalarySearch has up-to-date data on thousands of different job roles nationwide. REC members can access Croner SalarySearch for free through the Croner i-portal. Business health and strategy tool The REC’s free online business diagnostic is a simple, online tool, which allows REC

www.rec.uk.com

05/12/2016 12:41

members to assess where their business might need support. PAID-FOR PRODUCTS REC members will receive discounts on the following Croner paid-for products:

www.rec.uk.com

RM_JAN_17-NEW_V2.indd 5

Croner OnSite One of Cronerâ&#x20AC;&#x2122;s legal experts will visit your business and help resolve any conflicts and disputes. Croner SafeCheck Get peace of mind that your business is fully compliant with

the latest health and safety requirements. Online job evaluation tool The perfect tool for clients looking to build the right job specifications, benchmarked across a variety of industries. Market rate report

An independent review of roles, provides information on quartile pay ranges and typical benefits packages. To renew your REC membership for 2017, visit

http://bit.ly/2fSHdT6 RECRUITMENT MATTERS JANUARY 2017 5

06/12/2016 10:53

Legal update

2017 Status for employment and tax purposes - what can we expect for 2017? By Lewina Farrell, solicitor and head of professional services For a couple of years there has been a lot of media attention on the changing nature of work – including the use of zero hours contracts and how temporary workers are treated, both by agencies and their end user clients. This has really ramped up in recent weeks and months. The BEIS Select Committee has looked at Sports Direct’s operations both in its stores and warehouses and may now look also at Amazon and others. The Government has also announced a review by Matthew Taylor into employment status. Meanwhile, in October 2016, three Uber drivers won their employment tribunal claim to be recognised as workers for the purposes of national minimum wage, holiday pay and whistleblowing protection – Uber has said it will appeal the decision. Deliveroo faces similar claims as does Addision Lee. Separately HMRC is looking into Hermes and how it engages its drivers – the result

6 RECRUITMENT MATTERS JANUARY 2017

RM_JAN_17-NEW_V2.indd 6

will determine whether they are workers for tax purposes. If they are, then Hermes (or any employment businesses they use) could face huge retrospective bills for employers’ national insurance contributions whilst the individuals themselves could face bills for PAYE tax and employee national insurance contributions. At the time of writing there are calls for HMRC to look into alleged tax avoidance by employment businesses when supplying temps. In some instances it can be clear whether someone is a worker for tax and employment rights purposes. It may also be equally clear when they are not and are genuinely self-employed. However, for other temporary workers it can be less clear cut and requires weighing up a range of factors – such as whether they take a financial risk in running their own business, number of clients, whether they work

under supervision, direction or control. Employment and tax status is relevant for recruitment businesses because it determines: • What employment rights those individuals are entitled to (or not) – workers are entitled to national minimum wage, holiday pay and rest periods, and statutory pay such as sick pay, maternity pay and pensions auto-enrolment (subject to meeting the relevant criteria). “Agency workers” are entitled to equal treatment under the Agency Workers Regulations 2010. Employees have additional rights such as to maternity leave, protection from unfair dismissal and redundancy pay (subject to a 2-year service requirement) and protection under TUPE. Genuinely self-employed persons are not entitled to any of these; • Whether the employment business should be deducting PAYE tax and NICs, and

paying employers’ NICs (or whether an intermediary the employment business has engaged with should make these deductions/ payments); • What contracts should they engage temps on, particularly if engaging them through an intermediary such as an umbrella company or a personal services company. Recruitment businesses will have to give these issues even more thought from April 2017 when supplying to the public sector, when changes to IR35 are expected to come into effect. In brief, these changes will require employment businesses to assess IR35 status for temps working through personal service companies (it is currently the responsibility of the PSC). If inside IR35, the employment business will have to deduct PAYE and NICs, and pay employers NICs. REC Legal will keep members updated on all of these developments.

www.rec.uk.com

05/12/2016 12:41

Inspiration

BEHIND THE SCENES AT THE INSTITUTE OF RECRUITMENT PROFESSIONALS

The View

Lisa Starkey is a principal consultant n at MVP Supply Chain Recruitment

Q&A How did you get into recruitment? By accident! I registered with People First, a specialist agency in the City in London, after relocating from the Midlands. They asked me in for a registration interview and, at the end of that, asked if I’d be interested in working for them. Two further meetings later, they offered me a position, and I accepted. What do you love about the job? Every day is different, plus you’re in charge of your own destiny, to a large extent. There’s also the very real bonus of helping people find a new role and make a huge difference to their life. This is especially satisfying when you place someone into a role they love and in which they thrive, despite it being one they wouldn’t have considered themselves. Would you recommend that job seekers consider recruitment a career of choice? Definitely. It’s not a career that was highlighted or promoted when I was at school, and most of my colleagues and other people I know in recruitment got there by accident. I think more should be done to promote what is a rewarding and challenging career option. There are more and more recruitment apprentice schemes being developed now so, hopefully, this will make the sector more appealing as a career choice for young people at the start of their working life. Given your time again would you do anything differently from when you started out? I’ve given this question a lot of thought and, genuinely, I don’t think I would. I was really lucky to start my career with People First, who provided me with great training and the opportunity to get qualified via the REC. All of this gave me confidence in my ability to recruit, through the combination of practical work and best practice standards and processes.

