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Help Your Clients Avoid Employee Misclassification Risk

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Employment AgreementMisclassifying employees as independent contractors is a very tempting proposition during difficult economic times.

After all, companies can get out of payroll taxes, unemployment, workers’ compensation, paid sick time, vacation and health insurance.  Companies can save substantial amounts of money that can instead be allocated towards other important business needs.

This is probably why the IRS is cracking down on this practice.

Misclassification is not a good idea at all, as it can land companies in a world of trouble with the IRS.  And this is true whether the misclassification was intentional or unintentional.

Recruiting or staffing agencies can ensure their clients stay on the right side of the law in this matter by employing some of the tests the IRS uses to evaluate if workers are functioning as employees.  These tests are designed in part to examine behavioral and functional control, which means they assess whether a company has the right to direct and control an employee’s work and the financial and business aspects of his or her job.  In addition, they will also take a look at the type of relationship a company has with workers, and whether that tends to describe an employee/employer relationship.

Some examples of what is evaluated include:

·         How the business pays the worker

·         The extent to which the worker can realize a profit or incur a loss

·         Whether the business provides the worker with employee-type benefits

Dependent on the outcome of these tests, one option companies can employ to avoid misclassification risk is the development of a contract for temporary employees.  In a general sense, this contract would be designed to limit the control a company has over the worker, while also spelling out the agreed-upon responsibilities of each party.

Other strategies that can help avoid misclassification include labeling any work as a project that can be completed at any time by the contractor, requiring invoices from the contractor for all services, and structuring the contract between the contractor’s business entity (if applicable) and companies.  But again – this is all dependent on the outcomes of tests offered by the IRS.

What will always ring true is that each employment situation is unique with its own challenges and complexities.  And your clients will always look to you as an expert in all employment matters.  This means there will be a certain expectation with your clients that you will be the one that helps to prevent them from any trouble with the IRS.

While some of the options I offer above can be taken into account when consulting your clients, note that employment guidelines can change rapidly.  In other words, the advice you can take from a static post in a dynamic world is this – always stay up to date on the changes – and when the IRS is involved never offer advice today based on what you knew to be right yesterday.

To learn more about how staffing software by Bond US can help ensure your staffing agencies processes remain efficient, in the face of ever-changing employment guidelines, request a free demo.

How Not to Manage a Staffing Agency

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Sometimes, the best lessons in life are learned by viewing the example of others.  And sometimes, the example provided by others – from a refusal to admit your mistakes to focusing too heavily on office politics to is a great example of what not to do.  Unfortunately, a staffing agency in Stockholm, Sweden has provided an atrocious example of how not to manage relationships internal or external to your company.

What Happened?

An unnamed Swedish staffing firm and a union were involved in an ongoing dispute.  Both were locked in heated discussions over very serious allegations against the firm –invalid layoffs, salary disputes, and worker pay and holiday leave cuts.  To his great surprise, the union leader was attacked and severely harmed by six gang members, forced at knifepoint to call the staffing company and retract all union demands, and the attackers also demanded €60,000 from the leader himself.  The most outrageous part of the story lies in the fact that Swedish newspapers refused to publish the name of the staffing agency, even though the leader of the criminal gang that carried out the mafia-style attack is biologically related to the owner of the agency!

Lessons Learned

As you can see, this outrageous example shows you several lessons of how not to behave when managing a staffing agency or any type of company.  Here are some I noticed:

  • If you don’t like what someone else is doing, don’t resort to childish and violent behavior.  With the exception of the moron in charge of the staffing agency and a handful of other nincompoops (we all have at least one in our social circles), most people have sense enough to not react in such extreme ways when someone else is doing something they don’t like.  If one of your employees is doing something you don’t like, don’t immediately react with anger.  Sit down and have a conversation about what is happening, reach a resolution, and move on – like adults.
  • Idiotic and immature behavior always has consequences.  Sure, using violence, this guy got the union representative to retract his demands, but it was hardly a victory.  Such use of physical force isn’t the only way to bully people in order to get what you want. If you emotionally or psychologically bully employees at your workplace, they will only respect you to your face – and some may not even do that.

Guess what?  The minute employees who feel bullied find another job, they’re going somewhere else.  You know how costly it is to recruit and train new employees – that’s more costly than hiring someone and holding on to them a while.  The lowlife running this staffing agency received the short-term result he wanted, but now he risks going to prison for several years and losing his business.

  • Admit where you were wrong and be willing to respectfully disagree.  The jerk who ran this company committed overtly wrong acts in the past, but then he never went to right them.  Instead, he tried to get everything his way, until he went way too far.

