
This Jedi Session with Natalie Whittlesey explores the Big Quit in the UK and how organisations can attract people, and more importantly, keep them.
This Jedi Session with Natalie Whittlesey explores the Big Quit in the UK and how organisations can attract people, and more importantly, keep them.
Investigo Executive has announced the appointment of Natalie Whittlesey as its new Director. Joining the business after two years as Area Leader of Korn Ferry’s EMEA Technology Officers Practice, Whittlesey will now help to lead the development of Investigo Group’s growing executive brand.
Welcome to our Talent Trends report January 2022.
Rarely have consecutive years started with such different mindsets. 2021 may have begun with uncertainty, but it ended up being an extremely positive year for our industry and for the Investigo Group – in fact, our best ever year.
As we begin 2022, the market has returned with a vengeance and the demand from our clients has dramatically increased. If our focus a year ago was on how we could continue to adapt and embed the lessons of the pandemic, our thoughts now turn to growth and to how else we can support our clients to give them the best chance of success.
In fact, it’s been such a positive year that career transience has become increasingly common. We’re already in the midst of the Great Resignation, with the UK experiencing the highest quit rate since the financial crisis. For organisations across the market, this presents both challenges – not least in standing out to potential new talent and keeping the talent they already have – but opportunities.
After virtually two full years of widespread remote working, we’re more often than not remembering to unmute ourselves before speaking on those Microsoft Teams calls. But being more accustomed to a new mode of communication doesn’t necessarily mean that we’re connecting. After all, we each have different preferred methods and frequencies of communicating and it’s important that business leaders get to know their people’s preferences on an individual basis, enriching their working relationships with a touch of old school connection.
Never is it more important to connect with your people than in your approach to DEI. In an area that changes all the time – this time last year many of us would have referred to it as D&I – you must never stop talking and never stop learning. Increasing their diversity will continue to be at the forefront of organisations’ thinking, but this must not be at the expense of inclusion. You can have the most diverse, representative workforce in the world, but if your people don’t all have the opportunity and the support to participate and achieve, then you’re wasting your time. Before you can understand what kind of policies you need to have in place, you first need to understand yourself. Last year, we conducted a “who we are” survey of our staff to better understand our people and their needs. The results of this survey will help to form the basis of our approach to DEI in the future, both internally and externally.
Environmental, social and governance issues (ESG) have never been more prominent in corporate thinking, but too many companies are still struggling to raise these issues with the board in any meaningful way. By reframing ESG in a way that emphasises its importance to your everyday business operations, you can bring about the required focus, funding or policy change. Once again, connection is key. This is something we all need to do together, both within our business – sustainability specialists working with finance, marketing, senior leadership and any other interested parties – and at an organisational level. The time of siloed thinking is over.
Our Talent Trends report features expert insights and practical tips on each of these key trends – career transience, the changing focus of communication, DEI and ESG – and a lot more besides, including market updates on each of our specialisms. Many thanks to everyone who offered their insight and expertise.
We hope that you’ll find this report useful and if you’d like to discuss any of the insights raised, or to talk to one of our experts in more detail about how these trends will affect the talent in your business, please contact us.
Nick Baxter | Investigo Chief Executive Officer
Investigo Executive was honoured to host a talk from Nick Elliott CB MBE, Former Director General of the UK Vaccine Taskforce, on Tuesday 23rd November. Joined by our clients and partners at South Place Hotel in London, Nick provided a fascinating internal perspective on the success of the UK’s COVID-19 vaccine programme and discussed the lessons organisations can learn from this.
Within article 1 in our series of articles to help you check your process and management of IR35, we reported that both the DWP and HM Courts & Tribunals Service received large fines and penalties for issuing incorrect IR35 determinations.
It is understood that both organisations were utilising the gov.uk tool – CEST – for making the IR35 determinations, but were still unfortunately making incorrect determinations. Does this mean the CEST tool is not fit for purpose? Not necessarily. It could also be that the responses given by end users to the questions raised by the CEST tool were inaccurate. Remember it is important to respond to the questions on the basis of fact (what is actually happening) as opposed to aspiration. In article 3 of this series, we explore this further.
The Check Employment Status for Tax tool, better known as CEST, was introduced during the public sector reforms back in 2017. Those who have worked with CEST for many years will be well aware of the changes and updates it has undergone, as well as the large amounts of criticism it has received. So with this in mind why would we utilise CEST as the best approach for making an IR35 determination?