Adrian McGennis s is the CEO of Ireland’s Sigmar up Recruitment Group

WHAT I KNOW Your team needs to believe in what you’re doing People talk about purpose and purpose within an initiative. It even gives the individual some deal of satisfaction. You’ve got to do it in a very real way. Overseas can be tricky, but being at home helps We’ve had a lot of sojourns overseas, including opening in Prague, Warsaw, Sofia and Singapore with mixed experiences. We were really conscious of the cultural transition and know that’s important for getting there. We’re servicing clients from Ireland. Even though it’s more expensive, we have that visibility, we have that control and that culture. Have the right people If the temp side of your business is substantial, your back office needs to be rock solid. You’ve got to over anticipate to grow and know it’s going to be squeaky. Getting in a good financial director is important too, depending on your scale. Know your tech Our SEO is really good, our utilisation of technology is really good. The training we give people to use social media provides them with the tools they need to do a good job. I think the first two hours in a new business is vital. It’s vital for you to get them into your mentality in the early stages. I think we’re the only company in the world with the stated goal of getting 100% in being social media black belts. If the training culture is there, it’s not too difficult to maintain, because we know we’re going to make the investment over time. You can listen to the full podcast with Adrian at www. rec.uk.com/scaleuppodcast

To keep up to date with everything the Institute of Recruitment Professionals is doing, please visit www.rec-irp.uk.com

www.rec.uk.com

RM_JAN_17-NEW_V2.indd 7

RECRUITMENT MATTERS JANUARY 2017 7

06/12/2016 10:53

Events and training

AWARDS

IRP AWARDS RESULTS 2016

JOBS TRANSFORM LIVES: FINDING LOVE AND CAREER SUCCESS THANKS TO WOODLAND

It was another great IRP Awards ceremony. Congratulations to all winners and those shortlisted.

Woodland Consultancy Services uses the REC’s client and candidate attraction toolkit to talk about how they transformed a candidate’s life. Scottish national Lewis Wilson’s salary went up stratospherically since Woodland began working with him in early 2002, having found him positions matching his requirements over a period of 7 years. Woodland has more than 30 years of experience in placing quality candidates in their perfect role and transforming their lives. We got in touch with Lewis shortly after he visited our website to explore the new opportunities available to him. After some bespoke career advice on what direction Lewis’ career should go according to his experience and needs, namely fast career progression, we got him the jobs he deserved. The last salary we negotiated for him was substantially higher than what he was earning initially as a result of a string of promotions. Lewis says: “The wonderful staff at Woodland looked at my previous experience and catered it towards positions that were the perfect fit for me. One of the roles was in Paris, where I met my wife. I am now living in Paris permanently and I can say working with Woodland was my best career decision to date!” At Woodland we understood how guiding Lewis towards the right jobs would have a positive impact on his life. We last worked with Lewis in 2009, where he left us to become self-employed, for even further financial gain to him. • This case study originally appeared on Woodland Consultancy Services’ website (www.woodland.co.uk/ blog/jobs-transform-lives-71.htm).

Category

Winner

Highly Commended

Best Newcomer of the Year

Laura Garratt Chefs Jobs UK

Despina Kefala - Hyper Recruitment Solutions

Recruitment Apprentice of the Year

Bradley Carton BPS World

Permanent Consultant of the Year

Andy Cox Rethink Group

Temporary Consultant of the Year

Adam Razzell - Advance Resource Managers

Blayne Cahill Carrington West

Best Candidate Experience

Susannah Lawson Chefs Jobs UK

Business Manager of the Year Cheryll Breed ID Medical Group

Chloe Baptiste - Veredus Executive Search and Selection

Business Leader of the Year

Deenu Patel ID Medical Group

Best Back-Office Support Team

Liquid Personnel Ltd

Advocate Company of the Year

Serocor Solutions

Best Corporate & Social Responsibility Practitioners

Gi Group

Best Recruitment Campaign

Pertemps Network Group

Best People Development Business Award

Liquid Personnel Ltd

Amoria Bond Ltd

Best Company to Work for (up to 20 employees)

Think Global Recruitment

Class People

Best Company to Work for (up to 50 employees)

Carrington West

Best Company to Work for (up to 150 employees)

Amoria Bond Ltd

Best Company to Work for (up to 250 employees)

New Directions Holdings

Best Company to Work for (more than 250 employees)

Phaidon International

Lifetime Achievement

Julia Robertson

Recruiter of the Year

Andy Cox - Rethink Group

A special thanks to our partner Indeed And thanks to our sponsors

RECRUITMENT MATTERS

Membership Department: Membership: 020 7009 2100, Customer Services: 020 7009 2100 Publishers: Redactive Publishing Ltd, 17 Britton Street, London EC1M 5TP. Tel: 020 7880 6200. www.redactive.co.uk Editorial: Editor Michael Oliver michael.oliver@redactive.co.uk. Production Editor: Vanessa Townsend Production: Production Executive: Rachel Young rachel.young@redactive.co.uk Tel: 020 7880 6209 Printing: Printed by Precision Colour Printing

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.