You have sense enough not to hire thugs to intimidate or bully people.  But, you might be like many others who get caught up in emotional battles and aren’t willing to give in just a little bit.  If you are in a contentious agency battle, admit where you made mistakes in the past, allow the other party to have its own views, and come to a reasonable compromise that makes everyone happy.

By handling tough situations in an upstanding, rather than selfish way, you and everyone impacted by your staffing agency you will win long-term.  The most important thing is to learn and grow as best you can with each experience.

To learn more about how staffing software by Bond US can help you run your agency the right way, request a free demo.

Using Staffing Software To Find Specialized Candidates

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You may be one of those staffing firms that specializes its recruiting efforts exclusively in one industry, such as healthcare, accounting, or manufacturing.  While staffing software assists you no matter which industry you serve, keep in mind it can also provide you with specialized help for specialized fields.  Using software to sort through all that candidate big data helps you zone in on very select market segments, and amplifying your results.

How exactly does the right staffing software help?

1. Laser targeting of miniscule market segments.  The job market isn’t the greatest right now, and no matter who is elected to be our next president, odds are our economic problems will take years yet to fix.  If you have a large amount of data available, the right staffing software can help you to laser target nearly any micro targeted niche of candidates.

If you take a macro approach to hiring, you are going to have a difficult time producing results for your clients and your own business.  If you can find success in several micro niches other firms have overlooked, you can be successful, even in this economy.  An upward trend in temporary and contingent staffing has helped other staffing agencies to actually experienced growth since the economic collapse of 2008 – and it’s possible for yours to grow, too.

3. Future market conditions will remain challenging.  The near future will stay challenging because of the current economic conditions, but so will the long-term future.  Did you forget about the baby-boomers?  The current generations getting ready to take their place simply do not have enough numbers to replace all of the baby boomers, and in many sectors, the next generations also aren’t yet experienced enough.

You will have candidates from which to choose, but the challenge will be selecting the right candidate who can do the job.  Fortunately, increasing amounts of data will become available, so if you have the right staffing software in place and the skills to use it, you will be in a better position for long-term success than firms who can’t change along with market conditions.

4. Companies are exploring new talent pools, so help them.  Telecommuting is becoming increasingly easy for knowledge workers.  An eased telecommuting process breaks staffing agencies free of geographical barriers and entering into a larger pool of candidates from which to choose.  Because it can cost nearly the same as an employee’s annual salary to replace that employee, your firm can become a strong player in the market by having the highest success rate of matching qualified candidates to positions fitting their skills well.  However, that does mean you will have to know how to use software to find those needle-in-a-haystack candidates.

Your staffing agency can succeed in any market.  The challenge lies in successfully locating job seekers other firms can’t find and successfully matching them to the right jobs.

To learn more about staffing software by Bond US, request a free demo.

What Staffing Metrics Should Your Agency Focus On?

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Finding the right metrics to focus on in your staffing agency can be quite challenging. Which metrics are the most important and why could be a subject of debate for hours without end.  To complicate the situation, if you adjust your processes or goals based off tracking the wrong staffing metrics, you could end up driving your agency into unfamiliar, alarming and/or potentially hazardous territory.

Without a doubt, some metrics are better than others at providing your agency with big candidate data from which to base more effective decisions.  Let’s explore some of those and why they are more important than others.

Which Staffing Metrics Are Most Important?

Some of the more common metrics analyzed by the typical staffing agency include time-to-fill and cost-per-hire.  These metrics are great for measuring short-term performance.  And, short-term performance is definitely important.  But what about the long-term?  If your agency purely focuses on placing the first candidate with the required qualifications, is that truly a foundation for long-term success?

You might have some initial success and an incredible placement rate, which makes you look good now, but you may lose client companies because your turnover rate stinks!  As such, it’s also critical to track turnover rates to see how well you are actually matching candidates to positions and companies in which they will be successful.

Length of time in a position can indicate a good fit, but some other important metrics you might also want to track to determine the quality of the hiring process at your staffing agency are production and manager satisfaction.  By measuring the employee’s production as compared to his or her peer group, you will have a good idea as to how his or her skills will fit that position.  Manager satisfaction with the employee contains a fair amount of subjective judgment and may or may not reflect the candidate’s performance accurately, but it does provide a good measurement of culture fit.

When You Focus on Long-Term Staffing Success, You Transform Your Agency

Focusing on those short-term metrics has its place when analyzing your company performance, but if you also take the time to focus on long-term metrics, you will take your staffing agency a step above all the rest.  The more tightly an employee’s skills and personality fit a company and its culture over the long haul, the higher the employee’s performance.  The better the employee performs, the better the company performs, and the more business your agency earns by developing a great reputation.

