Global Daily News

  • PE firm makes majority investment in Ettain Group; two acquisitions follow

    Ettain Group announced Tuesday that it received a majority investment from private equity firm Alvarez & Marsal Capital. The Charlotte, North Carolina-based company then went on to acquire Global Employment Solutions, which ranks among the 100 largest US staffing firms, and Leidos Inc.’s consulting business in commercial electronic health records.“Ettain Group provides a highly attractive platform for investment in the IT staffing and solutions space,” said Michael Odrich, managing partner and founder of A&M Capital.On Staffing Industry Analysts’ list of largest US staffing firms, Ettain Group ranks No. 109 while Global Employment Solutions ranks No. 94.Combined, the company will have more than 3,000 employees and consultants.Global Employment Solutions provides IT and professional staffing services. Its brands include Fahrenheit IT, Itec and Global Employment Solutions. The Littleton, Colorado-based firm has been a portfolio company of TZP Group, which will retain a minority stake in the combined company.The Leidos business provides electronic health records implementation, optimization and go-live services. It will be rebranded along with Ettain’s healthcare IT practice as Ettain Health.“The Leidos Health business brings deep knowledge and comprehensive healthcare IT advisory, implementation, optimization and application management solutions,” Ettain CEO Trent Beekman said. Global Employment Solutions “brings years of experience in IT and professional staffing and ranks among the largest US staffing firms.&rdquo […]

  • Earnings roundup: Synergie, HCL Technologies, SAP

    Firms announcing earnings today included France-based staffing firm Synergie; IT services firm HCL Technologies Ltd.; and SAP SE (NYSE: SAP), the owner of vendor management system SAP Fieldglass.SynergieSynergie, a France-based staffing firm with operations in 17 countries including Canada, reported third-quarter revenue rose 3.0%. It cited strong performance in its French temporary staffing operations. (€ millions) Q3 2019 Q3 2018 % change Q3 2019 (US$ millions) International € 348.4 € 346.4 0.6% $381.0 France € 323.8 € 306.4 5.7% $354.1 total € 672.2 € 652.8 3.0% $735.2 The announcement included only information on revenue.HCL Technologies Ltd.IT services firm HCL Technologies Ltd. reported revenue rose 18.4% in US dollars in its fiscal second quarter ended Sept. 30. It cited growth across segments. (US$ thousands) Q2 2020 Q2 2019 % change % constant currency Revenue $2,485,605 $2,098,634 18.4% 20.5% Gross profit $917,087 $775,464 18.3%   Gross margin percentage 36.9% 37.0%     Net income attributable to shareholders $376,172 $356,659 5.5%   The financial results include the impact of the $1.8 billion acquisition from IBM that was announced in December of last year.SAP Business software provider SAP, which also owns vendor management system SAP Fieldglass, reported third-quarter revenue in its “intelligent spend group” rose 23% to €823 million (US$900 million). The intelligent spend group includes SAP Fieldglass; SAP Ariba; and SAP Concur, a business travel expense platform.The increase was 18% in constant currency.SAP’s intelligent spend group comprises only a portion of total revenue at the Walldorf, Germany-based company. Total revenue rose 13% year over year in Q3 to €6.79 billion (US$7.43 billion). Profit after tax rose 30% year over year to €1.26 billion (US$1.38 billion) […]

  • The Reserves Network acquires Texas-based ExecuTeam Staffing

    The Reserves Network, a Fairview Park, Ohio-based staffing firm, acquired ExecuTeam Staffing, which operates in the Houston area. The deal will give The Reserves Network its first office in Texas.“We’re thrilled to have ExecuTeam as a part of our TRN family,” said Neil Stallard, CEO of The Reserves Network. “Both companies share some unique historical and cultural similarities, making this partnership very authentic.”ExecuTeam was founded in 1987 and provides staffing in office, accounting and professional employment. Plans call for the ExecuTeam brand to remain and operate as an affiliate of The Reserves Network. This includes Team1Medical, a division of ExecuTeam, founded in 1995 to provide medical staffing.Laura Bowen, ExecuTeam Staffing president, will continue to oversee business operations; she has been with the firm for 23 years. In addition, all internal employees will remain.Anne Flournoy, founder of ExecuTeam Staffing, noted both companies have a history of working together.The Reserves Network was founded in 1984 and employs nearly 20,000 people annually through more than 40 operating locations in the Midwest, Southeast and Northeast.ExecuTeam’s “track record in the staffing industry the past three decades speaks for itself, and the great state of Texas is a market we have wanted to introduce our services to for many years,” said Nicholas Stallard, chief growth officer of The Reserves Network.This is The Reserves Network’s second acquisition in the last three months. It acquired North Carolina-based Hire Alternatives in July. […]

  • Supplemental Health Care announces executive changes

    Healthcare staffing firm Supplemental Health Care announced several executive changes, including naming Vickie Anenberg as president of local and allied services, Donna Carroll as president of workforce solutions and schools, Linda McDonnell as president of travel nursing, and Christopher Long as chief process officer.Anenberg formerly served as president of the nurse and allied division at Cross Country Healthcare Inc. Most recently, she ran her own consulting firm.Carroll has been president of local office and workforce solutions for Supplemental Health Care since 2017. In her new role, she will oversee strategic workforce solutions and the company’s MSP and schools services.McDonnell was promoted from her former role as senior VP of operations and has been with the company since 2012.Long has been with Supplemental since 2002; he formerly served as senior VP of operations.Park City, Utah-based Supplemental Health Care ranks as the 10th-largest US healthcare staffing provider. […]

  • More than half of US employees report seeing or experiencing discrimination

    More than half of US employees, 61%, have witnessed or experienced some form of workplace discrimination based on age, race, gender or LGBTQ identity, according to a survey by Glassdoor.Looking at specific forms of discrimination, the survey found that 45% reported witnessing or experiencing ageism, 42% reported racism, 42% reported gender discrimination and 33% reported LGBTQ discrimination.Glassdoor’s survey included more than 1,100 US employees.Younger workers, those between the ages of 18 and 34, are more likely to have experienced or witnessed the four types of discrimination.However, 77% of employees responded that their companies employ a diverse workforce, and 64% said their companies are investing more in diversity and inclusion now than in past year.Separately, Glassdoor found that job openings for roles related to diversity and inclusion in the US have increased 30% since last year with approximately 810 jobs open across the country.Still, 55% of US workers believe their companies should do more to increase diversity and inclusion efforts, according to the survey. This sentiment was even more prevalent among Gen Z and millennial employees, with 62% saying their companies should do more.In addition to the US, Glassdoor also surveyed employees in the UK, France and Germany. But the US had the highest percent of workers, 61%, reporting they witnessed or experienced discrimination in the four categories. In the UK, 55% said the same. The percent fell to 43% in France and 37% in Germany. […]

  • Sweden – Poolia Q3 revenue down but profits on the rise

    Swedish staffing firm Poolia (POOLB: SS) reported revenue for the third quarter ended 30 September 2019 of SEK 420.1 million (€39.1 million), down 12.1% compared to the previous year.Due to the merger between Poolia and Uniflex, which was completed on 31 October 2018, the third quarter results refer to the results of both companies. The group elected to recalculate its comparative figures, whereby the merger has been reported as if it had taken place on 1 January 2017. As a result, comparative figures for 2017 include Uniflex's income, expenses, assets and liabilities. Results also exclude Uniflex Germany which was sold in January 2018.Third-quarter revenue is as follows. (SEK millions) Q3 2019 Q3 2018 Change Q3 2019 (€ millions) Revenue 420.1 478.2 -12.1% 39.1 Operating Profit 11.1 6.7 65.6% 1.0 Profit After Tax 8.8 2.3 282.6% 0.8 According to Poolia, revenue was down due to decreased demand in the staffing industry. Currency effects had a positive impact on revenue by 0.7%. The group reported an increase in profits.In August 2019 Uniflex and Poolia signed a framework agreement with Lantmännen an agricultural cooperative owned by 25,000 farmers, regarding staffing and recruitment services. The agreement is valid throughout Sweden and extends over three years. (SEK millions) Q3 2019 Q3 2018 Change Q3 2019 (€ millions) Poolia Sweden 107.7 114.3 -5.7% 10.0 Poolia Germany 39.0 48.0 -18.7% 3.6 Poolia Finland 12.6 10.4 21.1% 1.1 Uniflex Sweden 219.5 269.4 -18.5% 20.4 Uniflex Norway 32.3 28.2 14.5% 3.0 Uniflex Finland 9.3 7.9 17.7% 0.8 In Poolia Sweden, the group reported a decreased demand for staffing services as a consequence of generally weaker economic activity. However, the group added that it has signed a number of important framework agreements with new customers in recent quarters.In Poolia Germany, results were negatively impacted by the effects of labour legislation changes. Poolia said it has implemented a savings program to create better opportunities for future profits.Poolia said its Finland operations continue to deliver good sales growth and results. Poolia added that its results in Finland will enable further investments in sales and recruitment.In Uniflex Sweden the company says its decrease in sales was mainly due to weakened demand from the construction and automotive industries.Uniflex Norway saw growth due to the influx of customers. Its results were in line with the previous year despite it being charged with costs for establishing Poolia as part of Uniflex Norway's range.Uniflex Finland revenue saw growth due to a high level of activity in customer processing.As of last trade, Poolia traded at SEK 6.40 (€0.60), up 9.22% on the day and 23.08% above the 52 week low of SEK 5.20 (€0.48) set on 30 August 2019. Based on its current share price the company has a market value of SEK 209.63 million (€27.08 million). […]

  • Netherlands – Brunel halts its industrial services operations, earnings outlook downgraded

    Dutch staffing firm Brunel International announced that it has decided to stop its Brunel Industrial Services operations, based in Texas, US.Since 2017, BIS has worked on various construction and maintenance projects, including large projects in shale oil & gas.As previously announced in its second-quarter results, the group encountered issues with a project for a water treatment plant, which it first won in 2018, leading to a one-off loss of €5.5 million.“We replaced the general manager and rebuilt the organisation, but at the same time we saw the market for shale oil & gas experiencing a slowdown with changing clients’ behavior in their contracting model from T&M (time and material) to fixed pricing,” Brunel said.“As a consequence, our BIS-activities in Q3 were at a very low level, causing a disbalance with our organizational capacity and resulting in significant operational losses,” Brunel said.Brunel said that after a thorough re-evaluation of the strategic rationale of this business, it was decided to stop the BIS-activities as soon as practicable.Until then, existing commitments, including the water treatment plant project, will be delivered on in close collaboration with the client for an “optimal outcome”.The group added that all commitments are expected to be delivered and finalised in Q2 2020. Brunel has no similar contracts anywhere else in the world.“We expect that the operational losses for BIS in the second half of the year will amount to €9 million,” Brunel stated. “Additionally, we will encounter one-off costs of €8 million to cease activities and speed up the finalisation of current projects.”In its update Brunel said that its performance in the Netherlands is still hindered by the scarcity in specialised IT and Engineering talent.“To improve profitability, we are speeding up our activities to start 2020 with a leaner organisation from top to bottom, with full focus on the newly identified growth areas. In Germany, more automotive projects are being stopped than forecasted, and although this only has a limited impact on revenue growth, it does decrease the profitability of our business due to a slightly higher bench in Q4,” the group stated.“While we reiterate our revenue outlook for the full year and continue to expect revenue to be between €1.025 billion and €1.075 billion, our EBIT will be significantly impacted and is expected to be between €15 million and €20 million for the full year 2019.The group will publish its third quarter results on 1 November 2019.Brunel International NV (BRNL:AEX) set a new 52-week low during today's trading session when it reached €8.15. Over this period, the share price is down -24.59%. As of last trade the company traded at €8.25. Based on its current share price the company has a market value of €539.13 million. […]

