Recruiter - December 2020 by Redactive Media Group

Business intelligence for recruitment and resourcing professionals

Dec 2020

INCORPORATING Recruitment Matters

2021

springing into a brighter year ahead

IR35 & PAYROLLORT

www.recruiter.co.uk

SPECIAL

REP

red by sponso

DATA SPOTLIGHT

PROFILE

RED SEA RECRUITMENT

The value of data has come to the fore for recruitment

Richard Stevens of Momenta has the right moves

Turning on the tourism talent tap in Saudi Arabia

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unused office space Jon Dweck has a solution for best utilising his working environment Spot(ify)light on talent Entertainment streaming firm Spotify has remotely hired some of its best talent ever during the Covid-19 pandemic crisis Moving towards new ways of working for leaders Since working from home became the new norm, is it time for performance management to be called performance motivation? Thoughts from... Contracts & Deals

INCORPORATING Recruitment Matters

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INTERACTION Viewpoint Alan Crockert, Alan Crockert Consulting Soundbites

FEATURES

18 Profile: Richard Stevens

TRENDS

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Guy Hayward on the pressures of agile working, and Sharon Sands advises on board appointments Insight Adzuna is providing the ONS with state-of-thenation data Tech & Tools The latest recruitment technology and services

COV E R I M AG E | I KO N / IMAG ES | ISTO C K /UN P

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The Momenta founder has an ability to predict emerging trends â&#x20AC;&#x201C; and capitalise on them 24 Turning on the tourism talent tap Saudi Arabiaâ&#x20AC;&#x2122;s Red Sea Project needs a workforce of 35,OOO in to a sector in which the country is inexperienced 31 SPECIAL REPORT: Countdown to IR35 With the world in upheaval, implementation of new IR35 rules looms in 2O21

E COMMUNITY 49 Social 51 My brilliant recruitment career: Ruth Harding

52 Movers & Shakers 53 Recruiter contacts 54 The Last Word:

Jo Bowerman

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Pod timeshares office with The Hive WE LCO M E

Leader

t time of writing, the big question of ‘Will we or won’t we have a normal Christmas/Hanukkah’ remains just that – a question. The UK’s weather has done little to cheer up the locked-down masses. Yet there is a persistent electricity crackling in the dreary grey that suggests that recruiters in particular are creating their own brighteners to overcome the gloom and doom. Our haunting cover this month by senior designer Sarah Auld reﬂects the hint of an uplift en route to 2021, representing collectively our news stories and the recruiter spirit this month instead of a single article. “Our haunting Take heart from the cover this month story of Jon Dweck of Pod Talent, who by senior turned a thorny designer Sarah Covid-related problem Auld reflects the into a potential gold mine. If you listened hint of an uplift en route to 2021” to our November podcast, Recruiter reveals all… about the new-style Christmas parties for 2020, you heard from former recruiter Steph Cooper who brought her brand-new party planning business in line quickly with the current conditions and from ResourceBank’s Richard Pearson who embraced the 2020-mode of celebration with gusto in the holiday season. Remember 2020 as the year we all learned what we’re made of – the biggest gift of all.

DeeDee Doke, Editor

BY DEEDEE DOKE

TIRED OF PAYING the full rental price for office space for your recruitment business – especially when your staff would prefer to work from home most days? Recruiter Jon Dweck has just the solution: a timeshare option to share your offices with another business. That’s the concept for Space Three Two, Dweck’s new start-up, born in spring during the first lockdown this year. And the concept is now a reality for Dweck’s own recruitment company Pod Talent and fellow independent recruiter The Hive. Pod will use its existing office in Old Street, London, for three days a week, while The Hive will move in for two days weekly. “My first conversation about this led to the first deal,” Dweck told Recruiter. Initially, Dweck said, he wanted to be talked out of following up on his idea, which had emerged out of his own dilemma – affording expensive office space he was not using as Covid-19 swept the UK and would not fill even when the return to offices began. But when he sought out The Hive’s then-CEO James Johnson as a sounding board, and Johnson also saw the potential benefits of timeshare, Dweck knew he had to see it through. “Office timeshare, or the ability to share office space with another firm of a similar size, is the future of workplaces,” Dweck said. Pod’s arrangement with The Hive saw Pod buy a second refrigerator for the office for The Hive’s use and ensure secure, separate and colour-coded storage for both companies. When one company’s time in the office is done for a few days, all employees remove everything from their desks and place their items in their company’s secure storage. “If they don’t clear their desks, the cleaners do remove everything,” Dweck said. For the days each team are in the office, they can hang up their branding and make it identifiably theirs. The change-out erases any sign of each team’s opposite number. “It’s really so simple,” Dweck said. The savings for both Pod and The Hive are and will be significant, with Pod already saving about £75k per year. Since Pod had a long lease and The Hive was coming to the end of its lease, the circumstances were highly complementary. “We really helped each other,” Dweck said. Although some recruitment businesses have already approached Dweck about arranging timeshares for them, a

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38,714 FOLLOWERS

UPDATE

AS OF 19 NOV 2020

signiﬁcant market push will occur in Q1 2021, “and we’ll be looking for investment early next year”, he said. While Pod and The Hive’s timeshare agreement covers premises in London, Dweck is not limiting Space Three Two’s boundaries to London or even to the UK. Australia may be the company’s ﬁrst overseas outpost. “We’ll go wherever there’s interest,” he said. Another aim may be even more important to Dweck, however: “I want to see positive, lasting change from what we learned from Covid,” he said.

OFFICE SPACE: AN EXODUS? A survey of 1,102 oﬃce workers conducted by Opinium 20-23 October 2020 revealed:

4.2 days 2.7 days 11% 44% to 28% Almost £13bn

the average number of days London oﬃce workers spent in the oﬃce before Covid

the average number of days London office workers want to spend in the office post-Covid of workers don’t want to go back to the office at all

the drop in use of desks if time in the oﬃce drops to 2.7 days per week

The cost of unused oﬃce space to London-based businesses post-Covid.

“This is the tip of the iceberg,” Dweck said. “These ﬁgures paint a damning picture for London-based ﬁrms but we expect to see similar trends across the UK.”

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Great time to change performance management BY DEEDEE DOKE

THE MOST TALKED-ABOUT workplace adjustment erupting from the Covid-19 pandemic has been the success of working from home (WFH), but HR thought leader David Fairhurst sees another focus rising to the fore in WFH’s wake: performance management (PM). Traditional methods of PM were on shaky ground even before the pandemic struck, but physical distance between many managers and employees for extended periods has accelerated the quest for more relevant and pragmatic PM thinking. Citing a survey by the Society of Human Resource Management (SHRM) in the US, Fairhurst told the Excellence in Leadership virtual conference in November that 92% of managers want to review their organisations’ approach to PM within the next 12 months. “The appetite for change is huge,” said Fairhurst, currently an independent consultant and previously executive vice president, global people officer for McDonald’s. As part of moving toward new ways of working, Fairhurst is calling for PM to now reflect a different attitude: performance motivation. “What would that look like?” he asked. “This is about reimagining the whole thing.” Fuelling and influencing new ways of working are the growing need for what Fairhurst called AND Leadership, meaning leaders who can simultaneously manage two conflicting requirements and move

“away from short-term decisions that reﬂect medium-term disasters”. Contributing to the rush to new ways of working is “a driving need for new skills”, Fairhurst said, as a recent McKinsey report that contends a third of the workforce will need retraining. Also, employee wellbeing is becoming such a priority that some companies have created a position of chief wellbeing officer, Fairhurst said. With teams spread out more widely across geographies, improved communications channels are needed, and companies do need to pay greater attention to staff wellbeing. “Many [companies] are self-congratulatory” about their health & wellbeing offerings, Fairhurst said, “but are often misguided” when it comes to understanding what their employees need and want. And the role of the office is evolving into “a periodic meeting and collaborative space” from the place where people spend their days from 9 to 5 ﬁve days a week, he said. Fairhurst also dismissed any future place for 'Big Brother’-style measures of monitoring employees in the new world of work. In spite of the adaptations and evolutions demanded by the new ways of working and the ongoing Covid crisis, Fairhurst declared this “a great time, a great opportunity… to positively shape the future of work”. Fairhurst shared the podium with Andy Parsley, the two being part of a team of HR experts collectively known as OrgShakers.

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THOUGHTS FROM… K ATRINA HUTCHINSONO’NEILL FOUN DER A N D C E O, JOIN TAL EN T S PE A K IN G AT TH E LO N DO N H R CON N E C TION

“Recruiters are really good at papering over the cracks until the house falls down.” ROGER MARTIN-FAGG B EH AV IO UR A L E CON OM IST, SP EAK IN G AT E LITE LE A D E RS

“The impact of Brexit on recovery? Overall, I think it’s psychological… Provided we stop being too jingoistic about it, we’ll come out all right.” K ATHERINE CORBISHLEY B U SIN E S S CON TIN UITY SUP E RV ISOR , M A JOR L AW F IR M, SPE A K IN G AT H IN DSIG H T 20/20 WE BIN A R

I M AG E S | I STOC K / PA L HA NS E N

“We’re all in the same storm but in different boats.”

Remote hiring brings the best to Spotify BY DEEDEE DOKE

DEFYING THE CHAOS levelled at the business world in the Covid-19 pandemic, Spotify has hired “some of the best people” the company has ever brought in since the crisis began, according to the head of global talent acquisition (TA) at the digital entertainment streaming service. With Spotify one of the top technology companies where a buzzy campus culture is highly valued, the pandemic-induced inability to bring candidates to company offices to experience it in person brought both “challenge and opportunity”, said Jonathan Singel, speaking in November at Annapurna Recruitment/The Business Transformation Network’s Excellence in Leadership conference. Meeting the challenge by hiring remotely paid off well for Spotify, Singel said. Of the latest recruits, he said: “Some of them are already making an impact… Yes, there is value in the on-site experience, but maybe we can do even better more efficiently.” Overall, the pandemic, lockdown and working from home (WFH) have resulted in positives for the popular consumer technology company, Singel said: “We are moving faster, quicker, more efficiently, decisions are happening at a faster pace.” Productivity is higher too, he said. Conversing with Daniel Goldstein, founder and CEO of Elements Talent Consultancy, who has previously partnered with Spotify, Singel was addressing the

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theme of building world-class hiring functions. Spotify has moved within the last few years from a hiring committee approach to one in which the ﬁrm’s recruiters are embedded with hiring managers in business units. Previously, the TA function was organised by the engineering department, referred to as R&D. That model was not “scalable”, Singel said. If the company was going to scale, its in-house recruiters had to work closely with the hiring managers. “There were a lot of sceptics,” Singel acknowledged. However, Goldstein pointed out, Spotify’s “culture of acceptance” in which its employees are allowed to “break things” made the new way forward ultimately feasible. A focus on Spotify’s future was essential, Singel said, with the company’s recruiters having to get in the heads of the hiring managers and leaders by considering such questions as what keeps them up and where are they headed. “It’s about the future, and truly being embedded in the business, with a heightened sense of focus,” Singel said. The new, or iterative, process has proved successful, with the company’s employee count increasing from 2,500 to 6,000 “in a couple of years”, Singel said. Headquartered in Sweden, Spotify has offices around the world including the UK, US, Canada, Australia and more.

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CONTRACTS

CONTRACTS & DEALS

EVera Recruitment EVera Recruitment has been appointed the sole recruitment partner to Britishvolt, one of the UK’s leading investors in battery technologies. Based in Warwickshire, EVera Recruitment is a dedicated battery and electric vehicle recruiter, and will be carrying out gigaplant recruitment exclusively for Britishvolt.

Camino Partners Two of recruiter Camino Partners’ original founders have completed a management buy-out of the company from the third member of the founding trio. The MBO, led by Sachin Ruparelia and Matt Newman, sees Alan McBride, who has been a part-time chairman and most recently non-executive chairman, amicably exit the business.

Broadbean Technology ent soft softwa are company Recruitment ware Broadbean Technology has partnered with programmatic media buying agency Talent Nexus to provide recruiters with a new job advertising solution to help them reach targeted talent pools quicker.

Harvey Nash Group Global technology recruitment and solutions provider Harvey Nash Group has acquired Latitude 36 as part of its strategic expansion in the US. Latitude 36 is a technology recruitment specialist with 125 employees in seven offices across the US and India, and will become part of Harvey Nash’s technology recruitment division.

Evie Evie, an AI assistant for recruiters, has been selected to help manage post-Covid-19 hiring for Siemens Mobility. The announcement follows a six-month pilot programme, with Evie engineers working with the Siemens team to refine the assistant.

DEAL OF THE MONTH

Healthcare Resourcing Group Healthcare Resourcing Group (HCRG) has confirmed the sale of Sugarman Australia in a management buy-out. HCRG acquired Sugarman Group and Sugarman Health & Wellbeing earlier this year as part of an investment into Cordant Group by Twenty20 Capital. An HCRG statement said: “Following an extensive restructuring, repositioning and

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change in strategy, HCRG confirmed the sale of the Australian group as a result of wanting to concentrate specifically on UK operations as opposed to international services.” Sugarman Australia began operating in 2008, has offices in Sydney and Perth, and employs 31 people. No details were given regarding price.

Hortor Global strategic resourcing expert Hortor has launched a joint venture with Mobile Cloud to provide customers with access to a specialist automation people company, LEVO RPA. Providing everything from managed services through to staffing options that will set up, operate and deliver automation, LEVO RPA will work in partnership with organisations to provide a focus on automation strategy and project management.

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WORKPLACE

The Workplace BY GUY HAYWARD

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for some people can become a version of self-isolation – it creeps up on you without warning. You love working from home, then all of a sudden you become uncomfortable with loneliness. Social interaction reduces, social isolation increases... the cycle gets bigger and you withdraw. There is a clear link between loneliness and mental health; research has shown that people who feel more connected to others have lower levels of anxiety and depression. Let’s be aware of our friends and colleagues who we see less and less of in the office (or on Teams). When we have colleagues working from home or the local café, abandon emails, instant messaging and other workplace apps, and instead replace with face-to-face communication if possible. Don’t let the modern ways of working isolate each other, with technology removing the momentum for people to talk. Working from home can, for some, mean nowhere to escape. That was a bit like how I felt. So, in an agile working environment, ensuring that we communicate and that doing the basic things such as taking regular breaks, eating healthily, drinking

“Don’t let the modern ways of working isolate each other, with technology removing the momentum for people to talk” enough ﬂuids and not being connected to devices all the time are a must, surely? And how often do we hear ‘I don’t have time to exercise’? Agile working can feel like you’re always ‘on’ – either sat in front of endless videoconferences or your phone as your mobile inbox. Either encourage physical exercise (even if it is a lunchtime walk) or provide access and opportunity to involve yourself and colleagues in digital ﬁtness; promote physical wellbeing and fun into the virtual working environment. For health challenges, rotate who runs the next Teams workout or even create a weekly run club. The couch to 5k was a fabulous initiative and I know many

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I WANTED TO share some thoughts. I remember after the first national lockdown, when we finally returned to the office. Talking to our chairman and founder, I recall their surprise when I shared how my loneliness at being at home had started to affect me. Not because I wanted to escape the family but because I struggled with not being around people, and my daily routine was a routine that didn’t excite. Nearly a paradox for me. I’m a huge supporter of agile working and all its benefits, yet being at home (and with no other choice) I had begun to struggle. And this has positioned my thinking. We have full agile working now at Goodman Masson; you can come and go when it works for you – five days a week at home, if you so choose. Therefore, we must have an approach to mental health and wellbeing in our agile working environment. As agile working continues to overtake flexible working as the answer to the work/life balance debate, to truly embrace the benefits there are surely wellbeing considerations: insecurity, isolation, loneliness, anxiety, fitness and mental health. While it doesn’t start out as such, working from home

GUY HAYWARD – redefining the modern workplace CEO, Goodman Masson

who now run for their daily exercise – and they feel great for it. I personally love my Headspace app. And make sure you create an agile working environment that doesn’t blur the lines between work and home – one that removes the ‘always available’ culture. It’s hard to understand the wellbeing and mental health of your team at the best of times... make an extra effort in the agile working world. ●

DECEMBER 2020

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T R E N DS

INSIGHT

ASK THE EXPERT WHAT CHARACTERISTICS AND SKILLS SHOULD COMPANIES BE LOOKING FOR IN THEIR BOARDS NOW? Our research shows that Brexit and Covid-19 are significant factors shaping the boards of companies in the UK’s FTSE 350. Appointments have reflected a renewed focus on efficiencies, cost cutting and intelligent restructuring. A significant increase has recorded in seats filled by executives with financial risk expertise, which rose from 4% in 2018 to 39% in 2019. This trend toward highly experienced board members – and particularly chairs – is unsurprising, given the rigorous demands of the current climate. In conversation with chairs of FTSE 100 firms, five major threads emerged:

Balancing the view of today with tomorrow – and beyond The tension between long-term strategy and short-term returns has been ampliﬁed by the consistent increase in pressure from governments, consumers, employees and other stakeholders to factor digital, purpose, diversity & inclusion, and sustainability into decision-making. Boards are forced to think more creatively, and the concept of three to ﬁve-year plans is going out the window. Boards are looking for a more dynamic and agile way of thinking.

