Canada: Navigating The New Normal: Brexit, IR35, And Recruiting In A Pandemic

It's safe to say that 2020 has been a year like no other. Businesses across the country have been subject to an onslaught of new employment legislation, uncertainty due to Brexit, and all the issues that come with operating in constantly evolving markets.

And that's without the global impact of the COVID-19 pandemic.

This webinar was held in partnership with Advantage Group UK, outlining how you can approach the issues currently being faced by businesses across the UK. The webinar covers the new IR35 legislation coming into effect next year, the effects of Brexit and how best to address its impact, to recruiting your workforce during a pandemic and minimising employee risk in your workplace once we return to the 'new normal' - whenever that might be.

Transcript

David Woakes: Right, good morning everybody. I am David Woakes from the Advantage Group. We may still have a few more people joining in throughout but we will carry on now so we can get underway with what I think is going to be a really interesting webinar this morning which we have titled 'Navigating the New Normal'. Four very interesting topics which are going to be presented from our partners Gowlings this morning so we will have some real experts there to give you some guidance and some information that you will hopefully find useful.

Very quickly and just to give you an overview of the Advantage Group for those that may well not know us in their entirety. They may well know more the Crone Corkill business which is represented in the graph on the left-hand side. Then certainly the Advantage Group itself is divided into two more operating units; Advantage Resourcing, our mainstream recruitment business and also the XPO operation, which is our managed service provider and on the left hand side you can see a little bit of background on ourselves. We have around about 200 people working across the UK and particularly relevant for the IR35 section today over 4,000 contractors/temps that we engage with on a week by week basis. Lucy if you could move it onto the next slide please. The core services of our business, as I say, is around recruitment so most people will know either Advantage Resourcing or Crone Corkill and our divisions there and really what we are about is providing these four core elements of solutions to each of our clients.

Key today is around what is going on in consultancy and working with you to hopefully provide services which can improve your business and the recruitment process as well as ongoing recruitment needs but also to talk to you about key issues such as IR35 open to all of these so I will finish off at the end with contact details and just a couple of extra pieces. Lucy again if you would move on.

Here is the agenda for today. These are, as I say, our partners that are going to be going through these interesting topics. Brexit again very much at the forefront of our interest factors right now, IR35 again is going to be very very live bearing in mind that this comes into effect as of April next year. Recruiting in a pandemic from Vivienne I think is going to be very interesting. We have all had to get used to this and now starting to move forward that way and then also understanding how you can work with your employees is going to be a crucial factor as we move forward with what we are defining the new normal. So, I am going to pass you straight over to Martin who will go through the information on Brexit. Thanks very much, over to you Martin.

Martin Chitty: Good afternoon everybody and thanks very much for allowing us to join your webinar with Advantage today. Lucy is going to put up the topics that I am going to talk about so there is basically four things I am going to talk about in the next ten minutes or so. The first of these is where are we as from 1 January in relation to the matter of EU law which we currently have and there is lots of it, particularly in the employment field as you will know.

The second thing is what might change. This is speculative; some of it may never happen, one or two things might. There are two other things I want to touch on very briefly; one is about immigration as well, although we as a firm do not provide immigration advice so this is very top of the wave stuff and the last thing, not strictly to do with Brexit but it is certainly in the offering for next year, is an announcement made by the government at the end of last week around consultation on exclusivity. That is in terms of zero hours contracts and the like and the reform of restrictive covenants which for any of you who have customers and want to protect those customer bases and your own staff of course that is of some significant interest.

Let us start with the first of those things which is where are we going to be on 1 January. Well whether we like it or we do not like the fact that the UK is leaving in the EU, as far as employment law is concerned 1 January is not going to be very big news at all. That may come as a relief or indeed as a shock to some people. Why is that? All of the current EU derived law so; equalities law, lots and lots of our family friendly policies working time, effective consultation, agency workers, all of the things I mention further down remain exactly as they are at the moment and that is because the Withdrawal Bill does exactly that, it imports all of that law as it stands into English law and that is where it sits.

We will continue to need to interpret those provisions in accordance with the decisions of the European Court from time to time so not only the current ones but ones that come in the future as well. The UK Government will be able to introduce legislation which departs from that EU law and that may happen although there is no signs of it at the moment. The Government, at this point, have been very clear that they are going to ensure the current workers' rights stay as they are. So we will have to wait and see what happens.

The UK Courts will have some right but only at an appellant level so Court of Appeal and the Supreme Court to depart from previous CJEU European Court decisions and employment law cases but it is a very narrow right that they will acquire and any new law which the Government does introduce will have to be implemented in a manner consistent with pre-existing EU rights where those arise. So no change here, why are we worried? Well in the short term there is not a lot to worry about but it is something which the Government will definitely look at from a political perspective. How might that impact on the issues I have raised, all of which are fundamentally provisions which originate within EU law and our implementation of those provisions. I think initially, certainly after the referendum, we spent some happy hours speculating on how things might change. I think the feeling is there is some low hanging fruit and indeed there might be some changes which would actually be helpful, certainly to employers, possibly less so employees.

