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Episode 24
416 Plays1 year ago
News for the week beginning 28 August 2023 and Question of the Week: "Should agency recruiters include salaries in job ads?"
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Transcript
Weekly News Introduction
00:00:07
Speaker
This is the news for week commencing 28th August 2023.
Employment Report Highlights
00:00:11
Speaker
SEEK's employment report for July showed job ads increase for the first time month on month since January this year, rising 0.8%. The increase in volume was almost entirely driven by the NSW result which was up 3.6%. Hospitality and tourism easily accounted for the largest month on month increase by sector up over 12%.
00:00:33
Speaker
Compared to a year ago, national ad volumes on Seq were down by 19.5%. Victoria was responsible for the largest year-on-year decline with a drop of 24.7%. By sector, hospitality and tourism recorded the largest year-on-year decline of just over 40% followed by ICT down 35%. Applications per job ad rose 4.4% and are now consistent with 2019 volumes.
Corporate Financial Updates
00:01:02
Speaker
ASX listed Ignite reported another disastrous full-year result for the 12 months ending 30 June 2023 with a net loss of $1.5 million from $12.2 million of gross profit. The previous year's loss was $300,000 from a gross profit of $13.4 million. Group active contractors as at 30 June 2023 were 652, a 23% decline compared to the end of June 2022.
00:01:31
Speaker
Over the same timeframe, total internal staff declined from 87 to 52. Ignite's market capitalization stands at just over $6 million. ASX listed people in, reported revenue for the financial year, ended 30 June, 2023, rose 73.9% year on year to $1.18 billion. Normalized V-Bitter rose nearly 30% to $61 million.
00:01:59
Speaker
statutory net profit after tax rose 11.2% to $20.5 million. The industrial division, responsible for three quarters of the company's revenue, was the main contributor to the improvement with the division's revenue and EBITDA both almost doubling in the 12-month period. Hayes ANZ four-year gross profit for the year ended 30 June 2023 was down by 6% in constant currency
00:02:26
Speaker
while operating profit declined 39% on a like-for-like basis to $63 million. Net fees in Hayes Australia dropped 7%, however net fees in Hayes New Zealand rose 9%. Hayes ANZ consultant headcount was 1,071, as at 30 June 2023, a 6% decline since the end of June last year. Along with the full year results released last Thursday, Hayes announced the internal promotion of Dirk Hahn
00:02:55
Speaker
to the global CEO role, replacing the retiring Alistair Cox. Hahn is currently MD of Hayes Germany and Hayes Continental Europe, Middle East and Africa, responsible for approximately five and a half thousand employees. Having started with the group 26 years ago, Hahn won the role based on his leadership of Hayes Germany, which has grown to become the company's largest business, representing over 30% of group net fees, a tenfold increase in size since 2007.
00:03:24
Speaker
Harn's remuneration package will comprise a base salary of £620,000, a 4% pension, an annual bonus opportunity of 150% of salary, and a performance share plan reward of 200% of salary for 2023. Harn officially starts his new role this Friday, the 1st of September.
Legal Disputes and Cases
00:03:46
Speaker
A Brisbane law firm principal has taken a legal recruitment agency to court
00:03:52
Speaker
over his dissatisfaction with a new employee. Rodney Say, the principal of Brisbane firm Stevens & Tozer, has disputed a $13,848 fee owed to Scott's Co. trading his focus legal recruitment for the placement of a solicitor in 2021. Scott's Co. placed a solicitor with Stevens & Tozer who was subject to a restraint of trade clause which Say was unhappy with.
00:04:18
Speaker
Although the employer expressed dissatisfaction with the impact of the clause, he continued to employ the solicitor. Scott's co-complained after Sey refused to pay the balance of the fee owing after having paid an initial instalment. An adjudicator found the placement had been fulfilled as the soliciting question remained employed. Sey's application for appeal was rejected by the Queensland Civil and Administrative Tribunal.
00:04:45
Speaker
Scott's Co has also been cleared of allegations of misleading Sei or deliberately keeping information from him and the firm. In all, the adjudicator found that Sei received the benefits of the contract with Scott's Co and no compromise for the claim of payment of the full placement fee was agreed between the parties, acting senior member and Fitzpatrick determined. Sei has since commenced proceedings in the registrants court seeking damages for breach of contract or misrepresentation.
