New Contingent Workforce Legislation – Are You Ready for the Next Challenge?

Following on from the recent high profile tax evasion cases such as Jimmy Carr, Chris Moyles, Take That and The Student Loans Company extensively covered by the press, HMRC will be tightening the reins on tax avoidance schemes.

In April 2014, new UK legislation will be introduced that will affect how businesses manage their contingent workers, and the impact of that engagement on the end client.

 
Clearly, there are many advantages associated with engaging contingent workers. However, to ensure that you maximise those benefits you need to minimise any potential risks. Some key questions your organisation should know about the entire contingent population at the drop of a hat are:

 

•              How many contingents are there?

•              Are the resources temps, contractors or consultants?

•              How much does that population cost you?

•              How much is the person being paid?

•              How much are third parties charging?

•              Have they been pre-screened, including references and eligibility to work in the UK?

•              In what areas of the business are they providing services?

•              How do you track their movement within the business?

•              How long have they been there?

•              What does the supply chain look like?

•              Have you ever audited your suppliers?

•              What does the contractual agreement look like?

•              What cross checking happens during the payment of invoices?

Are you in a position to answer these questions?

When the new legislation arrives, such issues will become even more critical for you to tackle as it becomes imperative that you effectively manage your ‘hidden’ contingent population. Over our next few blogs we will provide you with more advice on how to deal with the challenge of managing contingent workers in light of the changing legislation, which will help to protect you from paying the costs of negligence further down the line.

 

How to Avoid Paying £30k in Employee Replacement Costs

We weren't entirely surprised to hear that the cost of replacing an employee is high, but that doesn't mean we weren't slightly taken aback to see a solid figure placed on the amount it costs to find and integrate new talent into your business when someone leaves – a cool £30,614, no less!

The result, published by Oxford Economics, breaks down the cost of replacing staff and illuminates that it is the process of bringing a new employee up to speed with the business that incurs the highest fee for companies (accounting for £25k of the overall total). We’re sure that all businesses will agree that paying out in excess of £30k per lost employee is a little steep. Fortunately, there are steps that you can take which will significantly reduce the risk of you having to replace staff members quite as frequently; from improving your talent acquisition strategy, to ensuring that your existing teams are thoroughly engaged in their roles.

1. Improve Your Talent Acquisition Strategy

It’s typically acknowledged that getting your recruitment process right means that you will ensure that the candidate has the skills and experience for the role, but that’s really only the tip of the iceberg. Even with all of the right knowledge, if an employee joins the company to find that the on-boarding process is terrible, that the company doesn't match up to their expectations, or that they don’t suit the work environment, there is little that you can do at that point to prevent them from leaving. Furthermore, the money you've already invested into recruiting and integrating them into the business? That suddenly rises as you find yourself on the search for a candidate once again (you see where the £30k comes from now?).

2. Have Clear Objectives

Effective job analysis helps to evaluate the skills, experience and behaviours that you are looking for and help to avoid over recruiting or under recruiting for a position. Clear communication of the main responsibilities of the role and what a “typical day” looks like gives potential candidates an accurate impression of the demands of the position.

3. Make Sure Your Employer Brand is Real

Cultural fit is a term that is well versed when recruiting, but few employers truly understand the weight of its implications. It involves ensuring that a candidate shares the same values, behaviours and aspirations of the company before they join. In order to do this, your employer brand should accurately reflect what your business is all about; this will help to attract the right people to you from the outset. The values and behaviours that you deem as important factors in achieving success at your company should be highlighted throughout every stage of your recruitment process – from the initial job ad, to the day that the candidate arrives on site.

4.  Promote From Within

One of the most cost-effective ways to replace team members is to promote people from your existing employee base. The benefits of doing this are multiple; you won’t have to wait for a notice period to end to welcome your employee onboard; the time it takes bring them up to speed with their role will be greatly reduced as they’re already familiar with how the company works; your levels of employee engagement in the wider business will improve, as they see the potential for career progression within your firm.

5. Motivate and Engage Your Employees

The equation is simple: motivated employees = an engaged workforce. An engaged workforce means your turnover will be lower, productivity will be up and you’ll develop a strong, loyal workforce that will inadvertently attract new talent to the business. In their whitepaper on The Puzzle of Motivation, recruitment group Resource Solutions Group states that modernising your motivation strategy should begin with reviewing whether your performance management process really gets the best out of your employees. As part of this, you should consider not only your employees’ pay, but also their contracted hours, flexible working arrangements and the level of autonomy they have over how they work.

Learn How to Improve Your Employee Engagement Strategy

As a business, you won't always be able to prevent all employees from moving on. However, following these steps can have a significant impact on reducing the cost of replacing employees. For a full guide on how to improve your employee motivation and engagement strategies:

Download the RSG whitepaper on The Puzzle of Motivation.

Resource Management Becomes Headline Sponsor of The CIPD Recruitment Marketing Awards

Resource Management, part of Resource Solutions Group (RSG), has become the headline sponsor of The CIPD Recruitment Marketing Awards  - one of the major events in the HR Community providing reward and recognition for excellence and professionalism in recruitment marketing and talent management.
 

Nick Walrond, Managing  Director, Resource Management comments: “Resource Management are proud to be the headline sponsor of The CIPD Recruitment Marketing Awards and support ‘Best Employer Brand’ category. Having worked with a variety of clients to help them successfully develop their employer brand over the last four decades we strongly believe that an effective employer brand makes a huge difference to an organisation’s ability to recruit, retain and engage its talent.”  

Furthermore, Resource Management has also been invited to be part of the Awards’ judging panel consisting of recognised senior recruitment and HR professionals representing a variety of industry-leading brands.

All winners will be announced at The CIPD Recruitment Marketing Awards ceremony at The Brewery in the heart of London on Wednesday, 16 July 2014. We would like to wish good luck to all the participants and look forward to seeing you on the night!