- Written by Rebecca
- Category: News
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What reassurances could employers give to potential candidates during the pandemic to encourage them to move?
There is very limited recruitment happening at the moment. For many sectors of the economy a reduction in headcount growth may continue for months and possibly years. However, there are professions where the impact of Covid-19 has been limited and companies may be in position to recruit new people while the pandemic continues around us. Whilst much recruitment has been put on hold even for companies that have experienced minimal financial impact, there is a tipping point where the need for new staff overbalances the cautiousness in respect to hiring. This could present an issue.
There is an expectation within the broader recruitment industry that once companies start recruiting again, finding candidates for those positions will be easier than it has been before. And of course, in certain sectors that will be true, particularly where there have been significant volumes of redundancies. But industries where redundancies become common are not what I am considering here. In sectors where people have generally hung on to their jobs there is likely to be much more reticence for potential candidates to move positions and no newly redundant people to fill new vacancies.
A contact of mine raised the following question recently and given that he made an excellent point (he usually does) I thought I would try and address it. What reassurances could employers in historically candidate short sectors; largely financially unimpeded by Covid-19, do to entice reluctant potential candidates to move? I have a few suggestions.
1) Get rid of probation periods entirely
As employment rights are very limited for the first two years of an employment contract, even in normal circumstances probation periods are largely unnecessary. They can have a psychological advantage – that both parties can test the water for the first few months but in practice they do not really change a great deal except where particular additional benefits are awarded after a probation period. But even in those circumstances the cost to the employer of these benefits tends to be fairly minimal so the value is more symbolic.
Employers can still rid themselves of ineffective employees for very little due cause in the first two years of employment irrespective of a probation period. The only likely significant impact a jettisoning of probation period might be is in respect to a notice period i.e. that a new employee is on a one week or one month notice period during probation then an extended notice period after this. It’s pretty rare that candidates leave a position during probation so one could offer the same extended notice period from day one that typically applies after probation. An employer could allow a week or two ‘bedding in’ period when someone first starts in case someone leaves immediately (but don’t call it probation).
2) Don’t have benefits offered based on timed served.
Offering the same holiday allowance, life insurance, pension etc. from day one that long termers receive would give reassurance that a firm is fully invested in new hires. It would also likely not have a significant financial impact with the exception of possibly corporate non-performance related bonus schemes.
3) Bonus guarantees
If an employer pays a monthly, quarterly or annual bonus particularly if it has a performance related pay element then guaranteeing some of it until a new employee can realistically earn it could be advantageous i.e. a pro rata annual bonus for the number of months worked in a financial year and based on the average bonus paid to other fee earners.
4) Fixed term contracts
Another possibility, not without risks would be to offer a candidate a fixed term contract instead of a permanent one with the proviso that it will revert once the contract is up. It mitigates the risk from both sides but also means you would be liable to pay a salary for the entire contract if a position ended early. The same could also be achieved with a little less risk with a permanent employment contract with a long notice period, such as six months from day one.
5) Unequal Notice Periods
This would be a real show of commitment where you offer a potential employee less notice if they decide to leave than you would give them if you ended the job. I am not a contract or employment lawyer but as far as I am aware unequal notice periods are lawful but uncommon. This is largely because they are more at risk of being deemed to be unfair but if it favours the employee then I would imagine they would be okay.
6) Joining bonuses
Because they’re a one-off measure they are sometimes not as successful as people might think but a significant bonus for starting a new position might help. In my experience joining bonuses are usually most effective when someone is choosing between two offers and not when you are trying to persuade someone to leave their current firm as people rarely consider moving positions entirely for financial reasons. I would suggest that a joining bonus should not be the key piece of ammunition but may help as part of a range of measures.