  • World – Despite recruiter confidence, skills gaps hit the hiring process

    The majority, or 95%, of recruiters around the world say they are confident they can find the right candidate for open positions according to a survey from job board Monster.However, despite their confidence 71% of recruiters say they struggle to fill a position because of candidate skills gaps.Monster’s ‘2019 State of the Candidate’ survey also found that 77% of recruiters consider active candidates to be high quality.Meanwhile, 85% of recruiters agree that candidates exaggerate skills and competencies on their resume. Monster states that, while these candidates look good on paper, recruiters need to adjust expectations to consider candidates with most or some (70%) of the necessary skills to find the right fit.“For recruiters to be effective, the industry must continue to adapt to the needs of both candidates and employers,” Scott Gutz, Chief Executive Officer, Monster, said. “The reality is that the skills and generational gaps will continue to widen in the years to come. But by focusing on addressing those challenges today, companies will be able to not only identify top talent, but also retain and grow their existing employee base.”"Today's tight labour market is making it increasingly challenging for organisations to find and hire outside talent that has all of the necessary skills and is the right fit,” Gutz said. “Upskilling is critical to not only retain top talent, but also to attract qualified candidates from competitors.”“Companies need to evolve how they view the role upskilling plays within their own organization. Further, it's crucial that recruiters think about the impact the skills gap has across generations,” Gutz said.Monster’s survey polled recruiters across the UK, France, Germany, the Netherlands, US and Canada. […]

  • UK – Number of UK tech freelancers fall in the wake of public sector IR35 reforms (The Register)

    The number of freelance IT contractors working in the UK fell by 2.4% in 2018 compared with the previous year, the first fall in five years, reports The Register, citing data from the Office of National Statistics and accountancy firm Access Financial. The number of freelance IT contractors totaled 121,989 in 2018. Access Financial states that, following the impact of IR35 reforms in the public sector, many contractors have been moved into permanent roles or umbrella companies. In April 2017, the UK government reformed the rules in the public sector, shifting the responsibility for determining employment status from workers to the public authorities. From April 2020, the same rules will apply to the private sector. The changes have been blamed for a number of delays to public sector IT programmes due to freelancers quitting. Other industries have also seen an impact in how they engage freelancers and contractors with banking giant Barclays recently announcing that it would no longer engage contractors who provide their services via a personal services company, limited company, or other intermediary, unless they work on a PAYE (pay as you earn) basis. […]

  • Australia – Café allegedly paid workers in food and drinks, Fair Work Ombudsman says

    Australia’s workplace watchdog the Fair Work Ombudsman has commenced legal action in court against the operators of a Brisbane café that allegedly partially paid some of its employees in food and drink.The regulator alleges 11 employees at Café 63 Chermside were paid part of their wages in meals, desserts and drinks during two periods between August 2017 and January 2018.Most of the affected workers were visa holders, including seven juniors aged under 21, who worked as cooks, kitchen attendants and food and beverage attendants.Facing the Federal Circuit Court are Timi Trading Pty Ltd, which operates Café 63 Chermside, company director and manager Tien Hoang Le, company manager Minh Vo Duy Nguyen and company owner-director Hamish Watson.Fair Work Ombudsman Sandra Parker said that inspectors investigated after receiving underpayment allegations.“All employees in Australia are entitled to be paid the minimum pay rates that apply to their positions – in money, not food,” Parker said. “If we consider that employers are breaching their lawful obligation, we will take enforcement action so employees receive what they are entitled to.”The Ombudsman alleges that Timi Trading’s conduct relating to the 11 Café 63 Chermside employees breached the provision of the Fair Work Act requiring that employees be paid in money.Fair Work Inspectors allegedly found that eight of the 11 employees were paid according to Individual Flexibility Agreements (IFAs) that provided for flat hourly rates and a list of ‘bonuses’ and ‘allowances’, instead of being provided their lawful entitlements under the Restaurant Industry Award 2010, such as overtime and penalty rates.It is alleged the IFA ‘allowances’ included employees being allowed food and drink up to the value of AUD 42.00 (USD 28.72) per day when working, including AUD 20.00 (USD 13.68) in meals, AUD 7.00 (USD 4.79) in desserts and AUD 15.00 (USD 10.26) in drinks.The Ombudsman also alleges that Timi Trading’s conduct also breached workplace laws by failing to ensure the IFAs passed the better-off-overall test (which requires employers to ensure employees are better off overall under an IFA than under the relevant Award) and failing to detail in the IFAs how each individual was better off overall under the IFA.Timi Trading allegedly also breached workplace laws by providing the Ombudsman with false and misleading records, failing to make and keep proper records and agreements, and failing to pay one employee for her absence on a public holiday.Le and Nguyen were allegedly involved in breaches relating to all 11 workers and Watson was allegedly involved in breaches relating to the eight workers engaged under IFAs. The alleged record-keeping failures have prevented the Ombudsman from calculating back-payments.Timi Trading faces maximum penalties per breach of up to AUD 63,000 (USD 43,079), while Le, Nguyen and Watson face maximum penalties per breach of up to AUD 12,600 (USD 8,615). […]

  • Australia – ApplyDirect CEO steps down, new interim CEO and MD appointed

    Australia-base job search site ApplyDirect Limited announced today that Bryan Petereit has decided to step down from his role as CEO and Director of the Board.Petereit, who founded the group, will remain with the business in a consulting capacity in the short term to assist with the transition and to work on projects.The Board also announced the appointment of Prashant Chandra as the interim CEO and Managing Director effective immediately. Currently serving as Chief Financial Officer and Company Secretary of ApplyDirect since May 2018, Chandra has been instrumental in leading the business through a period of significant transformation including the acquisition and integration of Utility Software Services earlier in 2019. Chandra has previously held finance leadership roles with efm Logistics Pty Ltd and the Adecco Group.ApplyDirect Chairman, Andrew Henderson commented, “On behalf of the Board, I would like to thank Bryan for his contribution to and the leadership of the business since its inception over 10 years ago. As the founder of ApplyDirect, Bryan has been key in driving the business through its formative stages and leaves it well positioned for the future.&rdquo […]

  • Taiwan – Jobless rate rises in September

    The unemployment rate in Taiwan increased by 0.04% in September 2019 to 3.80% when compared to the same period last year, according to data from the latest manpower survey results from the Directorate General of Budget Accounting & Statistics.When compared to the previous month, the unemployment rate decreased by 0.09%. On a seasonally adjusted basis, the unemployment rate increased by 0.01% to 3.74%.The number of unemployed persons was 455,000 in September, which decreased by 11,000 (-2.40%) but increased by 8,000 (+1.72%) from the previous month and that of the previous year, respectively.Meanwhile, total employment decreased by 19,000 (-0.16%) in September to 11.50 million when compared to August 2019. However, it increased by 58,000 (+0.51%) when compared with the previous year.Compared with that of the previous year, employment in agriculture decreased by 4,000(-0.75%), by contrast, the goods-producing sector and the services-providing sector increased by 4,000(+0.08%) and 59,000 (+0.86%), respectively.Taiwan’s labour force participation rate was 59.22% in September, which declined by 0.16% from the previous month; however, it rose by 0.17% from that of the previous year. […]

  • Japan – Number of foreign students seeking jobs after graduation hits record high (Japan Times)

    The number of foreign students who changed their visa status to work in Japan after graduating from universities or vocational schools hit a record high in 2018, amid a chronic manpower shortage in the nation, reports The Japan Times citing data from the Immigration Services Agency. A total of 25,942 students switched their status of residence last year to one that permits employment in Japan, up 3,523 from a year earlier. The figure more than doubled from 2013, apparently reflecting overall growth in the number of overseas students and surging demand from companies for foreign workers to deal with a labour crunch caused by Japan’s aging population and low birthrate. By visa status type, “engineer, specialist in humanities, international services,” accounted for 93.2% of work visas. “Business manager” comprised 2.2% and “professor” comprised 2.1%. Earlier this year Japan’s labour law revisions took effect which brought a number of changes including granting entry to more foreign workers to ease the country’s labour shortage. […]

Latest Research

  • Largest Staffing Firms in Canada: 2019 Update

    Key Findings: We estimate that 25 firms generated at least CAD 50 million in Canadian staffing revenue in 2018. Added together, these firms generated CAD 5.5 billion in such revenue, accounting for 58% of the market, by our estimates. The complete list of 25 firms can be found on page four of this report. In this market share report, we have ranked companies in order of revenue size, according to industry custom, but this ranking should not be taken to imply that a firm with a higher rank provides better service or more value to its shareholders. Staffing firms varied in degree of financial transparency, and even when forthcoming with information, in some cases data provided was adjusted for greater accuracy and consistency. Therefore, for all firms in this report, revenue shown should be considered an estimation by Staffing Industry Analysts. Market share percentages in this report were calculated by dividing each company’s revenue figure by our estimate of CAD 9.4 billion for the Canadian staffing market in 2018. Overall, we believe that this list is accurate and can be used appropriately to get a “big picture” reading of the Canadian staffing industry landscape. However, as transparency and availability of information from staffing companies can vary from one year to the next, this year’s estimates may not be comparable to those of previous years in all cases. For that reason, we did not display prior year revenue estimates in this report. Two firms are included in this year’s ranking that did not appear in last year’s report: BOWEN Group and IS2 Workforce Solutions. Additional details on the methodology of this report are provided on page five. Please select the following link to download the complete report:  Largest Staffing Firms in Canada 20191018 - You do not have permission to view this object. […]