8 RECRUITMENT MATTERS JANUARY 2017

RM_JAN_17-NEW_V2.indd 8

www.rec.uk.com

05/12/2016 12:41

Advertorial A DV E RTO RIAL F P S G R O U P

Autumn Statement – Chancellor press-gangs recruitment bosses into service as HMRC’s new compliance resource With his opening remarks congratulating the Government on the high levels of employment prevailing within the country, the UK recruitment industry might have been forgiven for anticipating some appreciation from Chancellor Hammond for the part they have played in this success. Regretfully what followed demonstrated that the Government continues to view the recruitment industry, and particularly the contracting sector, as being awash with workers who are ‘pretending’ not to be employees in order to gain a tax advantage. Despite protest from recruitment industry bodies, HMRC are activating the plan to hold recruitment companies liable for the taxation of contractors who use personal service companies (PSC’s) whilst working in the public sector. As of April 17, agencies will need to make the call whether a contractor can legitimately be classed as self-employed (outside IR35) or whether their working practices are more akin to an employee (inside IR35). Once the legislation is in place, agencies will need to ensure PAYE and NIC is deducted on all payments to PSCs on assignment in the public sector that fall within the scope of IR35. The nasty sting in the tail being that it is virtually impossible for agencies to determine a contractor’s IR35 status at outset. Worse, IR35 status can change over time and agencies have almost no chance of being able to keep track of every contractor’s working practices during the course of every assignment. If the agencies make the wrong call, liabilities can be substantial. In one landmark IR35 case (Dragonfly vs HMRC) a single PSC accumulated a tax bill of over £90,000 as a result of becoming too ‘integrated’ into the end client’s business. In HMRC’s eyes, this debt will sit with the agency rather than the contractor’s company, post-April. This also means that when HMRC identifies the rules have not been applied properly, it will be much easier to enforce collection on the assets of a UK business (the agency) rather than the worker, who may not have sufficient wealth to pay. The move forcibly co-opts agencies into the front line of tax compliance with a metaphorical gun to the head of those who incorrectly assess a worker’s status. This approach may well seem unfair. HMRC themselves have struggled (even with the benefit of hindsight and considerable legal powers) to determine worker status with 100% accuracy. Over many years they have been losing and winning high profile IR35 cases seemingly in equal measure. Such cases are complex and hinge on the particular circumstances of an affected worker. The suggestion of a straightforward ‘online tool’ to help agencies assess worker status will be of little comfort given the consequences if the outcome is incorrect.

image (if applicable)

Public sector agencies are already operating on tight margins, some are even subject to rate caps. They have limited capacity to absorb this additional compliance burden. The risk-averse alternative is to ensure that payments to all contractors are made under PAYE, either via in-house payroll or an umbrella company. For those operating agency payrolls, consideration must also be given to the Apprenticeship Levy which similarly comes into effect from April 17. The levy will cost agencies an additional 0.5% of their total pay bill. Although the first £3m of payroll is covered by an allowance, even a mid-sized contractor book can rapidly exceed this threshold. To make matters worse, the Finance Bill is worded in such a way that payments made to limited companies net of PAYE/NIC deductions will count towards an agency’s total pay bill. With these liabilities in mind it is essential any agency involved in the placement of any workers in the public sector immediately review their payment arrangements.

ABOUT FPS Established in 1994, FPS Group is the industry’s most trusted and reliable employment solutions provider. Visit www.fpsgroup.com or call 0800 634 4848 for more details. FPS Group is the trading name of Freelance Professional Services Ltd, which is licensed by the Isle of Man Financial Services Authority

It is difficult to see how the clampdown on the use of PSC’s in the public sector will not be extended to the private sector in due course. This year’s legislative change may well be seen as the Government getting its own house in order before requiring others to do the same. Autumn statement 2017 may well be the last of its kind, but it comes with a parting promise; the recruitment industry can expect further tightening of rules surrounding worker’s pay. The Chancellor included in his speech a promised consultation to ‘ensure that the taxation of different ways of working is fair between different individuals, and sustains the tax-base as the economy undergoes rapid change’. Fair or not, holding agencies liable for policing their contractor’s tax affairs is likely to be both an effective and relatively inexpensive way for HMRC to achieve their view of compliance in the sector. Whilst it is public sector agencies that must respond immediately, all agencies with significant proportions of contractors on non-PAYE solutions need to be aware of the clear direction of travel. Considering tax compliance an issue between the worker and HMRC is no longer an option. ●

The Autumn Statement, however, made it explicitly clear that these changes are a reality. WWW.RECRUITER.CO.UK 31