Securing tried and tested skill sets and assembling a diverse team The best boards determine their composition in terms of the mix of skills and experiences required to meet their long-term strategic needs. Finding such people will likely mean looking at less common candidate pools, such as consulting, public sector, academia, legal and trading bodies – but with the caveat that they need to understand how to run a business – and have done it before. There is a need to think more creatively and be open to new board members joining from a greater variety of backgrounds and experience. Building and recognising cognitive diversity is another gap that boards need to address.

Maintaining harmony while enabling challenge and debate

Global head of leadership development, Heidrick & Struggles empowered to contribute early on, and ensure directors from diverse backgrounds have a voice.

Finding the right successor in the new regulatory framework Today’s UK regulations require chairs to step down from their roles once they have served on a particular board for nine years, including time served as a board member. Chairs need to start mapping the potential successors as soon as they take over the role and anticipate what the role will entail a few years down the line.

Know the detail but don’t get too close The relationship between the CEO and the chair is somewhat malleable at the moment, with chairs taking on a more external role than previously and often engaging more with the day-to-day issues the company faces. While the chair’s role as a trusted adviser to the CEO is one of immense value, it is essential that the chair is not seen to interfere in matters that come under the CEO’s role. A risk-averse approach to board appointments is sensible in light of Brexit and the ongoing pandemic, but not at the expense of medium to long-term strategy or D&I. While the immediate focus may be on experience, a digital disruptor or innovator may be crucial to your board’s – and your company’s – long-term health. Experience and risk-mitigation are valuable, but unprecedented times will undoubtedly result in unprecedented measures – and the impact will be seen in the composition of boards.●

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Chairs must facilitate lively and equal discussion within their boards, allowing for debate and dissent to ensure all potential merits and drawbacks of an idea are heard. Ultimately, an inclusive and effective board is built around a shared purpose, which requires breaking down barriers and establishing principles of engagement based on trust and transparency. Chairs should make sure new board members, particularly ﬁrst-time directors, are

Sharon Sands

SHARON SANDS is global head of leadership development, Heidrick & Struggles, and co-lead of the CEO & Board Practice (London)

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SPOTLIGHT ON DATA The Covid-19 pandemic has brought the importance of data to the fore, not only for public health but also for recruiters and employers BY ROISIN WOOLNOUGH

ata’s star has been on a continual rise in recent years, but it grew in importance and prominence in 2020 when Covid-19 struck. All of a sudden, data was on our screens and on our minds all the time – and it hasn’t stopped. “The pandemic has shone a spotlight on the importance of data, both in terms of tracking the severity of the pandemic, and revealing the areas and sectors that need most help,” says Andrew Hunter, co-founder of the UK-based job search engine Adzuna. “But it has also increased appetite for statistics more widely. Once the preserve of data scientists and statisticians, the public is now used to seeing rolling seven-day averages, week-on-week comparisons and trends in growth and decline as regular news features, with infection, hospitalisation and death rate statistics becoming key touchpoints for ‘how the country is doing’.”

Vacancy data Since 2017, Adzuna has provided data on job vacancies to the Office for National Statistics (ONS). Then in April 2020, Adzuna also became the feed for the ONS’ new, real-time national job vacancy index. This new index is a key part of the ONS’ weekly ‘faster indicators’ report, giving an in-depth study of the current UK job market, and the economic and social impact of Covid-19.

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“It means we can produce a weekly measure of vacancies, with a time lag of about six days,” says David Freeman, head of labour market and households at the ONS. “Normally it’s four to six weeks with our survey data, so it’s great to be able to get data out so quickly.” Vacancies are one of the leading indicators of employment and unemployment trends, and the Adzuna feed highlights important hiring data across all industry sectors. It includes all of the UK, and the data can be used to pinpoint which industries and geographies are reporting a strong or increasing demand and which are sluggish or declining. “For example, we’re able to quickly see the impact of restrictions such as the recent three-tier lockdown system on local jobs markets and vulnerable sectors,” says Hunter. “At the time of writing, we’ve already tracked a signiﬁcant fall in hospitality and catering job postings since the restrictions were announced two weeks ago [22 October].” A wide range of organisations and individuals use the ONS data as a decision-making tool, with the government being one of the ONS’

Data has to be based on reliable sources with reliable methods biggest customers. Recruiters can use the data to keep up-to-date with the latest labour market trends. “It can give recruiters a better picture of the overall market and where to focus their resources,” says Freeman. “It’s exciting to think this is helping recruiters to make better decisions and helping people get jobs.” Freeman says the new Index was precipitated by the Covid-19 pandemic

IM AGE | ISTOCK

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T R E N DS

INSIGHT

but actually feeds into the ONS’ long-term strategy of using a variety of different data sources to improve how it monitors the economy. The important thing, he says, is to make sure any data used is credible. “It has to be based on reliable sources with reliable methods.”

Data sources Adzuna pools its data from various sources – job sites, recruitment portals and XML feeds from companies. “For those sites too small (or too busy) to give us XML/API access, we behave very much like Google and crawl the web for the most up-to-date listings from thousands of sites we ﬁnd, or our users suggest,” says Hunter. In July 2019, the government

published its National Data Strategy, part of a drive to encourage data-driven decision making in every part of the economy. Adzuna has worked directly with the government on technology and data insights since 2013, when it built ‘The Number 10 Dashboard’, a data insights iPad app that was created to help the government make better decisions. It also runs Find a Job, the Department of Work and Pensions’ digital jobseeking service. Hunter says data is now at the heart of everything. “Now, more than ever, it is critical that we make well-informed, data-driven decisions at all levels of society. Adzuna’s role in all of this is to provide recent, clear and statistically signiﬁcant recruitment data points to both the government and the ONS.” ●

POWER POINTS

1 2

Adzuna provides live data insights from over 50,000 British employers, giving a weekly update of hiring activity across all sectors in the UK.

Adzuna has over 10m monthly jobseekers visiting the platform every month

It gives the ONS an XML feed of over 500,000 real time job ads, including data on geography, category, company and salary. The Index includes 95% of all available jobs in the UK.

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Min

NEW CHRISTMAS PARTY ADVENTURES FOR 2020!

LISTEN TO OUR FREE PODCAST bit.ly/RecruiterReveals

REVEALS ALL

THE PODCAST

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Available on all major podcast streaming services

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T R E N DS

TECHNOLOGY AND SERVICES Accessing a talent pool of problem-solvers UK charity Astriid is teaming with open innovation platform InoCrowd to create work opportunities for people living with long-term health issues who are often ignored by traditional recruitment channels. Astriid has a talent pool of more than 1,000 qualified individuals who will be matched with corporates looking for solutions to specific business problems via the InoCrowd platform. Because of their health conditions, the individuals will typically need flexible working conditions which dovetails well with InoCrowd’s approach. Its system is based on challenges, posted by companies (called ‘seekers’) and solutions, identified by individuals (also known as ‘solvers’). “We are solution-driven, therefore daily schedules or being in the office are things that do not play a part in our offering,” said Soraya Gadit, CEO and founder of InoCrowd. inocrowd.com.pt/

Going beyond skillsets A new platform from Thomas International claims to make it easier to translate people’s diverse characteristics into easy-to-action recommendations for more informed recruitment and development decisions. There are two applications within the platform: Thomas Perform and Thomas Profile. The former allows companies to use a broad range of behavioural, personality and aptitude assessments to identify the potential in people beyond skills. The latter enables an individual to create their own profile via access to a suite of assessments that can be directly shared with organisations. In the future, they will be able to share their Thomas Profile across social networks. The platform uses predictive analytics and machine learning to present the outcomes of assessments. It also generates tailored interview guides to support recruitment practices, suggests best-fit candidates for a role based on benchmarked star ratings and allows users to compare individuals within teams side-by-side to identify potential areas of conflict, harmony, strengths and weaknesses. thomas.co

TECH & TOOLS BY SUE WEEKES

A look at some AI services with recruiters and employers in mind

Reaching out from the cloud Recruiters who are yet to migrate their payroll operations to the cloud may want to check out Octopaye, from the company formerly known wn as Recruit Payroll. Its launch and rebrand is to extend the solution beyond recruitment (hence the name with Octopaye’s tentacles branching off into different sectors) but its ability to take ake the legwork out of running multiple payrolls across multiple locations means it remains a good fit for recruitment agencies with temporary workers. Hundreds of payslips can be processed from a single dashboard and users can log in from anywhere to do so. The solution, which received HMRC approval in 2019 and is fully compliant with UK legislation, is scalable so it can flex up or down with payroll needs and the requirements of the business. octopaye.com/

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Facilitating a data-driven employee lifecycle Beta testing of the new Phoenix51 remote hiring and onboarding platform supported the view that an unstructured interview – just asking questions about a candidate’s background and reviewing their CV – is likely to give less than a 50% chance of making the right hiring decision. The company also reckons that, with virtual hiring becoming the norm, this statistic drops even further due to the potential of recruiters missing non-verbal communication, as well as the applicant’s increased level of discomfort due to being interviewed via a video platform. Phoenix51, the latest venture from The Apprentice former winner Lee McQueen (above, founder and CEO of the company), aims to enable recruiters to make “data-driven” decisions at every stage of the employee journey from hiring through to benchmarking, training and retention. It creates digital frameworks and scorecards that allow organisations to assess and interview against key behaviours and competencies specific to a job role. Meanwhile, embedded video technology enables recruiters to conduct structured competency-based interviews and incorporate a wider range of evaluation methods. phoenix51.io

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INTE R AC TIO N

VIEWPOINT

Starting up in a pandemic Ok, so what do I do now? BY ALAN CROCKERT

iming is everything… right? This was the slightly fragile question, or perhaps it was the nervousness in his voice, as he told me he ﬁnally achieved his dream of having his own recruitment business, which opened in a heavy shower of pride and expectation in February 2020. Then came the $64k question, which I sort of knew was coming my way. “Ok Alan, we ﬁnd ourselves in a pandemic, and my clients are pretty much closed for business, so what do I do now?” Well, although this crisis has seen the word ‘unprecedented’ used more than ever, I still tend to go back to basics, and that was my guidance while in the eye of the storm at least. When I said ‘go back to basics’, I meant communicating with clients, and those in his prospect client network, together of course with candidates. No selling during the closures; rather, take the opportunity to talk/chat to them all. Get to know them better, their challenges and opportunities pre-Covid, and their opinions of what life could be like post-pandemic. Their fears and aspirations. I’m pleased to report he did this, and it was appreciated by many candidates and clients. He called me again last week. “Some of my clients are starting to return to a more positive pipeline of work, so what advice can you give me now as I feel I’m now in proper start-up mode?” Where do I start with advice?

ALAN CROCKERT is owner of Alan Crockert Consulting.

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● Sheer hard graft. ● Work smart. ● Don’t be tempted to ‘buy’ business. ● Maintain margins. ● Protect whatever cash you have. ● Don’t overtrade. ● Don’t over promise/under deliver. Do the opposite. The list goes on, doesn’t it. However, I wanted him to take this opportunity, while things are still quiet, to really think about what he wants from the business, short, medium and long term. And to be as self-aware as possible. ● What am I good at? ● Where do my strengths really sit? ● What do I love about what I do? ● Where do I struggle, and what might I not know, or have thought of ? In most cases, it can take many years to build a recruitment business of real value. The vast majority never achieve it, so if you have the time, use it wisely. If you’re younger than me (that’s everyone!) there is really no hurry (doesn’t mean procrastinating should be entertained). You may discover as time passes that your original goals have changed – that’s ok, but think hard about what you want and when you want it. Leave any ego and pride at the door. Hopefully, you can start at home, with minimal costs. Forget, at least temporarily, any notion of committing yourself to an office. No fancy job titles – focus on making placements, ﬁlling bookings and treating candidates with respect. Build cash when possible and minimise ﬁnancial commitment. Get the right and proper external support for you – I know, I would say that! – but emotions run high when it’s your baby, and that muddies the clear waters of the brain way too often. Get someone who has been through what you’re going through and will provide objective advice and support through your journey. The industry has produced countless thousands of people with a good or great life, and if you have been brave enough to take the plunge, make sure you develop the business you really want, and believe in. Everyone connected to you will see this is you being you. Can we ask for anymore? ●

DECEMBER 2020

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I N T E R AC T I O N

SOUNDBITES

WEBCHAT Reader responses to our article ‘Clause in IR35 makes umbrellas redundant and makes agencies the fee payer’ (recruiter.co.uk, 8 October). Please see our Special Report on Payroll and the new IR35 legislation in this issue of Recruiter. AN ERRANT CLAUSE THAT’S CAUSING CONFUSION This is fake news. The legislation as it is currently drafted doesn’t say this at all. Simon Bailey Now I’m no expert... but the changes do appear to say exactly that https://bit.ly/3eSwCYI Martin Dangerfield Is there any reason why end clients couldn’t pay the umbrella directly? Rather than taking a cut of the invoice amount, agencies who place contractors could negotiate a fixed fee just as they do with permanent hires. IR30WTF

JOINING TOGETHER TO HELP STRUGGLING RECRUITERS In response to your article ‘Lonely Marketers join Together to support struggling recruitment firms’ (recruiter.co.uk, 2 November), www.staffingfuture.com are pleased to help recruiters struggling to survive and hope we can all get them to a place where they’ll thrive in 2021 and beyond.

“What is the greatest lesson you have learned in 2020, and how will you apply it in 2021?” DAVID ANNABLE FOUN D ER A N D D I REC TOR , F R A N K L I N F ITCH

“This year, the vast majority of our industry, from trainee consultant to CEO, has needed to dig deep; 2020 has been an arduous wrestle in numerous ways. To conquer the constant work and life challenges we’ve faced and feel any semblance of victory, it’s taken more than the usual grit, resilience and determination; for me, purpose has been the driving force. Purpose is a broad term and works on many levels. Right now, I’m thinking a lot about my purpose, my team’s purpose and Franklin Fitch’s purpose. Once fully understood, in 2021, we will be laser-focused on these, and work tirelessly to achieve our goals and our greater purpose.”

ANDY LEWIS OP ER AT ION S D I REC TOR , EN CORE P ERS ON N EL

“The biggest lesson learnt for me through the lockdown summer and subsequent uncertain times has been the importance of not losing sight of the reward and recognition staff deserve for continuing to deliver such amazing results for our business. Be that a well-worded email, a gift voucher, a pay rise/promotion or simply a virtual arm around someone’s shoulder when they’ve needed it, a business that loses sight of the importance of staff engagement and welfare will be one that struggles to come out the other side.”