Well let’s be honest: (1) It’s built by HMRC so surely they should know their own legislation; (2) it states that HMRC will stand by this result should it be a true and accurate representation of the engagement; and (3) it’s free to use! So I think it’s fair to say that CEST is here to stay and will be adopted by many organisations.
Our approach is that we would recommend the use of CEST in making determinations, but it should not be solely relied upon. Having an accurate view of each contractor engagement to make the determination is vital. Secondly, when making the determination, ensure that when you take into account the contractual terms, you focus primarily on the ACTUAL working practices on the ground.
What about 3rd party status determinations and insurance practices? There are many organisations offering these types of advice and services and at Investigo, we have built up a number of relationships with those whose services we have assessed and believe to be fit for purpose. They can provide helpful insight and additional levels of understanding, informed advice and ensure a ‘belt-and-braces’ approach to IR35 determinations.
In our opinion, with the right process, governance and methodology, these organisations can be utilised as a sanity and reference check to help ensure your practices and decisions are aligned to the legislation and also to audit your determinations. It is certainly worth considering the services of such a third party for some of the more nuanced determinations. The insurance packages, I’m still to be convinced by. If an engagement is outside at the start, and it remains outside throughout its duration, then what do you need the insurance for? I understand the drive for this, especially from a risk perspective, knowing you have accurate determinations but also knowing you have insurance that covers you should HMRC disagree with a determination.
So in conclusion, use CEST, make sure that it’s an accurate reflection of both the contractual terms and working practices (and not what you think they could be!) and periodically sanity check a sample of your determinations with a reputable third party to ensure this represents your interpretation of the legislation. Oh, and don’t forget to store the evidence for when your favourite tax person comes knocking…
In September HMRC started to contact organisations to begin to understand how end users are engaging with contractors and applying the off-payroll rules for IR35.
A template of the HMRC letter shows that they are looking to understand:
Within their letter, HMRC then explain what they do once they have decided whether your systems and processes are suitable for the correct application of the rules and whether they believe more tax is owed / any interest is due on the tax owed.
It’s worth noting that HMRC launched IR35 with a ‘soft-landing,’ stating that any fines would not be applied within the first 12 months of the new legislation being implemented. However, it’s also worth noting HMRC still expects the rules to be followed and the correct tax to be accounted for. And with six months already lapsed, the 12-month window is quickly evaporating. Therefore our advice to end-users is to double check your own processes are fit for purpose and act now to make sure those processes are properly documented. Your records should provide a clear audit trail of those processes and the decisions made in relation to IR35 so that you are prepared should one of these letters land on your doormat.
Getting prepared
We have extensive experience of implementing IR35 management frameworks that allow you to make individual, case by case determinations for all contractor engagements. The silver bullet for IR35 isn’t SOW, it’s knowing IR35 and managing a framework for true and accurate determinations to be made for all contingent worker engagements where an IR35 determination is appropriate.
Ensure you have:
If you are concerned with the methods and processes you use to govern and manage your contingent workforce then feel free to contact us.
Our next article will be based on making the status determination and whether we can be safe relying on a CEST determination.
Six months ago IR35 reform was made across the private sector. And similar to GDPR in February and March this year we had a lot of noise with agencies, end users and contractors all working hard to be compliant for the 5th April 2021 deadline. While this all seemed to go quiet over the summer, those paying closer attention to the IR35 world would have found that quite a lot has happened.
Six-month timeline:
So what does this tell us?
IR35 is a very technical subject with lots of intricacy and details. Understanding all of the case law and interpretations of legislation requires a doctorate in itself, so it’s easy to understand why people may shy away or delegate decisions.
However, with the market BOOMING – APSCo reporting a 17% month-on-month rise in contractor recruitment in September – are end-client organisations getting the best available skills? Is IR35 still hampering your efforts? Are you putting yourself at even more risk by heading into an unsuitable SOW arrangement for resource? With the rush to making determinations have many organisations lost sight, or even control of their IR35 process as it’s transitioned into BAU?
At Investigo Group we want to help our clients get this right. Support our clients with making the right and most compliant decision.
So over the coming weeks we’re releasing a series of articles designed for talent communities to help them understand, demystify and sanity check their process and management adoption for IR35.
Watch this space for more to come but please contact us should you be concerned about your IR35 process!
Diversity and inclusion is top of most businesses’ agendas right now, especially when considering their hiring goals. However, the urgency of getting things done impedes getting things right.