7) Strong flexible and part time working policies
In a post-covid world, an employer’s attitude to flexibility is going to be crucial. If you’re strong on this you will have a significant advantage. Having enjoyed the flexibility, if not the lack of social activity, of home working for months, many employees will be reluctant to go back to working in an office every day or having a rigid working day. This will likely be a reason why people look at leaving employers - the prospect of losing, post lockdown, the flexibility they now have. Clear and active facilitation of home-working could be great signal of intent such as providing a phone, laptop and broadband subscription as part of a job offer and having incredibly flexible working practices.
8) Short-term increased holiday allowances or sabbaticals
Given that going on holiday will be difficult for most, if not all, of 2020 then adding, for example, an additional ten days’ holiday allowance to be used over 2 years could be a method of enticing people, allowing them to catch up on vacations lost. Likewise, an unpaid sabbatical of 4-6 weeks could be offered for one-two years of service which would be much earlier than is currently usual but could be particularly attractive for people whose plans were cancelled this year. It is a policy that could aid staff retention as well if it is extended to the entire workforce.
And that’s it. It’s not an exhaustive list by any means there are, I’m sure, plenty of other measures that would help. It makes sense to think about this now before there are pressures on recruitment so you are ready to persuade people to join your organisation when you need to.
- Written by Rebecca
- Category: News
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The Lockdown has ended. Now what?
Alright it hasn’t yet but what will happen when it does? I have a few thoughts on the job market. I’ve done no research on this, so the article is entirely anecdotal but built on a great deal of experience of societal economic issues. I work across the financial and intellectual property law sectors as the owner of a recruitment company and I will make reference to both whilst at the same time hopefully keeping this fairly general. Points are not in order of importance, more just in the order I have thought of them.
The government has completely underestimated the value of small businesses in my opinion.
This is critical. At the moment, support for small business is lacking. Government loans (from many sources I’ve read and anecdotal evidence) seem to be hard to get as many of the banks are adding obstacles which arguably shouldn’t be there for businesses to receive money. And, even when applications for loans are successful the money can take a long time to come through. The furlough scheme and small business grants are a welcome stop gap but if, for example, the director(s) of a small business who are paid by dividend cannot make a similar claim to 80% of personal income then they are likely to have to make employees redundant when furlough ends to financially survive. There are numerous very small firms of patent attorneys and accountancy practices who may struggle and many small businesses support these firms with revenue that will likely reduce. Or, worse, these otherwise viable business will fail due to a lack of government support that will have a consequential impact on any business they buy from.
What happens when the furlough scheme ends?
Assuming that restrictions end at the same point as the furlough scheme ends (currently the end of June), on day one companies will be faced with a substantial cost to the bottom line in respect to returning employees who have, whilst being furloughed, not been generating any income to compensate. This will of course apply to wide a range of sectors but particularly I imagine any sales environment, especially those with a medium lead time such as automotive sales, property and recruitment. I would expect a huge second wave of redundancies in June or July when the furlough scheme ends. This would be further compounded by only a partial end of lockdown with no extension to the scheme.
A much wider pool of sectors will take a considerable time to recover than is currently envisaged.
There are obvious casualties, hospitality, theatres, cinemas, airlines but there are so many other sectors that will be impacted significantly that are often unaccounted for. Marketing spend will continue to decrease, sales of equipment may be put off, non-essential office repairs held, revisions to IT systems postponed as well as web design, so many sectors will be affected by companies cutting back. And sectors that serve these industries will be equally impacted (such as recruitment consultancies for marketing professionals).
Multi-sector businesses will have a better chance of survival.
IP firms and accountancy firms are likely to be okay for the most part, or at least as a collective the sectors will be fine even though there will be corporate casualties. If firms are too reliant on a particular client or a particular sector, they may be vulnerable but a typical firm of patent attorneys works across a wide range of industries so what they may lose in engineering they will gain in biotechnology. Likewise, an accountancy firm with a strong insolvency practice is a very solid proposition. But there may be specific areas where jobs are still at risk as the cost of them cannot be carried by a firm, trade mark attorney departments may be more vulnerable (albeit there could be some positive impact in work as a result of Brexit that may mitigate) as would the more consultative practices within accountancy firms.