  • Latin America Legal Update Q3 2019

    In this report, we round up the legal developments affecting the workforce solutions ecosystem across Latin America in Q3 2019:Chile      New working hours rights for call center workers       New rules for employing students     Mexico Government revises protocol for collective labor agreements      Puerto Rico        Special leave relating to domestic violence and harassment          Legal Disclaimer: This update is provided solely for the purposes of information and should not be considered legal advice. It is always recommended to seek the advice of qualified legal counsel before taking action.To download a pdf copy of this update, click below: Latin America Legal Update Q3 20191018 - You do not have permission to view this object. Chile 1.   New working hours rights for call center workersThe Chilean Labour Inspectorate has issued guidance on the new “Teleoperators Law” (No. 21.142, the “Law”), which went into effect on September 1, 2019. The objective of the Law is to regulate the activity of call centers and the specific employment issues they present relating to pay, working hours and breaks.The Law makes it clear that contracts with call center workers are employment contracts. Accordingly, such workers should have all the rights and entitlements of an employee under the Chilean Labor Code. Therefore, Sundays and public holidays are to be treated as non-working days, except for activities authorized by law to be performed on those days. Companies that undertake such activities must compensate their employees with a paid day off in exchange for worked Sundays or holidays. In addition, the Law requires such companies to set workers’ shifts one week in advance.Call center employers must provide certainty regarding work and pay, with each of the worker’s activities (calls) detailed on their pay slip along with the remuneration received in return. Variable remuneration must be determined according to “individual, objective variables with achievable metrics”. The Law requires a call center worker’s log-in details for connecting and making calls to be secret and personal to the worker, with the aim of preventing the employer from limiting the number of sales that the worker can make.The Law also provides that call center workers have the right to a ten-second interruption between calls, as well as a 30-minute rest during the workday, in addition to their right to a minimum half-hour lunchbreak.Call center employers should review their employees’ working conditions and their procedures regarding pay and working hours to ensure compliance with these new rules. 2.   New rules for employing studentsNew rules introduced under Law No. 21,165, relating to the employment of students, went into effect on September 1, 2019.This law defines the term “student employees” as employees between 18 and 24 years old inclusive, who are studying on a regular basis or are in the process of obtaining a professional or technical degree in an institution recognized by the Chilean state.Evidence of student status must be provided by the employee within 15 days of starting employment and every six months for the duration of their employment, or until their status changes. The student must submit a certificate granted by the educational institution and the employer must be informed of any change in his or her status immediately. The employer must attach this certificate to the employment contract and keep a special record of all student employees in the organization. The student employee and the employer may agree to a part-time working schedule and during academic vacations, the parties may choose any of the following options: continue with the term-time employment arrangements; suspend the employment contract; or agree to an ordinary working schedule (with the student working as a regular employee). Regular working hours must not exceed ten hours per day for any reason.  There must also be a minimum of twelve hours of rest between shifts.The student employee will be entitled to unpaid leave for examinations. The employee must inform his or her employer in writing, seven calendar days before he or she wishes to use his or her leave for examinations.Anyone that employs students must comply with the provisions of Law No. 21,165. Mexico Government revises protocol for collective labor agreementsEffective since August 1, 2019, the Protocol for the Legitimization of Existing Collective Bargaining Agreements (Protocol) requires all unions in Mexico, that are parties to collective bargaining agreements, to revisit employee support for their current agreements. If the legitimization process is not carried out by a certain date, the collective bargaining agreement will be terminated.The Protocol remains in effect until the Federal Center for Conciliation and Labor Registration, established under the recently reformed Federal Labor Law, becomes operational, on May 1, 2021. The Protocol provides that a collective bargaining agreement must be approved by a majority of the employees covered by it. The union must provide notice online to the Mexican Ministry of Labor (“STPS”) giving its details together with those of the employer, the collective bargaining agreement, and the consultation and voting process to be used to determine if the majority supports the collective bargaining agreement.The union must provide a list of employees with a right to vote. This will be all employees excluding those whose employment commenced after the date on which the notice to the STPS was submitted.The union shall notify STPS of the outcome of the vote within three business days after the date of the election. If a public notary verifies the consultation process, the corresponding notarial certification must be included in this notice. If the STPS finds that irregularities occurred in the consultation procedure, the results of the election will be declared void. If the STPS does not make observations or question the results during the 20 business days following the date on which the union gave notice of the result, the collective bargaining agreement shall be deemed legitimate, and the union may request a certificate of legitimization from the STPS.If the collective bargaining agreement does not have the majority support of the employees, the agreement will be terminated. However, the benefits and working conditions included in the collective bargaining agreement that are superior to those established by the law, will be retained for the benefit of the workers.Unions should legitimize their collective bargaining agreements before May 1, 2023. Otherwise, those collective bargaining agreements will be terminated.Further information on the Protocol is provided by Santamarina y Steta SC. Puerto Rico Special leave relating to domestic violence and harassmentAct No. 83, effective since August 1, 2019, provides employees of public and private employers with 15 days of unpaid leave per year for instances of gender or domestic violence, abuse of minors, sexual harassment in employment, sexual assault, lewd acts or aggravated stalking. This special leave also extends to cases where an employee’s family members are the victims, and allows employees to request reasonable accommodations, or flexible work conditions, to address these situations. Employees may request to take this leave through apportioned, flexible, or intermittent schedules.Act No. 83 specifies certain requirements that employees must meet in order to qualify for this special leave and provides a non-exhaustive list of the various activities for which this leave may be used. These activities include obtaining information about and requesting a protective order; searching for and obtaining legal assistance or safe housing; visiting any clinic, hospital or medical appointment; and obtaining information and/or benefits from any sources of help or services offered.Act No. 83 also allows employees to request reasonable accommodations, or flexible work conditions, to address abuse situations, as defined by the Act. A reasonable accommodation may include moving the employee's physical place of work, modifying his or her schedule, or any other accommodation to permit the employee to receive the help they need. Requests for accommodation must be in writing and can be denied only when the request is unreasonable, but not prior to reviewing all possible alternatives.The Act allows employers to request documentary evidence from employees to justify their use of the leave but limits the types of documentation that can be requested. Act 83 specifically requires employers to reference the Act in their Domestic Violence Protocols and sexual harassment policies. Employers must allow the employee to return to the same position after taking leave.Employers may not discriminate against employees who apply for or take leave under Act No. 83 or take adverse action, such as work-day reductions, shift changes, or negative performance evaluations. Employers that fail to comply with Act 83 may be subject to penalties of up to $5,000, as well as all damages suffered and back pay.Employers should understand the full requirements of Act No. 83 and establish written policies and procedures for requesting and granting leave. Employers should also provide training to staff designated to handle requests for leave under Act No. 83.Legal Disclaimer: This update is provided solely for the purposes of information and should not be considered legal advice. It is always recommended to seek the advice of qualified legal counsel before taking action. […]

  • Financial Results of Staffing Companies

    Key Findings: In the latest fiscal quarter, roughly corresponding to 2Q19, revenue decreased by a median of 1.0% year-over-year in 2Q19, representing the fourth consecutive quarter of decelerating growth, from a peak of 9.3% y/y in the year-ago period. Results not only broke a string of nine consecutive quarters of growth, but it also represents the lowest quarterly result over the eight years we have been tracking the group. Revenue deceleration was even more pronounced when adjusting for acquisitions, divestitures, currency exchange, and in some cases a difference in billing days between quarters. Median adjusted revenue declined 2.8% y/y, also the fourth consecutive quarter of deceleration and a meaningful drop-off from 0.5% growth in the previous quarter. Thirty-eight percent of firms in the group reported positive year-over-year adjusted revenue growth in their most recent fiscal quarter. This is 19 points below the previous quarter and 33 points below the year-ago period, reflecting softer top line trends. Average adjusted revenue growth among the five companies with more than $1 billion of revenue in 2Q19 was -0.6% y/y (Adecco, Randstad, ManpowerGroup, Kelly Services and Robert Half), near the -0.1% y/y rate for the remaining firms. At the median, 2Q19 gross margin expanded by 30 basis points y/y. Median net income growth of 0.3% y/y in 2Q19 fell from 8.1% y/y in the prior quarter. Tepid earnings growth is likely to persist near-term due to difficult comparisons resulting from tax cuts enacted at the end of 2017. Net income in several cases was impacted by significant one-time events that may not reflect the ongoing operations of these companies. For further information, one can refer to the financial statements of the companies in this report. Financial Results of Staffing Companies NA 2Q19 20191017 - You do not have permission to view this object. […]

  • Making Talent Acquisition Technology Work for You

    In times of talent scarcity, staffing firms need every tool in the toolbox to help them discover and engage difficult-to-find candidates. Talent acquisition technology provides a plethora of solutions, although there are so many companies and the solutions so niche it can be difficult to put all the pieces together. In this session, we’ll look at three specific talent acquisition technologies that staffing firms use – job boards, chatbots, and candidate assessment technology – and discuss how they can best be leveraged to grow business and unlock opportunities.Moderator: David Francis, Research Manager, CCWP, Staffing Industry Analysts Panelists:Eyal Grayevsky, CEO, Mya SystemsPriyanka Jain, Head of Growth and Product, PymetricsMatt Plummer, VP, Product Strategy, ZipRecruiterTo listen to the recording, click on the PLAY button below:&nbs […]

  • Largest Healthcare Staffing Firms in Europe

    The European Healthcare staffing market was worth £6.1 billion in 2018. The UK accounted for 39% of the European market, followed by France (13%) and the Netherlands (12%). The 40 largest staffing firms operating in the European healthcare segment accounted for 60% of total sales in 2018. The aggregated revenue of the Top 40 increased by 5% in 2018. While UK-based firms represent a half of the Top 40 firms, only two of the five fastest growing companies from this Top 40 are based in the UK, illustrating the challenging market conditions faced by suppliers to the country’s main client, the National Health Service. An overview of the European healthcare staffing market can be found on page 3. The full list of the Top 40 firms is displayed on pages 5-7, ranked by market share. The fastest growing firms are highlighted on page 8. Company websites, country HQ and types of roles filled are presented in the tables on pages 9-11. We have ranked companies by revenue, according to industry custom, but this ranking should not be taken to imply that a firm with a higher rank provides better service or more value to its shareholders. Staffing firms varied in degree of financial transparency, and even when forthcoming with information, in some cases data provided was adjusted for greater accuracy and consistency. Therefore, for all firms in this report, revenue shown should be considered an estimation by Staffing Industry Analysts. To download a full copy of the report, click below: Largest Healthcare staffing Firms in Europe 20191018 - You do not have permission to view this object. […]