JAMIE REYNOLDS CEO, CORDA N T G ROUP

“2020 has taught me to continually promote and inspire innovation. At Cordant, we didn’t surrender to the pandemic, we were resilient: we responded, adapted and acted. Having already made considerable progress in digitalising the candidate journey, and integrating market-leading technology, the business quickly implemented virtual processes and moved to remote working. In 2021 we will continue to innovate. Technology isn’t slowing down, and if we want to remain stable, successful and futureproof we need to keep up with the hyper-connected, ever-advancing employment market.”

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P ROF I L E : R I C H A R D ST E V E N S

Right move at the right

Momenta s CEO and founder of the £100m contingent resourcing company Momenta, supporting financial services companies to meet compliance needs around regulation, remediation and risk, Stevens has been at the forefront of change throughout his working life, and that’s where he wants to stay. That’s why he recently embarked on a strategy of geographic expansion and diversification, turning Momenta into a business with global reach. It all started back in the 1980s, when regulation was on the horizon in the UK in the wake of several high-profile mortgage and pensions scandals. Stevens was in the early days of his career in the banking sector, having abandoned his engineering degree. “I didn’t really want to be an engineer, so I dropped out a year early. Also, engineering was going through a challenging time but financial services was booming.” Having decided that he was more likely to prosper in financial services, Stevens took a job as a trainee bank clerk at (as it was known then) the Halifax Building Society. A few years in and he saw what a lot of other people in the sector couldn’t or wouldn’t see – that regulation was coming and would have a huge impact in the not too distant

Entrepreneur and Momenta founder Richard Stevens has an uncanny ability to predict emerging trends and then capitalise on them. Roisin Woolnough found out more

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P ROF I L E : R I C H A R D ST E V E N S

future. Stevens could also see that it was an open market because so many people had their heads in the sand about the implications of regulation. “It was clear that there was broad denial in the industry that regulation would have a big impact.” And he was right. Regulation soon swept across the UK financial services scene, precipitating a new, lucrative industry as a whole raft of companies needed people with specific skills to help them clean up operations and meet new and increasingly stringent compliance regulations. PPI (payment protection insurance), for example, the biggest scandal of them all, is still rumbling on and will cost over £50bn to resolve eventually, according to a briefing piece by Dominic Lindley, director of policy at the financial services forum and think tank New City Agenda.

Going global The UK regulation market has since reached a level of maturity and many organisations have internal teams with the necessary skills, so while there is still a healthy demand for Momenta’s services, the strongest growth area is, actually, now abroad. “The UK was a leader in the regulation of the financial services industry and probably still is,” Stevens explains. “But it is a mature market now in the UK, so are we going to see double-digit growth for remediation processes in the UK? Almost certainly not. But in other territories, where the trend towards greater regulation happened later, we are seeing double-digit growth.” Going from a national business to a global one is not without risks, but Stevens was sure it would pay off because the need was there and would continue to exist for some time to come. “Regulatory trends are quite long,” he says. “We’ve been trying to tidy up financial services in the UK for years now.” The first stop was Australia in 2016. Regulation and implementation in financial services in Australia is roughly a decade behind the UK, with The Royal Commission into Misconduct

Stevens: what it takes to be an entrepreneur “I’m not a genius. I believe that the entrepreneurial spirit, hard work, attention to detail, focus and commitment are the ingredients to make a success of something. You have to understand the art of the possible but the clichés around hard work and commitment and staying true to what you are good at are true. “I’m a great believer in sticking to what you’re good at and seeing how you can apply it in a new way. It’s entrepreneurial, but also a safe option, and you are more likely to be successful. You have to have this balance of understanding what you are good at but being able

to take some risks – that’s a key attribute of the entrepreneurial spirit. “You have to work with the right people, internally and externally. You need to build business contacts and leverage those partnerships for mutual benefit. It has to be mutual benefit. You have to look after your end client, know what they want and provide that service flawlessly to achieve long-term success. I’ve never been an advocate of short-term opportunism. You need to find opportunities that have sustainability because long-term sustainability is key to building shareholder value. “Find the business, find

in the Banking, Superannuation and Financial Services Industry being launched in 2017. Momenta had deﬁnitely arrived in Australia at the right time. “We had ‘ﬁrst mover’ advantage there. Being ahead of the curve is important – otherwise you are trying to get into a developed or developing market, which is hard.” Likewise, when Momenta opened offices in the US in 2018, there was a strong demand for professionals who could help deal with federal regulation issues. India is another growth market due to national compliance alignment challenges because of the expanding global offshoring trends for back office functions.

Partnership success These may have been new markets for Momenta, but Stevens had no

the people and then keep the people. None of these three things are easy, but if you can do them in a business like ours you can be successful. “Lastly, prevention is better than cure. It’s a mix of clearing up the sins of the past (cure) with dealing with the challenges of the future (prevention). The cure game has fuelled the business – sorting problems out is the lifeblood of this business, but clients don’t want to be putting out fires for ever. They want you to help the fires from starting. Prevention is really important. Being aware of what’s happening and what’s coming down the track is very important. If you are able to add value to clients in that way you are a true partner, rather than taking advantage of their misfortune.”

intention of going in cold. He is a big advocate of the partnership model, accessing new clients and markets through existing partnerships. Before Momenta had even set up shop in Australia, Stevens worked on leveraging its successful relationship with Deloitte UK to forge connections with the consultancy’s Australian arm. This is a strategy Stevens has pursued each time the company has moved into a new territory. “We reach out to partners and explore what the art of the possible is with them before we land. This means we can land and expand, leveraging the partnership relationships we have. The strategy really lends itself to geographical expansion and it means we are not landing in a country and having to go cold calling or door knocking to get work.”

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CONGRATULATIONS TO OUR 2020

BEST CONTRACTOR CARE • CMA Recruitment Group • Gravitas Recruitment • La Fosse Associates • MCS Group BEST EMPLOYEE COMMUNICATIONS • Goodman Masson • Investigo • MSI Group BEST WORKPLACE ENVIRONMENT • Amoria Bond • CMA Recruitment Group • Goodman Masson • ISL Recruitment • La Fosse Associates • Seven Resourcing • SR2 - Socially Responsible Recruitment DIVERSITY AND INCLUSION CHAMPION • Bramwith Consulting • SR2 - Socially Responsible Recruitment MOST EFFECTIVE PAY & BENEFITS STRATEGY • Leap29 • Seven Resourcing MOST EFFECTIVE BUSINESS CONTINUITY & RESILIENCE PROGRAMME • MSI Group • Pertemps • Rutherford Briant Recruitment

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• Richard Cooke - Seven Resourcing • Derek Skelton - Meridian Business Support

• Charmaine Vincent - Baltimore Consulting

BEST RECRUITMENT COMPANY TO WORK FOR – MICRO (UP TO 19 EMPLOYEES) • Baltimore Consulting • Darcy Associates • SR2 - Socially Responsible Recruitment

BEST RECRUITMENT COMPANY TO WORK FOR – SMALL (20 TO 49 EMPLOYEES) • Franklin Fitch • Hunter Bond • Leap29 • Seven Resourcing BEST RECRUITMENT COMPANY TO WORK FOR – MEDIUM (50 TO 99 EMPLOYEES) • MSI Group • Oscar BEST RECRUITMENT COMPANY TO WORK FOR – LARGE (100 + EMPLOYEES) • Amoria Bond • Frank Recruitment Group • Goodman Masson • Gravitas Recruitment Group • Investigo • La Fosse Associates BEST RECRUITMENT TEAM OF THE YEAR • Jane Lewis Healthcare • Lucky Hunter • VIQU COVID-19 SUPPLIER CHAMPION • MembersOnly HQ • Omni Resource Management Solutions

• People Group Services

11 December 2020, 14:30

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| #investingintalent | #RITAshortlist

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P ROF I L E : R I C H A R D ST E V E N S

As well as taking the partnership approach, Stevens has also formulated a direct to market strategy, building a sales and marketing team to get it off the ground. Four years on from that initial foray into Australia and Momenta now has about 500 people on the ground there, expecting this year to report roughly £38m in turnover from the region. The company uses these results to demonstrate to any potential new partners that the business model is

working, and that it can replicate the success of UK operations in other geographies as well. Credibility and a good track record are important in any industry, but particularly so in the financial services, regulation and risk arena. Stevens attributes a large part of the company’s successful expansion and diversification to this partnership model. But the other significant contributory factor is his knack of making the right move at

the right time. Had he stuck with UK-only operations, doing what he had done successfully for the previous 26 years, the business might have plateaued. Or worse, dipped when demand leveled off. “It was a sensible, good-sized, proﬁtable business,” he says. “But to stay ﬁxed on this market was a bit limited, particularly as it’s a very mature market in the UK now. I wanted to move the business on to the next level, so it has a broader base and generates more shareholder value.”

Flexibility

“I’m as enthusiastic about the business as I was, if not more so”

The model of providing contingent workers to meet specific short-terms needs is one that Stevens could and has applied to other business areas – digital transformation, financial crime, training and development, for example. In 2015, Stevens commissioned an external agency to conduct a market assessment report into the trend for using flexible labour. That report confirmed his view that the contingent resourcing model was only going to get stronger. “People are looking to carry less fixed-cost and be more nimble,” he said. Stevens thinks the mass migration to remote working precipitated by Covid-19 has accelerated the trend for flexible workforces. At the beginning of 2020, Momenta’s workforce was completely office-based. Now, they are all working remotely, a shift that suits Stevens, the workforce and clients, he says: “The biggest advantage is that it makes staff geographically agnostic so you can fish in a much bigger pool of candidates.” The plan is for Stevens to retire in a few years. But, before that, his goal is to ensure the long-term security of the business and his employees. He thinks his strategy of expansion and diversification will achieve that, and he expects to float the business in the future. “I’m as enthusiastic about the business as I was, if not more so, but at some point, I would like to retire and see the benefits of all that hard work. With the current strategy, I think the business has got fantastic longevity and will be around long after I’ve gone.” ●

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FE ATURE : INTE RN ATIONAL RECRUITMENT

audi Arabia is blasting onto the leisure tourism scene with a new luxury development spanning 28,000sq km. The Red Sea Project includes 200km of coastline, over 90 islands, dormant volcanoes, desert and mountains, all on Saudi Arabia’s Western coast. “It’s the size of a country,” says Ahmad Darwish, chief of staff at the Red Sea Development Company. “It’s a giga project – the most ambitious tourism project in the world. It really is exceptional, with several experiences all in one location.” Although the resort covers 90+ islands, 75% of them will be left untouched. This is for environmental reasons and to limit the number of visitors. Its airport, which should be operational in 2022, is predicted to serve 1m tourists a year, at a peak of 900 passengers an hour. A project of this size and scope requires a large workforce with a varied and extensive skills set. The resort will have created 35,000 direct jobs by the time it is complete, with another 35,000 jobs being created indirectly. This means that if the Red Sea Project is to fulﬁl its promise of being a luxury destination, “an exquisite sanctuary offering indulgent experiences, seamlessly customised to the unique needs of each visitor”, as it says on its website, it is going to need a very skilled and experienced set of employees, and a lot of them.

Global talent search Given that the region does not have a history of leisure tourism – the only tourism that has really existed in Saudi

Arabia until very recently is religious tourism – this has presented certain recruitment challenges for the resort. So far, 50% of people hired are Saudi, with the other 50% coming from abroad. The latter situation is because there isn’t a sufficient base of existing skills to tap into, and some skills are not represented at all in the area. “On a project of this scale we need a lot of technical skills,” says Moneer Brembali, executive director of HR at the Red Sea Development Company. “These workers are not easy to find within Saudi Arabia, so we have gone outside. We have been going around the world looking for talent.” The Red Sea Project has and continues to make use of international search firms and headhunters to spread the word about the resort globally and to draft in skills that don’t exist or are in short supply in Saudi Arabia. For example, the resort has a big focus on sustainability, and there is not a strong representation of people with relevant sustainability expertise locally. “By creating this project, we are creating a new sector that has never existed before,” says Darwish. “Tourism never existed, so we have had difficulties recruiting Saudis for roles such as on the environmental side of things, the smart side of things, in design and sustainability.” Darwish is keen to stress that the intent is not to rely on imported talent. The recruitment strategy is one of recruiting locally wherever possible but looking further afield when

Saudi Arabia’s Red Sea Project is going to require a workforce of 35,000 in a sector – leisure tourism –in which it doesn’t have a huge home-grown skill base

TURNING ON

THE TOURISM TALENT TAP 24 RECRUITER

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F EAT URE: I N T ERN AT I O N A L R E C RU I T M E N T

necessary and then sharing skills and knowledge around the organisation to build up local capabilities. “We want knowledge transfer from experts,” says Darwish. That said, the resort will be an international destination, so it is useful to also have an international workforce.

Growing local talent

“These workers are not easy to ﬁnd within Saudi Arabia, so we have gone outside. We have been going around the world looking for talent”

The Red Sea Development Company has also entered into partnerships with universities to build up a graduate talent pool and will keep forging networks to ﬁnd and develop new skills. “We are growing our local talent, taking on young Saudis and training them to be the leaders of the future,” says Brembali. Women are being recruited into roles, as well as men, which is far from standard procedure in Saudi Arabia. There are already women working in all departments, including in risk and resilience, security and project management. Any job advert that is put out is assessed for gender bias and skills analysis before posting, and care is taken to ensure that the tone and vocabulary used will appeal to both men and women. To ensure an effective and efficient recruitment process, Mohammad Altuwijri, recruitment manager at the Red Sea Development Company, says they have embraced what

digital has to offer. This includes a shift from manual processes to automation, using a SAP applicant tracking system, and using AI and Searchie.ai during the interview process to map candidates’ strengths and weaknesses. Doing this has streamlined the recruitment process from an organisational point of view, resulting in better hires, a reduced time to hire and a better carbon footprint. Altuwijri says it also ensures a better candidate experience. If you want the best talent, Altuwijri says, you have to give them the best experience. “With ambition comes very high expectations. We are looking for pioneers and these people are hard to ﬁnd. The HR team have implemented world-class HR practices – talent management systems, development programmes, onboarding, rewards packages and relocation packages – and we want to ensure candidates have a red carpet experience.” Automating the hiring process allows the organisation to analyse hiring metrics, which helps it to identify any areas for Phase one improvement. It has also led to deliverables: considerable time savings as the tech does 1. Airport most of the legwork. “We had almost 2. Desert Rock 15,000 applicants through Searchie.ie,” 3. Southern dunes says Altuwijri. “AI has helped us shortlist 4. Shurayrah high volumes and create efficiencies.” 5. Sheybarah Before rolling out the ATS system, the 6. Ummhat Alshaikh Special economic zone organisation ran workshops for hiring managers to train them on using the system and ensure buy-in. A project

IM AGES | ISTOCK /T HE RED SEA DEVELOPM ENT COM PANY

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cOnGrAtUlAtIoNs tO oUr 2020 wInNeRs

On Thursday 29th October we celebrated the industrys most outstanding & successful recruitment campaigns at our ﬁrst Virtual awards ceremony.

www.thermas.co.uk

ART DIRECTION Havas People - WSP

OUTDOOR CAMPAIGN Stafford Long & Partners - Secret Intelligence Service MI6

INTERNAL COMMUNICATIONS Ph.Creative - GVC

COPYWRITING (IN PRINT, ONLINE OR MOBILE) SMRS - Unlocked

DIGITAL SOLUTION Havas People - WSP

SOCIAL MEDIA Symphony Talent - Mars

CAMPAIGN OF THE YEAR TMP - The AA & PeopleScout

RECRUITMENT WEBSITE (BELOW £50,000) TMP - City of London Corporation

PRINT COLLATERAL

RECRUITMENT WEBSITE (ABOVE £50,000) Ph.Creative - GVC

AUDIO (RADIO, PODCASTS ETC) Havas People - Costa Coffee, The Soundtrack

GRADUATE INITIATIVE SMRS - Unlocked

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(BROCHURE, POSTER, FLYER ETC)

TMP - Addleshaw Goddard

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CONTENT MARKETING Blackbridge Communications - Rolls-Royce

EMPLOYER BRAND Ph.Creative - GVC

HR PROFESSIONAL OF THE YEAR Joao Rodrigues - National Crime Agency

EXPERIENTIAL Tonic Agency - RBS

RECRUITMENT EFFECTIVENESS CA3 & Crunch Digital Media - Expedia Group

CREATIVE PROFESSIONAL OF THE YEAR John McNally - Ph.Creative

VIDEO (£5,000 OR UNDER) CA3 & Eli Onboarding - Natwest Group

DIVERSITY & INCLUSION INITIATIVE Pink Squid - Capgemini

ACCOUNT MANAGEMENT PROFESSIONAL OF THE YEAR Ruth Faulkner - Tonic Agency

VIDEO (£5,001 - £15,000) Penna - Security Service MI5

APPRENTICESHIP INITIATIVE Alexander Mann Solutions - Santander

AGENCY OF THE YEAR TMP

VIDEO (£15,001 +) Pink Squid - Capgemini

TECHNOLOGY INNOVATION Havas People - WSP

GRAND PRIX CA3 & Crunch Digital Media - Expedia Group

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FE ATURE : INTE RN ATIONAL RECRUITMENT

team oversaw the process, communicating with all the relevant stakeholders and issuing regular updates. Brembali says the company is taking a one-platform approach so that employees and managers will be able to access everything they need in one place online.