Jobs in industry in central services will be lost.
Massively increased volumes of work will be outsourced, I think this is more of a risk for IP than finance as companies will look to outsource much more patent work but finance departments will likely be reduced too. Finding a job in industry will be increasingly difficult. In general terms this would include all other shared service departments as well – marketing, HR/Recruitment, I.T. etc. After the economic difficulties caused by 9/11 I remember many of my friends who worked as in-house recruiters losing their jobs and I would expect something very similar now.
It will be a great deal more difficult to find a job but it may also be very difficult to find people for jobs.
There will be an initial period where more candidates are on the job market as a result of redundancy. But this pool of candidates will quickly dissipate. Some will leave their sector entirely and pursue other careers, some will find a new job and some may be out of work for a long time. Moving at a senior level will be difficult as from a hiring company’s perspective the additional expense may not be worth the risk but that may mean that competition for less experienced staff will increase significantly. For patent attorneys that will mean newly/recently qualified attorneys, where work has grown but a firm doesn’t wish to risk the additional cost of a more experienced hire, likewise for newly qualified accountants for private practices. This surge will be further complicated by many potential candidates taking the ‘better the devil you know’ approach and being cautious about moving positions.
Therefore, dependent on what a requirement is, it may be extremely challenging to source people. Acting quickly could be crucial when you are in a position to assess the impact of lockdown on overall business turnover. Waiting to hire could set back growth for years if it becomes increasingly difficult to persuade people to move. This could also have a consequent impact on salaries – in 2010/11 as the IP sector was coming out of the impact of the economic downturn there was a short term bidding war for patent attorneys with an electronics background at newly/recently qualified level with some receiving as much as 50% above what was average market rate at the time. At the same time, it was very difficult to place salaried partners with similar technical expertise as firms saw this as too risky.
Graduate/Entry Level Jobs will reduce.
Certainly, in the IP sector, firms have learnt from the 2008 financial crisis in the sense that the dramatic cutback in trainees back then created demographic gaps that the sector is still suffering from now but there will still be lower graduate intake. In more general terms, it will be extremely difficult being a graduate in 2020 or from 2019 and quite likely into 2021 too. Graduate schemes will be paired back, they will be financially easy to cut and redundancies inexpensive, so many who joined in the last year or so may find that they lose their jobs. For 2020 graduates, notwithstanding the issues of degree scoring, the competition for positions will be intense and remuneration may well decrease. Graduates will have to be far more flexible in what they require of a position and those prepared to relocate will be at a distinct advantage.
Is there hope for the future?
The article has been cathartic for me but I appreciate also pretty depressing. I don’t want to end with platitudes or false reassurances - life may well not go in the direction you anticipated. That might be a bad thing, you might be chasing what you could have had if not for this disaster and that is a perfectly reasonable response. Your life might have been better in different circumstances. But, we can’t change it. That doesn’t mean you have to accept what you have now, for many of you there will be a route to better and if you can think in terms of improving your circumstances and not trying to capture what was lost then that might be helpful. People can give you choices, keep an open mind, keep making connections and opportunities will present themselves. These will not be the opportunities you expected, not the ones you wanted or hoped for but better than what you have and that has to be worth something, hopefully a great deal.
- Written by Rebecca
- Category: News
- Hits: 147
What do you do when there are less jobs than applicants for them?
Covid-19 and the intellectual property and accountancy sectors, 21st April 2020.
For both sectors that the Fellows group of companies operate in (accountancy - Fellows Finance; and IP Law - Fellows and Associates) for the most part they have been candidate driven for quite some time. There have been more vacancies than candidates to fill them, which means that quite a few positions have remained unfilled for months, if not years. As a consequence, whilst certainly for trainee patent and trade mark attorneys it has been difficult to enter the profession in the first place; for qualified accountants and experienced IP professionals moving jobs has been relatively straightforward.
