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From the President – Ian McPherson APRCSA

A great month with the “official end of the recession” and good news gradually filtering into most industry sectors.

The recent signing of a relationship agreement between the Recruitment and Consulting Services Association Ltd (RCSA) and Work and Income is a hugely positive step for our industry.  The agreement formalizes best practice guidelines and a more collaborative approach between the parties and has been established to help recruitment agencies to find and fill more vacancies with Work and Income clients.  The Hon Paula Bennett, Minister for Social Development and Employment launched the partnership.  Our industry has always struggled to be understood by successive governments and this has been reflected through ACC levies and changes to the Holidays Act to name but a few, so to be involved in an agreement like this is a huge step forward.  Well done to all involved, in particular Jacqui Barratt.  The launch of this program is on Friday so if you haven’t registered please click here to do so.

Another great opportunity for Members is the just announced partnership with Open Polytechnic.

RCSA and Open Polytechnic

RCSA, in partnership with Open Polytechnic, is pleased to offer Accredited Professionals and Corporate Members the opportunity to take up further learning and development opportunities.

Members choosing to study with Open Polytechnic will receive a 25% discount off student tuition fees.  Study may be work related, or for personal interest; chosen from the nearly 1350 courses available.  These range from NZQA approved courses to Diploma and degree level programmes.

Most Open Polytechnic students are 25 or older and balance full or part-time career with their studies. Study materials are delivered to the door or, for some courses, on the Internet via the Polytechnic’s Online Campus. 

Tutors are easily contactable by freephone or email for guidance and support.  The Online Campus helps keep students in touch with tutors and fellow students, and also provides access to the Polytechnic’s library and learning support services.

Click here to discover the range of courses and study options available

To receive the 25% discount, enrolments must be completed on the RCSA pre-coded enrolment form and review the Guide to Enrolment. The FAQ document provides further information about how the discount can work for you.

For a copy of Open Polytechnic "Learning for an Open World Prospectus 2009”, contact Customer Services, ph 0508 650 200 or email CustomerServices@openpolytechnic.ac.nz

Employment Relations and OSH Update

Andrew McComish APRCSA

Proposed Changes to ACC Legislation

The Government is reporting that ACC’s claim costs have risen by 57% and its unfunded liabilities have grown from $4 billion to $13 billion in just four years. The proposed major legislative changes are:

• Extending full funding date from 2014 to 2019: This means you will have to pay the Residual Claims Levy for a few years yet.
• Enabling safety incentives for employers and vehicles. Details of these are coming
• Reversing 2008 income compensation extensions covering “casuals” which include  on-hire employees), part-timers, non-earners and abatements for holiday pay
• Reversing vocational rehabilitation changes
• Introducing 6% hearing loss threshold

For the non-work environment proposed changes include:

• Reversing entitlements for wilfully self-inflicted injury and suicide
• Strengthening disentitlements for criminals
• Requiring far more open reporting on ACC’s liabilities

Submissions are being invited by government on these proposed changes. Their aim is to balance the entitlements of claimants with the rights of levy payers.

Levies

In addition to these proposed Government legislative changes, ACC is proposing changes to levy rates for the 2010 / 2011 year.  The proposed changes are ($ per $100 of earnings):

	Current	Proposed
78610 Levy rate (Perm Recruitment Agencies)	$0.18	$0.32
78620 (Office On-hire Agencies)	$0.18	$0.32
78621 (Non-office On-Hire Agencies)	$2.20	$3.53
78622 (Office and Non-office on-hire Agencies)	$1.02	$1.68
86351 (Health Agencies)	1.15	1.88

The Changes for the Residual Claims (For claims before 1999) are

	Current	Proposed
78610 levy rate	$0.57	$0.72
78620	$0.27	$0.36
78621	$1.09	$1.36
78622	$1.02	$1.68
78622	0.57	$0.72
86131	$0.23	$0.30

 

ACC does however have a range of initiatives and improvement plans in place at the moment. It is a little to early yet to say if the results of these plans will impact on levies. This first table shows the average proposed levies – without results.

	Current 2009/10 rates	Proposed 2010/11 rates	Proposed change
Average levy for current year work claims	$0.75	$1.18	Up 43c
Average levy for pre-1999 work claims	$0.56	$0.71	Up 15c
Combined average work levy rate (per $100 liable earnings)	$1.31	$1.89	Up 58c
As an illustration, the following table provides an indication of possible levy rates based on some of these initiatives producing results and changes to legislation taking effect.
Average levy for current year work claims		$1.11	Up 36c
Average levy for pre-1999 work claims		$0.36	Down 20c
Combined indicative 2010/11 levy rate (including initiatives and legislation change)		$1.47*	Up 16c

We are still digesting the other changes proposed by ACC. Again the RCSA will be measuring Members response to these changes to determine if a Submission on behalf of Members is warranted.