Wage Theft and Legal Consequences
00:05:14
Speaker
Wage theft is costing Australian workers $850 million a year, demonstrating an ingrained culture of deliberate underpayment and the need for criminalization at the federal level, according to a damning new report from the McKell Institute. A fresh analysis of Fair Work Ombudsman audit stretching back to 2009 shows that more than a quarter of audited businesses fail to observe the monetary obligations set out by industry awards or enterprise agreements, according to the institute's researchers.
00:05:42
Speaker
This calculation showed nearly 27,000 businesses were found to have underpaid approximately 1.3 million Australian workers over that timeframe. Consultation papers released by the Department of Employment and Workplace Relations indicate the federal government is considering how to penalise unintentional wage underpayment separately to deliberate wage theft.
00:06:04
Speaker
In its report, the McKell Institute also acknowledged the Fair Work Ombudsman generally found that employer non-compliance was due to a lack of awareness and understanding of award provisions rather than employers acting maliciously. Adam Cranston, the son of a former Australian tax office deputy commissioner, has been jailed for a maximum of 15 years over his role in the $105 million tax evasion conspiracy via his company Plutus Payroll.
00:06:33
Speaker
that featured a number of prominent recruitment agencies as peripheral innocent parties in the scandal. The 36-year-old was considered one of the architects of the fraud and was found guilty of two offenses earlier this year following a lengthy trial in the New South Wales Supreme Court. Between 2014 and 2017, Plutus Payroll collected gross wages from employers before money that should have gone to the ATO by way of GST and PAYG tax
00:07:03
Speaker
was siphoned via second-tier companies. Last week, Justice Anthony Payne found Cranston received at least $6.86 million from the scam and was knowingly involved from the outset and was intimately aware of its criminal purpose. The judge ordered Cranston to serve a non-parole period of 10 years.
Political Developments and Criticism
00:07:24
Speaker
The community and public sector unions pushed to revive last century's Commonwealth Employment Service
00:07:29
Speaker
and return job matching for the unemployed back to the public service, has scored a major win at the recent ALP National Conference after delegates voted up a key amendment. Labor's official platform will now be amended to reflect the position, however the policy position is not binding on the federal government. The conference winners are a necessary but small win for the CPSU on a path to rolling back the present system of outsourcing job placement services to for-profit providers like Max Employment
00:07:59
Speaker
and not-for-profit providers like Mission Australia and returning it to a CES-style public service function. Neither the Prime Minister, Anthony Albanese, nor the Minister for Employment and Workplace Relations, Tony Burke, has offered public comment on the conference motion since it was passed. More recruitment shenanigans in the NSW Public Service.
00:08:22
Speaker
With this time the new Labour government accused of jobs for the boys after former Chief of Staff for then Transport Minister John Watkins, Josh Murray was announced as the new Secretary of the Department of Transport. Murray was appointed in mid-July but government documents released last Wednesday revealed the external search firm engaged in undertaking the recruitment process, NGS Global, was concerned he lacked the required experience.
00:08:49
Speaker
A progress report by NGS Global initially listed Murray as under review or not recommended to proceed, describing his experience as being without the level of operational complexity required of a Transport Secretary and his appointment to the role would bring significant risk. Murray denied reports he was not on the shortlist and only added at the request of the Transport Minister, Jo Halen's Chief of Staff. Opposition Transport Spokeswoman, Natalie Ward,
00:09:18
Speaker
said Murray was dangerously unqualified for the role.
Job Ad Practices Debate
00:09:32
Speaker
Question of the week this week is prompted by some legislative changes in the United States and also some research from a few years ago. So to give you some context, you may be aware that in certain jurisdictions in the United States that pay transparency in job ads is now the law.
00:09:55
Speaker
In fact, you must put a salary or a salary range in a job ad in certain jurisdictions. I think most prominently New York, being one of those. This has twinned with some research from 2016 in the International Journal of Human Resource Management. And in this journal, researchers investigated the inclusion or non-inclusion of salary information in job ads.
00:10:27
Speaker
In the experiment, 283 job seekers were given identical advertisements with only the remuneration details differing. And what the researchers found was that the more specific the salary information, the more likely it was that candidates were going to apply. And this was amplified further when an extensive list of benefits was also provided.
00:10:56
Speaker
Interestingly, the salary informational lack thereof it did have job seekers form opinions about the prospective employers. The conspicuous absence of financial details tended to elicit a negative reaction from the applicants, whereas generous and transparent offers with respect to remuneration and benefits
00:11:22
Speaker
We're inclined to make applicants think positively about the organization and its values. So Adele question this week, should agency recruiters in Australia as a matter of course, include salary information in their job ads? I don't think it's a requirement in Australia. I look for the most part, obviously temp and contract work. It's pretty much there. I'd say, you know, 95% of the time.