Inspiring change So where does the inspiration for this Red Sea Project come from? The whole project actually stems from a nationwide drive to modernise, diversify and increase prosperity through moving into new markets. And the impetus for change is coming from the very top, from Mohammed bin Salman bin Abdulaziz Al Saud, the Crown Prince of Saudi Arabia and deputy prime minister. Back in 2013, Saudi Arabia made the historic announcement that tourist visas would be issued for the ﬁrst time, although it was a while (2019) before any visas were actually granted. And in 2016, Vision 2030 (vision2030.gov.sa/en) was launched. The brainchild of the Crown Prince, Vision 2030 was a new framework that aimed to reduce the country’s dependence on oil and diversify its economy into new areas, including tourism. It is Vision 2030 that paved the way for the Red Sea Project. There are three overarching themes in Vision 2030: for Saudi Arabia to become a

28 RECRUITER

When the resort is finished, there will be:

50 hotels 8,000 rooms

1,300

residential properties across

Facilities at Construction Village for workers onsite

islands and 6 inland sites

full-sized grass cricket pitches

multi purpose sports pitches

basketball/ volley courts

2 gyms 24hr

2 movie halls/cinemas

clinic (walk-in urgent care clinic) Helipad Fire station

Value of contracts signed to date:

SAR7.5bn (£1.5bn) 3 in 5 contracts awarded to Saudi companies The resort will have created

35,000 direct jobs by completion, with a further

35,000 created indirectly 50% of the current workforce are Saudi

vibrant society, a thriving economy and an ambitious nation. Included in those themes are a focus on urbanisation, culture and entertainment, and the role of women in the workplace – all things that are not traditionally associated with Saudi Arabia. And some of this is already happening – the Red Sea Project is underway, with the first hotel due to open its doors to guests in 2022. In 2017, the first public live music concert in over 25 years was held and it featured not just Saudi singers, but also an American country musician. In 2019, the first ever women’s professional wrestling match to be held in Saudi Arabia took place. A range of other projects have either also happened or are in the offing. The Red Sea Project ties in with several of the themes of Vision 2030 – it is bringing tourism to the nation, it is bringing women into the workplace, it addresses sustainability issues, it is developing local skills and boosting the local and national economy, and t repurposes the perception of Saudi Arabia at home and abroad. “The country has been evolving and changing,” says Darwish. “The vision is clear for us – we need to open up the country, develop Saudi nationals and have a better life for people in this country.”●

DECEMBER 2020

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TH E VI E W AN D TH E I N TE LLI G E N CE

What to expect in the year ahead p2 B I G TALKI N G POI N T

How to build back be er in 2021 p4

Recruitment Issue 89 Ma ers December 2020

LEGAL U PDATE

Your checklists for IR35 p6 TR AI N I N G AN D E VE N TS

Why governance ma ers p8

Rebuilding the UK’s economy

The REC's six step plan for jobs recovery T

he REC has published a plan to help create jobs and promote business recovery. "The same swi and decisive ac on we saw in the spring, including the furlough scheme and other cashflow support, is needed now. We can't pull up the drawbridge. And we shouldn’t ignore businesses in the supply chain of sectors that have to close. This is a unique economic shock – we'll recover more eﬀec vely by keeping businesses going," said Neil Carberry, REC Chief Execu ve. We’re calling on the government to work with the recruitment industry on the following six measures:

Reduce employer naঞonal insurance contribuঞons. This would have the benefit of slowing redundancies for businesses struggling to maintain their wage bill, while also encouraging businesses to take on more people into new jobs where they are needed.

@RECPress RM_Dec_Jan-FINAL-new.indd 1

Fund Statutory Sick Pay (SSP) for every worker. Most recruiters supplying temps are ineligible for SSP rebates. Crea ng opportuni es for temps during a pandemic is therefore a big financial risk if workers are required to selfisolate, which could mean fewer opportuni es for work.

Private recruitment experts can support overstretched jobcentres

Remove unnecessary red tape when finding work. The temporary provision for online Right to Work checks enabled recruiters to get people into work quickly and safely. This measure should be kept. Re-doing, in person, a years' worth of checks would be costly.

Ensure key sectors can access the people they need, including through the new immigra on system. The points system will mean sectors such as construc on, social care, and hor culture will struggle to recruit. Businesses need the immigra on system to be flexible while our skills system is gearing up to meet the needs of a changing economy.

Open up the Apprenঞceship Levy so people who need to retrain can be supported. The pandemic has hit sectors such as hospitality and the arts par cularly hard. For some, the only way to a new job will be to retrain. Everyone knows the levy isn't working as intended. It must be broadened so employers can oﬀer short, highquality training courses to new starters and temps.

6 Keep up to date with how we're supporঞng members on the REC's Covid Hub.

Making great work happen

Make recruitment experts central to all job finding support services. Jobcentres and employability services will be stretched, but the recruitment industry is able and willing to help. We need a more systema c way of bringing private recruitment experts, par cularly niche local specialists, into jobcentres.

www.rec.uk.com 19/11/2020 12:24

Leading the industry

the view... Keep going, says Neil Carberry, REC Chief Execuঞve

he advent of ghter restric ons has been a challenge but the end of 2020 is near! Just like the NHS, businesses are be er prepared – trading through more than shu ng down. The focus at the REC has been helping members to do just that. Taking a longer view, 2020 has taught us a lot. Long-term trends like remote working have embedded in a really short space of me. Agility will be the diﬀerence between thriving and surviving in 2021. What's your client thinking? Strategies are changing. Businesses are focusing on what they can grow. The people you're used to working with client-side may be no clearer than you on the path ahead. Recruiters need to think about who it’s best to talk to on strategy and what allies can help you connect. Clients need a new people plan, you can be their trusted advisor. All our senior client guests on the REC podcast have made this point – bring ideas that solve our problems, not just candidates. Candidate experience ma ers more than ever. As Lewis Iwu said at our REC2020 conference, Covid has made candidates reassess what's important. Purpose and a sense of belonging will be key mo vators. Clients are aware of the risks of ge ng this wrong, with ques ons on supply chain transparency focusing minds in boardrooms. This is an opportunity to oﬀer a professional, values-led service. Being sharper with tech will be a big theme. Recruiters have done well, moving lock, stock and barrel online. We're doing business remotely, interviewing online, and earlier this year the REC was pleased to secure digital Right to Work checking. Keeping this innova on is a priority. We'll also be upping our game on tech advice in 2021 with our new Business Support team – watch this space! As was experienced at Eid, Rosh Hashanah and countless important events this year, the Covid impact can feel most personal when we are meant to be with family. Whether together, or planning some Christmas crea vity over Zoom, on behalf of everyone at the REC I wish you all the peace of the season and a prosperous New Year. If you want to keep up to speed with all things recruitment then follow me on Twi er @RECNeil 2

POL I C Y

Visa disrupঞon

The new immigraঞon system must not put recovery at risk, says Sophie Wingfield, the REC's Director of Policy

f it wasn’t for Covid-19 the changes to the immigra on system would have stood out in the news and come under more scru ny. The rule changes total some 500 pages and come into eﬀect on 1 January. They put EU ci zens on par with the rest of the world when it comes to living and working in the UK. This will disrupt the labour market considerably. The new Points Based System is exactly as you might imagine. Applicants must gain enough points ahead of a visa being granted. Factors including salary, educa on, and whether the job is on the Shortage Occupa on List (SOL) all accrue points. Under the scheme there is no route for so-called "low skilled workers" – even those currently facing candidate shortages, such as LGV and forkli drivers and care workers. While some reforms will be welcome, we are raising concerns with government about the poten al mismatch of skills and candidates with the jobs available. The new immigra on rules must not put the fragile economic recovery at risk. We are asking government to ensure the new system meets three tests: • It must be flexible to changing economic needs, not subject to poli cal whim. • The SOL must be frequently reviewed by the Migra on Advisory Commi ee and include jobs at all skill levels. • There need to be routes for SMEs to sponsor individuals from abroad. This should go hand-in-hand with the UK’s skills strategy – suppor ng people who are currently unemployed to gain the skills they need to transi on into growth industries. Evolving the Appren ceship Levy so it can be used more flexibly by employers to train temporary workers could significantly boost skills in industries like construc on and care. We will be following the impact of the new laws closely so we can represent the concerns of our industry.

Recruitment Ma ers December 2020

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Leading the industry

the intelligence...

1.28m

million acঞve job posঞngs at the beginning of October,

What the trends tell us about the year ahead By Thalia Ioannidou, Research Manager

The jobs recovery The jobs market has shown signs of recovery since the shock crash of March. Unemployment is rising, but businesses are crea ng new posi ons all the me. As our Jobs Recovery Tracker shows, there were 1.28 million ac ve job pos ngs at the beginning of October, 33% more than three months earlier. There is a clear disparity in staff demand across regions, sectors and occupa ons as restric ons and local lockdowns have had different effects on workforce needs. This is likely to con nue in 2021 as regions recover at different speeds. Learning from these trends and focusing on growth areas of business will help recruiters get ahead. Recruiters are specialists in facilita ng career transi ons and suppor ng people to get jobs. We know temporary work is cri cal in any recovery – businesses turn to temps to help them meet demand while the future looks uncertain. At the same me, it enables people to find work quickly. Past recessions show that temporary work bounces back more quickly – it is one of the labour market’s

biggest strengths. Recruiters have a huge part to play in mobilising the temporary workforce and ge ng the economy moving again.

2.7

million people claimed unemployment-related benefits in September

Employer confidence Employer confidence in the UK economy’s prospects plummeted at the start of the outbreak. This was mainly driven by a dive in sen ment among small businesses, which have been hardest hit by the pandemic. As a result, overall staﬀ demand dropped significantly – in April, the number of vacancies fell at the fastest rate in the 22-year history of our Report on Jobs survey, while the ONS revealed the number of vacancies had halved at the peak of the pandemic. A total of 9.6 million jobs had been supported through the Coronavirus Job Reten on Scheme (CJRS). Nonetheless, redundancies rose at the sharpest rate since 2009 and 2.7 million people claimed unemploymentrelated benefits in September. The Claimant Count increased by 1.5 million since March. According to our Report on Jobs data, the

Jobs Recovery Tracker 140 130 Thousands

It has been a year of unparalleled economic disrup on and recruiters, as jobs experts, have been in the thick of it. 2021 will bring new challenges. We can't see around corners, but understanding the trends we've experienced over the past 12 months can help us to be agile as this health crisis unfolds and the impact of Brexit becomes apparent.

120 110 100 90

March

April

May

Jun

Jul

Aug

Sep

Oct

33%

more than three months earlier marked increase in the availability of staff to fill vacant posi ons had far exceeded that seen during the global financial crisis. Encouragingly, as ini al lockdown measures eased and more parts of the economy reopened in July, the overall posi vity toward the labour market improved. Following a record low in April-June, employer confidence in making hiring and investment decisions increased gradually and the REC’s JobsOutlook showed sen ment toward short-term hiring returning to posi ve territory. Similarly, our Report on Jobs survey signalled a sharp increase in hiring ac vity in September with temporary billings expanding at the quickest rate since December 2018. But a challenging winter is now upon us, with the drama c rise in Covid-19 cases and the new lockdowns and restric ons that have come with it. And that's before we even consider the impact of Brexit. The effect of this uncertainty on employer confidence, and the knock-on effect on the jobs recovery, will define the challenges we'll face in 2021. Recruiters have proven they play a vital role in mes of crisis – supplying staff to cri cal sectors and in suppor ng businesses to plan their workforce effec vely to reopen. They will con nue to do so in 2021 as they ac vely support the recovery of the UK jobs market. December 2020 Recruitment Ma ers

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18/11/2020 17:42

Looking to growth

big talking point

New year, new business opportuniঞes But how do you build back be er?

y the me it’s all over, Covid-19 will have le a permanent mark on the recruitment industry. The jobs available. The way people are hired. What people want from work. How recruiters connect all the dots. Even as the second wave and local lockdowns hit, there was acceptance from recruiters – and employers – that they needed to work through the crisis, look to the future and adapt. The situa on has moved on from doom and gloom to accep ng change is happening and seizing the opportuni es. For the most ambi ous among us, that might mean star ng up your own business, opera ng on a leaner cost base, targe ng a gap in the market. The REC has seen that trend reflected with new members. For others it will making the best out of the new trends and following where the jobs growth is happening (as iden fied by REC’s Jobs Recovery Tracker). For many more it will be about stepping up to the plate to support clients – and indeed the government – to help shape the employment recovery. Collec vely, there’s a once in a life me chance to build on the upheaval of 2020, challenge “the way things have always been done” and cement the value of the recruitment industry as an indispensable and highly skilled professional service. 4

Recruitment Ma ers December 2020

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www.rec.uk.com

18/11/2020 17:42

Here are just four ways to build back be er in 2021:

Invest

When the economy has taken a ba ering and business has been hit, it’s not easy to take the plunge and invest. But doing so can give you a serious compe ve advantage at a me when others are s ll focused on damage control. But what to invest in? Of course, there may be a bargain to be had for a sensible acquisi on to strengthen or diversify your business. But for most industry leaders, it boils down to three areas: people, training and technology. When it comes to technology, Covid has simply but drama cally accelerated change that was already happening. Recruiters, clients and candidates have had to adapt to online ways of working – and they need the tools to do so e ciently and eﬀec vely. The benefits of video interviews as part of the recruitment process have now been established, for example. And the unfortunate deluge of CVs for each and every opening will drive greater acceptance of, and innova on, in AI too. Likewise, the importance of training in response to skills gaps was clear even before the pandemic le millions in need of help to get back into work. According to a report from the CBI, nine in 10 UK employees will have to reskill by 2030 as a result of the pandemic accelera ng changes to the world of work. Recruiters are well placed to iden fy requirements, connect the dots to government assistance, and refocus on making a real impact on people’s lives.

Think about the recruiter experience, not just that of the client and candidate

For all the talk about technology, the human touch remains essen al. But for a recruiter to care about their clients and candidates enough to foster long-term, consulta ve rela onships, they have to be engaged and cared about. “Stop overinves ng in technology and underinves ng in staﬀ,” said Lisa Jones, www.rec.uk.com

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Founder at Barclay Jones, at REC2020. “For us to come out of this with a bit of a slingshot, we need to look at our staff and take the opportunity to fix some of our processes with really good training.” For best effect, staff should also be consulted on what technology is bought in and how it can help them. They may also need support in adap ng to it. Take the enforced shi to remote working – research commissioned by social learning pla orm FutureLearn discovered that 37% of recruiters have found it more di cult to find the right talent and 25% feel they are not prepared or trained to shi to the new way of working. The pla orm has recently teamed up with the REC to launch a new course to support remote hiring and onboarding. Away from technology, pu ng the focus on recruiter experience gives rise to plenty of other ques ons business leaders should be asking. Do your recruiters have the access to data they need so they are in a posi on to take on a more advisory, more highly valued, role? Are they incen vised in the right way to focus on D&I now that it’s quite rightly high on clients’ agendas?