There are two really key points I want to make:
First of all, we need to challenge our understanding of what constitutes ‘diverse’ – everyone is diverse, which means we must stop defining minority groups within homogenous environments as ‘diverse talent’ because it assumes diversity is all they can bring to the table. Diversity recruitment is just simply recruitment and as a female of mixed heritage I want to know I’ve been hired because I’m a superstar and not because I look different.
Secondly, there is no point talent pipelining if your organisation isn’t inclusive, as reflected through your culture, EVP and reputation. As my incredible D&I Committee co-lead Kelly says, culture eats strategy for breakfast.
WHY IS TALENT PIPELINING IMPORTANT?
Quite frankly, diversity of thought will come from a diverse group of people. When you’re in a rush to find someone who fits a job description, it’s all too easy to revert back to tried and trusted hiring techniques and talent sources, which is not conducive to new modes of thinking. By talent pipelining, you have access to a wider net of talent and the process will change behaviours from looking for someone to fit a mould.
This will lead to improved idea generation and problem solving where everyone’s creative juices can flow and better decisions are made because of it.
HOW CAN YOU PIPELINE TALENT?
To reiterate my earlier point, you can only achieve a diverse workforce if your company culture is authentically inclusive in the first place.
So you’re thinking all this is great and interesting, but give us some tangible advice. Here goes:
WHAT TO BE AWARE OF
It’s very important to consider who is attracting talent into your business and addressing their biases. Make sure your talent teams are actively considering potential candidates based on the value they can bring to the organisation and not just the credentials of the previous person; by default you’ll be looking to replicate a hire, not consider the value a diverse perspective could bring. With your hiring managers, ask them if they consider a group of people to be better at a job role than another and then get them to consider why their teams lack wider representation.
Remember equality and equity are different things – suggesting all candidates have an equal footing by going through the same interview process is not equitable. You could miss out on a brilliant candidate who is neurodiverse because you’ve insisted on ‘the social test’.
This will lead you directly into analysing barriers to entry that have existed. For example, within the Russell Group universities, there is a huge student population disparity concerning race; by stipulating Russell Group educated candidates in job descriptions, you’re immediately discounting a huge range of talent based on barriers to entry that existed when they were at school.
Avoid being performative at all costs – at the end of the day you’ll miss out on great talent and damage your reputation in the process. You’ll teeter on territory of being viewed as unfair or participating in a ‘tick box’ exercise. This is absolutely not a quick fix and why improving our talent pipelining for future generations is so important.
The fact you’re at the end of this article means you are engaged and you want to make change in this space. This change is going to take time but why not be a leader, why not pave the way for your industry and be a vital part of the transformation? Go on, I promise you can do it and believe me, you have no idea the positive impact you will have on people’s personal and professional lives (and outperforming your competitors is pretty nice, right?)
Olivia Dodd – Investigo olivia.dodd@investigo.co.uk
Although flexible and remote working were already becoming more commonplace before COVID-19, there was still that barrier of reluctance in a lot of companies. Some leaders’ attitudes were still embedded in traditional working practices and presenteeism, resulting in a reluctance to move with the times.
On Wednesday 5th February, Investigo hosted a networking breakfast focusing on IR35 at the Ivy City Garden in London. With the IR35 legislation due to come into force on 6th April 2020, private sector organisations will have to rethink their approach to hiring interim service providers. At the same time, contractors will need to look at the way they define, present and deliver their services.
Outlining their respective journeys with IR35, our expert speakers, David Kershaw and Max Curzon-Hope, provided real-life examples and practical advice for how clients and service providers alike can work within the legislation. They also discussed how IR35 has enabled them to establish their business, Curshaw, to focus on delivering outcomes. The breakfast was attended by change and transformation leaders from various professional sectors.
Understanding IR35
New for the private sector, IR35 aims to ensure contractors pay the right amount of tax. It’s set to come into force on 6th April 2020. Under IR35, individual contractors who operate like employees – otherwise referred to as “disguised employees” – pay the same tax contributions on their earnings as those in employment, regardless of the structure they work through. IR35 applies where an individual provides their services, through an intermediary, to another person or entity.
The speakers
David Kershaw
David is an experienced procurement delivery specialist who has worked in the public sector for over 10 years. He’s vastly experienced in delivering intricate procurements for the public sector in a wide range of complex environments, including digital, data and technology, marketing and communications, transport and the emerging ‘Brexit’ space.