  • Europe Legal Update Q3 2019

    In this report, we round up the legal developments affecting the workforce solutions ecosystem across Europe in Q3 2019:European Union New directive on work-life balance for parents and carers EU-wide whistleblower protection adopted  IrelandReasonable accommodation includes assigning core duties          Netherlands      Changes for payroll employees from 1 January 2020        Poland  Changes to the Labour Code re auto-enrolment, terminations and discrimination               Serbia  Draft law on temporary workSwitzerlandRevised Act on gender equality  UK Key information document for agency workers from April 2020           Shortage Occupation List changes from October 2019             Proposals to extend labour licensing and civil penalties for breach of Conduct Regulations Further developments in the calculation of holiday    AWR does not give right to work same hours as comparator  Government to tackle misuse of confidentiality clauses           Legal Disclaimer: This update is provided solely for the purposes of information and should not be considered legal advice. It is always recommended to seek the advice of qualified legal counsel before taking action.To download a pdf copy of this update, click below: Europe Legal Update_Q3_20191017 - You do not have permission to view this object. European Union 1.   New directive on work-life balance for parents and carersOn 13 June 2019, the European Council of Ministers adopted a directive on work-life balance for parents and carers which aims to increase the participation of women in the labour market and the take-up of family-related leave and flexible working arrangements.The main elements of the Directive are: paternity leave - fathers or second parents will be able to take at least 10 working days of leave around the time of birth of a child paid at a level equal to that currently set at EU level for maternity leave (in line with article 11 of Council Directive 92/85/EEC). The right to paternity leave will not be subject to a prior length of service requirement. However, the payment of paternity leave can be subject to a six-month prior service requirement. Member states with more generous parental leave systems will be able to keep their current national arrangements; parental leave - an individual right to 4 months of parental leave, from which 2 months are non-transferable between the parents and are paid. The level of payment and the age limit of the child will be set by individual member states; carers' leave - a new concept at EU level for workers caring for relatives in need of care or support due to serious medical reasons. Carers will be able to take 5 working days per year. Member states may use a different reference period, allocate leave on a case-by-case basis, and may introduce additional conditions for the exercise of this right; and flexible working arrangements - the right for parents to request these arrangements has been extended to include working carers. Member States will have three years (by mid-2022) to implement the new rights but are allowed an additional two years (five years in total) to bring in the right to pay for the last two weeks of paid parental leave. 2.   EU-wide whistleblower protection adoptedThe Council of Ministers adopted a directive on whistleblower protection on 7 October 2019. The directive will guarantee a high level of protection for whistleblowers by establishing safe channels for reporting both within an organisation and to public authorities, setting EU-wide standards. It will also protect whistleblowers against dismissal, demotion and other forms of retaliation, and require national authorities to inform citizens and provide training for public authorities on how to deal with whistleblowers.The core feature of this directive are: Protection not only exists for employees who report their concerns, but also for job applicants, former employees, supporters of the whistleblower and journalists. These persons are protected from dismissal, degradation and other discrimination. Protection applies only to reports of wrongdoing relating to EU law, such as tax fraud, money laundering or public procurement offences, product and road safety, environmental protection, public health and consumer and data protection (the EU is encouraging national legislators to extend this to also covering wrongdoing relating to national laws). The whistleblower can initially choose whether to report a concern internally within the company or directly to the competent supervisory authority. If nothing happens in response to such a report, or if the whistleblower has reason to believe that it is in the public interest, they can also go directly to the public. They are protected in both cases. Companies with more than 50 employees or more than EUR 10 million (USD 11,048,700) in annual turnover will be obliged to set up suitable internal reporting channels. Companies with 250 or more employees will be expected to comply within two years of adoption; companies with between 50 and 250 employees have a further two years after transposition to comply.Whistleblowers should be able to submit reports either in writing via an online system, a mailbox or by post and/or orally via a telephone hotline or answering machine system. Companies are also obliged to offer a personal meeting should the whistleblower request it.Organisations must ensure that the identity of the whistleblower is kept confidential regardless of which reporting channel is used and all personal data must be processed in accordance with GDPR.There will be a two-year implementation period during which time EU member states will be obliged to implement the directive into their own national laws by September 2021. Currently less than half of the EU member states have comprehensive whistleblower legislation, so this aims to harmonise the protections for whistleblowers across the EU. Ireland Reasonable accommodation includes assigning core dutiesThe Supreme Court has overridden a decision of the Court of Appeal in the long-running case of Daly v Nano Nagle School regarding the extent of an employer’s duties in relation to the accommodation of an employee with disabilities in the workplace.In 1998, Marie Daly began working as a special needs assistant in Nano Nagle School in Co Kerry, which caters for children on the autistic spectrum and those with mild to profound disabilities. In July 2010, Ms Daly was very seriously injured in an accident while on holiday, and as a result, she was paralysed from the waist down and has to use a wheelchair. In 2011, Ms Daly was anxious to return to work, however, after an assessment, the school board refused Ms Daly permission to return to work.Ms Daly brought an application under s.83 of the Employment Equality Acts 1998-2011 to the Equality Tribunal (now the Workplace Relations Commission). Ms Daly claimed that the school’s decision amounted to unlawful discrimination under sections 6, 8 and 16 of the Act, and that the school had failed to comply with its statutory duty under s.16(3) and (4) to provide “reasonable accommodation” or “appropriate measures” to accommodate her disability and allow her to return to work.When the case came before the Court of Appeal, they held that the obligation to reasonably accommodate could not involve the redistribution, to other staff, of tasks which are essential to a position. However, the Supreme Court disagreed with this distinction between essential and non-essential duties stating that “it is hard to see [that] there would be any policy or common good reason why simply the distribution of tasks, or their removal, should be confined only to those which are non-essential.”The Supreme Court also stated that there is no mandatory duty to consult with an employee in each and every case where reasonable accommodation is being considered. However, it cautioned that a wise employer should engage the employee in “meaningful participation" in order to demonstrate compliance with their obligations to consider what appropriate measures might accommodate the employee. In any event, it is still possible for an employer to find that the degree of redistribution or accommodation would “impose a disproportionate burden on an employer”.The Supreme Court has reverted to a stricter interpretation of employer obligations and confirmed that the requirement to fully consider the potential to redistribute a disabled employee’s duties is mandatory. However, employers are not required to recruit, promote, retain or train an individual who "is not capable of undertaking the duties attached to that position" and it will depend on the circumstances in every case as to what would be a “disproportionate” burden on the employer. Netherlands Changes for payroll employees from 1 January 2020In our last Europe Legal Update Q2 2019 we reported on changes to the employment rights and status of payroll employees introduced by the Labour Market in Balance Act (Wet Arbeidsmarkt in Balans WAB). Flexmarkt has published an explanation of those changes (in Dutch) which are summarised here.In a payrolling arrangement, a payroll company takes over the responsibilities of an employer (hirer) for its staff (similar to PEO in the US or some umbrella companies in the UK). This means that the employer (hirer) outsources matters such as payroll administration, salary payment, payment of social contributions and, for example, pensions to a payroll company. The payroll employees currently fall under the collective labour agreement (CLA) for the temporary employment sector or the CLA of the individual payroll company, rather than the applicable CLA for the hirer or the sector covering the work performed by the employees.Previously, the definition of employees engaged on a “temporary employment contract” under the Dutch Civil Code (Article 7: 690) included both workers assigned to a client by a temporary work agency, and employees of payroll companies identified and recruited by the client. Both types of employee were entitled to the same rights.Definition of ‘payroll agreement’. From 1 January 2020 the definition of a “temporary employment contract” will change, with a “payroll agreement” being separately defined as an agreement where: the payroll employer does not fulfil an “allocation function” in the labour market i.e. does not recruit and supply labour to an employer as and when needed; and the workforce is made available exclusively to the client. To help determine whether the payroll employer is performing an “allocation function” the explanatory notes to the WAB refer to a number of indicators: Whether the temporary employer has recruited and selected the workforce itself, for example by placing a vacancy, actively approaching potential employees, and actively approaching clients; Whether and to what extent the client hirer has been involved in the recruitment and selection process; Whether the employees were previously employed or otherwise engaged by the client hirer and the client identified the former employee as the candidate they wanted to hire; Whether there is a temporary demand for work by the client hirer, such as replacing employees during illness or other absence, dealing with peaks in demand or output; The structural nature of the work / function that is being performed by the workforce at the client hirer; Whether the payroll employer performs any “allocation” activities such as having a job site and employing intermediaries who actively recruit and allocate the workforce to clients; The terms of the agreements made with the client hirer (whether or not in writing), such as an exclusivity clause giving the client exclusive right to engage the worker; Whether the worker has been informed that he is made available exclusively to that client and that this is actually the case; How long the worker has been working (exclusively) for the hirer and whether he has previously worked for the hirer; Whether the worker must also agree practical matters with the hirer (for example related to his employment conditions), such as his holidays; Whether the hirer is also involved in personnel matters in relation to the temporary worker, such as performance reviews. Employment conditions of a payroll employee from 1 January 2020. A payroll employee will be entitled to the same employment terms and conditions as permanent employees of the hirer. Whereas temporary agency workers are only entitled to equal treatment for certain employment conditions, payroll employees will be entitled to all employment conditions that apply to the hirer’s permanent staff, e.g. 13th month bonus, number of vacation days, leave allowances etc.Moreover, a payroll employer can no longer rely on the so-called “temporary employment clause” to dismiss an employee on the basis that they are no longer required by the client they are assigned to work for. In addition, the phasing arrangements (Phase A, Phase B etc.) that apply under the collective labour agreement for the staffing sector and the exclusion from equal pay obligations which apply to agency employees will no longer apply to the payroll employee.Payroll employees are also entitled to an 'adequate pension'. The current StiPP pension is not considered ‘adequate’ in this regard but rules regarding this 'adequate pension' will not come into effect until 1 January 2021 and will be clarified in due course.Hirers and payroll employers will need to review the terms and conditions of those employees currently employed under a payrolling agreement before 1 January 2020. The terms of payroll employees will need to be harmonized with those of the hirer’s permanent staff and this may involve changes to contracts and policies as well as a negotiation over the cost of payrolling such workers. Poland Changes to the Labour Code re auto-enrolment, terminations and discriminationAs of 7 September 2019, significant changes were made to Poland’s Labour Code ushering in new pension plans to require employees to save for their retirement. In addition, the categories of unlawful discrimination were broadened.Pensions. Employee Capital Plans (PPK) were launched from 1 July 2019 for employers with at least 250 employees as at 31 December 2018. From 1 January 2020, employers with at least 50 employees as at June 30, 2019 will be covered and from 1 July 2020 those with at least 20 employees as at the end of 2019. The remaining employers will be covered by the PPK regulations from January 1, 2021.The system provides for the automatic enrollment for all employees aged 19 through 55, as from the end of the third month of employment. The largest employers are obliged to conclude agreements with suitable benefits providers for the management of their schemes by 25 October 2019 and agreements for programme participation for eligible employees by 12 November.Discrimination. Before 7 September 2019, the Polish Labour Code listed the following as protected characteristics: sex; age; disability; race; religion; nationality; political beliefs; trade union membership; ethnic origin; creed; sexual orientation, employment for a definite or indefinite period of time, working full-time or part-time. The new wording of the Labour Code makes it explicit that these protected characteristics are just examples and that other characteristics may be discriminatory if not objectively justified.Termination of employees. From 7 September, an employer is obliged to issue a “work certificate” to a departing employee on his/her last day of employment if it does not intend to enter into a new employment relationship with him/her within the following 7 days. Employees will be able to ask a court to order the employer to issue a work certificate and employers who fail to supply a work certificate, on time or at all may be liable to a penalty.Employers in Poland should implement systems for auto-enrolment of staff and amend policies and procedures in relation to discrimination and termination and dismissal of staff to comply with these changes.   Serbia Draft law on temporary workIn August 2019, a draft law on temporary work engagement was laid before the Serbian Parliament for discussion, according to the Serbian Monitor and Nova Eknomija.The draft law stipulates that workers in Serbia, hired through employment agencies, will be guaranteed equal pay and other working conditions (working hours, absence, holidays) equal to workers who are directly employed by the hirer.The draft law proposes a restriction on employing workers through employment agencies limited to 10% of the total number of employees directly employed by a company. This is to address the current practice of laying off surplus workers and their subsequent re-employment through agencies on significantly less favourable working conditions. An exception to this limitation is allowed for companies with less than 50 employees.  This restriction was opposed in the debate on the draft law by employers’ representatives who argued that their constitutional rights were being violated.The law also proposes that employment agencies cannot assign a temporary employee previously employed for a fixed-term with the same employer, directly or through the same or another agency, for a total period of 24 months after. This is to prevent the continued employment of part-time employees with the same employer.In addition, the draft law proposes a ban on the employment of civil servants working in the public sector, local governments and the government of autonomous provinces via an employment agency.The draft law also proposes prohibiting an agency from charging the employer for the temporary work after the termination of service.Serbia is a potential candidate for EU membership with the country formally applying in 2009. This new law on temporary work would align Serbia more closely to the EU’s Agency Work Directive in preparation for their anticipated accession. Switzerland Revised Act on gender equalityA revised Federal Act on Gender Equality will enter into force on 1 July 2020 encouraging companies to eliminate gender inequalities voluntarily.Under the new regime, companies with 100 or more employees will be obliged to carry out an internal wage equality analysis every four years. The Federal Government will provide all employers with a free standard analysis tool based on a scientific and legally recognised methodology.The revised Federal Act on Gender Equality is silent on the penalties for employers that fail to conduct a wage equality analysis (in violation of the law) or fail to respond if a gender pay gap is identified. In the latter case, the employer will have their wage structure reviewed every four years until the wage inequality is remedied.Employers will be obliged to report (in writing) the results of all wage analyses to their employees and shareholders of companies listed on the stock exchange. This will put gentle pressure on companies to voluntarily remedy any gender pay gaps. In addition, employees who commence legal proceedings against their employer for wage discrimination will be able to submit the results of wage equality analyses to the courts as important evidence to substantiate any discrimination.The revision of the Federal Act on Gender Equality exists for a limited period, presumably in the hope that it will not be needed once gender equality is achieved. The associated ordinance will automatically expire on 1 July 2032. UK 1.   