FPS FP Adv.indd 31

06/12/2016 09:31

O FF- PAYRO LL RULES

SHIFTING THE LIABILITY The new ﬁnancial year could see the responsibility for administering offpayroll workers’ tax onto recruitment agencies. Sue Weekes delves beneath the new government reforms CHANCELLOR PHILIP HAMMOND’S changes to off-payroll working rules in the public sector announced in the Autumn Statement mean many contractors and recruitment agencies may be beginning the year with a sense of trepidation. From April 2017, responsibility for operating off-payroll working rules and paying the correct tax will be moved to the body paying the worker’s company. This body, of course, potentially being a recruitment agency. Full details of the reform of the intermediaries legislation are set out in the draft Finance Bill 2017. As Matthew Brown, managing director of giant group, which specialises in professional services for the management of temporary 32 RECRUITER

p40_42_compliance.indd 40

JANUARY 2017

workers, points out, the biggest potential ramification for agencies is that they will have responsibility for administering the IR35 status decision made by the public sector organisation that a contractor is working for (for each personal service company [PSC]) and be liable for employers’ National Insurance payments. The changes are a substantial blow to the contracting sector. Marcus Green, director at Nova Contracting, which provides umbrella employed and PSC contracting services, described it as a missed opportunity to demonstrate that the government understands modern working patterns and recognises the vital role of the temporary workforce in creating a “match-fit” UK economy. “At a time when there is huge demand in the public sector for vital skills on a flexible basis, the new rules will make it much harder for them to deliver their services,” he said. Matthew Huddleston, MD of Freelance Professional Services, which provides payroll and umbrella company solutions to temporary workers, agrees and said the government seems determined to treat everyone with a one-size-fits-all employee relationship, which is at odds with the modern workplace. “The government seems to think that a huge proportion of people are pretending not to be employees when they really are and this is simply not our experience,” IM AGE | ISTOCK

06/12/2016 11:10

he says. “A lot of people are working in contracting roles because that is the way of the new economy.” There is no doubt that the changes will bring considerable challenges to recruiters. First off, Huddleston says it has been, and always will be, very hard for a recruiter to establish IR35 status. “It is extremely difficult to know what a worker’s status is on-site on a day-to-day basis,” he says. “And it isn’t something a recruitment agency can do at the outset and then consider they are compliant because it can change over time.” He advocates agencies use umbrella company arrangements rather than PSC arrangements for contractors placed in the public sector. “Veriﬁcation that PAYE is being operated by the umbrella can then be obtained in the form of copy payslips or real-time information

submissions showing the full payment to the worker is being subject to PAYE,” he says. Alan Nolan, senior partner at Aspire Partnership, agrees that the agency is likely to be the “least equipped” to give a full account of the contractual situation and will need to canvass the end user and obtain information from the contractor too, and assess their answers accordingly. “This will be time-consuming for recruiters,” he says. “In a scenario whereby there is also a contracting intermediary – so they would be the engager and liable for the off-payroll working rules – they are even more far removed from the hirer and so it will

be even more of a burden to collate the appropriate information. Straight away, the risk of a ‘Chinese whisper’ effect rings bells.” HMRC is developing an online tool to help decide IR35 status (see box overleaf). It is optional so engagers may decide to implement a questionnaire process of their own to come to a decision, says Nolan. And he adds: “The consultation that was published in the summer states there will be a statutory right of appeal against the tax and NI liability for WWW.RECRUITER.CO.UK 33

p40_42_compliance.indd 41

06/12/2016 11:10

O FF- PAYRO LL RULES

when a PSC or engager disagree with a determination that the new rules apply. The PSC and/or engager will be able to request a formal review of the decision and to appeal that decision to the tribunal in the same way as other PAYE and NI decisions and determinations.” Nolan says that if it is found that IR35 does apply, the engager will have increased costs as they will need to pay employer’s National Insurance (NI), and this will lead to increased costs throughout the supply chain, especially given that the Chancellor has also removed the ﬁve per cent tax-free allowance for PSCs caught in this reform. The changes are likely to bring considerable risk to agencies and the additional administrative burden for agencies will be signiﬁcant. Brown explains that for PSCs that the public body decides fail IR35, the agency will be responsible for calculating the amount of PAYE due (on each remittance) and pay this amount to HMRC, as well as including it in a Real-

Time Information (RTI) submission. “Additional information will be required from the PSC director to enable this,” he says. “HMRC will have ﬁnancial redress against the agency if the agency miscalculates the PAYE liability or doesn’t make the payment to HMRC.” To avoid risk of non-compliance penalties, some agencies – or the public sector organisation in the case of a direct hire – may decide to pay all contractors as employees. Green believes it is “unavoidable but understandable” that many public sector bodies and their suppliers will take a risk-averse approach, but not necessarily across the board. “The very nature of contract working is that it gives employers planning and budget ﬂexibility to meet peaks and troughs in demand and