Focus on talent, not locaঞon

And what about the new employment rela onships to be nego ated in 2021? One thing is for sure: fewer people will be ed to the o ce in quite the same way. In a survey by Right Management, almost half (47%) of employees believed the pandemic marks the end of full- me work in an o ce environment. Physical boundaries have been blown away in terms of how far people are prepared to commute for the occasional o ce trip. What that means for salaries, team structures, KPIs, and so on, remains to be seen, but savvy recruiters who can keep track of the data, stay on top of the trends and make sense of it all will be an invaluable support for their clients. These new dynamics will also aﬀord recruiters the opportunity to think more about the diversity of the talent they are tapping into. But they’ll also have

to overcome the challenges of how to access diﬀerent networks, with more limited face-to-face events and more geography to cover.

Don’t be afraid to do things di@erently

With all that 2020 has thrown at us, people have either forgo en what “normal” looks like or want to avoid slipping back into old habits. As Michael Smith, CEO of Randstad UK and Ireland, says, it’s led to a widespread acceptance of change and the opportunity to do things diﬀerently. At one end of the scale, businesses have come out commi ed to be er working prac ces on diversity and inclusion, taken a stand on other societal issues (from mental health to climate change), or decided to work more closely with their own communi es. By doing so they are aligning with values that are more commonplace a er lockdown than they were before, and not just among younger genera ons. At a more granular level, the recruitment process itself is ready for a shake-up – something discussed in detail at our REC2020 digital conference. Throughout 2021, and because of the support it has oﬀered the jobs market in the pandemic, the government will remain interven onist. There will be an emphasis on fair work and recruiters will be held to high standards. Services will be in demand. Clients and candidates will need more support than ever before. Ongoing turbulence means businesses need to be adaptable. Against this backdrop, Mark Essex, Director of Public Policy at KPMG, advised recruiters to “challenge every assump on and make every decision as if you’re star ng out anew”. “It’s temp ng to just react to what’s going on now but it’s really important to have a vision of how you’re guiding and shaping what’s happening, to move towards a be er future,” added Jus ne Lu erodt, Director, Centre for Synchronous Leadership. December 2020 Recruitment Ma ers

18/11/2020 17:42

IR35

legal update

Are you ready for the IR35 changes? By Lewina Farrell, Head of Legal Services, REC

n 6 April 2021, the o@payroll rules will apply in the private sector changing how contractors will be taxed. Although Covid has been recruiters' top priority, it's ঞme to get the house in order for IR35. Here are some ঞps to help you get ready: Who's exempt? Clients who are small or wholly overseas will be exempt from the o@-payroll rules. This means contractors will conঞnue to manage IR35 themselves. But don't guess if your client is exempt and don't assume that because you deal with an overseas oLce that the client is exempt. You should ask your clients to confirm their status in wriঞng. Assessing roles Find out if your non-exempt clients have started to assess roles. You should make sure you are confident that clients have the correct processes in place to make accurate IR35 status decisions.

Reviewing your IR35 relaঞonships By Peter Stoll from Marsh Commercial – REC’s recommended insurance broker.

Recruitment Ma ers December 2020

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How will you pay? For ‘inside IR35’ decisions, will you conঞnue to pay contractors through their PSCs, or will you pay them through your own payroll or through an umbrella company? If through an umbrella company, have you done full due diligence? As a minimum REC recommends that agencies deal with FCSA members only. If you engage with an umbrella company (or another intermediary) check that they will employ the individual and not pay them through another intermediary (such as their PSC) and ignore the client’s inside IR35 status decision. You don't want them to pay the PSC gross or you could be liable for unpaid tax and naঞonal insurance. Have you got the right contracts in place? Put new contracts in place at the right ঞme – the new rules apply to work done on or a[er 6 April 2021 so for ‘outside IR35’ engagements you can change contracts any ঞme before then. For ‘inside IR35’ engagements, you will need to manage transiঞoning to new contracts carefully. Also, can you do another pay run as close as possible to 5 April 2021 to encompass work done up to and including that date?

With just a few months to go unঞl the revised implementaঞon date for IR35 in the private sector, recruiters should take this ঞme to undertake reviews of any Personal Services Company’s (PSC) tax status and assess their own potenঞal tax liability. Agreement with the hirer is needed on who will pick up the addiঞonal tax charge, or whether the PSC should be expected to reduce their take home pay. So, what should recruiters be doing now? 1. Engage with the hirer immediately. They can use tools such as Check Employment Status for Tax (CEST) to determine the PSC’s IR35 status

Check the indemnity clauses in your contracts. If o@ered any tax liability insurance read the policy carefully. What are the condiঞons of cover, what is the level of cover? Don’t just relabel your recruitment services as ‘statement of work’ contracts. If there is an agency in the supply chain, HMRC will assume labour supply unless you can prove otherwise. A statement of work contract involves delivering a whole service and not just contractors to do the work. If you are presented with other ‘soluঞons’ to the IR35 changes, you must understand what those soluঞons are. HMRC will look for contrived arrangements. Visit the REC's IR35 hub for advice and materials to help you get ready

2. Idenঞfy any PSCs whose contracts extend beyond 6 April 2021 3. Assess the potenঞal tax liability facing the recruiter 4. Agree who will carry out the assessment 5. Decide if insurance is required to protect tax invesঞgaঞon costs and potenঞal tax liability 6. Keep updated records of any change to a PSC’s contract 7. Deal with any challenges to the decisions 8. Keep accurate records for any future claims rec.uk.com/marsh-commercial www.rec.uk.com

18/11/2020 17:43

Inspiraঞon

Q&A

Behind the scenes with recruiters on the front line

How has Royall responded to the Covid crisis?:

As with all recruiters for the creaঞve services industry, Royall were hit hard when lockdown started. We furloughed our team to protect our future as a business, ready to spring back into life when demand started picking up, which it did in August. Since then, we have seen a paradigm shi[ towards interim/contractor talent as clients get back to business. We have also seen new opportuniঞes in sectors such as HR, Markeঞng and Finance. So as a small, agile business we diversified to service these, knowing we had senior team members with the right experience. Businesses have been downsizing and restructuring. Demand, though lower, is for talent that is versaঞle and resilient. Human qualiঞes and 'discreঞonary e@ort’ are now key, with the need to fully understand who a person is – their vibrancy and energy, as much as www.rec.uk.com

RM_Dec_Jan-FINAL.indd 7

Jenny Royall, Founder of Royall, on how taking a selfl ess approach to recruitment will pay o@ long term. their skill and experience, coming into play.

How did the team manage when returning from furlough?

There was a strangeness in working again, a[er such a long ঞme away from the oLce, and finding a new normal was challenging. We’ve always had an agile, flexible culture, so we were used to working remotely. We all have di@ering family/life commitments and recognised that presenteeism doesn’t guarantee performance. Trust and good engagement are far be er moঞvators. We did all miss the team support and energy of our vibrant the oLce. So re-entering lockdown restricঞons again was a blow. We have tried to overcome this by dramaঞcally improving the way in which we engage. For example, we have regular team meeঞngs online which always li[ our spirits and fuel momentum and performance.

What are you most proud of?

We’ve idenঞfied and answered a need at opposite ends of the recruitment spectrum. One in invesঞng our ঞme in young talent, as young people have been hit hard by the pandemic; the other in launching a new arm to the business, called Resolute, to help senior execuঞves be er engage talent and acঞvate organisaঞonal purpose, and build their businesses through their people. We are excepঞonally proud of our focus on youth employment and talent development, which is not only vital but enormously saঞsfying. Through lockdown 60% of our e@orts were spent providing coaching to our younger candidates, improving their personal branding, knowing that discreঞonary e@ort is vital for talent to succeed in this climate.

What advice would you give others?

Firstly, listen to talent and to clients and hear their

ambiঞons. Listen to the advice of others. Listen to your execuঞve directors. Listen to podcasts and webinars. Listen, listen, listen! You’ll hear what your clients and candidates need most, and you can adapt accordingly. Shi[ the tone away from commerciality and sales towards support, altruism and nobility. You have to take a selfless approach to helping your clients get through the crisis, o@ering them whatever support you can, even if far from your usual sphere. It makes you a true partner and someone they will return to and be grateful for. Most of all, set goals and put ঞme aside to focus on them. This is a ঞme for many to learn new skills, improve their knowledge base, be commi ed to their own self-advancement. This is the key to discreঞonary e@ort. It’s not about being perfect, it’s about e@ort. When you implement that e@ort into your daily life, that’s where transformaঞon truly happens. December 2020 Recruitment Ma ers

18/11/2020 17:43

Governance

The benefits of outside influence I

n October, Sarah Thewlis, Managing Director of execuঞve search firm Thewlis Graham Associates, took over as Chair of the REC. Her appointment at the head of a newly structured board puts the importance of governance in the spotlight and recognises how valuable it can be to look outside your own business to understand what could be coming next. Thewlis’ own career covers commercial, recruitment, not-for-profit and charity work. She’s joined by four non-execuঞve directors from outside the industry. We caught up with her to find out why that could give the REC the edge it needs in challenging ঞmes.

How important is governance as a topic for anyone in recruitment? Governance is really important. When things have gone wrong in organisaঞons, it’s o[en because people siমng around the top table either haven’t seen it coming or they’ve not thought about it. I’ve been in recruitment for long enough to know that the industry can be quite inward looking. Recruitment is so important to the UK. Pre-Covid, the industry made over 1 million permanent placements each year, and 1 million people were on temporary assignments every single day. But it needs to be be er at promoঞng itself to the outside world. It needs to posiঞon itself be er as the experts on the window of the world of work. And when so much is changing, it needs to learn as much as it can wherever it can.

Recruitment Ma ers

The oLcial magazine of The Recruitment & Employment Confederaঞon Dorset House, 1st Floor, 27-45 Stamford Street, London SE1 9NT Tel: 020 7009 2100 www.rec.uk.com

Recruitment Ma ers December 2020

RM_Dec_Jan-FINAL.indd 8

It’s good that REC has had a really good look at governance over the past year. We’re now clear about who the top table is. We have a smaller group of elected recruiters siমng around it. We’ve also brought in four non-execs from outside the recruitment world to broaden the way we think about things, whether that’s immigraঞon, Brexit or new ways of working. Are you expecঞng very di@erent perspecঞves from the four non-execs? I think we are. In Jon Sibson, Pro ViceChancellor of the Faculty of Business at the University of Greenwich, you’ve got somebody who has had three di@erent careers, and is at the crossover point between higher educaঞon and business. Jane Rumble, Interim Deputy Group Director, Consumer and External Relaঞons Group at Ofcom, has a really strong customer services background within the regulatory world. Sakhila Mirza, Execuঞve Board Director and General Counsel, London Bullion Market Associaঞon, brings an alternaঞve perspecঞve from within a professional body. Dr. Gopa Nair, Chief Operaঞng OLcer, NHS Unit Croydon, has done a really interesঞng mix of internaঞonal work as well as supporঞng the public sector. They’ll bring fresh thinking on commercial development, digital transformaঞon, inclusion and standards. This is all the more crucial given the economic challenges we all now face.

And it supports the idea that diversity of thought is an important aspect of diversity and inclusion… It does. When you’re looking to appoint people rather than relying solely on an elecঞon process, it’s an opportunity to make some very posiঞve statements about D&I. Our board is very mixed, in terms of ages and geographical diversity too. Geographical diversity shouldn’t be overlooked. I’ve been really impressed with the acঞon the REC has taken to support members since Covid hit. This seismic event has prompted us into new ways of thinking more quickly and members are sঞll grappling with that. But every area will be experiencing the latest trends di@erently and I’m keen to see the REC focus more and more on the regional variances as it gets even closer to its members. Helping them to understand what’s happening in their locality, and how that relates to retraining and reskilling needs. That’s so much more powerful than a one-size-fitsall model. I want all recruiters to be seen as experts in their field, but there’s a lot they need to know. When you put the emphasis on high standards, recruitment is a complicated business. We can help.

Membership Department: Membership: 020 7009 2100, Customer Services: 020 7009 2100 Publishers: Redac ve Publishing Ltd, Level 5, 78 Chamber Street, London E1 8BL Tel: 020 7880 6200. www.redac ve.co.uk Editorial: Editor Pip Brooking Pip.Brooking@rec.uk.com. Produc on Editor: Vanessa Townsend Producঞon: Produc on Execu ve: Rachel Young rachel.young@redac ve.co.uk Tel: 020 7880 6209 Prinঞng: Printed by Precision Colour Prin ng © 2020 Recruitment Ma ers. Although every eﬀort is made to ensure accuracy, neither REC, Redac ve 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 Redac ve Publishing Ltd. No responsibility can be accepted for unsolicited manuscripts or transparencies. No reproduc on in whole or part without wri en permission.

www.rec.uk.com

18/11/2020 17:43

ENTRY DEADLINE 13 January 2021 WINNERS ANNOUNCED 5 May 2021

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Taking the madness out of recruitment

The next chapter in recruitment software. www.itris.co.uk

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Special Report

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18/11/2020 18:34

Payroll

IR35 AND PAYROLL LIFTING THE VEIL OF CONFUSION AROUND LEGISLATION

S P O N S O R’S STAT E M E N T

EDITOR’S COMMENT

RE-IMAGINING PAYROLL WILL PROTECT AGENCY PROFITS Hive360’s CEO David McCormack explains how strategic payroll can help protect and maximise profits for recruiters, and why outsourcing payroll must be a strategic decision that addresses wider policies including efficiency, cost saving, staff retention, productivity, employee engagement and wellbeing. Today’s world of work is placing unprecedented demands on agency payroll. The growing complexity of compliance, expansion of IR35 rules, and mounting pressure on agencies to look after workers’ welfare, is a heavy commercial burden for recruitment businesses. Hive360 is a specialist employee benefits and outsourced payroll provider, and its compliant and reliable PAYE payroll support and employment administration reduces overheads and improves operational efficiencies. Recruiters outsourcing their temporary workers’ PAYE payroll to Hive360 report savings of £100 or more per worker in the first year. The Hive360 payroll solution also has a host of tools that support employee engagement strategies, to deliver communication, wellbeing and lifestyle benefits, via its market leading Engage app, included as standard for all clients.

SHEDDING LIGHT ON AND TRYING TO UNTANGLE IR35 LEGISLATION FOR RECRUITERS IR35 is the topic that most concerns recruiters at the moment, just a few months away from April 2021, when the off-payroll rules go into force for private sector hirers who meet specific criteria. The entire IR35 regime is so tangled, so fraught with ‘gotcha’ perils, that even those who impose this legislation find themselves having to go back to it time and time again to clear up some ambiguity. For instance, the latest round of concern over the impending legislation centres on wording – determined to be unintended – around umbrella companies that will have to be amended in the next Finance Bill. This signals poorly imagined and poorly understood legislation. At any rate… we hope our latest Special Report will shed light for you on more dusty corners of this devilish legislation.

DeeDee Doke Editor Recruiter/recruiter.co.uk

David McCormack CEO Hive360

EDITORIAL +44 (0)20 7880 7606: Editor DeeDee Doke deedee.doke@recruiter.co.uk Contributing writer Christian Koch, Greg Pitcher Production editor Vanessa Townsend vanessa.townsend@recruiter.co.uk Art editor Sarah Auld Picture editor Akin Falope ADVERTISING +44 (0)20 7880 6231: Senior sales executive Joanna Holmes joanna.holmes@redactive.co.uk PRODUCTION +44 (0)20 7880 6209: Senior production executive Rachel Young rachel.young@redactive.co.uk PUBLISHING +44 (0)20 7880 8547: Publishing director Aaron Nicholls aaron.nicholls@redactive.co.uk

Redactive Publishing Ltd 78 Chamber Street, London E1 8BL 020 7880 6200

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Payroll

eyond the stiﬂing winter restrictions to tackle coronavirus, and the UK’s full exit from the EU, lies a third major challenge for recruiters, and it is shrouded in just as much uncertainty and confusion. On 6 April 2021, changes to the law will make agencies responsible for payment of tax and National Insurance for thousands of workers. The off-payroll working changes introduced in the Finance Bill bring much of the private sector – apart from the smallest ﬁrms (see box on p38) – into line with the rules in place in the public sector since 2017.