In no particular order as they like to say on Strictly, let us look at what might happen. Agency workers and the need to treat them consistently with permanent workers doing the same work is entirely EU derived. It is possible that that will get changed, I can see that being higher up in the Government's shopping list than some other things. They may not be entitled, for instance, going forward to complete parity of treatment but there is no stated policy objective from the Government's point of view. As you will know our obligations to consult collectively over mass redundancies, so more than 20 people over a 90 day period, that derives from EU law. That has already been reduced in the sense that for larger numbers of people the consultation period has been brought down to 45 days from 90 where it once stood. It could be that the Government will abandon that completely, although personally I think it is unlikely. I think that is so embedded in industrial relations these days that it is unlikely to be abandoned completely but it may be that it only applies in relation to what we might regard as common redundancy, so job losses rather than the more peripheral issues where it does arise in relation to the mass change of terms and conditions and dismissal and reengagement, but that is one to look at if and when the Government put any amending legislation forward.

It is highly unlikely that TUPE will be overturned, although TUPE is fundamentally an EU obligation. One part of it of course is service provision change which does not arise because of anything the EU required us to do, we made that one up all on our own in order to make it actually workable in the UK to deal with outsourcing.

The problem with TUPE for many years has been that it is very difficult to amend terms and conditions post a transfer so harmonisation is effectively precluded and it can become very cumbersome. You have different parts of the workforce on different terms, it can create inequalities of treatment where they would not otherwise exist and it is possible, and I suspect attractive to the Government, to try and give more flexibility for employers in that area so I can see that happening ahead of some other issues.

Discrimination law for those of you with longer memories you will recall that at one time discrimination claims were capped which they certainly are not these days and that is because the EU told us we could not do that. It is possible given that unfair dismissal is capped and that is the most common primary remedy in most cases that discrimination claims will be capped at the same level which is a year's pay or about £88,000 whichever is the lower so that is a possibility, although again the Government has not broken cover on that to this point.

The Working Time Regulations when they first came in 20 odd years ago were seen as being very difficult and likely to cause industrial chaos. Personally, I do not think that has ever happened that was a slightly hysterical position to adopt at the time. It is possible that some changes might be made in relation to holiday accrual or the payment of holiday pay what is included within holiday pay that has caused and is the most litigated area in all of this. There might be some revision in relation to workforce agreements, for instance, as between employers and collectively organised workforces. Again it is possible, but I think highly unlikely, that the raft of family friendly rights which have grown up over the last 25 years will be attacked. The issue with those rights is they are overly complicated and difficult for people even who spend all their time reading them actually to make any sense of them. So some simplification would be a great step forward and I think a repeal or massive revision of them is extremely unlikely.

Now I said I would talk very briefly as a third topic about immigration. What is clear, although the landscape is still evolving, is that immigration is going to become more difficult. That is going to impact substantially on some sectors of the economy, certainly the care sector, certainly the hospitality sector. There is going to be a points based system which many of you will have started to read up on which still is not thoroughly clear speaking to our immigration experts and I will come back to them in a moment. There are threshold in terms of pay levels in relation to different sorts of work. So It is going to become much more restricted and the position for those coming from European economic area countries so largely the EU and some others will be more difficult than it has been and will reflect more closely the position we have had from non-EU countries historically. I think there is a substantial risk that the Government has underestimated just how difficult that is going to make business for some organisations and some of you perhaps on this call. I know speaking to some of our clients who operate in the care sector for instance, they have a significant proportion of their employees coming from other EU countries.

I think as a proportion of workers overall, I think some figures are suggesting that it is as high as 8% for the entire workforce. I do not know whether that is entirely right, I think statistics are open to interpretation in that respect but it is not without its challenges, whatever the merits of a change in immigration policy might be and I will not comment further on that at the moment. As I say, we do not as an organisation deal with immigration work for individuals or corporates ourselves. We work very close with a niche firm called ASG Visa if you would like to contact them about any of that they will be able to help with you.

So my last point is about the Stop Press item which came out on Thursday of last week which is another round of Government consultation. The question of the zero hours contracts has been quite vexed because as you know there are further discussions about limits on exclusivity in contacts generally, not just zero hours contracts. It would be interesting, the current suggestion is that it would apply where people were not working more than a minimum number of hours a week. There is some discussion about whether that should be 12 or 16 so in effect if you have a part time job with someone you cannot be prevented from working part time for someone else. I do not think necessarily the law needs to change in order to bring that into effect. I cannot see that such clauses are readily enforceable unless you present an obvious threat in terms of confidentiality and the disclosure of information to your other employer.