00:11:50
Speaker
contract and temporary jobs will have the salary or the pay rate or the hourly rate. I think with full-time or permanent positions, it's perhaps the greater issue and that's where it's not always posted on every job ad. But interestingly, I did a little bit of research on this just randomly myself on Seek and brought up a number of job ads recently and found
00:12:14
Speaker
I would say anecdotally, more than half had the salary information on the job advert. So they were mostly direct advertisers, more so than recruiters, but I do see it on recruitment ads at times as well. I think the issue around putting the salary and having the salary transparent on an advert is that you're not engaging with a candidate at that point. The candidate is
00:12:40
Speaker
as that article says, making an assessment, making a judgment, making a decision about whether they like the sound of that job or like the sound of the company and the benefits. They can then self-select out. They can opt out themselves and not apply. And as agencies, we want the largest or greatest number of people to apply because we want to be able to assess the market.
00:13:04
Speaker
But two, we know that sometimes people aren't right for that job, but may very well be right for the very next job we're working on or another job on our board. So we want to try and keep it broad and get candidates not self-selecting out. We want them making the application. And as far as putting a range in, I'm not a big believer of ranges. You put a range in, the candidate's always going to want the higher end of the range. It's kind of useless to me, in my opinion, to have a range on an ad. But yeah, I don't think it's needed in Australia. What do you think, Russ?
00:13:34
Speaker
Well, I just want to pick you up on one thing, Adele, where your view is we want more applicants for our ads rather than less. Don't we want better applicants?
00:13:49
Speaker
rather than more. Isn't it better to have a smaller number of more suitable candidates? Because surely one of the things that creates the biggest waste of time in agency recruitment is dealing with candidates or rejecting candidates that are just not even close to suitable for the role. Yeah, but as I said, a good recruiter will be looking at other opportunities. I mean, if you've attracted a candidate
00:14:17
Speaker
with the right skill set who just happens to be off-mark on the salary, either too high or not enough experience, a good recruiter should be looking at that as an opportunity to take a candidate in another direction with another client.
00:14:30
Speaker
I see it keeping it broad. Yeah but doesn't that open us up to accusations of we're just fishing for candidates if we're doing that? I mean yeah I know that is something our industry does get accused of from time to time running ads just to sort of get candidates and I gotta say I'm definitely more in favor of
00:14:58
Speaker
putting the salary in or putting the salary range in. And I do appreciate the point about we don't want too many candidates to jump to conclusions about a job based on the salary that's advertised. But the flip side of that is, aren't candidates jumping to conclusions already simply because there's an absence of salary and other benefit data?
00:15:24
Speaker
Well, I think benefit data and salary perhaps are two different things. So I'm all for putting the benefit data in there and putting as much of the positive elements that you're really going to sell the job to the candidate with, you know, are really for putting that information and putting it in detail. I'm always telling candidates that run through my rookie training program that, you know, broad sweeping statements of, you know, flexible work arrangements is not going to cut it anymore. You have to be specific about what does that mean? Is it
00:15:53
Speaker
hybrid working is it being able to have every Friday off? What exactly does flexible working arrangements mean if you're going to use that as a benefit? So I think benefits separate to salary, I'm all for. I think we should absolutely be beefing up the benefits, the what's in it for them, why should people apply, why the ad really should differentiate itself. But as far as salary, yeah, I'm not 100% on this. Well, we might have to agree to disagree, Ross. Well, I certainly agree with what you've said about the more specific the better.
00:16:23
Speaker
Yeah, long experience. The more specific you can be about aspects of the whole opportunity, including the job, the culture, the salary, the benefits, the more credible the ad is and generally the better quality of applicant you'll receive. So maybe this could be a good little experiment to do yourself. For those of you listening, you know, think about putting two job ads out, one with the salary and one without and
00:16:50
Speaker
see what kind of response you get to both and let us know. We'd love to hear your feedback. Yeah, absolutely. We'd love to hear the results of any experiments people decide are worthwhile undertaking here.
Podcast Conclusion
00:17:02
Speaker
That's a wrap. Don't forget to subscribe to the podcast wherever you get your podcasts from, Google, Apple, Spotify, or on our website.