A TOOL FOR THE JOB? On the day after the Autumn Statement, HMRC presented the prototype of its IR35 tool to members of the Freelancer & Contractor Services Association (FCSA). The tool consists of over 50 questions in five sections: personal service, control, financial risk, business structure, and part & parcel. FCSA registered its concern that there is no section on Mutuality of Obligation, which is important in IR35 cases. FCSA CEO Julia Kermode says HMRC’s view is that it is present for the purposes of the tool because work is (or will be) undertaken in exchange for financial payment. “This seems to be a flawed approach and therefore the extent to which it is present should be tested in a similar manner to other sections of the tool,” she says. The tool is optional and Kermode says different parties might achieve different results for the same assignment depending 34 RECRUITER

p40_42_compliance.indd 42

on their perception and how they answer the questions. “Ultimately, it will be down to the party that has the tax liability to decide the IR35 status of a contractor, regardless of the tool outcome.” She concludes: “Whilst it is abundantly clear that the tool presents HMRC’s view of IR35 status for a given set of circumstances, this does not mean it is the correct view. Given HMRC’s poor success rate in 16 years’ worth of IR35, the failure of Business Entity Tests, and the much-maligned Employment Status Indicator (ESI), it is difficult to see why they believe that this tool will be respected or relied upon. I have heard of several instances of large public sector end-clients instigating a wholesale ban on the use of PSCs as a mechanism to engage freelance professionals, so they are clearly not considering the tool as a viable way forward to minimise their risk.”

contractors the freedom to work across a number of assignments,” he says. If they do take this route, Brown warns that in the first instance they may need to consider that this does not trigger an investigation by HMRC in respect of the IR35 status of contracts before the full-time employment. “Clearly one of the many benefits of a public body using contractors is not having employment risk. Therefore, we believe that in the majority of cases the public bodies will not be employing contractors themselves.” Another concern is that the new rules will eventually migrate to the private sector and Huddleston says this first stage could be seen as the government getting “their own house in order” before asking the private companies to follow suit. Nolan agrees that there has got to be “an expectation” that the same process will follow for the private sector in due course but believes the government would assess how well the reform has worked in the public sector before coming to a decision to extend to the private sector. Green believes “there is every likelihood” that the government will extend the new rules to the private sector based on the results it achieves in the public sector but says there is likely to be strong opposition to it. He adds: “There has to be a balance of course and protection against potential abuse of the employment model, but the proposals are a blunt instrument for something which is infinitely more nuanced.” ●

JANUARY 2017

06/12/2016 11:11

Discover our market-leading umbrella solution Robust SDC status tests completed in minutes Eligible contractors can claim variable mileage plus fixed subsistence, travel and accommodation expenses FCSA-approved

www.advance.online 01244 564 564 experts@advance.online REC.01.17.043.indd 43

05/12/2016 10:45

REC.01.17.044.indd 44

02/12/2016 11:33

CO M M U N I T Y

SOCIAL NETWORK WHAT HAVE YOU BEEN UP TO? GET IN TOUCH!

From sleeping rough, getting quizzical or bringing ‘elf’ care to kids, here are a few things you’ve been doing outside recruiting… RECRUITER EMBS BRINGS WORK BACK TO DARLEY ABBEY MILLS VIA Technical recruiter EMBS has mirrored the entrepreneurs of an 18th century working business and moved into The Long Mill, Darley Abbey Mills, which had been in a state of dereliction since 1969. Darley Abbey Mills was built in 1782 in Derbyshire. Director of technical recruiter EMBS Simon Bucknell said: “As a recruitment business operating in engineering, advanced manufacturing and technology, we love the idea of working in a World Heritage Site where these industries were formed – it just seems so right!”

CUMMINS MELLOR RECRUITMENT GETS QUIZZICAL FOR YOUTH CHARITY VIA Lancashire-based Cummins Mellor Recruitment put on a ‘Quiz Quest’ for Blackburn Youth Zone, with over 100 people representing businesses throughout Lancashire. The event raised £4k, which goes towards supporting the BYZ’s ‘Get a Job’ programme.

Lancashire’s Brainiest Business was Graham & Brown, pictured with Laura Phelan (left), events & stewardship manager, Blackburn Youth Zone, and chairman of Cummins Mellor Recruitment, Richard Mellor (centre)

THE SCENIC BEAUTY OF DARLEY ABBEY MILLS – AND BEFORE EMBS MOVED IN (right)

One of Kentemp’s Elf volunteers Katherine Ludkins

KENTEMP RECRUITMENT RAISES SMILES AND MONEY FOR CHARITY VIA Kentemp Recruitment & Staffing has been raising money for children’s charities by sending Santa’s Elves to visit children across Kent. Director Matt Lacey says: “It’s just the start of the campaign and we have three weeks to go. Our projection is 50 happy children seen and £500 donated. We are thinking of making this an annual thing for us, with such a great response and so many smiles so far!”

TW I TT E R

INFOSEC PEOPLE SLEEPS ROUGH FOR ACTION FOR CHILDREN VIA The team at cyber security and technology recruiter InfoSec People took to the streets of Bristol to sleep rough as part of Byte Night. Along with a host of others from various companies, the InfoSec team slept on the pavements to raise money for Action for Children. It was certainly worthwhile as they met their target of £2.5k. Well done, InfoSec People!