There are exceptions of course, moving specialisms for accountants within private practice has been tough (particularly from audit into to corporate finance) and then the number of available trade mark attorney positions tend to be cyclical and not consistent. But for the majority of the last few years, if you have wanted a job and you were prepared to compromise at least a little then there has been an abundance of opportunity. Quite often you didn't have to compromise at all. For example, Patent Attorneys with an electronics background and qualified accountants looking for new audit roles have been spoilt for choice.
This may now change.
Or it may not at all. No one knows, I certainly don't. After the next couple of months if market conditions return to their previous position then you may have nothing at all to worry about. However it is best to prepare for contingencies and a change in mindset may become necessary.
What might a change in mindset entail if jobs a scarce? Well I think you will need to have a better understanding of what you have and what you wish to change. Moving positions will be riskier as there will be less of a fallback position, so you really should think what the drivers for change are. You also need to manage the risks as much as possible and assess any opportunity in greater detail. Compromise may become essential, if you improve your position in one area is that enough to overcome obstacles in others? Can a new job get you where you want to be ultimately, even if it can't get you there now? Can you take a shorter term view, moving now is not a job for the very long term but an interim measure until market conditions change in the next couple of years?
You may have to compromise to a much greater extent than you currently realise or have accepted. It does depend on your circumstances but if you face the threat of losing your job or worse have lost it already as a result of the virus (or any other reason over the next few months) then what you hope to find may not be possible in the time frame that you have. You might need to consider relocation, or working in a practice area you find less interesting or accepting a lower salary than you feel you merit.
You will also need to grab at something that's suitable quickly and not second guess yourself. Deciding on the criteria for change and where you are willing to compromise will be essential, you will not be choosing between a range of options you may have only one to consider. The question will be to accept a new role or not, not to choose it over another opportunity. Waiting it out for a better position to come along could be incredibly risky or even foolhardy in certain circumstances.
How will recruiters fit into this? Whilst the best recruiters should always be willing to give you time, even if they can't help you directly, priorities will change. Trust will become essential. If you contact lots of recruiters without informing each one that you are doing so it could mean that, if this becomes apparent, none may wish to work with you. But you should demand an honest assessment from a recruiter of what they can and can't do so you can determine whether or not you should contact others. But bear in mind that, if a market has very limited options most recruiters may be aware of all vacancies. This is particularly true in a relatively small market like IP but is also true to an extent in accountancy too, particularly where there are regional limitations (i.e. available positions for FC's in Yorkshire). Therefore, when opportunities arise, in circumstances where candidates are relatively abundant, alongside best fit, recruiters will also prioritise candidates that work with them exclusively as it makes generating a recruitment fee much more likely.
For now, most recruitment is on pause in most sectors. Right at the moment is a terrible time to look for a position but I would imagine that the majority of recruiters in markets that were candidate scarce in January this year continue to act as if they are scarce now, in respect to how they will relate to you. It could therefore be a good time to make yourself known to recruiters for when conditions change. They have much more time on their hands and you will be first in their thinking when positions do arise. If markets then continue to be candidate scarce and job rich after lock down, you've not lost anything. If the opposite is true you have given yourself a good chance of being best placed to find the best result for you as you have already begun a dialogue with a recruiter.
Also consider that many recruiters haven't experienced a recession before (assuming that's what we're heading for). A lot of experienced recruiters left the industry in 2008/9 and people who have begun their career in recruitment since then may not be well prepared to deal with very different market conditions. Many of the methodologies they have been using to generate income will be less effective or will not work at all and they may not have a firm idea on how to change that. Cut them some slack but also do your research and partner with a recruiter who has the tools to give you the best outcome that is possible and who you trust enough to be sure that the best outcome right now might not be the job you hoped for. (This is my third(?) or fourth(?) economic crisis of some description I think, I've honestly lost count. I've been through it so can help us both get through this one too.)
Finally if you would like a chat about any of this then send me message, I'm always glad of a conversation.