Key information document for agency workers from April 2020In our Europe Legal Update Q2 2019 we reported that the government had passed regulations requiring employers in England, Wales and Scotland to provide workers (not just employees) with a written statement of particulars of employment before the individual begins employment. The information must include how long a job is expected to last; notice requirements; eligibility to sick leave and pay and details of other types of paid leave, such as maternity and paternity leave; any probationary period; details of remuneration; and specific days/times of work.This obligation takes effect from 6 April 2020. In addition, agency workers who register with a staffing agency after 6 April must receive a “key information document” from their staffing agency employer before they agree terms, pursuant to Regulation 13A of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 (the ‘Conduct Regulations’).The government has published guidance for employment businesses together with template key information documents for PAYE agency workers; agency workers paid via an umbrella company; and agency contractors who provide their services via a personal services company.The key information document is intended to improve transparency of information for agency workers, particularly around pay. It will give agency workers more immediate access to key pay-related information before agreeing terms with an employment business and a clear idea of how any fees and deductions will affect their pay.The key information document will not need to specify exactly what an agency worker will earn in an assignment, but rather should demonstrate how a proposed rate of pay is affected by fees and deductions made throughout the supply chain. The information must clearly reflect the minimum amount an employment business expects to achieve for an agency worker (for example, not less than national minimum wage).The document must also include a description of all deductions to be made to a worker’s pay. For statutory deductions (e.g. income tax), this can just be an explanation that the deduction will be made. For non-statutory deductions and fees (e.g. an umbrella company’s margin), the key information document must EITHER state the amounts to be deducted OR explain how they are calculated. Example statements showing how a rate of pay will be affected by deductions and fees should be included giving actual figures.Because the figures in a key information document do not need to be precise final figures, they do not necessarily need to be revised for every assignment. They only need to be updated as and when the information contained within them changes. This might for example be when a new deduction is made, such as student loan repayments or contributions to a private healthcare scheme, or when a worker’s right to equal treatment under the Agency Workers Regulations 2010 takes effect.This does not represent a radical change to the information employment businesses are already required to give to a worker. Instead, it emphasises the need for transparency by requiring an employment business to set out all the elements of an agency worker’s pay, including the fees charged by umbrella company employers. This information and other conditions of their engagement must be produced before agreeing terms with the worker, and also must be given to an umbrella company if one is involved. In practice this means giving the worker the document at or before the point at which they register or start a new assignment, if the information has changed. Staffing firms should read the guidance and download the template documents in readiness for 6 April 2020. 2.   Shortage Occupation List changes from October 2019In September 2019, the immigration minister announced changes to make it easier for UK employers to obtain skilled workers from overseas following the Migration Advisory Committee (MAC)’s recommendation to significantly expand the Shortage Occupation List.The Tier 2 Shortage Occupation List (SOL) is a list of occupations recognised by the Migration Advisory Committee (MAC) as being in national shortage, which they assess would be sensible to fill, in part, through non-EEA migration. Jobs which appear on the SOL do not need to be advertised for 28 days in line with the Resident Labour Market Test and benefit from prioritisation in the monthly restricted Certificate of Sponsorship (CoS) panels.  This is relevant because when the monthly limit on Tier 2 restricted CoS is reached only those roles scoring the most points are granted a CoS.Citing the rapid growth of the digital sector, its sector-diverse impact and job creation, the MAC recommended that the SOL be expanded to include all jobs under Standard Occupational Codes such as Programmers and software development professionals; web designers; IT business analysts; and systems designers.  Other notable inclusions in the SOL are chefs, architects and jobs in the fields of engineering, health and the sciences.Additional changes include the following: PhD level occupations will be exempt from the annual limit (20,700) on visas for skilled non-EU workers from 6 October 2019. Additionally, absences from the UK of migrants in PhD level occupations that are directly related to their Tier 2 employment will not be counted as absences in applications for indefinite leave to remain. The Home Office has streamlined English language testing ensuring that doctors, dentists, nurses and midwives who have already passed an English language test accepted by the relevant professional body, do not have to sit another test before entry to the UK on a Tier 2 visa. These changes will make sure that employers will be able to access the staff they need from outside the European Economic Area (EEA includes all EU member states plus Iceland, Liechtenstein and Norway) more quickly. For employers that have up to now relied upon EEA workers, post-Brexit such talent may need to be recruited from further afield and those employers will need to hold a sponsorship licence to employ non-EEA staff. 3.   Proposals to extend labour licensing and civil penalties for breach of Conduct RegulationsIn July 2019, the UK government commenced consultations on parts of the “Good Work Plan” which was their response to the 2017 report written by Matthew Taylor, appointed as Interim Director of Labour Market Enforcement in August 2019.Currently, the Director of Labour Market Enforcement is responsible for setting priorities for the Employment Agency Standards Inspectorate (EAS), the Gangmasters and Labour Abuse Authority (GLAA) and the minimum wage enforcement team at HMRC. A consultation on proposals for a new Single Labour Market Enforcement body would see the body having consistent powers to enforce payment of the minimum wage, labour exploitation and modern slavery and safeguarding agency workers.One proposal is to extend the GLAA licensing regime to sub-sectors like construction, care and contract cleaning. The GLAA’s existing remit under the Gangmasters (Licensing) Act (GLA) 2004, is licensing gangmasters who supply or use labour to provide a service in agriculture, horticulture, food processing and packaging and the shellfish industry sectors. It also investigates the activities of unlicensed gangmasters and those using their services. A labour provider must have a GLAA licence to work in the regulated sectors. It is a criminal offence to supply workers without a licence or be in possession of false documents with the intention of acting as a licensed gangmaster or to use an unlicensed labour provider.The government also proposed introducing civil penalties for breaches of Regulations 12 (withholding payments to agency workers) and 25 (withholding monies owed to entertainers/models) under the Conduct of Employment Agencies and Employment Businesses Regulations 2003. The consultation cites the penalties in the National Minimum Wage regime for underpayment of the NMW as an example of what might be introduced. The penalty is calculated based on a percentage of the total underpayment (currently 200% of arrears) – with a minimum penalty of £100 and a maximum of £20,000 per worker. To incentivise prompt payment, where unpaid wages and penalties are paid in full within 14 days, the employer only pays half the penalty.The consultation, which closed on 6 October 2019, also considered whether the body should enforce workplace discrimination, harassment and bullying along with holiday payments for vulnerable workers. Currently, holiday pay rights are enforced through employment tribunals, but many workers are either unaware of their rights or fail to enforce them.A second consultation, on reforms to statutory sick pay (SSP), proposed amendments to SSP regulations to enable an employee returning from a period of sickness absence to have a flexible, phased return to work, working the hours and days that would benefit them. This would allow an employee to earn a part wage and part SSP. The government is also considering whether to introduce legal guidance to encourage employers to intervene earlier on during a period of sick leave, such as making adjustments to working patterns or keeping in touch with staff who are off sick.The government will consider the responses to both these consultations and publish their responses in due course. 4.   Further developments in the calculation of holidaySince paid annual leave was introduced by the Working Time Regulations (“WTR”) in 1998 there has been a debate around the calculation of holiday and holiday pay to which workers in the UK are entitled. The latest case (The Harpur Trust v. Brazel [2019] EWCA Civ 1402) considers the issue of pro rating holiday for part-time workers or those who have an irregular pattern of work.In addition, the UK government has increased the reference period used to calculate pay due where a worker has a variable remuneration.The statutory minimum holiday entitlement is currently 5.6 weeks per year under the WTR. A part-time worker is generally entitled to this amount reduced pro rata. Many employers calculate the statutory holiday entitlement of a part-time employee by calculating 12.07% of hours worked. This method is not prescribed by the WTR but makes calculating holidays easier for those who work non-standard hours throughout the year. However, the Court of Appeal in The Harpur Trust v. Brazel has now made it clear that this simple approach does not comply with the WTR for those who work for only parts of the year, such as school term time.Mrs Brazel was a "visiting music teacher" employed by Harpur Trust (the Trust) on a zero hours permanent contract. She worked during term-time only but was paid monthly at an agreed hourly rate, for the hours worked in the previous month. The length of school terms varied, and it was agreed that she would receive three equal payments for her leave (April, August and December) calculated as 12.07% of her remuneration for the hours worked in that term. Mrs Brazel brought a claim for underpayment of holiday pay as paying 12.07% of hours worked was not the same as paying the normal rate of pay averaged over the 12 weeks prior to holiday being taken as required by the WTR.When her case came before the Employment Appeal Tribunal (EAT), the EAT found that there is no requirement in the WTR to pro rate holiday for employees who work full time but for only part of the year.At the Court of Appeal, the Trust argued the result would be unfair if the calculation applied was not 12.07%. However, the Court of Appeal upheld the judgment of the EAT. It concluded that there was no requirement to pro rata leave entitlement for part-year workers and the appeal was dismissed. The court held a simple understanding should be taken of what is required by the WTR, and there was no provision for pro rating as this would amount to accrual of leave to which the employee is entitled from day one.The WTR will be amended from 6 April 2020 by the Employment Rights (Employment Particulars and Paid Annual Leave) Regulations 2018. The regulations change the reference period used to calculate pay due where a worker has a variable remuneration. For example, this will apply if remuneration depends on the amount of work done, or if the worker does not have normal working hours. Where a worker has been employed for at least 52 weeks, the reference period will be extended from 12 weeks to 52 weeks. Where they have been employed for fewer than 52 weeks, the reference period is the period that they have been employed.This case gives rise to a difficult situation for staffing firms and employers who currently use the 12.07% approach to pay holiday to workers who are engaged on zero-hours permanent contracts of employment. Such employers need to consider their potential exposure and take detailed advice on potential options. The issue is less of a problem where workers are engaged on contracts for services as there is no requirement to provide work or to pay those workers when there is no work or they are not available for work but the fact remains that the WTR does not permit holiday or holiday pay to be accrued and requires holiday pay to be calculated over the reference period, which will be 52 weeks from April 2020. There is a possibility that this decision will be appealed to the Supreme Court. 5.   AWR does not give right to work same hours as comparatorIn July 2019, the Court of Appeal ruled in the case of Kocur v Angard Staffing Solutions Ltd and another ([2019] EWCA Civ 1185) that an agency worker’s right to equal treatment in relation to the ‘duration of working time’ under the Agency Workers Regulations 2010 (AWR) does not entitle him or her to the same number of contractual hours as a directly employed comparator.The AWR require end users to provide the same basic working and employment conditions to agency workers as those that would apply if they had been recruited directly to the same job.Mr Kocur was an agency worker assigned to Royal Mail (RM). After completing the requisite 12-week qualifying period, he claimed equal treatment with Royal Mail’s permanent staff under the AWR arguing that he should be given the same amount of work as RM’s employees - typically he was allocated less than 20 hours per week. A tribunal dismissed his claim to equivalent working hours stating that the right to the same ‘duration of working hours’ in the AWR did not mean an entitlement to work the same number of hours, as this would fundamentally change the relationship between hirers and temporary work agencies. The tribunal concluded that “agency workers will always be secondary, in terms of call upon their services, to that of the workforce of the hirer”.The Court of Appeal agreed that the purpose of the Agency Workers Directive, which is implemented in the UK by the AWR, is “plainly to ensure the equal treatment of agency workers and permanent employees while at work, and in respect of rights arising from their work; but there is nothing in either the preamble or its actual provisions to suggest that it is intended to regulate the amount of work which agency workers are entitled to be given”.This is helpful clarification of the right to equal treatment in the AWR.   6.   Government to tackle misuse of confidentiality clausesIn its response to a recent consultation on the use of non-disclosure agreements (NDAs) the government has announced that it will introduce legislation to tackle misuse of confidentiality clauses. The proposed legislation aims to prevent confidentiality clauses or NDAs being used to silence victims of harassment and discrimination. The new legislation will: Ensure that a confidentiality clause cannot prevent an individual disclosing information to the police, regulated health professionals and legal professionals; Ensure that those signing confidentiality clauses contained in either a settlement agreement issued on termination, or in the written statement of terms which must be provided to employees at the start of employment, are informed in plain English what the limitations mean; and Require independent legal advice on settlement agreements to cover the nature of and limitations on confidentiality clauses contained in the agreement. The government also proposes introducing new enforcement measures for confidentiality clauses that do not comply with the legal requirements. For employment contracts, these measures will form part of the current employment tribunal regime for a failure to provide a written statement, entitling the employee to additional compensation in some circumstances. In relation to settlement agreements, the government has said that such non-compliant confidentiality clauses will be void in their entirety providing a strong incentive for employers to get this right or risk losing the confidentiality protection for a departing employee altogether.The reforms, to NDAs and confidentiality clauses, form part of a wider response by government to sexual harassment in the workplace. It is not yet clear when the legislation will be introduced but it will be accompanied by guidance to help employers and their advisers comply with the new legislation.Legal Disclaimer: This update is provided solely for the purposes of information and should not be considered legal advice. It is always recommended to seek the advice of qualified legal counsel before taking action. […]