Recruiters need to spring in to action now to get to grips with the challenges of the off-payroll changes coming into effect in April. Greg Pitcher explains

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Special Report

It means end users will be responsible for determining the tax status of people who provide services via an intermediary, but fee payers will ultimately carry the can for paying HMRC. Lawyers have warned that this leaves recruiters with a dilemma. “The broad position is that if a client carries out an assessment using reasonable care, but gets it wrong, the staffing company acting in reliance of that assessment in good faith is liable,” said Kevin Barrow, partner at law ﬁrm Osborne Clarke. “The staffing company is in an invidious position of not knowing if it can rely on the assessments.” Agencies are left to second guess whether a client is being too scared of the complex rules and classing too many supplied workers as employees for tax purposes.

“The stafﬁng company is in an invidious position of not knowing if it can rely on the assessments” KEVIN BARROW Partner at law firm Osborne Clarke

This approach would cost genuine contractors money, add an administrative burden to agencies and potentially see valuable people exit their roles to the detriment of all parties. On the other hand, could the end user be playing too fast and loose in a bid to maintain the status quo for contractors – which could lead to a big bill for the recruiter as fee payer further down the line? An agency with 10 contractors on a site using personal service companies (PSCs), each paid £75k per year for three years, could owe tax and NIC on £2.25m of wages, Barrow points out. If they’ve underpaid these by 15 percentage points because of trusting an incorrect assessment of being outside IR35, that would leave a bill of about £333k and the penalty could double it to £666k even before interest is factored in.

Sector shift? The nature of the recruiter-client relationship makes it even more likely that the ﬁnancial burden will fall onto agencies, Barrow adds. “Even if they can demonstrate that the end user is in fact liable,” he explains, “the end users often require staffing companies to indemnify them for any tax suffered as result of supply of contractors.” Ultimately the IR35 changes could lead to a signiﬁcant shift in the sector, he adds. “This will drive consolidation of the industry. Rightly or wrongly, end users will trust larger, more sophisticated suppliers to get this right – and to pay any tax when a claim is made. They have stronger balance sheets. “It is bad news – fairly or unfairly – for relatively

smaller staffing companies who potentially will not be trusted by end users to get this right.” Seb Maley, CEO of IR35 specialists Qdos, says that when the changes to off-payroll working legislation were introduced for public sector clients in 2017, there was a “massive impact” on delivery of projects. “The public sector is inherently risk averse and there were blanket determinations so everyone working for a government body was determined as inside IR35,” he says. “It led to people leaving. They had the private sector to jump into.” Contractors know they will eventually pay a hefty price for being deemed employed rather than self-employed for tax purposes through the legislation, Maley insists. “The ﬁnancial impact always ends up with the IM AGE S | I STO C K / N O U N PROJ E C T

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A STORM OVER UMBRELLAS Ministers have been urged to pass legislation to stop the off-payroll working changes interfering with the way recruiters use umbrella companies to administrate tax payments. HMRC was forced to issue a statement in October after the spotlight turned on a seemingly innocuous amendment to section 61O of chapter 10 of the Income, Taxes, Pensions and Earnings Act. “It said every company was an intermediary,” explains Dave Chaplin, founder of compliance specialists IR35 Shield. “An umbrella company would be counted as an intermediary, so the company paying the umbrella company becomes liable for the tax deductions. “Many agencies legitimately use umbrella companies to avoid operating their own payroll and would need to bring their payroll in-house.” The Freelancer & Contractor Services Association (FCSA) raised its concerns over this situation and demanded a meeting with HMRC, which the contractor body later described as “positive and constructive”. “HMRC has accepted that it was never an intention of the reforms to stop a compliant umbrella company from operating as it does today when the new rules come into effect,” said the FCSA after the meeting. Barrow agreed with the body that an amendment to legislation was needed to ensure umbrella companies were not caught in the changes. But he warned it would not be straightforward, especially with so much occupying ministers’ time. “If there is no parliamentary time before 6 April then there may be an announcement that there is an intention to do that in the summer, pending which the government will expect affected people to trust that the legislation will not be enforced on the basis of its current wording. That would not be entirely satisfactory.” Even if legislation is amended at the last minute, getting umbrellas off the hook, there could be further ramifications, Barrow warned. “HMRC will be concerned about creating loopholes; and taxpayers will be concerned about other unintended consequences creating uncertainty for members of the staffing supply chain.” An HMRC spokesperson said: “We have engaged with stakeholders to understand their concerns about part of the off-payroll working legislation and reassure them that the policy intention remains in line with our published guidance. “We continue to work closely with stakeholders on this issue and are considering what action is required to ensure the rules apply as intended.”

contractor – they can end up more than 30% worse off in take-home pay if assessed as inside IR35. Employers’ National Insurance, for example, gets passed down the line, and travel expenses can’t be claimed to reduce tax.” Private sector clients had a dry run preparing for the law change last spring before it was put back a year because of the coronavirus outbreak. This showed that not all end users would treat it in the same way. “Determining someone as inside or outside IR35 is not black and white; it is based on decades of case law,” says Maley. “There are grey areas.” Indeed, a government website asks workers using intermediaries a huge number of questions before determining their IR35 status, including whether a substitute can be sent in their place; how much control the client has in selecting tasks, hours, location and working methods; what costs are incurred; and how they are paid.

Opportunities The complicated nature of the legislation – which aims to ensure anyone who would be classed as employed if contracted direct pays a similar level of tax as employees – has opened up opportunities for

“Determining someone as inside or outside IR35 is not black and white; it is based on decades of case law. There are grey areas” SEB MALEY CEO of IR35 specialists Qdos

recruiters, as well as threats, Maley says. Recruiters who can understand the fine points of IR35 determination and help clients understand the benefits of correctly and justifiably ruling a contractor as outside the scope of the legislation will be in high demand both from end users and workers. “Some agencies have used the rules to good effect for talent attraction.” End users will also be keen for guidance on how to implement the new laws correctly from April. “Clients will look to agencies for assistance. Many agencies will have people within their team who specialise in IR35. They can administer a

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determination process that works well to alleviate risk from client. It can be a core value-add in the relationship,” Maley says. He stresses that HMRC will be “quite aggressive” in trying to capture tax through the legislative change. And he urges recruiters to seek advice as well as offering it. “HMRC investigations are massively time consuming, complex and draining. We promote having a very substantive audit trail at the outset. “Agencies should be getting outside support. We don’t know how HMRC will police this but investigations are likely to involve the agency so it’s important to be prepared. Seeking third party advice is worth the time and expense.” Sophie Wingﬁeld, interim director of policy and campaigns at the Recruitment & Employment Confederation (REC), warns that some agencies lack conﬁdence in the preparedness of the whole supply chain for the looming changes to IR35. “Unsurprisingly, Brexit no-deal contingency

FIVE STEPS TO PREPARE FOR IR35 CHANGES The REC says agencies should be ready to answer the following questions: 1 Which clients are SMEs and therefore exempt from the new rules? 2 Which workers are working through their own personal service company? 3 How will their clients be making their determinations? 4 Who is in your supply chain – particularly who is the fee payer? 5 What records do you keep on workers?

HOW TO WORK OUT WHICH CLIENTS ARE EXEMPT FROM THE IR35 CHANGES The new rules apply to all public sector clients and to private sector companies that meet two or more of the following conditions:

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an annual turnover of more than

£10.2m

more than 50 employees

a balance sheet total of more than £5.1m

“We would urge any agencies that have not yet prepared to do so as soon as possible” SOPHIE WINGFIELD Interim director of policy and campaigns at the Recruitment & Employment Confederation (REC)

planning, as well as managing through Covid-19, have been prioritised over the forthcoming tax changes,” she says. “However, not preparing and falling foul of the rules could have serious ﬁnancial consequences, and we would urge any agencies that have not yet prepared to do so as soon as possible.”

19/11/2020 10:32

Payroll ADVERTISEMENT FEATURE

HOW CAN HIRING FIRMS ACHIEVE EFFECTIVE OFF-PAYROLL COMPLIANCE? The Off-Payroll legislation will take effect in April 2021, so robust compliance is crucial for hiring firms in the private sector and their recruitment partners.

ovid-19 contributed towards a 12-month postponement to the legislation’s rollout and, while some firms have used the extra time to establish rigid compliance processes, others are yet to act. Firms that have been daunted by the task need delay no longer with solutions from service providers that specialise in Off-Payroll compliance.

Meeting the ‘reasonable care’ requirement Hiring firms need to satisfy the legislation’s ‘reasonable care’ requirement when considering the IR35 status of contractors and provide a Status Determination Statement (SDS). The concept of ‘reasonable care’ is understood by most tax experts and HMRC has also published some useful guidance, which includes: Taking care to seek ‘appropriate advice’ to ensure correct tax treatment Conducting thorough status

assessments and preserving detailed records Continuing to monitor the status of contractors throughout each engagement

service that can demonstrate assessment accuracy, showing detailed test data that concurs with tribunal outcomes.

Does the solution take Hirers are required to make a compliance-led informed decisions and approach? therefore show they Off-Payroll compliance isn’t an understand the legislation. issue that can be simply IR35 & Off-Payroll – explained circumvented via an insurance details Hive360’s everything customisable, mobile policy app, Engage. slapped on top of a stakeholders need to know, lip-service compliance process. with chapters dedicated to It’s not possible to simply insure helping hirers and agencies against the non-payment of overcome compliance tax, in the same way that you challenges. cannot insure against Firms will need to committing a driving offence demonstrate that they have say, or breaking any other law. detailed record keeping and Insurance companies will not ongoing monitoring in place compensate if compliance – and that they have taken obligations have not been met. appropriate advice. Adopting a robust compliance-led approach Is the compliance offers the best protection in solution demonstrably the event of an HMRC enquiry accurate? and should avoid a firm’s Even with the best intentions, reputation being publicly hiring firms may fall foul if an dragged through a tax HMRC enquiry deems their tribunal. As the old saying status to be incorrectly goes, prevention is better assessed. This can be avoided than cure. by choosing a compliance Beware of opportunistic

Dave Chaplin is CEO and founder of contracting authority ContractorCalculator and IR35 compliance solution IR35 Shield. He is also the author of IR35 & Off-Payroll Explained.

service providers that offer status assessments that are really designed to steer customers into buying something else.

Ensure that you have effective Off-Payroll compliance Effective Off-Payroll compliance requires consideration of many factors, all of which have been accounted for by IR35 Shield and its suite of compliance products for businesses, tax professionals and contractors. Built by a team with a two decade obsession with IR35 and over 25 years’ software development experience, IR35 Shield sifts through vast amounts of data to help you reach decisions on a grand scale in real-time whilst bringing speed, scalability, consistency and accuracy into the complex world of employment status case law. It means those in the supply chain using IR35 Shield can run reports, gain insights and identify problems quickly. IR35 Shield continues to innovate and set the standard as the most robust compliance-led solution on the market. WWW.RECRUITER.CO.UK 39

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Special Report Report Special ADVERTISEMENT FEATURE

RE-IMAGINING PAYROLL WILL PROTECT AGENCY PROFITS Strategic payroll, off-payroll rules, HMRC compliance, IR35 – a heady mix and commercial burden for recruitment businesses in today’s new world of work. But David McCormack, CEO of outsourced PAYE payroll specialists Hive360, believes strategic payroll is the profit-protecting solution.

oday’s world of work is placing unprecedented demands on agency payroll. Add to this the growing complexity of compliance, expansion of IR35 rules, and mounting pressure on agencies to look after workers’ welfare, now is the time to embrace a new, commercial approach using a strategic payroll solution - that also protects profits.

All change: April 2021 Workers providing similar services to employees, and who would therefore be classified as an employee if working directly for the client, pay similar tax and NI contributions. The government introduced IR35 rules to ensure fairness across all, and in 2017, implemented additional rules for ‘Off Payroll’ workers, which were rolled out to only the public sector. But from April 2021, this will change. The classification of worker status will shift from the intermediary to the client, and 40 RECRUITER

the rules extend to the private sector – meaning organisations engaging workers through intermediaries must identify whether the worker is classified a direct employee for income tax purposes. In part, the changes are designed to address concerns that some intermediaries are not complying with IR35 but reducing due payments of tax and NICs. Under the new rules, the business – or agency paying the intermediary – must deduct income tax and NICs from the fees paid to the intermediary, and account employers’ NICs, and apprenticeship levy if relevant, as if the fees were salary payments, to comply with IR35 regulations. Standard IR35 rules will continue to apply to intermediaries providing services to private sector clients that are small or have no UK connection in a tax year.

Workers supply chain Recruiters should start by defining their role in the labour supply chain role: Client: also known as the engager, hirer or end client, and the organisation which is or will receive the services of the worker/contractor. The client will need to make a status determination to identify if IR35 rules apply, and is responsible for advising the worker, agency or other labour provider if the rules apply and the reasons why. If there is no one else in the supply chain, the client will also be the fee payer. Agency: the employment/ recruitment agency (or agencies, as there can more than one) that supplies a worker to a client, and may pay a worker’s intermediary (fee payer), depending on other parties in the supply chain. Fee payer: pays the worker, limited company or other intermediary. Is also directly above the worker’s limited

company in the supply chain, and could be the client or agency. Is responsible for deducting tax and NI contributions, and paying them to HMRC, and should have a copy of the status determination from the client. Intermediary: usually the worker’s own personal service company, but could be a partnership or individual. Worker (contractor): the individual providing services to the client through an intermediary.

Who decides? The client is responsible for establishing whether Off-Payroll rules apply based on a private company classification: Small/micro companies (less than two of: below 50 employees, turnover below

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HIVE360 Outsourcing payroll is a strategic decision that will address wider policies including efficiency, cost saving, staff retention, productivity, employee engagement and wellbeing. Hive360 provides compliant and reliable PAYE payroll support and employment administration that reduces overheads and improves operational efficiencies. Hive360 falls outside of the Intermediary definition because: It is not an associated company of the client. None of its workers has any interest in its business (no shares). Its management and control are separate to and uninfluenced by the workforce. All workers are engaged under PAYE contracts (either of employment or service). Unlike some outsourced payroll providers, Hive360 does not operate any form of tax avoidance or manipulation, which puts a business at ongoing risk. Anyone paid through Hive360 is done so under PAYE.

ADDED BENEFITS

Hive360’s customisable, mobile app, Engage.

£10m, net assets below £5.1m) – exempt and responsibility lies with the intermediary. Client medium/large companies (two or more of: above 50 employees, turnover above £10m, net assets above £5.1m) – the client is responsible. Government guidance will help determine if IR35 rules apply – but they will if a worker provides services to a client through an intermediary and would be classed an employee if contracted directly.

What next? To guarantee IR35 compliance, recruitment businesses can either: 1. Do nothing, and expose the business to crippling fines and taxes; 2. Carry on as they are, but let the fee payer deduct all appropriate tax and NI contributions; 3. Only engage with suppliers not caught by IR35 and off payroll legislation; 4. Convert all workers to in-house PAYE; or 5. Outsource to a PAYE payroll solution provider.