Expand Exec Search @expand_exec Nov 22 Extremely proud to be the Big Story in @RecruiterMag this month!! #winners #teamwork #collaboration @RecruiterMag instagram.com/recruitermagazine/ recruitermagazine.tumblr.com/

WWW.RECRUITER.CO.UK 37

p37_recruiter_social.indd 45

06/12/2016 09:13

E EMPLOYABILITY CO M M UNITY

PUTTING CLARITY INTO THE CAREERS OF STUDENTS “Getting a job is a journey for everyone”

BY GRAHAM SIMONS

ocial enterprise CLARITY is working to raise the career aspirations of blind and disabled students at a local school. The east London-based firm employs people who are visually impaired in its business of manufacturing toiletries and cleaning products. CLARITY wanted to use its own operation to show youngsters with disabilities who are leaving secondary school the possibilities for them to have meaningful employment. Helmed by CLARITY CEO Jeremy Robinson, the recently launched career development initiative takes the students through every stage of the production process. “The process of getting a job is a journey for everyone,” CLARITY spokeswoman Kasia Mysiak told Recruiter. “This journey can be long and difficult for some people, particularly for those with an impairment, or impairments, that could be perceived to be a barrier to employment. “The first stage on the journey is about raising expectations that employment is achievable; these are the expectations of the individuals themselves, and also those of their families and others around them. The next stage is experiencing work itself.” The 10-week educational transition project, supported by funds provided by Greater London Fund for the Blind, has seen eight students aged 1417 involved in every stage of production of CLARITY’s ‘bath bomb’ range. Most are visually impaired but some have autism and physical disabilities. The first few weeks of the programme are classroom-based, with the second half spent mostly in CLARITY’s factory and laboratory. Each student on the programme has their own individual style of learning, as well as skillsets. CLARITY uses a range of activities from individual talks to group work, as well as a range of hands-on work. Among the means of assessing the students’ progress are weekly quizzes. To introduce an element of competition, students go into two teams to come up with two different designs of a final bath bomb product – a toiletry product that is put in the bath

38 RECRUITER

JANUARY 2017

p46_recruiter_employability.indd 46

Students experience working on CLARITY's different products, such as the bath bomb (below)

and dissolves to create a more relaxing bathing experience. As some participants like routine, Mysiak says CLARITY ensured there was a routine for them, which started with an icebreaker game ahead of a lecture so there was a structure; they knew what was expected of them and what would happen next. Towards the programme’s end, students specialise in certain areas, with each team having a head of sales and a head of production, encouraging them to think about what skills they had and where their skills would be best suited. “We didn’t want to place limitations on the students’ ambitions, but we aimed to provide them with inspiration for roles that would best suit their own unique skillset,” Mysiak said. “Before the course, maybe some of them thought they won’t be able to ﬁnd work or ‘I will struggle’. “This programme shows them they are able to do things, and through conversations with our staff – the students had lunch in our canteen with our regular staff – they could get an impression of both the CLARITY family and ‘mainstream’ employment.” “We hope they can say ‘Oh, I really enjoyed this part of the programme, and I was good at it too’. It will give them structure for the future – that’s what we hope.” ●

WHO IS CLARITY? CLARITY was set up in 1854 as Incorporated Association for Promoting the General Welfare of the Blind by Elizabeth Gilbert. Seven employees made baskets in a small workshop in Holborn. Today, the organisation employs 105 people across two sites, and CLARITY is now pan-disability, although visual impairment is the largest disability that it looks after. No longer making baskets, CLARITY started making toiletries and cleaning products in the 1930s. How could recruiters help an organisation like CLARITY to put more people into work? Send your suggestions to recruiter.editorial@redactive.co.uk

IM AGE | CLARIT Y

06/12/2016 09:14

A DV E RTO RIA L

Compliance Brought to you by

PUTTING RECRUITMENT AGENCY COMPLIANCE INTO PRACTICE Once again, a recruiter’s questionable tax arrangements are in the news, and the government continues to see agencies simply as vehicles for the avoidance of tax and employment rights. Now, more than ever, recruitment agencies need to offer assurance to hirers and candidates that they provide a high quality service. Proving that your business practices are fully compliant also makes good commercial sense; it builds brand reputation which in itself could improve the top and bottom line of your P&L.

Senior management buy-in So how can a recruitment agency ensure compliance is at the heart of its business practices and demonstrate to hirers and candidates that this is the case? First, senior management needs to buy into the principles of good practice, continuous business improvement and established management systems and processes to support these. Second, an agency that claims adherence to compliance must, at the very least, ensure that the practices of all its consultants are consistent with all the legal requirements that affect recruitment agencies.

Proving your compliance credentials Third, recruitment agency compliance needs to reflect the reasonable expectations of hirers and candidates. If an agency wants to publicly prove its compliance credentials, it must have the evidence to demonstrate that its management and operational processes are consistent, transparent and effective. These would include, complying with legal, regulatory and contractual requirements, confidentiality, data protection and various other specific areas.

↗ JOHN RANDALL Engagement Director, Standards in Recruitment

Sadly, as we have all recently seen, trade association membership on its own cannot not establish this. It can only be verified through an independent external audit.

John Randall Engagement Director, Standards in Recruitment specifically for recruitment agencies. The SiR programme is about helping recruitment agencies not only to improve their business practices, as painlessly and cost effectively as possible, but also to enhance their brand credentials. As well as addressing the regulatory aspects of the recruitment process, the Standards themselves reflect the rules of engagement that clients and candidates expect, and accreditation under SiR provides assurance to investors, particularly at a time of uncertainty.