Don’t follow the herd and measure what everyone else does – take a risk by trying something different.  You won’t be disappointed by the results.

To learn more about how staffing software by Bond US can help you effectively track the staffing metrics that most contribute to the success of your agency, request a free demo.

Big Data Wave Failing To Surface Analysts For Recruiting & Staffing Agencies

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You probably already have a good idea that the amount of candidate information available to your recruiting or staffing agency is growing rapidly.  But the real question is:  who is going to analyze this ‘candidate big data’ and organize it into sensible patterns you can understand?

Unfortunately, while the demand for qualified analysts continues to rise, the talent pools from which your agency is able to find these talented individuals is not seeing corresponding growth.  Business consulting firm McKinsey estimates that by 2018, the United States will have a shortage of between 140,000 and 190,000 people needed to analyze the growing amounts of information.

And in the meantime, candidate big data – and the corresponding risk that you miss placing an ideal candidate with one of your top clients – continues to grow.  So how can you best overcome the odds to find the right data analyst for your agency?

First, you will need to identify whether or not your local talent pool is up to snuff.  And if not, let’s face it, you are just going to have to get creative.  Rather than focusing purely locally, you’ll need to expand your reach into national markets where there is more aggregate talent available.  A few of the current ones include St. Joseph (Missouri), El Paso and Tucson.  Next, you will need to determine whether you are comfortable bringing these employees on remotely (which may involve time zone challenges) – or paying a premium in salary and relocation fees.

Of course, another option is to look for candidates that are more entry level – and more commonly found in most markets.  Just because these candidates don’t have the immediate skills you want right out of the box doesn’t mean they won’t be successful in the job.  Many companies look for skills and experience, only to get burned by someone just looking to get a paycheck.  If you start with motivation and a willingness to learn, you might land on some stronger candidates.

Finally, the last option – which can tie into both of the options above – is to lure candidates away from other companies.  It is here that the staffing and recruiting software you use to fill your client needs can be used to meet the needs of your own agency.  Your recruiting software can help you evaluate the candidates available in your market by helping you more easily search for those that may have reached out to your agency in the past – or those that are describing their skill set with a targeted set of keywords in social networks such as LinkedIn (ie, ‘staffing,’ ‘data,’ ‘analysis,’ etc.)

Big candidate data is essential to your agency’s survival – as is having the team members in place that can help you interpret it accurately.  If you aren’t where you need to be in terms of getting the right team members in place – your agency is not alone – meaning the time for worry is not today.  Today is the time to use the tools you have at your disposal, to think outside the box – and more importantly – to think outside your neighborhood – to find the right analysts that will help you turn candidate big data into the actionable metrics that will help your agency grow.

To learn more about how recruiting and staffing software from Bond US can help your agency achieve its recruiting goals, request a demo.

Facebook Timeline Changes: What Your Staffing or Recruiting Agency Needs To Know

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Just when you thought you had your staffing agency’s Facebook page in perfect order, they went and made you change it.

Whether you are a staffing or recruiting agency, a staffing software or services provider – or any type of firm in between – your company’s Facebook page has likely been upgraded to the new Timeline format.  And you are somewhere on the spectrum of ‘loving’ and ‘adjusting.’

Regardless of where you find yourself, there are some basic truths that are constant:

 

  1. Change is inevitable, especially in social media
  2. With the opportunity that comes with change comes the opportunity for mistake
  3. Social media – and Facebook – remain one of the strongest tools in your staffing arsenal

So how can you ensure you continue to use this tool effectively, maximizing new opportunities and minimizing the type of mistakes that will earn either derision from social-savvy prospects or a firm slap on the wrist from Facebook?

Start by referencing our list of Facebook Timeline mistakes to avoid and opportunities to take advantage of below:

Facebook Timeline Mistakes to Avoid

1. Wrong Size Cover Photo
From now on, you’re limited to one large banner photo across the top of your page.  So you need to consider what type of image best communicates your recruiting or staffing agency’s brand message.

The photo can be a graphic or an actual photograph – as long as it is sized 851 x 315 pixels.  Any other sized image will simply look ‘off.’  For your image, you may want to show a location beauty shot of your firm’s exterior or even repurpose branding elements from your website, as we do on the Bond International Software Facebook page.

 

 

 

 

 

 

 

 

 

2. Wrong Size Profile Photo
Every time you post, you staffing agency or recruiting firm profile picture will appear with your updates, so it’s important to find an image that will still maintain quality in a smaller size — 180 pixels that will scale down automatically to a length and width size of 32 pixels.*

To avoid viewing problems with the smaller size and to give your company instant recognition, consider using your logo as your profile image.