  • Middle East and Africa Legal Update Q3 2019

    In this report, we round up the legal developments affecting the workforce solutions ecosystem across Middle East & Africa in Q3 2019:KenyaEmployers must register with new National Employment AuthorityUnited Arab EmiratesEnd of service gratuity system replaced with savings schemeLegal Disclaimer: This update is provided solely for the purposes of information and should not be considered legal advice. It is always recommended to seek the advice of qualified legal counsel before taking action.To download a pdf copy of this update, click below: MEA Legal Update_Q3_20191016 - You do not have permission to view this object. Kenya Employers must register with new National Employment AuthorityOn 26 June 2019, the National Employment Authority (NEA) published a notice pursuant to the Employment Act, No. 11 of 2007 (the Employment Act) requiring employers in Kenya to submit returns regarding their employees.The NEA launched in May 2019 under the National Employment Authority Act 2016. Its main purpose is to provide a comprehensive institutional framework for employment management, enhancement of employment promotion interventions and increasing access to employment for the youth, minorities and marginalised groups.The Employment Act requires all employers with more than 25 employees to keep a record of their employees’ details, including: full name, age, sex, occupation, date of employment, nationality and level of education, and file a return for each calendar year ending 31 December. Employers are required to register with NEA and then file the return using the available template.NEA gave employers a grace period of up to 8 July 2019 to file a return for the period 1 January 2018 to 31 December 2018. Failure to file the return attracts a fine of up to KES 100,000 (USD 954) and/or a six months jail term.The Employment Act also requires an employer with at least 25 employees to notify the Director of Employment when a vacancy arises. A vacancy is deemed to have occurred when: an employer creates a post to be filled by an employee or decides to engage one; or an employee terminates or has his employment terminated by the employer and the employer abolishes the office. An employer must notify the employment service office when a vacant post is filled, or where a post has been abolished before being filled. This notification is required to be made within two weeks of the filling or abolition of the post. An employer is also required to notify the nearest employment service office of the termination of every employment and of each lay-off of a person within two weeks of the termination or lay-off.Whilst the Employment Act provides that the above notices should be made to the “employment service office”, the notice published by NEA provides that, in addition to the employee returns, notifications in relation to any vacancies and/or terminations as set out above should also be made to NEA. United Arab Emirates End of service gratuity system replaced with savings schemeFollowing updates to the Dubai International Financial Centre (“DIFC”) employment laws, the DIFC has announced proposals to replace the End of Service Gratuity (“EoSG”) regime with the DIFC Employee Workplace Savings Scheme ("DEWS").DEWS is a workplace savings plan for expatriate employees working in the DIFC. It will replace the current end-of-service benefit entitlement from 1st January 2020. The scheme will not include UAE nationals or GCC nationals who are accruing a social security benefit. However, they could choose to make voluntary contributions.As of 1 January 2020, all employers in the DIFC will be required to pay monthly contributions on behalf of their employees into the DEWS. Employees may (at their discretion) also make their own contributions into the scheme.  Employers failing to comply with their obligations will be subject to a fine and other sanctions. The employer contribution rates depend on the employee’s length of service calculated from the date they started employment: for members with less than 5 years’ service - 5.83% for members with 5 years’ service or more - 8.33% Employees will also be permitted (but not obliged) to make their own payments into DEWS.  Such payments will be made via payroll.  Whilst an employee is employed by their employer in the DIFC they will be unable to withdraw from the DEWS, it is only when they change employer or leave the employment of a DIFC based entity, that they will be able to withdraw funds.Under the EoSG system, employees who leave the employment of the DIFC employer inside their first 12 months of employment have no entitlement to EoSG payments. The DEWS makes no such exceptions.  Contributions are earned from the first day of employment and are not limited or otherwise varied by the reason for termination.It is anticipated that outside of the DEWS, employers will be able to establish their own qualifying schemes, the rules of which are yet to be fully announced. Further details of the DEWS scheme and the changeover from EoSG are available on the DIFC website.Legal Disclaimer: This update is provided solely for the purposes of information and should not be considered legal advice. It is always recommended to seek the advice of qualified legal counsel before taking action. […]

  • Europe Staffing Co. Survey 2019 Findings

    Key Findings: This insight contains the initial findings of the 2019 Staffing Company Survey for staffing firms primarily operating in Europe. It includes the complete survey questions and summary statistics. Additional detailed reports will follow this summary report. The survey was conducted in the summer of 2019 and reflects the opinions of 54 staffing firms. Data includes: client contract terms; staffing company participation in online staffing; web and app enabled technology; internal staff benefits; sources of revenue; priorities and investments; referral bonuses; wages paid to temporary workers; and recruiting tactics. To access the complete report, please select the link below: EU Staffing Company Survey 2019 Initial Findings 20191015 - You do not have permission to view this object. […]