Business Solutions Contact Update

Legislative News from the BSC File

Andrew Wood Hon MRCSA

The Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill, introduced on 5 August 2009 is proposing that employees who have been in continuous employment with their employer for at least one year upon redundancy would be entitled to receive:

• no less than four weeks’ notice of dismissal
• four weeks’ pay as compensation, and
• a further two weeks’ pay for each subsequent full or partial year of employment up to a maximum of 26 weeks’ remuneration.

The ERA has held that “proof of sickness or injury” provided by a medical practitioner for the purposes of the Holidays Act must amount to a certification that the person is not fit to attend work because of the sickness or injury — mere notification that the person is off work for medical reasons will not be enough (Watson v Ryjack Holdings Ltd (unrep, ERA, AA 181/09, 15 June 2009).

An attempt by postal workers to include overtime in their “relevant daily pay” for Holidays Act purposes was unsuccessful because the overtime was not certain or sufficiently predictable (Postal Workers’ Union of Aotearoa v New Zealand Post Ltd (unrep, ERA, AA 105/09, 3 April 2009).

Anti Competitive Conduct

The UK Office of Fair Trading’s (“OFT”) decision on 30 September to impose penalties in excess of ₤39 million (AUD$72 million) on six UK recruitment firms who boycotted supply to a competitor (“Parc”) when it established for itself an intermediary position with the construction industry, should come as a reminder of the seriousness of engaging in anti-competitive conduct. Similar provisions to those upon which the OFT relied, apply in Australia, where the ACCC has been given authority to investigate and prosecute complaints of anti-competitive conduct. Since July 24, serious criminal cartel offences have been punishable in Australia by terms of imprisonment of up to 10 years. Corporations may also have exposures to claims for civil damages.

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General News for Members

Technology – “If your company doesn’t Twitter are you a Twit”?

Steve Kennedy APRCSA

3.19pm Tuesday: Just heading off to get a coffee.

3.35pm Tuesday: Ok, about to start writing this article about Twitting but forgot the biscuits…

Well, is this what Tweeting is all about?  Telling people you have never met un-meaningful stuff that happens throughout the day.  And what’s more, who actually wants to hear and read this stuff?

Well, as you can gather, I am not exactly a convert to the twitting world but if so many people and so many organisations are engaged in it, does it have merit in our industry?

To understand why people are using this medium to drive attention (or business) to themselves (their company), I swept the web to see what pro’s and con’s I could source about this method of communication and engagement.

5.25pm Tuesday: There is all sorts of ‘stuff’ on the web – more than I can absorb this afternoon.

I did come across a website by Chris Brogan and the one point that caught my attention was;

• ‘Without a strategy, it’s just typing”.

Chris (Brogan), I couldn’t agree more.  You have hit the nail on the head.  There are certainly merits for each of us to engage with communities of candidates/customers and find ways and methods to keep them informed of opportunities (employment or other) in the market.  For a certain market demographic using this form of communication may well be the right one, or one.  However, if we embark down this road it will be important to set some parameters and criteria around what we want to actually achieve.  Is it we want to do business with the people that have signed up to our ‘twitter’ or do we want to place people in roles that we are twitting with?  (I’m not even sure I am using the right ‘twitter’ terminology so for Twitter converts, I apologize).  Or, is it we want to drive people to other forms of communication we use, like our websites, and have them interact and engage with us there.  Whatever the answer is, I’m with Chris (Brogan).  Without a strategy, it’s just typing and someone in your company will convince you it’s a great idea and then generate no meaningful results.  So, my thoughts are give Twitter a go....but a caution to the wise...ensure there is some meaningful outcome and measurements in place.  Also, maybe some controls around the content of your Twitter might be in order.

5.55pm Tuesday: Off to set up a twitter account......

RCSA’s technology www.postjobsonce.com.au  has developed an excellent marketing strategy for RCSA Members, using Twitter.

KPI’s – What should we measure?

Steve Kennedy APRCSA

Over the years I have had many discussions with people from various Recruitment and HR practices about what we should measure in our respective organisations.  Often the initial question I have asked is:

“‘What do you measure and what do you do with the information you collate”?