(*Update – per an email I received from Facebook today, the new profile picture will be 160 x 160 pixels and will sit at 23 pixels from the left and 210 pixels from the top of the Page, starting April 26th.)

3. Adding a CTA to Your Cover Photo
Facebook does not allow a call to action on either your cover or profile photo.  Call to actions include but are certainly not limited to:

  • Contact information
  • Price or purchase information
  • Asks for ‘Likes’ or ‘Shares’

Instead, showcase your brand in a way that makes it hard for visitors to resist liking you or being moved to action. See a great example of this below:

 

 

 

 

 

 

 

Facebook Timeline Opportunities:

1. Take Advantage of Content Display Improvements
The Facebook team constantly refers to the site as a story-telling channel.  With expandable photos that can span across your Timeline with just a click, visitors can get a strong visual sense of your company’s unique story.

Complement those stirring images with the compelling and relevant content you’re already featuring and you’ll provide a powerful reason for fans to visit often.

2. Share Company Milestones
Another interesting add-on to the business Timeline is the Milestones feature.  This allows you to showcase the history of your company by posting important events that have occurred over time and to provide your visitors with a multi-pronged illustration of your firm’s effectiveness in placing candidates over the years.

And don’t limit yourself to milestones that have only occurred since Facebook was launched.  Remember, it all starts with the Model T:

 

 

 

 

 

 

 

 

 

 

 

 

To learn more about how your recruiting or staffing agency can best take advantage of the new Facebook Timeline updates, and how our social media enabled recruiting and staffing software can help you integrate candidate information from social profiles, contact us or register for a free demo.

Facebook Snooping: Steer Your Staffing Agency Clear Of the Stupidity

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As CMO for a large staffing software company, I am fully aware of the need to vet job prospects.  No company is going to the last stages of interviewing without background checks and personality tests.  But requiring candidates to turn over their Facebook passwords? Absolutely over the line – for a number of reasons:

1.    Employers and staffing agencies alike will be flirting with discrimination lawsuits. 
While everyone is in an uproar about having to share personal information with potential employers in the form of photos, updates and friends, both employers and staffing agencies need to realize that other information on people’s profiles put them in a protected anti-discrimination class, such as race, gender, age and religion.

If a candidate makes it down to the wire of the interview process and then doesn’t get the job after sharing Facebook information, they’d have the makings of a discrimination suit.  Who’s to say that candidate didn’t get hired – not because of their photos or friends – but because of their religion?

2.    There must be a separation between private and public. 
It’s just plain wrong for corporations to require a look at an applicant’s personal Facebook page, regardless if it involves asking for their password or looking over their shoulder.  Just as with the separation of “church and state,” there needs to be a similar division between “public and private” in any democratic society.

Employer’s do have the right to determine if an individual will be suited to the corporate culture, and in the case of governmental agencies, to fit the personnel restrictions for prisons or law enforcement (i.e., no gang affiliations, etc.), but they do not have the right to snoop through a person’s personal, private information.  That’s akin to opening a job prospect’s mail.

3.    Facebook forbids the practice. 
Amidst all the fuss over this topic, Facebook came out with a statement establishing their position.  “As a user, you shouldn’t be forced to share your private information and communications just to get a job. And as the friend of a user, you shouldn’t have to worry that your private information or communications will be revealed to someone you don’t know and didn’t intend to share with just because that user is looking for a job. That’s why we’ve made it a violation of Facebook’s Statement of Rights and Responsibilities to share or solicit a Facebook password.”

It’s important to note that not only does the network believe its bad internet protocol to share passwords; it’s also a huge security risk.

4.    Facebook snooping may soon be illegal.
Not surprisingly, the noise surrounding Facebook snooping has generated interest in the legislative arena, as well.  Just last week Rep. Chuck Schumer from New York and Richard Blumenthal from Connecticut called for investigations into the matter by the Justice Department and the U.S. Equal Opportunity Employment Commission.

The investigation will explore whether this practice violates the Stored Communications Act or the Computer Fraud and Abuse Act. Both acts prohibit intentional access to electronic information and computer access without authorization.

Schumer summed up his concern by saying, “In an age where more and more of our personal information — and our private social interactions — are online, it is vital that all individuals be allowed to determine for themselves what personal information they want to make public and protect personal information from their would-be employers. This is especially important during the job-seeking process, when all the power is on one side of the fence.”

Ultimate, any employer, recruiter or staffing agency that engages in this dangerous behavior is putting itself in a negative position when it comes to future hiring – because honestly – the best candidates won’t put up with this kind of nonsense.

I’m interested to know how other staffing or recruiting professionals feel about this topic.  Please feel free to share your opinion via a comment below.