Max Curzon-Hope
Max is a commercial specialist with 10 years’ experience at the heart of government, delivering major complex commercial change and transactions. He is a leading expert on the Private Finance Initiative hand-back/expiry and complex infrastructure and real estate contracts.
Their firm, Curshaw, is a commercial transformation consultancy which helps organisations transform and thrive in complex and uncertain environments.
The journey
“Both service providers and their clients need to invest the time to understand IR35, do it properly, not cutting corners,” said David Kershaw, who provides defined specialist procurement services. “It’s an opportunity to go in and actually deliver and then leave.”
IR35’s nothing new, but it seems to have caught up with many organisations in the way an overdue essay catches up with a distracted student. Even for the prepared, the coming weeks will be pretty busy. “Over the next six to seven weeks, we’ve got 400 contractors waiting for determination,” said Derek Mackenzie, Executive Director at Investigo. If a reminder were needed on the urgency of the issue and the timeliness of the discussion, this was certainly it.
To say that the IR35 legislation was greeted with trepidation in the public sector would be something of an understatement. “There was a kneejerk reaction to IR35 and people were concerned,” said David. At the time, he’d been working on a transformation project at the heart of government and had actually received IR35 very well. He took the view that this provided more rigour to his contracts and the way he delivered specific services permanent staff could not.
The Summer Budget 2015 document, ‘How to make IR35 more effective in protecting the Exchequer,’ reignited the subject. “When it was first rolled out,” added Max Curzon-Hope, “there was huge uncertainty.” Such was the immediate effect on the public sector. Now it’s the private sector’s turn to ride the wave.
Aiming to provide some clarity for the public sector, HMRC launched its IR35 checker. While companies are using it to determine contractors’ status, some clients are nervous when determining the middle ground. The information on the government website offers a starting point, it gives a flavour of the questions, but professional case-by-case advice is still recommended.
Comfort in anonymity
Contracting presents an interesting contradiction – the desire to quickly make an impact offset by the need to stay in the shadows. From that point of view, contractors are in many ways the hero organisations deserve, if not the one they need right now.
As such, contractors should not be part of the organisational hierarchy and structure:
If you are a genuine service provider then act like one. It’s about delivering the contract, not about being part of the organisation.
As an interim chief, your role is to provide strategy and to deliver big projects. That’s the role. Not line management. A permanent member of an organisation’s board needs to carry that management burden so you’re very explicitly focused on the project and not involved in things like management and other employee-related matters.
A world of opportunity
The key to evolution is the ability to adapt: to adjust your way of working according to the changing conditions around you. David Kershaw said: “IR35 gives more opportunities than people think.” One of those opportunities comes in the form of substitutions, which can be interesting and fun.
Think about publishing case studies to give the market an insight into what you can do and open up a world of potential new contracts. Demonstrate where you’ve delivered, and how this has changed something in a client organisation – what difference has your discreet service made?
The future
IR35 is obviously something that needs to be respected, adhered to and worked around, but in many ways it’s very much a work in progress with a number of grey areas. It’s therefore important that contractors continue to keep the government aware of their concerns. One attendee used the very apt analogy of the New Zealand rugby team: “Play what’s in front of you head on.” He talked about how he’d challenged government – local MPs, chancellor and even the Prime Minister – with varying degrees of response. While MPs tend to reply very quickly, response-times become somewhat longer the further up the chain you go.
But it’s important to keep the dialogue open, to think about how you can influence grey areas that can’t be worked around, to explain to legislators that you want to help the nation become more productive. The organisations you work with can advise you on who else to contact for advice.
At the same time, understand and challenge the client’s decision on whether you’re inside or outside IR35. A small company may have a different position to a large company concerning IR35. If the company uses the HMRC IR35 calculator and there’s a particular answer, ask them why. If you’re inside no matter what, ask them the reasons. You’re learning and helping them at the same time.
Summary
The discussion provided several simple tips to help contractors acclimatise to IR35:
Conclusion
The introduction of IR35 has no doubt presented huge challenges to hiring companies and contractors alike. While many are still trying to get their heads around the implications of this legislation, professionals are gradually waking up to the realities and understanding how it will affect them in their working lives. For organisations, there are resources out there to help with determination. For contractors, there’s a world of opportunity. The key, as with any significant change, is to adapt your ways of working. Professionals who can do this in a way that fits in with their chosen lifestyle, and satisfies their professional needs, will have the best chance of thriving in this new environment. For them, the transition will present countless possibilities.