I must admit, I firmly believe that in any organisation in our industry there should be a combination of financial and operational measurements in place.  Certainly, they will vary from company to company based on organisation size, services provided, company and individual budgets, etc.

Each Consultant should have metrics they are performance managed against as this allows a greater level of objectivity and discussion in review meetings.  Also, measurements surely allow trends to be considered and more informed decisions to be made on company expansion/contraction!

So for me, these are the measures I like to track:

Financial (Monthly and measured against budget):

• GP$ per Consultant –v- target (Temp Consultants)
• GP$ per Consultant – v- target (Perm Consultants)

The reason I measure these is often I have seen organisations measure the consolidated results from Consultants.  Within these results you often find ‘some’ Consultants are well behind their individual targets.  These people may need to be managed up....or possibly out!

• Salary ROI: (for every $ of salary spent, what GP$ are generated)

This highlights gaps in performance and productivity of a recruitment practice.  If this ROI starts declining you know you have capacity in your operation to either trim costs in this area, provide additional work to existing staff or redeploy people into roles that will generate additional GP$.  If, operationally, the workload remains high but you have a declining result in this area, you are likely to be experiencing margin declines.

• GP$ as a % of Total Sales

This highlights an organisation’s ability to convert sales to gross profit.  Therefore, its efficiency levels. Specific targets will allow you to measure trends and if GP$ as a % of total sales starts to decline, then you are likely to be experiencing margin erosion in temp or perm fees, or both.

• Net Profit as a % of GP$

The reason I measure this is if GP$ are stable or climbing but net profit is falling, there may (or likely to) be an issue with expenses.

• Net Profit as a % of Total Sales

This shows a company’s ‘Return on Sale’. I.e. For every dollar of sales, how many cents of profit are generated.  This is an important measurement as year over year companies should look to improve this return.  It is a particularly important measure for those organisations looking to sell their business, and an important measure for those companies looking to acquire!

• Expenses as a % of GP$

Expense management is crucial in any business.  Ideally, (I think) a company should look for this expense ratio to be declining.  This can show that an organisation is becoming more efficient. 

Operational (Monthly)

• Temp hours per FTE
• Perm Billings per FTE
• Sales calls per FTE
• Candidate Interviews (with customer) per FTE

While certainly there are other financial and operational measures that can be deployed, the important aspect for me when managing teams across branches (or a branch) is to have some sound measures in place and ensure they are used to drive performance and productivity, manage expenses and ultimately to manage risk i.e. If productivity is declining cut costs and, if improving, invest to maximise opportunity.

The ‘Recruiter’ who survived the Recession – what skills did they have and will they be valid as the economy grows?

Jacqui Barratt APRCSA

It is no surprise that many consultants and business owners didn’t quite make it out the other side and many companies and consultants are still in survival mode.  The market is showing signs of stabilising but one thing is certain we will not return to the market of old.  I still hear people saying it will be good when things get back to normal…. There is no going back.  We need to adopt a new “normal”.

Many consultants, who may have generated reasonable income in the past, struggled in the downturn and some have exited the industry entirely. 

So who survived and what did they have that others didn’t?

I can only comment from what I see in the market place and talking to my colleagues within the industry on both sides of the ditch, but generally the feedback is the same.

The biggest hurdle for many was the sales component.  Whilst we would all agree that this is and has always been part of a consultant’s role, many would argue the effectiveness of the sales activity and the level of contact being made.

The consultant who survived knew how to generate their own business, be it through existing relationships and developing width or through seeking out new opportunities.  They weren’t afraid to explore the unknown and get themselves in front of new clients as they valued their expertise and knew they had something to offer.

Consultants who survived weren’t talking about recruitment – they weren’t just looking for a job to fill.  They were helping clients diagnose issues and bringing business solutions to the table.

Consultants who survived spent more time taking talent to the market and creating opportunities – but not by flicking out CV’s via email telling clients they had the perfect candidate for a job they knew nothing about apart from what the advert said.  This was targeted selected marketing promoting talent in the right places and identifying skill shortages, whilst also working with clients to build talent for the future.

Consultants who survived spent more time being visible in the market as opposed to sitting at desks.  They increased their networks and spent more time building their market understanding and contacts for the future.  In a country that talks about 2 degrees of separation, this is something many of us spend little time doing.  I don’t mean just catching up for a drink of coffee - although this is part of our social makeup - but what industry groups or activities are you involved in and what professional networks have you established.