Clear business value-add Julie Welford, compliance manager for aerospace specialist Aeropeople, states “SiR goes further; into more depth and because it is specifically for the recruitment sector, the accreditation programme reinforces that we are providing the best service to our clients and our organisation. It’s a clear value-add to our business to complete the SiR programme. To any recruitment business serious about wanting to improve the way it operates, SiR’s accreditation programme is an excellent management and compliance tool”.

Genuine quality The SiR programme is designed to promote excellence in a very practical way. In today’s challenging world, capturing the right standards and establishing independent verification is critical. Having created this platform, SiR accreditation highlights genuine quality businesses. Call: 0845 450 4415 (quoting Recruiter 0117) Visit: www.standardsinrecruitment.com

Reassurance for clients and investors Standards in Recruitment (SiR), is the only independent compliance accreditation programme developed

WWW.RECRUITER.CO.UK 39

REC.01.17.047.indd 47

02/12/2016 11:34

REC.01.17.048-49.indd 48

02/12/2016 11:37

REC.01.17.048-49.indd 49

02/12/2016 11:38

E BUSINESS ADVICE CO M M UNITY

10 WAYS TO MAKE THE MOST OUT OF YOUR RECRUITMENT SOFTWARE Recruitment software plays an integral role in the success of the constantly evolving recruitment sector. It enables consultants to manage their relationships while giving stakeholders the ability to monitor productivity.

How you can get the most out of your CRM

➊ Develop a plan Choosing software is a big decision, one that requires thorough research into the options available to meet current and future business needs. All too often business leaders naively assume that the software will take care of itself. Without a plan, the initial beneﬁts will erode with time and the investment will never realise its full potential.

Ian Farrow The SME Coach

➋ Appoint a usage decision-maker

Your decision-maker should be somebody in a senior capacity that fully understands the business needs and processes, has a thorough understanding of the software’s functionality, and is fully trained in using the software.

➌ Appoint an internal trainer

This is the person who is in a position to determine how the system is used and can react quickly to users and the businesses needs by providing help when needed. They will also be well positioned to help reinforce the standards outlined by the usage decision-maker.

➍ Stay updated

With the pace of change in recruitment and the evolution of your business, not staying updated with news from your provider and regularly updating the version of the software will result in it becoming less effective. Ensure you are on the latest release.

➎ Have a test database

This is good for both training and testing as it can act as a safe environment for training for new starters or existing users. It can also be used to test releases or new versions prior to rolling them out.

➏ Train staff Training will usually take place at the point of purchase and often a minimum required amount of training will occur based on your business needs. If you initially just took the minimum training it is likely you will be unaware of some functionality.

➑ Feedback Software providers will have a development plan stretching many 42 RECRUITER

p50-51_recruiter_careers.indd 50

years into the future with planned features and improvements. These will be based on market trends, technological enhancements, changes within the recruiting environment, functionality to gain competitive advantage and user feedback.

➒ Bespoke development Off-the-shelf recruitment software is at times too rigid and doesn’t provide your ideal solutions. Providing suggestions may result in these ideas being added. Some never make the development plan or if they do, the timescales may not suit you, so bespoke development would be the best option. 10 Maintain IT infrastructure

Over time the complexity of your system will grow, demanding more from your IT infrastructure. If your IT resources are not regularly maintained and improved, performance will be affected. Unchecked, the consequences will be a reduction in user buy-in, usage and, ultimately, productivity. ●

↗

➐ Manage resistance Resistance to change is a constant business issue. If resistance becomes part of the culture, or if it is not managed, it can result in the deterioration of data quality and consistency. Appoint a usage decisionmaker and make everyone aware their usage will be monitored.

“Business leaders naively assume that the software will take care of itself”

IAN FARROW is head of training at recruitment software provider Itris

JANUARY 2017

06/12/2016 11:11

CO M M U N I T Y

CAREERS

Will you be on the Naughty or Nice list after the holiday party?

Find your next move in recruitment on jobs.recruiter. co.uk

BY TARA LESCOTT

↗ TARA LESCOTT is managing director of Recruiter Republic

IF THERE’S ONE THING us recruiters are good at – it’s celebrating and partying. With the party season upon us once again, we will be gearing up to a big night out with our colleagues. A bit of tinsel around the whiteboard and some lukewarm wine in a plastic cup is not us! We’ll dress up and do it in style, thank you very much, and we’ll let our hair down and celebrate our successes … but there will always be one, sometimes several, that will really see the year out with a BANG and possibly won’t be back in January because of how they behaved at the holiday party. After 18 years in recruitment I have witnessed all sorts of eye-opening scenarios – some funny, some serious and some downright weird. To make sure 2017 gets off to a healthy start – career-wise – avoid these vignettes at all costs: 1. THE RANT

Your directors do not want an in-depth analysis of their management skills, business strategy or personal habits while at the party. If you’re smart, the party is a great opportunity to show them how you can conduct yourself, to bond with the management team and getting some attention of the right sort. If

you’ve got something to say less than celebratory to your manager, do it professionally and get it out of the way before the party so that your frustrations don’t bubble over once you’ve had a few drinks. A drunken, verbal assault will deliver a killer blow to your prospects for promotion. 2. THE DRUNKEN CAREER REVIEW/ SALARY NEGOTIATION