  • Asia Pacific Legal Update Q3 2019

    In this report, we round up the legal developments affecting the workforce solutions ecosystem across the Asia Pacific region in Q3 2019:Australia Proposed amendments to SA labour hire licensing scheme            Work Health and Safety Guidelines for labour hire businesses and hosts  Controversial decision on personal / carers leave calculation of a “day”    India      Federal minimum wage code passed        Consolidated labour code clarifies the meaning of ‘contract labour’ When are contract labourers deemed direct employees of the principal employer? Japan    Guidelines for dispatch workers equal pay issued              New Zealand     New rights for labour hire employees     Philippines          President vetoes bills altering rules on contracting           South Korea       Fair Hiring Procedures Act extended to the private sector        Legal Disclaimer: This update is provided solely for the purposes of information and should not be considered legal advice. It is always recommended to seek the advice of qualified legal counsel before taking action.To download a pdf copy of this update, click below:    Asia Pacific Legal Update Q3_20191016 - You do not have permission to view this object. Australia 1.  Proposed amendments to SA labour hire licensing schemeThe Labour Hire Licensing Act 2017 (SA) commenced on 1 March 2018 introducing a mandatory licensing regime for entities providing labour hire workers in South Australia. It was suspended for a time when the incoming Liberal government indicated they intended to repeal the legislation. However, they were unable to secure sufficient votes in the Legislative Council to repeal it entirely.Consumer and Business Services (CBS) announced on 7 June 2019 that they would recommence accepting applications for labour hire licenses from 14 June 2019. However, on 24 September 2019, the State Government announced its intention to amend the existing labour hire laws, following concerns about the scope and application of the licensing scheme in its current form.As it stands, from 1 November 2019, unlicensed labour hire service providers will face substantial penalties for operating without a licence. Businesses engaging workers via an unlicensed labour hire service provider also face penalties.The Government is seeking to narrow the scope of the scheme to apply to labour hire providers operating within industries where workers are at a greater risk of exploitation due to the low-skilled, labour intensive nature of the work that they are engaged to undertake: Horticulture processing Meat processing Seafood processing Cleaning Trolley collection The proposals are still going through the legislative process, but should the legislation pass, some businesses that have already applied for a licence may no longer require a licence. Consumer and Business (CBS) will provide updates to all licence applicants as the proposed changes go through the legislative process. 2.  Work Health and Safety Guidelines for labour hire businesses and hostsIn August 2019, Safe Work Australia published a guide for persons conducting a business or undertaking (“PCBUs”) involving the supply of workers (labour hire PCBUs) to work for another business or undertaking (host PCBUs) on complying with their health and safety duties under the model Work Health and Safety (WHS) laws.All Labour Hire PCBUs and Host PCBUs have a primary duty of care to reasonably ensure the health and safety of labour hire workers, and this obligation cannot be transferred or contracted out to another person.The guide highlights that Labour Hire and Host PCBUs must communicate with each other and share information to ensure compliance with workplace health and safety laws, in particular: Potential hazards/risks and their control measures; Compliance with minimum workplace health and safety standards and legal requirements; Safe work methods and training requirements; Arrangements for facilitating assessments of worker's needs; and Policies and procedures, as well as roles in response to an incident. Both Host and Labour Hire PCBUs are required to be proactive in managing hazards and risks and to review these when circumstances change, such as a change in work process or a change in the physical environment.Safe Work Australia points out that in most jurisdictions, the labour hire PCBU (not the host PCBU) is responsible for providing workers’ compensation to the worker. However, there are exemptions to this. Labour hire and host PCBUs should work together to coordinate return to work arrangements and support workers through the return to work process. It is important to understand and comply with your workers’ compensation obligations, as penalties can apply. 3.  Controversial decision on personal / carers leave calculation of a “day”In August 2019, the Full Bench of the Federal Court handed down a decision regarding the meaning of a ‘day’ for personal/carers leave under the Fair Work Act 2009 (Cth). The Act provides that employees are entitled to 10 days of paid personal/carers leave per year.The decision in Mondelez v AMWU [2019] FCAFC 138 arose in relation to Mondelez employees who worked 36 hours per week, averaged over a 4-week cycle and in 12 hour shifts. Mondelez provided the employees with 96 hours of personal/carers leave per year of service, but this only entitled them to take eight 12-hour shifts off work as personal/carer’s leave.The Minster for Jobs and Industrial Relations intervened in the case to argue that the expression “10 days” should be understood as a reference to a particular number of hours of personal/carer’s leave. The dissenting judge, O’Callaghan J, agreed and found that personal/carers leave should accrue based on ordinary hours to ensure that employees working the same overall hours accrued the same amount of leave. The majority of the Federal Court found that the employees were entitled to ten periods of 12‑hour shifts each year as personal/carers leave, which equates to 120 hours per annum.On 16 September 2019, the Attorney-General announced that the Federal Government will seek leave, in the High Court, to appeal the decision, because it has sparked confusion and uncertainty around the way personal and carers leave entitlements should be calculated.The Attorney-General’s statement said that “Prior to the decision in Mondelez v AMWU and Ors, employers and employees all understood that full-time staff who worked a 38-hour week were entitled to accrue 76 hours of personal leave each year, based on the number of ordinary hours they worked over a normal two-week period. That had been the situation that existed for decades, and it was meant to remain the situation when Labor introduced the Fair Work Act in 2009, which changed the wording of the provisions regarding how leave was to be accrued to ‘10 days’ per year”.The decision is of concern for employers, many of whom have payroll systems that accrue personal/carers leave based on the number of ordinary hours an employee works, and on a pro-rata basis for part-time employees. Of particular concern are the entitlements of employees, including those in flexible service industries, who work varying rosters with different shift lengths. In addition, many part-time employees may now be entitled to more leave than their current accrued balance, following this decision. Any appeal to the High Court will be closely watched, but in the meantime, employers concerned about calculating personal /cares leave should take independent legal advice. India 1.   Federal minimum wage code passedIn September 2019 the Indian Parliament India passed the Code on Wages Bill, 2019 ("the Bill"). The Bill enables the federal government to fix minimum statutory wages for millions of workers.With the Code on Wages Bill, the labour ministry plans to streamline the definition of wages by amalgamating four related statutes: Minimum Wages Act, 1948; Payment of Wages Act, 1936; Payment of Bonus Act, 1965; and Equal Remuneration Act, 1976. Currently, 12 different labour laws define wages differently.The Bill allows the provision of minimum wages, as well as timely payment of wages, to cover all employees in both the organised as well as unorganised sectors. The unorganised sector includes labour-intensive industries and small businesses employing less than ten workers in total.The Bill provides for the federal government to set national minimum rates for wages, as well as the minimum wages in certain sectors (such as railways and mining). State governments will fix the minimum wages for their regions, which cannot be lower than the national minimum wage (or “floor”) set by the federal government. However, the federal government may set different national minimum wages for different parts of the country.The Bill specifies that the minimum wages must be revised every five years, and the overtime rate must be set at twice the standard wage rate across the country. The Bill also enhances the applicable penalties. The employer may now be punished for a failure to comply with duties to make payments due to employees with a fine of up to INR 50,000 (USD 705.33). For any other failure, employers may be fined up to INR 20,000 (USD 282.13).The Code on Wages is the first in the series of four labour codes (see 2. below) that the government is working on to rationalise its 44 labor laws and improve the ease of doing business in the country. 2.   Consolidated labour code clarifies the meaning of ‘contract labour’In a move to consolidate the laws on occupational safety and health, welfare facilities and working conditions in relation to employees and workers, the Code on Occupational Safety, Health and Working Conditions, 2019 (OSH Code) was introduced in the Lok Sabha on 23 July 2019. The proposed legislation seeks to replace 13 statutes, which are – Factories Act, 1948 (Factories Act); Contract Labour (Regulation and Abolition) Act, 1970 (CLRA); Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979 (ISMW Act); Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996 (BOCW Act); Mines Act, 1952 (Mines Act); Dock Workers (Safety, Health and Welfare) Act, 1986; Plantations Labour Act, 1951 (Plantations Labour Act); Working Journalists and Other Newspaper Employees (Conditions of Service) and Miscellaneous Provisions Act, 1955 (Working Journalists Act); Working Journalists (Fixation of Rates of Wages) Act, 1958; Motor Transport Workers Act, 1961 (Motor Workers Act); Sales Promotion Employees (Condition of Service) Act, 1976 (Sales Employees Act); Beedi and Cigar Workers (Conditions of Employment) Act, 1966 (Beedi Workers Act); and Cine Workers and Cinema Theatre Workers Act, 1981 (Cine Workers Act). Applicability. The OSH Code will apply to all establishments, meaning (a) a place where any industry, trade, business, manufacture or occupation is carried on and employing 10 or more workers, (b) a factory, motor transport undertaking, newspaper establishment, audio-video production, building and other construction work or plantation employing 10 or more workers, and (c) a mine or a dock. At present, the threshold for the applicability of the relevant laws varies from one or more employee to 20 or more employees.Definition of ‘contract labour’. The OSH Code defines the term 'contract labour' to mean a workman who has been hired by a contractor in or in connection with the work of an establishment. This is the existing definition under the CLRA, but the OSH goes on to exclude from its scope any worker who is regularly employed by the contractor for any activity of his / her establishment and the employment of such worker is governed by mutually accepted standards of the conditions of employment.This exclusion is intended to clarify the scope of 'contract labour' and would likely exclude the employees of outsourced service providers. This is in response to the number of obligations imposed on the principal employer in respect of contract labour by law, including ensuring the provision of amenities and payment of wages to such workers, making contributions towards employees' provident fund on behalf of such workers etc. Therefore, the principal employer will not be liable towards  contract workers who are employed by the contractor regularly to perform activities on behalf of the contractor’s business, but will have responsibility only towards those workers who are hired to perform work for the principal employer.Welfare facilities. The OSH Code imposes the responsibility of providing welfare facilities to the contract labour on the principal employer. This is a change from the current framework where such responsibility is placed on the contractor.Registration. An employer is not permitted to engage employees if its’ establishment is unregistered, or its registration has been cancelled. The OSH Code also provides for a common registration for an establishment instead of separate registrations under the current laws.Licensing. Under existing laws, the validity period of a ‘contractor’ license is prescribed under state-specific rules, which vary greatly. The OSH Code provides for a uniform validity period of 5 years. However, within the said period, if the contractor wishes to increase the number of contract workers, he will be required to apply for renewal of the license.Deemed employment. Under the OSH Code, it is expressly provided that where any establishment employs contract labour through a contractor who has not obtained a license, the contract labour engaged shall be deemed to be employed by the principal employer. The provision is not new but helps to clarify when contract labour will be deemed to be employed by the principal (see below for a recent case on the existing law). Inevitably it requires establishments to be thorough while exercising due diligence as regards the contractors engaged by them.The OSH Code covers many other aspects of employment law, and Khaitan & Co provide further details. The OSH Code is being debated in Parliament, but concerns have been raised about safety provisions in specific sectors and the discretion given to state parliaments to make detailed regulations. 3.  When are contract labourers deemed direct employees of the principal employer?A contract labourer is defined by the Contract Labour (Regulation and Abolition Act), 1970 as one who is hired in connection with the work of an establishment by a principal employer through a contractor. While a contractor is the supplier of contract labour for the organisation, a principal employer is the person responsible for the control of the establishment.In a recent ruling, Bharat Heavy Electricals Limited vs Mahendra Prasad Jakhmola & Ors (Civil Appeal No. 1799-1800 of 2019), the Supreme Court of India reiterated the basic tests to be applied in determining whether contract labourers can be classified as direct employees.Bharat Heavy Electronics Limited ("BHEL") entered into an agreement with a contractor to engage contract labourers in its factory at Haridwar in North India. BHEL terminated the employment of certain contract labourers, following which the contract labourers applied to the Labour Court at Haridwar, seeking reinstatement. The Labour Court ruled in favour of the contract labourers, basing its analysis on the fact that BHEL exercised supervision, superintendence and administrative control over them.In BHEL's appeal, the Uttarakhand High Court upheld the Labour Court's ruling, holding that as the contract labourers were performing duties identical with BHEL's regular employees, they were under the command, control and management of BHEL, and the contract with the contractor was a sham. BHEL appealed this decision to the Supreme Court.The Supreme Court stated that the tests for determining whether contract labourers are the direct employees of the principal employer are: (i) whether the principal employer pays the salary instead of the contractor; and (ii) whether the principal employer controls and supervises the work of the employee."The Supreme Court referred to the earlier case of International Airport Authority of India v. International Air Cargo Workers' Union ((2009) 13 SCC 374) in which the Supreme Court held that "If the contract is for supply of labour, necessarily, the labour supplied by the contractor will work under the directions, supervision and control of the principal employer but that would not make the worker a direct employee of the principal employer, if: (i) the salary is paid by a contractor; (ii) the right to regulate the employment is with the contractor; and (iii) the ultimate supervision and control lies with the contractor. The principal employer only controls and directs the work to be done by contract labour, when such labour is assigned to him. But it is the contractor as employer, who chooses whether the worker is to be assigned/ allotted to the principal employer or used otherwise. In short, a worker being the employee of the contractor, the ultimate supervision and control lies with the contractor as he decides where the employee will work and how long he will work and subject to what conditions. Only when the contractor assigns/sends the worker to work under the principal employer, the worker works under the supervision and control of the principal employer, but that is secondary control. The primary control is with the contractor."In the present case, the contract labourers were being paid salaries by the contractor, and not by BHEL. Further, the second test was not met as BHEL was merely exercising secondary control over the contract labourers. Therefore, the Supreme Court set aside the judgment of the Uttarakhand High Court and the Labour Court's award.This case serves as a useful reminder to principal employers of how the tests for deemed employment will be applied. The contract between the employer and the contractor should explicitly lay down the rights and obligations of the principal employer and the contractor. For instance, who shall pay the employed contract labourers and ensuring that the ultimate supervision and control over the contract labourers rests with the contractor. Japan Guidelines for dispatch workers equal pay issuedIn July 2019, Japan’s Ministry of Health, Labor and Welfare issued guidelines for calculating pay for temp workers under the ‘Equal Pay for Equal Work’ regulations which were passed in 2018 as part of the “Work Style Reform” legislation. The Ministry issued the new rules to labour bureaus across Japan, in preparation for the regulation to take effect in April 2020.Temporary or “dispatch” workers are limited to a three-year term for each individual worker. Wages are usually determined based on job type, duties and location. Under the Equal Pay for Equal Work regulations, staffing agencies must provide a certain level of compensation to dispatch workers or conclude a labour-management agreement (an “Article 36 Agreement” under the Labour Standards Act) covering the statutory requirements.The Ministry’s guidelines oblige companies to pay fair wages to temporary staff according to their skills. Under the assumption that skills improve over time, the Ministry set these wage standards according to how long the person is employed at the same workplace. It was reported that the guidelines called for pay for temps to rise by 16% after one year and 31.9% in the third year, compared with the worker's starting wage, but this is unconfirmed.Increases will apply to dispatch workers whose work/skill levels develop with experience. For those who continue to do the same level of work over the years, their hourly wage will remain the same. When workers are dispatched to a new workplace, the wage may be lower because each employer sets their own wages for their dispatch positions. Under these new guidelines, the starting wage at a new workplace must not be lower than the worker has been paid previously. Any increases should correspond to the permanent employees doing the same job.Although the guidelines are mandatory, there is, as yet, no penalty for not complying. There are a number of details that still need to be clarified. New Zealand New rights for labour hire employeesThe Employment Relations (Triangular Employment) Amendment Bill (“Triangular Employment Bill”) received Royal Assent on 27 June 2019, to be enacted in law in 12 months’ or earlier if another date is appointed by Order in Council.The Triangular Employment Bill provides 16 new clauses to be inserted into the Employment Relations Act 2000 (the Act) which recognises the position of employees who work under the direction of someone who is not their employer. This will include those engaged through labour-hire companies and “temp” agencies.The Employment Relations Act 2000 will be amended to introduce the concept of a “controlling third party”, being a person or organisation who: has a contract or other arrangement with an employer under which an employee of the employer performs work for the benefit of the person or organisation; and exercises, or is entitled to exercise, control or direction over the employee that is similar or substantially similar to the control or direction that an employer exercises, or is entitled to exercise, in relation to the employee. Both an employee and employer may now apply to the Employment Relations Authority or the Employment Court to join a controlling third party to a personal grievance proceeding. Where a controlling third party is to be joined to a proceeding, the Authority or Court must consider whether to direct the employer, employee, and controlling third party to use mediation to resolve the personal grievance.The Authority or Court may also require a controlling third party to contribute to any remedies awarded to an employee to the extent that the controlling third party has caused or contributed to the employee’s grievance. This includes reimbursement for lost wages and the payment of any compensation for hurt and humiliation and/or the loss of any benefit. Philippines President vetoes bills altering rules on contractingSenate Bill No. 1826 (SB 1826), or the bill on the Security of Tenure and End of Endo Act of 2018, which proposed several changes to the Labour Code’s provisions on employment relationships and contracting arrangements was vetoed by the President on 26 July 2019.SB 1826, and its equivalent proposed by the House of Representatives HB 6908, were the product of a concerted effort on the part of labour groups to put an end to certain unfair labour practices. In particular, the practice of “Endo” (end of contract) dismissals where employers terminate workers’ employment after five months to circumvent permanent employment status that is deemed to arise after six months employment with the same employer.Another popular proposal was to restrict further the practice of labour-only subcontracting, which is illegal in certain circumstances. The existing definition in Department Order 174 of 2017 (DO 174) prohibits labour-only subcontracting in two situations where:1)     The contractor does not have substantial capital or investment and the contractor’s employees are performing activities which are directly related to the main business operation of the principal; or2)     The contractor does not exercise control over the performance of the work of its employees.SB 1826 and HB 6908 proposed amending this by precluding businesses from engaging the services of contractors for activities directly related to their businesses as a stand-alone prohibition. The revised definition would have prohibited labour-only contracting where:1)     The contractor does not have substantial capital or investment; OR2)     The contractor’s employees are performing activities which are directly related to the main business operation of the principal; or3)     The contractor does not exercise control over the performance of the work of the employees recruited and placed.SB 1826 granted a power to determine whether an activity is “directly related to the main business operation of the principal” to the appropriate Industry Tripartite Council, or the Secretary of Labour and Employment (DOLE Secretary) in consultation with the National Tri-partite Industrial Peace Council (NTIPC). But, as SB 1826 did not provide any limitation or describe the standard for making such determination, the discretion given to these bodies in exercising the power was arguably very broad.These amendments to the existing law led to business bodies condemning the changes. However, this did not entirely explain the President’s veto as he had been a vocal advocate of the reforms.The practice of contracting out ‘jobs’ as opposed to labour is not prohibited, but job-contractors must be licensed. SB 1826 had also provided new requirements for licensing job-contractors. The job-contractor would have had to prove that:1)       It is an expert or specialist in the work contracted out, by demonstrating that it employs the necessary competent professionals or skilled workers or that it has a proven track record in its’ field of specialisation;2)       It has the financial capacity to carry on its contracting business based on relevant factors such as the number of its employees and the nature of its business;3)       It has the tools and equipment which are reasonably necessary to perform the job contracted out, as opposed to the current requirement of a mere general provision of tools and equipment.Despite the President’s veto, these issues have not gone away and both sides, representing labour and business, remain polarised. So, it seems unlikely that this will be the end of the matter, but for now, the definition of labour-only subcontracting remains unchanged, and the practice of “endo” continues. Herbert Smith Freehills clarifies the criteria for compliance with the law on contracting in Department Order 174 of 2017 (DO 174) which continues to be enforced by the Philippines Department of Labour and Employment (DOLE). South Korea Fair Hiring Procedures Act extended to the private sectorOn 17 July 2019, amendments to the Fair Hiring Practice Act (“FHPA” also known as the "Blind Hiring Act") introduced new restrictions on hiring practices for private sector employers with 30 or more full-time employees.The amendments prohibit such employers from engaging in improper solicitation, coercion, or pressure in connection with hiring decisions and prohibit offering or accepting any gift, entertainment, or other thing of pecuniary value in connection with any hiring decision. The Improper Solicitation and Graft Act already prohibits improper solicitation and illegal acceptance of money, goods, or services, in connection with hiring or otherwise. However, it only applies to government officials, and certain private-sector workers who are deemed quasi-public, for example, teachers and journalists. Until now, there has been no law generally prohibiting private companies from engaging in corrupt hiring practices.First-time offenders who violate the prohibition on corrupt hiring practices are subject to an administrative fine of up to KRW 15 million (USD 12,458) and repeat offenders may be subject to a fine of up to KRW 30 million (USD 24,916).The amendments also prohibit such employers from requesting personal information from job applicants if such information is unrelated to the performance of the role which the applicant is expected to perform. For example, employers may not request details of the applicant's height, weight, hometown, assets, family members, or marital status, unless such information is necessary for business purposes. Also, the employer cannot request or compel applicants to provide supporting documents containing such information.First-time offenders who violate these new prohibitions are subject to an administrative fine of up to KRW 3 million (USD 2,491), second-time offenders are subject to a fine of up to KRW 4 million (USD 3,322), and repeat offenders are subject to a fine of up to KRW 5 million (USD 4,152).Employers should review their hiring processes and provide training and guidelines for existing employees involved in the hiring process to ensure compliance with the new FHPA requirements.Legal Disclaimer: This update is provided solely for the purposes of information and should not be considered legal advice. It is always recommended to seek the advice of qualified legal counsel before taking action. […]