I could go on and on; however, I am confident and have no doubt whatsoever that these skills will continue to flourish in any market boom or bust because at the end of the day, these are the fundamentals of a great consultant.  It’s not hard to bill lots in a boom time; work is being driven to you, demand is high and prices are not negotiated.  You are reactive, responding to what’s in front of you.  It takes a lot more skill to build a career in recruitment and polish your craft in the highs and lows and come out with your reputation intact and your relationships firmly in place with all the stakeholders.

Using Online Assessments

Jenny Durno APRCSA

We all know how expensive it is to get a recruitment assignment wrong.  We need to use all the tools available to us to choose the right candidate.  In the race to win the best candidates, it makes sense to use technology, and web based technology is becoming second nature to many overseas companies hiring staff.  But surely speed is dangerous?  It is all very well to be first to interact with a pool of candidates but what if we hire the wrong person, or say no to the right person, in our haste?

In September 2009 the company PreVisor in the USA had its product ‘Front Line Manager’ Solution named one of the 2009 Top HR Products of the Year by USA’s Human Resource Executive magazine.  Why did it win this award?

The company’s press release tells us that they do assessments online using a realistic simulation of an inbox and painting scenarios for the candidate to work through.  It adapts the items presented to the candidate according to the personality trait levels and abilities indicated by the candidate’s responses to previous questions. In other words, the computer is having an intelligent, yet objective, conversation with the prospective employee.

So the online tool is fast, cost effective and accurate for the hiring manager.  The HR Magazine has looked into this particular product and confirmed that it is innovative and effective enough to win its award.

Gone are the days (or they should be) when a candidate is attracted to a web site only to be invited to bare all – name, email address, contact details, the whole CV – without so much as a promise of any interaction with a human being.  But if we wait for the human touch it might be too late.  The same candidate has logged on to half a dozen sites in the same 10 minute break. 

The good news for us humans is that when it comes to assessing an individual’s competence, it is best to use human intervention. This doesn’t necessarily mean face to face, however.  UK based company ‘It’s a career thing’ promises to save clients time, money and CO2 emissions (eh?)  They have launched a Virtual Assessment Centre; enabling recruiters and hiring managers to carry out live assessments, competency based interviews and interactive surveys via telephone and webcam.  They are talking about a virtual meeting, saving time, money, space and carbon emissions (ah!).

Where is the downside?  Many of us are working remotely already, with smart telephone connections and broadband at home.  Rents in central locations are expensive – and inflexible, as many of us discovered when the recession arrived practically unannounced.  Once applicants get a taste of applying for roles without having to trek across town in their lunch times, guess which recruiter is going to be first and best informed about the available talent?

RCSA has a number of Affiliates who provide a range of services to assist Members with remote strategies – be sure to check out the Supplier Index.

From the CEO

Thanks to everyone for the feedback on the Recruitment e-Journal, SAVVY and newshub – both positive and negative. Just to clarify: newshub is for everyone who is associated with the RCSA, SAVVY is for the Accredited Professionals and the Recruitment e-Journal is for the Corporate Representative. It is then a company decision how these are disseminated.

As more of the Association’s on-line strategy rolls out there will be no excuse for “not knowing”.

Remaginet Welcomes a New BusinessR Company

IRD Recruiter is the latest addition to remaginet’s BusinessR program, an initiative which provides an opportunity for service providers to increase their market exposure, with RCSA Members receiving discounted rates fr the services provided. IRD Recruiter conducts research on company growth events that can inform new business development.

This type of research can enhance new business activity by providing useful information about a company and who to contact, and a valid reason to make contact with the company and approach them with a relevant and informed proposal. IRD Recruiter scans over 30,000 sources, looking for company evolution signals that we feel recruiters should be aware – or going after.

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Frequently Asked Questions

Skills Shortage

RCSA is often asked how to define a 'skills shortage', identifying a role which may be subject to a recognised skills shortage, and the dangers of generalising 'skills shortage' to the general workforce.

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Professional Reading of Interest

Rainmaking: Recruitment strategies and tactics for finding,

keeping and growing profitable clients

by Terry Power has been made available to Members as an e-book. Terry is a strategic consultant in Western Australia and is keen to hear Members feedback.

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Verify, a BusinessR company has some interesting reports in their latest newsletter including:

Lying on Resumes – Did you know that 40-60% have inconsistencies regarding past employment such as title, responsibilities, salary and company information.

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