It’s getting towards the end of the night, you spot your manager at the bar, and you stagger over ready to set your boss straight on why you should have been promoted and why you should be paid more. STOP. This is the last thing your boss wants to talk about and you’re not going to get the outcome you want. Save it for the new year – or book a meeting. 3. THE AFFAIR

Believe me, that colleague you work with every day is only temporarily the most gorgeous creature on earth while at the party. It’s Cinderella syndrome – out of your usual environment and ﬂuffed up in their best togs, everyone suddenly looks more attractive. But you are likely to regret that drunken clinch as soon as you get back to the office, and everyone will know about it – no matter how discreet you think you

are being at the time. Have a buddy close at hand to keep an eye on you. 4. THE PRANK

There’s always that one joker in the office, isn’t there? Watch out because in a crowded room, a captive audience and a few drinks inside them, anything could happen. Don’t get involved no matter how hysterical the proposed gag is. In most cases this won’t end well and you’ll be dragged down with them. 5. THE HANGOVER

Please moderate the drinking. Starting too early and going overboard can leave you in some strange scenarios. Unless you want to be humiliated and arrive in your war-torn outﬁt from the night before and sporting a random tattoo, just tone it down a bit. We live in a digital age so the days of “I don’t remember a thing” are long gone. You’ll wake up to a montage of your evening’s greatest hits on social media if you don’t pace yourself early in the evening. And trust me – everyone will see it. Including those outside of work. What would your mum say? Despite these warnings I hope you all have a cracking holiday party – we certainly will! ●

WWW.RECRUITER.CO.UK 43

p50-51_recruiter_careers.indd 51

06/12/2016 11:12

E CAREERS CO M M UNITY

‘By the age of 10, I was playing for Yorkshire e and by 15 I was playing for England’ MY BRILLIANT RECRUITMENT CAREER What was your earliest dream job?

What was your first job in recruitment and how did you come into it? Consultant at Michael Page HR, based in Reading. I taught golf to a former director of Michael Page about seven years ago, when I was still in the golf industry. He said: “If you ever want to move away from golf, we quite like sports people.” So I ended up joining Michael Page.

What do you love most about your current role? It’s quite exciting to see our small business grow into a bigger business, and be part of the change in leadership. I’ve got a small team and it’s really exciting to see the next generation of managers come through.

↗

Professional golfer. My uncle was a golf pro and inspired me to pick up pa few clubs. By the age of 10, I was playing for Yorkshire and by the age of 15 I was playing for England. A mentor when I was working at a golf club said: “You could pursue a career in this.” I joined the PGA and played on the tour, lived in Dubai for two years, teaching at an academy, and was a head pro for an academy. I came back to the UK and was a head pro of a golf club.

MATTHEW GRADY, managing consultant, Venture Recruitment

Matthew Grady go, and presenting go resenting them t an opportunity to go and live in Australia. That was incredible to offer a job to somebody in a country they aspire to live in and start a new life with their family.

The interview was an hour and a half away, there were no trains, it was too late and his car had broken down, so I ordered a taxi to go and pick him up, and he ended up getting the job.

Do you prefer a staycation or holiday abroad?

What’s the best or worst interview question you’ve ever heard?

Deﬁnitely abroad. I lived in Dubai – I’ve always got a thing for Dubai and the Middle East.

Worst – what are you going to do to make me happy?

Outside the office, where would you like to interview a candidate or be interviewed? The Google head office in California.

Regional director for a food services business.

Laugh or cry, what did yourr most memorable candidate make ke you want to do and why?

I recruited eight really senior-level candidates into a retail business in Australia. It was a six-month journey from ﬁnding the people, discovering their motivations, where they wanted to

Almost cry but it was joy in the end. nd. I had a candidate through to third-stage d-stage interview for a job he really wanted. ted. He ended up pulling out of the process rocess because he couldn’t get to the interview. terview.

44 RECRUITER

IMAG ES | AKIN FALOPE, SHUT T ERSTOCK /ISTOCK

p52_recruiter_brillcareer.indd 52

Imagine your dream job, then imagine the dream business you’d like to work for within hospitality – and then call me. ●

What’s your top job to fill at the moment?

What would you consider to be the most brilliant moment of your career?

JANUARY 2017

Make us an offer we can’t refuse

06/12/2016 11:12

In association with:

AWARDS LAST CHANCE TO ENTER RECRUITMENT’S ICONIC AWARDS! MAKE A DATE WITH AN ICON – ENTER THE INDUSTRY'S UNRIVALLED ‘MUST WIN’ HONOURS TODAY.

ENTER

NOW Entry deadline 16.12.2016

VISIT RECRUITERAWARDS.CO.UK

WATCH THE WEBINAR ON DEMAND

HOW TO CREATE A

RECRUITER AWARD-WINNING ENTRY In association with:

REC.01.17.053.indd 53

Supported by: