Doing the Right Thing

INTRODUCTION – Simon Kent casts a look over the results of this year’s compliance survey and finds some positive messages emerging.

Recruiters have seen the amount of time they spend on compliance matters increase over the past 12 months. While candidate compliance still figures significantly in their work, the issue of securing compliant processes has greater significance today than it had last year. Despite the stresses and strains brought to their businesses through compliance activities, broadly speaking recruiters still believe the level of compliance is appropriate for the industry. Perhaps most encouragingly this year, 72 per cent of respondents view compliance as an opportunity to deliver high levels of service compared to eight per cent who view it as a hinderance.

With the industry poised on the edge of another major challenge in the form of IR35 in the private sector and perhaps still working through the overall impact of the introduction of the GDPR, recruiters might be forgiven for feeling a little punch drunk when it comes to compliance.

Which compliance related activity takes up the most amount of your time every month?

While this year’s survey asked a few new questions, it also returned to a number of subjects in order to track trends and find where the recruitment industry’s main concerns lay.

Asked which areas of compliance related activities took up the most time each month, ensuring candidate compliance still scored the highest level – 40 per cent 2019, 80 per cent 2018. However, beneath this headline score the time consuming areas seem to have become more focussed: 28 per cent opted for international compliance this year which didn’t register last year, while the task of training recruiters is still viewed as less time consuming than the time required to understand updates as they emerge.

An impressive 92 per cent of respondents to the survey said the amount of time they spent on compliance activity had increased over the past year. The majority – 52 per cent – assessed that time to be 1-5 hours per week with the next largest vote, 28 per cent, opting for 5-10 hours a week. When asked to assess the overall disruption inflicted on the business through meeting compliance requirements the vast majority – 72 per cent – said they had coped with requirements. The next largest group, at 16 per cent of the survey total, selected ‘very disruptive’ saying that it had changed the way they operate as a business.

Change impact

These figures reflect a similar pattern from last year when 60 per cent said they had coped, alongside 29 per cent assessing the activity as very disruptive. Last year 11 per cent also cited a negative impact on their financial position as a result of compliance activities – an option which drew zero votes this year. It is possible that issues such as GDPR and IR35 in the public sector did have a more significant impact on the industry in the year up to March 2018 than in the following year. On the one hand there would have been a significant investment on the technology side to meet the former regulation, while IR35 in the public sector may have led to contractors shifting into the private sector, thereby impacting on revenues. As far as the GDPR is concerned in the past 12 months the technology cost should have reduced.

While IR35 in the private sector has yet to come into force, it is clear that contractors will not find the grass is greener in the public sector, with the result perhaps that there will be less of a financial impact for recruiters. This time around the contractors will stay where they are rather than searching out more lucrative alternatives. Naturally, the overall outcome here has yet to be seen.

The final option on the question of disruption was that recruiters were able to cover the costs of complying and that the impact of compliance had not been disrupting at all. With seven per cent choosing that option last year, eight per cent took it this year.

Asked about the level of compliance in the industry, 68 per cent said the level was appropriate, 24 per cent said there was too much and eight per cent opted for not enough compliance – the pattern and split of the vote very similar to last year.

How do you feel about the amount of compliance activity required from the recruitment sector?

GDPR and more

Last year we asked recruiters whether they were ready for the forthcoming GDPR. At the time 20 per cent said they were ready, with 70 per cent saying they would be ready and five per cent saying they were unlikely to be ready. With the regulation now in force a reassuring, but by no means perfect 88 per cent report being fully compliant. The remaining organisations said their systems would be adequate for the demands of GDPR suggesting there is still an amount of work to do within the industry to ensure this data rich sector stays on the right side of practices when it comes to the collection, management and sharing of information.

Last year we also asked if recruiters were making plans to deal with ‘off payroll’ in the private sector. Last year 44 per cent said yes, this year 60 per cent said yes. The split leaves only eight per cent this year not making preparations despite it appearing that they will be affected (32 per cent deemed the move not applicable to them).

Are you making plans to deal with ‘off payroll’ in the private sector?

To get a sense of the kind of pressure recruiters are under from their clients when it comes to compliance, both this year and last we asked respondents to place three concerns in the order they felt reflected their client’s priorities. Overall, the priorities have stay the same with only minor changes appearing in each sample. Perhaps depressingly, compliance figures as the last consideration for employers in both years, coming after prompt service and low cost in both years. Indeed, the most recent figure shows more recruiters opting for this order of elements perhaps indicating how competition within the industry is increasing as employers become more demanding in their talent requirements.

Prompt service maintains the second most popular options as well this year, while the third most popular order for each year does place compliance at the top of the list. Given this result it is little wonder that recruiters often report themselves caught between compliance demands and employer demands.

Which of these orders best reflects how your clients prioritse compliance – from most to least important?

Despite the trials and tribulations of the past year and even the forthcoming changes a final refreshing finding was that recruiters do have a positive view on compliance. When given the choice between describing compliance as a hinderance or an opportunity to deliver high levels of service, the overwhelming majority saw it as an opportunity.

Do you view compliance as a hinderance or an opportunity to deliver high levels of service?

At least with this perspective on the issue it appear recruiters are prepared to continually up their game – to embrace new standards as and when they emerge and to still succeed in delivering the talent required, whatever hurdles, barriers, standards or expectations are thrown at them along the way.