Recruiters outsourcing temporary workers’ PAYE payroll to Hive360 report savings of £100 or more per worker in the first year. The Hive360 payroll solution includes tools that support employee engagement strategies, to deliver communication, wellbeing and lifestyle benefits, free of charge to the worker via our Engage app. Engage includes 24/7 confidential access to counsellors and GPs, especially important at this time – during the first week of Covid-19 lockdown, we recorded an unprecedented 273% increase in demand for mental health support services, and 102% increase in the use of the GP service. Communication with a workforce is essential, and typically clients using Engage record employee engagement levels of over 80%. Hive360 is a specialist employee benefits and outsourced payroll provider. For more information: www.hive360.com

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IR35 COMETH: ARE YOU PREPARED? With IR35 reforms just four months away, one recruitment firm tells Recruiter the steps they’re currently taking to make their clients compliant for this notorious piece of legislation. It’s time to start holding clients’ hands, as Christian Koch reports

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fter the Christmas lull, comes the chaos. If any recruiting professional is looking forward to effortlessly easing their way into work on 4 January, coasting their way through the month’s tasks without troubling their Prosecco-addled brains, perhaps even taking a sickie sometime around Blue Monday, they’d probably need to think again. The ﬁrst few months of 2021 are set to be a brutishly busy time for recruiters. In-trays are set to be inundated with applications, thanks to the

UK labour market having been clobbered by Covid-19 (unemployment will rise from 1.5m to 2.6m, according to the Bank of England). The end of the Brexit transition period on New Year’s Eve may spark staff shortages due to changed immigration rules, while hiring from Europe won’t be as easy as it once was. If that wasn’t enough to make recruiters crawl back underneath their duvets until springtime, then consider this: it’s the ﬁnal leg of the journey to IR35 implementation with private sector employers. “It’s going to be a nightmare,” says Leslie Owusu, director of London-based IT recruitment agency Gazelle Global, who has been preparing his team for IR35 since late last year. “When I spoke to clients in early 2020, many had a lack of understanding about how IR35 works. My feeling was, we’re going to have to hold clients’ hands through this.” From 6 April, the rules get rebooted, with larger organisations in the private sector now responsible for determining whether their contractors are ‘inside’ IR35 rules (subject to PAYE) or ‘outside’ (operating as a genuine company). As such, recruiters can expect to be busy communicating IR35 changes to clients and helping them become compliant. The new rules affect private ﬁrms with a £10.2m+ turnover or with more than 50 employees. In fact, although it’s the

responsibility of the hiring company to check the employment status of its contractors, all recruiters need to ensure their clients are on the road to compliance. Fail to do that, and your recruiting agency – along with the hiring company – could be liable for any unpaid tax and National Insurance Contributions (NICs) if HMRC ﬁnds a worker has been incorrectly classiﬁed. “If there’s an investigation [by HMRC], then the hiring company and everybody in the supply chain will feel it,” says Ishari Martenstyn, Gazelle Global’s head of contracts & compliance. “If the fee-payer [hiring company] can’t pay, they’ll come down the supply chain to retrieve those funds from the recruitment company or hirer… There’s no option of not being compliant here.” Martenstyn continues: “At the moment, it’s the liability of the contractor to decide whether their working arrangements fall inside or outside IR35, plus to pay the correct taxes and NIC. “But from April, all

“It’s going to be a nightmare. When I spoke to clients in early 2020, many had a lack of understanding about how IR35 works” LESLIE OWUSU Director of London-based IT recruitment agency Gazelle Global

necessary tax and NICs will be deducted before the ﬁnal payment.”

Role of the recruiter What’s the recruiter’s role in all this? According to Martenstyn, recruiters “need to keep the client well-informed, make sure they understand exactly

In-trays are set to be inundated with applications as unemployment will rise from

1.5m 2.6m

to , according to the Bank of England

IM AGES | SHUT T ERSTOCK /NOUNPROJEC T

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Transform the way you bill and pay. With the ability to help you comply with IR35, our Pay & Bill service is specially designed to reduce the back office burden for recruiters. We handle your timesheets, expenses, billing and payroll – using our tailor-made InTime software. Visit rsmuk.com and search for recruitment pay and bill or call 07852 124 355 to arrange a free demo.

Quote RSM2020 to get advanced features FREE for one year Experience the power of being understood. Experience RSM | rsmuk.com

The UK group of companies and LLPs trading as RSM is a member of the RSM network. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent accounting and consulting ﬁrm each of which practises in its own right. The RSM network is not itself a separate legal entity of any description in any jurisdiction. The RSM network is administered by RSM International Limited, a company registered in England and Wales (company number 4040598) whose registered oﬃce is at 50 Cannon Street, London EC4N 6JJ. The brand and trademark RSM and other intellectual property rights used by members of the network are owned by RSM International Association, an association governed by article 60 et seq of the Civil Code of Switzerland whose seat is in Zug.

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what the obligations are, and to hand-hold them through the process”. To deal with client concerns, Martenstyn recommends “being like a sponge at this time. Keep up to date with all the HMRC guidance, but also trust industry experts. Read everything”. Communicating to clients – as simply as possible – is essential. Gazelle Global has created a dedicated online portal online and sent out informative ‘client packs’ on email. As Martenstyn says: “[As recruiters] we’ve got to be careful. We can’t advise clients exactly what to do because that would make us

COULD IR35 BE POSTPONED ONCE AGAIN? The reforms had a trial run in the public sector in 2017 and were originally set to be rolled out to private companies last year, which was postponed due to Covid-19. Three reasons why the IR35 changes might not be a reality until 2022 or even later… 1 Unemployment woes. The second national lockdown in November and extension of the furloughing scheme until March is set to disrupt employment. The UK’s 2.1m self-employed army faces a “triple whammy” of uncertainty from Brexit, Covid-19 and the IR35 reforms, according to IPSE (the Association of Independent Professionals and the Self-Employed). The prospect of more jobless might force HMRC to postpone. 2 HMRC has also admitted there is some confusion surrounding the reform draft (it defines umbrella companies as ‘intermediaries’), which could prolong its implementation. 3 The tax position of many contractors has also become more nebulous over the past year, with many of them now working from home and using their own (rather than the hiring company’s) equipment. Check the latest IR35 info at gov.uk, which has an Employment Status Manual, the free (but controversial) ‘check employment status for tax’ CEST) tool, plus regular webinars.

“[As recruiters] we’ve got to be careful. We can’t advise clients exactly what to do because that would make us liable if something goes wrong” ISHARI MARTENSTYN Gazelle Global’s head of contracts & compliance

liable if something goes wrong. It’s about giving them enough information to make decisions, create a status determination statement (SDS) and inform their contractors. All our client packs are doing is informing everybody in the chain what they should be looking out for.” When it comes to contacting clients, Martenstyn recommends adopting a “phased approach”, starting with those businesses in highly regulated industries such as ﬁnancial institutions or

large organisations with a high volume of contractors. Recruiters also need to deal with any questions clients may have about the Status Determination Statement (SDS), which determines whether their contractor is operating inside or outside IR35 rules, the criteria that could indicate whether a solo trader is ‘outside’ IR35 include whether they own their own equipment, work for multiple clients or market their services via a professional website. As 6 April looms,

Martenstyn suggests sending reminders to clients, plus keeping them updated about any IR35 legislation. And with clients expected to lose money by paying taxes for their contractors, a difficult conversation about renegotiating rates might be necessary too. To ensure they’re IR35-ready internally, Gazelle is taking steps to keep their staff up to date on the latest information. “We want to keep everybody informed and ensure any questions from clients and contractors are answered,” says Owusu. “We don’t want to end up with a situation where these questions are asked after a contractor has been hired.”

Contractor challenges IR35 will throw up additional challenges for recruiters in the months ahead, he adds, especially when it comes to working closely with their contractors. “You need to think about the mindset of a contractor,” says Owusu. “When they realise IR35 is coming into effect, they’ll be concerned they won’t be earning the same amount… It’s about trying to train their minds that it won’t necessarily work like that going forward. There’ll be some deductions and they’ll need to look at it from different perspectives.” Owusu continues: “If the average contractor has a breaking point, it’ll be the moment he/she hears that their pay is being reduced. “Generally speaking,” he says, “contractors are happy to forgo employee beneﬁts because they like

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the ﬂexibility and money they can earn. The IR35 extension means it’d make much more sense for them to become permanent. What’s the point of having none of the beneﬁts (sick pay, etc) of employees, but all of the restrictions?” For employing

organisations, the prospect of paying increased taxes could result in their putting an employment freeze on contractors, or even ditching their existing ones. Morgan Stanley, Barclays and Lloyds have already announced they won’t take on any more contractors unless they’re

paid on PAYE terms or through an umbrella company. Unless IR35 gets delayed once again (see box, p45), recruiters can expect to spend the next few months informing clients about the IR35 extension and the importance of auditing

their contractor workforce. “You need to show you’ve done everything you’ve can and taken reasonable care with the client,” says Martenstyn. “Every single person in the supply chain has an obligation to ensure compliance. If not, you could be liable…”

ADVERTISEMENT FEATURE

BEATING THE DEADLINE Access Pay and Bill software can help recruiters get ready for IR35 What is the IR35 question you are asked most often? The biggest question is, “what’s involved in implementing IR35 in the ever-changing world of temporary recruitment?” How do you implement that on a weekly basis with an irregular workforce when it’s got to be 100% right?

Is there any difference between how IR35 is being applied to the private sector? We’re in a fortunate position given our early development of Access Pay and Bill to cater for the public sector off-payroll requirements. Extending this capability to the private sector means going forwards we will 46 RECRUITER

have one simple checkbox for IR35 legislation to drive the calculation to add the taking of taxes at source.

everyone understands where responsibilities lie.

What are the roles of the umbrella company, the recruitment agency and the end-user? The umbrella or managed agency is responsible for the appropriate tax deductions and reporting to HMRC via RTI. You should start talking to all the parties now to be sure everyone is ready, understands what is needed and who is responsible at every stage.

What steps would you advise agencies to take in the coming months to ensure they are prepared for the new rules?

What is the most important aspect of the new rules for a recruitment agency to keep in mind?

It’s really important that you are assessing your workers right now. With our software, you can be making that determination early, setting up the system well ahead of the April deadline. You also want to plan your communications with both your contractors and customers. Agencies working with umbrellas and managed agencies need to ensure that

IR35 is essentially a tax at source piece of legislation. It’s now our job to ensure your contractors are paying up front, to collect that tax and give it to the Treasury. Plus we have to make sure we report it all correctly, to the HMRC as well as to our respective boards. Access Pay and Bill obviously handles all of IR35, together with the entire payroll

Ben Oliver is the Product Manager for Access Pay and Bill With over 20 years’ experience in product management within the recruitment sector, he has spent loads of time with customers on-site such as Adecco, Randstad, Impellam and Capita. He has introduced automation to Access Pay and Bill delivering efficiency and productivity gains of over 25%.

billing and accounts pre-processing. And it does it at scale. It’s certainly the only product I would want to be using to implement IR35. https://www.theaccessgroup. com/recruitment/software/ pay-and-bill/ Tel: 0845 345 3300

DECEMBER 2020

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Special Report Report Special ADVERTISEMENT FEATURE

his year has been tough for hirers, employers, recruiters, contractors and freelancers. Uncertainty over the off-payroll IR35 reforms in the private sector, a raft of amendments to legislation and a global pandemic that has all but decimated the job market leaving everyone wondering whatever will happen next. Oh yes – and Brexit! IR35 has been with us since 2000. However, it has taken until recently for the legislation to catch up with modern working practices. Despite several strong challenges and a damning report debated in the House of Lords, the off-payroll reforms received royal assent in July and will come into force in April 2021. Whilst the delay was welcome news for some, some businesses had already started their IR35 strategies, and as such those organisations who are looking to hire a workforce quickly post-Covid are likely to be better prepared. Others have adopted a more risk-averse approach by imposing blanket determinations on personal service companies (PSCs). Not all businesses that are excluding PSCs are operating a blanket approach, but the stakes are high, and choices are limited to employing people permanently, PAYE contracts or employing through an umbrella company. With many organisations looking at restructuring and only focused on key projects, the need for flexibility primarily made up of contractors and freelancers will be crucial to a quick start when the recovery begins. With the number of PSCs shrinking, the risks from non-compliant umbrella 48 RECRUITER

ENGAGING CONTRACTORS IN THE ‘NEW NORMAL’ Janet De-Havilland highlights the changes for recruiters in the new IR35 environment companies and a diminishing outside IR35 even today, it is contracting talent pool, hiring littered with language for an will be much more difficult. The employee, not a business ability Hive360’s to fill interim customisable, roles ormobile providing app, Engage. a service. This level finding the right capability to of detail will become very deliver measurable and relevant in a challenge by time-bound critical projects HMRC and will need to could become more difficult change if recruiters are to be for most. taken seriously by these sought-after contractors who Challenges are genuinely in business, as The recruiter’s hiring process they cannot afford to for contractors has barely associate themselves with changed in decades except recruiters and end clients who for the embracing of don’t understand the technology. However, the IR35 difference. reforms presents their biggest challenge yet, as this process Compliance has always centred around The onus for IR35 compliance hiring employees for jobs. To sits with the end client and/or engage and introduce a fee payer to determine the business to the end client will status. This also means that require wholesale change and non-compliance within the re-education. If you look at a supply chain will impact on dozen job advertisements for the end client by way of

penalties for not taking “reasonable care”. For many, this additional administrative burden and risk is too much to focus on, leading them to opt for the easy option. Ultimately, the time and money spent, both in finding the right talent and the associated risks with the hire – as HMRC’s enforcement focus will be on the end client and not the contractor – will lead to a reduction of opportunities for those outside IR35. The primary focus for the end clients will be on the survival, stability and growth of their own business.

Janet De-Havilland is CEO, Pendragon Consultancy

MARCH 2018 DECEMBER 2020

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CO M M U N I T Y

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

From cycling in Derbyshire to leaping out of a plane over two miles from the ground, you’ve been busy fundraising since the last Recruiter…

PRIME TEAM TAKE TO THE SKIES FOR ALZHEIMER’S Ten staff members at Prime Appointments took to the skies at Beccles Airfield, Norwich, facing their fears and completing a 13,000ft (2.4 mile) leap of faith for charity. So far, the brave team of sky divers have raised over £14k between them. The recruiter’s mission – to raise £100k for Alzheimer’s Society – is in honour of Prime’s co-founder Margaret Locke, who was diagnosed with Alzheimer’s 14 years ago. To help them reach the £100k target, sponsor them here: www.justgiving.com/fundraising/prime-3000

WORKING FOR FREE FOR THOSE IN NEED Orson Cornick, an executive talent scout at life sciences firm Lonza, is giving an hour of his time every week to help anyone who has lost their job due to Covid-19. Called #Hourofneed, Orson encourages other recruiters to do the same, so get in touch at thehourofneed@ yahoo.com

RECRUITMENT BOSS USES PEDAL POWER TO SUPPORT LOCAL ATHLETES David Torrington, MD of Derby-based Sky Recruitment Solutions, got in the saddle to ride 200 miles in aid of Derbyshire Institute of Sport (DIS), helping people access sport during the pandemic. He completed his cycling feat despite a muscle injury, helping DIS to smash its £2,020 target. “The whole Derbados cycling challenge is all about encouraging people of all ages to get out and about and maintain their mental and physical health during the pandemic,” he explained. Congratulations, David, hope you’re not too sore!

FUTURES TEAM CARRY THE BURDEN FOR LEEDS MIND

PMP RAISES £10K FOR UNSEEN SLAVERY VICTIMS In support of Anti-Slavery Day in October, PMP Recruitment has donated £10k to Unseen UK to help them with their efforts to abolish modern slavery. The money is a result of outstanding fundraisers from last year that included a golf tournament and a skydiving event.

Leeds recruitment agency Futures has chosen Leeds Mind as its annual charity partner. The Futures team are planning several fundraising activities, which included taking part in ‘Carry the Burden’ – an event which saw staff members carry an item of their choosing for a 24-hour period, representing the invisible burden that those suffering with mental health issues experience. @RecruiterMag instagram.com/recruitermagazine/ recruitermagazine.tumblr.com/

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CO M M U N I T Y

CAREERS

“I thrive off every aspect of what I do – the variety, the people you meet, the difference you can make” MY BRILLIANT RECRUITMENT CAREER What was your earliest dream job? Watching wrestling with my father, I wanted to be a female wrestler. Ending up in recruitment wasn’t the plan as an 11-year-old practising her suplex* moves!

I bounced around after completing A-Levels and fell into working for a large insurance ﬁrm. My mother walked me into a recruitment agency to ‘ﬁnd a job’ that suited me. They offered me the role of receptionist. I started to assist on the temporary industrial team, supporting a consultant. Five years later I was running their commercial temps & perms division… I had found my niche.

Who is your role model – in life or in recruitment? Always my mother. She taught me you have to work for things, that you have to try to get better – and she’s the one who led me into recruitment. Also, recruitment adviser and speaker Greg Savage – I love his candidness and no-holds barred opinion on recruitment.

What do you love most about your current role? The role of a recruiter is pivotal to both client and candidate. When you get that magical right match, only good things happen. I thrive off every aspect of what I do – the variety, the people you meet, the difference you can make.

What would you consider to be I M AG E S | A L A M Y

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↗

What was your first job in recruitment and how did you come into it?

RUTH HARDING Business partner, R13 Recruitment

RUTH HARDING the most brilliant moment of your career? The day myself and co-director received our ﬁrst payment for a placement made as R13. It was a cheque; we have a picture of us holding it in pure happiness and disbelief that we were doing it alone. It felt so good.

Laugh or cry, what did your most memorable candidate make you want to do and why? Laugh – when I emailed a client to say my temp was going off work as they had a ‘margarine’ [instead of ‘migraine’]. Clearly my spellcheck was not working that day. The client did not laugh. Cry – when the person you least expect writes you a letter, which moves you to tears because of the impact you ﬁnding them a job had on their life.

What would you regard as your signature tune?

Tina Turner’s Proud Mary. I know all the words, and can do all the moves.

What has been your sanity go-to during the lockdown so far? My business partner – she has kept me sane! And running – it’s been brilliant for my well-being and overall state of mind.

What have you learned about recruitment during lockdown? Recruitment needed even more care, heart and authenticity than ever. At the height of the pandemic, it felt panicked, uncertain and unsettled. We had to improve in every area – how we communicated, how we managed our teams, how we supported the people around us. I feel a stronger business owner/recruiter for it. ● As told to Roisin Woolnough *Suplex is a throw that involves lifting the opponent and bridging or rolling to slam the opponent on their back.

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E CAREERS CO M M UNITY

BERRY RECRUITMENT Former Royal Marine Jeff Williams joins the independent recruiter as its new regional manager for the Midlands.

BOARDROOMADVISORS.CO Bristol-based BoardroomAdvisors.co, which gives ﬁrms access to experienced part-time directors, has made a number of senior appointments. Entrepreneur Mike Gray has been hired to spearhead BoardroomAdvisors’ operations throughout Africa; tech entrepreneur and Lisbon, Portugal-based Ani Gupta will be offering his advice to SMEs worldwide; and Antonio Aznar Domínguez comes onboard to spearhead the launch of a Madrid office and build a team in the Madrid region.

CLARION Law ﬁrm Clarion has appointed Natalie Saunders as director of HR consulting.

CLOUD INTERNATIONAL James Munroe joins the global recruitment consultancy as market director – cyber. Munroe, formally of recruiters Goodman Masson and Empiric, brings more than 15 years’ recruitment experience in information and cyber security.

Recruitment software ﬁrm Bullhorn has taken on Jason Heilman to lead the company’s artiﬁcial intelligence (AI) business unit as senior vice president,

promoted Theresa Cantwell to an expanded role as director of HR and engagement management, and also taken on Helen Chilton as senior technical recruiter as part of the expanded HR function.

FLINT HYDE

DIGITERRE The software and data engineering consultancy has

BULLHORN

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product – automation and AI.

Vicky Short, managing director Randstad UK, has been promoted to CEO for Randstad UK & Ireland from 1 January 2021. Short is shadowing current CEO Mike Smith in the role until her start date, after which time Smith takes the helm as global CEO for Randstad Sourceright, based in the US. Short has been with Randstad for the past 23 years. Her experience has ranged across business solutions, education, healthcare, student support, logistics, FMCG and engineering, culminating in her role as MD for public services since 2016. Speaking about her appointment, Short said: “Mike has been a great mentor for this executive board and started us out on a journey together. I’m looking forward to taking the helm now.” Short will report to executive board member Rebecca Henderson.

Ben Robson joins the international executive search specialist as associate director based in the Leeds office, working on appointments within the packaging, sustainability

Email people moves for use online and in print, including a short biography, to recruiter.editorial@redactive.co.uk

and industry 4.0 sectors.

FRAZER NASH CONSULTANCY The systems, engineering and technology company has promoted head of human resources Sam Geis to its board in the newly-created role of people director.

GRANGER REIS The executive search ﬁrm and consultancy has appointed real estate ﬁgure head Michael Strong as chairman. Strong has more than 40 years’ experience within the commercial property market.

HARVEY JOHN Specialist accountancy, tax

DECEMBER 2020

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and legal recruiter Harvey John has appointed Guy Middleton as associate director to set up a new treasury specialism, and Ian Trevett, who joins as head of marketing.

solutions consultancy New Street Consulting Group has appointed two new directors, Lee Parker and Natalie Douglass, to lead the ﬁrm’s talent strategy consulting practice.

LILY SHIPPEN SECRETARIAL RECRUITMENT

ODGERS BERNDTSON

Specialist secretarial recruitment ﬁrm Lily Shippen Secretarial Recruitment has appointed Victoria Coghlan as head of its London office.

LIVINGSTON JAMES GROUP The executive search specialist has appointed Jacqui Paterson to its executive search and leadership advisory practice to focus on executive level procurement and supply chain appointments across the UK and Europe.

Global executive search ﬁrm Odgers Berndtson has appointed Julie McKeen as the ﬁrm’s new head of media.

PERSONIO Personio, the provider of an all-in-one HR software solution for SMEs, has appointed Ross Seychell as chief people officer.

ROBERT WALTERS Carol Hui’s nine-year tenure as non-executive chairman at the international recruitment group expires on 29 January 2021. Following a planned succession process, the board has appointed Ron Mobed to succeed Hui.

Global human resources consulting ﬁrm Mercer, a business of Marsh & McLennan, has made CEO of Mercer Germany, Achim Lüder, its new chief people officer. Based in Frankfurt, Germany, Lüder will be responsible for driving Mercer’s global people strategy across 44 countries. He will report to Carmen Fernandez, Marsh & McLennan’s incoming chief HR officer.

NEW STREET CONSULTING GROUP Leadership and people

CONTACTS EDITORIAL +44 (0)20 7880 7603 Editor DeeDee Doke

RECRUITMENT ADVERTISING Recruitment@recruiter.co.uk

+44 (0)20 7880 6215

deedee.doke@recruiter.co.uk

Contributing writers Christian Koch, Greg Pitcher, Sue Weekes, Roisin Woolnough Production editor Vanessa Townsend

PRODUCTION +44 (0)20 7880 6209 Senior production executive Rachel Young rachel.young@redactive.co.uk

vanessa.townsend@recruiter.co.uk

Art editor Sarah Auld Picture editor Akin Falope ADVERTISING +44 (0)20 7880 7661 Senior manager Fred Dubery fred.dubery@redactive.co.uk

+44 (0)20 7880 6231 Senior sales executive Joanna Holmes

PUBLISHING +44 (0)20 7880 8547 Publishing director Aaron Nicholls aaron.nicholls@redactive.co.uk

RECRUITER AWARDS/ INVESTING IN TALENT AWARDS +44 (0)20 7324 2771 eventsteam@redactive.co.uk

joanna.holmes@redactive.co.uk

Kelly York joins recruitment and HR outsourcing and consultancy provider as chief operating officer.

CIRCULATION and SUBSCRIPTIONS Recruiter is the leading magazine for recruitment and resourcing professionals. To ensure each issue of Recruiter magazine is delivered to your desk or door, subscribe now at https://subs. recruiter.co.uk/subscribe. Annual subscription rate for 12 issues: £35 UK; £45 Europe and £50 Rest of the world • Recruiter is also available to people who meet our terms of control: http://bit.ly/RecruiterCC • To purchase reprints or multiple copies, or any other enquiries, please contact subs@redactive.co.uk or +44 (0)1580 883844

WALTER JAMES GROUP

CONTRIBUTIONS

Riko Arends has joined the Walter James Group portfolio as group commercial director. He was previously managing partner at recruitment and executive search consultancy Sire Life Sciences UK.

Contributions are invited, but when not accepted will be returned only if accompanied by a fully stamped and addressed envelope. Articles should be emailed. No responsibility can be taken for drawings, photographs or literary contributions during delivery, transmission or in the editor’s hands. © 2020 Redactive Media Group. All rights reserved. This publication (and any part thereof) may not be reproduced, transmitted or stored in print or electronic format (including but not limited to any online service, any database or any part of the internet) or in any other format in any media whatsoever, without the prior written permission of Redactive Media Group. Redactive Media Group accepts no liability for the accuracy of the contents or any opinions expressed herein. The publishers cannot accept liability for any loss arising from the late appearance or non-publication of any advertisement for any reason whatsoever. ISSN 1475-7478

THE CURVE GROUP

MERCER

Redactive Publishing Ltd 78 Chamber Street, London E1 8BL 020 7880 6200

WELOVE9AM The Gloucestershire-based agency has strengthened its leadership team with the appointment of cultural change specialist Roz Thornton.

Total average net circulation between 1 July 2017 & 30 June 2018 – 14,837. is also sent to all REC members

Recycle your magazine’s plastic wrap – check your local LDPE facilities to find out how.

Scan here to get your own copy of

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E THE LAST WORD CO M M UNITY

“We have also revelled in the achievement of regular exercise, as we have seen and felt a difference in ourselves”

JO BOWERMAN Keeping fit to cope with the isolation of working from home t has been a difficult six months on many levels – the uncertainty of the economy, the isolation of working at home, the challenge to keep focused and motivated. All this on top of keeping ourselves, and our loved ones, safe from the pandemic. Here’s how the Atwood Tate team have been coping and why we now find ourselves ready for the winter with renewed energy and confidence. At the start of the lockdown, we were acutely aware of how tough it was going to be. As a small company, with a team who were used to sharing ideas and encouraging each other in an already tough market, the idea of a weekly Zoom meeting didn’t fill any of us with much enthusiasm. A couple of years ago I had qualified in teaching a fitness class called Hour of Power. As a qualified personal trainer in my spare time, I was keen for a new challenge. I loved teaching

54 RECRUITER

the class, but I found that the competition offering fitness classes in my area and the fact that it was an unknown class made it very difficult to cover my costs. I ended up finishing before Christmas 2019 and had no motivation or confidence to start it up again in January 2020. Fast forward to March 2020 and I find myself in a directors’ meeting saying I could always do a weekly fitness class on Zoom… perhaps? Well, it was received with far more enthusiasm than I thought it would! And so, on a Wednesday lunchtime in April the team appeared on the screen in front of me in Lycra, and we have not looked back. I think we have only missed three sessions over the months – due to holiday or illness. We have exercised through the heatwave, with some of the team furloughed and some not, when there’s been little happening in the market, and when we’ve all

probably felt it is the last thing we want to do. But it has been a really positive experience for us all. Before and after the class we have a chat – rarely about just work. We have got to know each other much better, and the smiling faces and laughter after the class lift the spirits well into the afternoon. Physical activity is certainly a tonic and mood enhancer, whatever your fitness level (it may also have had something to do with my faithful sidekicks Charley the dog and Uno the conure bird [inset], who always make their presence known!). Plus, keeping fit increases confidence. We have all tackled difficult tasks we may otherwise have kept delaying and we have also revelled in the achievement of regular exercise, as we have seen and felt a difference in ourselves. For me, it has helped me regain

my confidence and belief in the class as a means of building strength, stamina and confidence, which feed into other areas of our lives. It has become a staple of the weekly routine for us all and we have no plans to stop, unless we all become too busy to fit it in. But in that case it will have done its job, tiding us over a difficult period, keeping us motivated. Or we may just reschedule it to a different time! ●

Jo Bowerman is director (finance & operations) at publishing recruiter Atwood Tate

DECEMBER 2020

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CORONAVIRUS

& CONTRACTOR EXPENSES What does this mean for expenses? Traditionally, umbrella companies have structured the contract and payslip based on National Minimum Wage (NMW) + a discretionary bonus. The pay is structured in this was to limit umbrella companies exposure to non-payment and to ensure that they meet NMW requirements. This has also enabled some umbrella companies to allow qualifying employees to claim tax relief on main site travel and subsistence costs. In 2016, there was a legislation change which meant that only umbrella employees who aren’t under the supervision, direction or control of the end client were allowed to claim tax relief on these types of expenses. The introduction of the Optional Remuneration Arrangements (“OpRA”) legislation in 2017 resulted in a further restriction on availability of tax relief on these expense claims, as they could no longer form part of a WEPEV] WEGVMƼGI WGLIQI 9QFVIPPE GSQTERMIW TE]MRK 21; TPYW E HMWGVIXMSREV] FSRYW [IVI RSX WEGVMƼGMRK salary in exchange for tax free expenses, so were not caught by this rule change. These rules and contractual structures have worked for the majority of umbrella companies, until the recent pandemic and the introduction of Furlough. Based on the above contractual agreement, only the NMW part would be allowed in the calculation of payment under the Coronavirus Job Retention Scheme (“CJRS”). Many umbrella companies have recently tested the discretionary nature of their pay and concluded it is not discretionary at all, and therefore able to be included in the calculation of the CJRS grant payment.

That is a question that most people have ignored and is a very important one! (YI XS GPEVMƼGEXMSR SJ XLI HMWGVIXMSREV] IPIQIRX SJ XLI pay (i.e. it is not discretionary), the payment of tax free reimbursement of travel and subsistence costs is no longer available to umbrella companies who have based their CJRS grant claim on 80% of the full salary as they would breach the OpRA rules. If they were to argue that the NMW + Discretionary Bonus construct is correct, then they would FI ƽSYXMRK XLI VYPIW SJ '.67 ERH PMOIP] LEZI XS VITE] XLMW as the government look to crack down on non-compliant furlough claims. Essentially, you can’t make a different argument about the discretionary pay element when considering expenses and the CJRS scheme. As a recruitment agency, you need to make sure your WYTTP] GLEMR MW GSQTPMERX ERH ƼRERGMEPP] VSFYWX %R] of your current umbrella companies who have made payments to furloughed employees based on 80% of the full earnings and who continue to reimburse tax free travel and subsistence expenses, risk HMRC investigation and ƼRERGMEP PSWW ERH EVI EPWS I\TSWMRK ]SY ERH ]SYV FYWMRIWW to risk under the Criminal Finance Act. 8LI EHHMXMSREP FIRIƼX XS XLI [SVOIV [LIR QEOMRK this change is simply that their entire payment (less IQTPS]QIRX GSWXW [MPP FI GPEWWMƼIH EW E WEPEV] ERH therefore remove the common dissatisfaction of contractually only being entitled to NMW. This will also help contractors when applying for credit, such as mortgages & loans. With the changes to IR35 coming in 2021, where the responsibility for determining a contractor’s IR35 status shifts from the contractor to the end hirer, we will see even more contractors moving from working within a PSC to an umbrella solution. This will undoubtly see a rise in the use of non-compliant umbrella solutions. We’re recommending all recruitment agencies to stay vigilant when it comes to managing your PSL, and the solutions your contractors use. For advice on compliance, industry changes and all things contracting, reach out to our experts today.

SPEAK TO THE EXPERTS 01925 694 521 | agencies@brookson.co.uk brookson.co.uk/globalrecruiter

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at the coalface DW èԥ ‫ޖ‬Nԥ‫ݜ‬OIHܼV phrase 1. engaged in work at an active rather than theoretical level. e.g. IR35Shield.co.uk co-defends cases and attends tax tribunals

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