  • Engineering Growth Assessment Globally

    Global engineering staffing generated $34 billion in revenue in 2018, based on SIA estimates, representing 16% of the total global professional staffing market. Europe accounts for approximately 44% of global revenue while a third of engineering staffing is derived from the US, where we forecast revenue to grow a 4% in 2019 and 3% 2020 to match our projections for the global engineering staffing market. Despite the stable growth forecast, a host of underlying trends are shifting in a market that has become increasingly complexSector demand remains strong and is underpinned by secular trends including the expansion and cross-pollination of engineering skillsets spurred by the growth of new technology, the fierce competition for a narrowing pool of talent and the increasing attractiveness of the flexible staffing model for engineering projects. Bill rate growth is accelerating as a result of the shortage of engineering workersIn many respects, as we look ahead, 2020 can be expected to offer more of the same demand drivers: rapid technological change, candidate shortages, greater adoption of the digital processes that are reshaping engineering and, quite possibly, greater political and economic uncertainty.The 5 sections of this 49 page report further explore dynamics in engineering staffing and workforce solutions, to inform industry stakeholders and support their strategic planning initiatives.To download the complete report, please click the link below: EngineeringGrowthAssessmentGlobally 20191010 - You do not have permission to view this object. […]

  • Trends in Digital Credentialing

    There is a strong need for those who have to source and hire talent to efficiently identify and credential candidates in order to quickly and safely fill open positions. Companies such as Recruit, Workday, Kelly Services and PwC have been actively investing in blockchain-based credentialing technology development and/or partnering with blockchain companies. Some of them are working on enabling blockchain-based resume databases. Quite a few technology start-ups are developing credentialing solutions that use blockchain to facilitate credential verification and access, while having consumers store and own their verified credentials. Blockchain enthusiasts, start-ups and tech giants such as Microsoft, IBM, and other vertical industry leaders are trying to create an open, interoperable digital identity ecosystem.• Although blockchain has been widely perceived as immutable, secure and private, it does have inherent security risks and limitations with regards to privacy protection. For readers new to blockchain, a Blockchain 101 is provided in the Appendix of this report and we recommend you read this before reading the rest of the report. To download this report please click below: Trends in Digital Credentialing 20191009 - You do not have permission to view this object. […]

  • Directory of Suppliers to Staffing Firms 2019 - October Update

    The Directory provides a comprehensive range of solutions and services that staffing firms may require to operate their businesses more efficiently and  effectively. 24 different categories ranging from advisors & consultants to payroll funding and back office technologies. Over 1,100 vendors spanning over 60 countries globally. New to this update the addition of the Recruitment Marketplaces category.   To download the complete report, please select the following link:  Directory of Suppliers to Staffing Firms 2019 - October Update - You do not have permission to view this object. […]