Last but not least is the prospective reform of restrictive covenants. The Government had a look at this a few years ago and then took a big step backwards when they realised just how complicated it was. The premise seems to be at this stage the restrictive covenants so stopping people leaving you going to the opposition and then poaching your staff and customers is actually fundamentally a bad thing and inhibits changing innovation and the growth of new businesses. That is fine if you are a new business trying to pick off staff and gain a position in the market but a thoroughly bad thing if your business needs protection from rather aggressive competitors. The Government is having a look at this whether they actually are inclined to follow it through, I do not know and how they might do it. They might do it I suppose by thinking about having some absolute restrictions in terms of it cannot be for more than one year and it has got to be defined in these ways so it becomes something a creature of statute by definition is imported. They might do it and follow the American model where if you want to restrict someone you have to pay them so effectively you buy them out of the market for a period of time.

That, in our context and our system, is something which the Courts have never accepted and is contrary to policy on all sorts of issues. Now, as I say, it is a consultation process. Doubtless we will all contribute and certainly we as an organisation will, you may have a view too either as an individually or through trade organisations and I would encourage you to participate, otherwise we are all in danger of getting what we are given. As a slightly cynical conclusion, I would say that all governments, not just this one, are particularly prone to consulting and then doing exactly what they intended to do all along and on that rather depressing note I am going to hand over to Zoe.

Zoe Fatchen: Thanks very much Martin. IR35 is certainly an area on which there has been a lot of consultation but the final form, or as far as we are concerned, the final form of the legislation has been available for at least the last year and we are now well into the year's delay in terms of its implementation. So, as you may remember, IR35 was originally due to come into force on 6 April this year but it has been delayed by 12 months partly due to COVID but also to give businesses more time to get ready.

Just quickly then, as a reminder when does IR35 apply? Well it applies when work is being provided by an individual who is acting through a personal service company or some other sort of individual. So we are talking about contractors who are not employees of any other business. So they are not employed by the contractor or subcontractor entity so that they have full tax deductions and payments made in relation to their income tax and national insurance liabilities.

They are not provided by an agency which employs them and deducts the PAYE, they are acting on a self-employed basis. Equally though, they are not contracting directly with the business for whom they are providing their services instead there are some other sort of intermediary in the way. Personal service companies are by far the most common and the ones that you will see the most written about but there can be all sorts of other intermediaries; it could be a large company, it could be a partnership, it could be an LLP and there can also be chains of provisions with other intermediaries.

So you might have an agency introducing a personal service company through which an individual's services are provided. Those are the kinds of arrangements which are potentially subject to IR35 and in carrying out the IR35 assessment we have to consider what is the nature of the relationship between the individual and the business in which that individual is working?  Does that relationship look very similar to an employer/employee type relationship and there are effectively nine different tests that we look at when working out whether or not that is the case. So there is no single solution. There is not an easy checklist to apply. It is a very holistic approach so we look not just at the contracts but also all the surrounding circumstances and the way that that contract works in practice. Okay next slide please.

So what is the proposal, what is changing? Well IR35 has been around for a long time and up until now in the private sector if there was an IR35 assessment it was the intermediary which was required to account for additional tax. But under the proposals, which are due to come into force from 6 April next year, it is the end client or the hirer, so the business in which that individual's services are being provided, which must as a matter of statute carry out an analysis to work out whether or not that person's arrangements fall within the scope of IR35 and then to issue a status determination to that effect to each contractor.

So that means if you have one contract with a supplier who is supplying the services of 20 workers who are all doing the same thing you have to supply a copy of the status determination in respect of each of those 20 workers. Now, if they are all operating under the same contract and doing the same thing, you would expect that it would just be a proforma and all that you would do would be to change the names associated with those.

If you have 20 people who are doing a very different thing and performing those services in different ways over different periods of time, you might find that some of those are inside IR35 and some of those are outside but you have to do a status determination for all of them whether or not the conclusion is that they fall inside IR35. It is really important for the ones you think are outside of IR35 because if the Revenue are ever to disagree with you, you have a really good paper trail explaining the reasons why you think they fall outside IR35 and that can help both in terms of rebutting an enquiry and also if that enquiry results in a tax liability mitigating or eliminating any potential penalties that HMRC might wish to charge.

That status determination must say whether that arrangement falls within or outside IR35, why that is the case, taking reasonable care to look at the different factors and then setting out an appeals process so if someone is found to be within IR35 they must have recourse to an appeal and it is a 62 day process whereby they have an opportunity to submit further information so they might say, there are these other factors that you have not taken into account or I believe you have not taken into account in the analysis and I think that takes me outside of IR35 and then you can look at that extra information and decide whether or not you agree to uphold that appeal. Okay next slide please. Thank you.

So the end client is the business in which the individual is working, the fee payer is the entity that pays the contractor's intermediary. So if you are contracting with a personal service company directly, for the provision of services by an individual, then the fee payer will be the same entity as the end user because the person paying the fee is also the person in whose business the individual is working.

It may not necessarily be the same person if you have a chain of contract going on so if, for example, you have an agency that supplies the services of a person who operates via a PSC then the agency is the closest entity to the intermediary PSC and therefore, in that circumstance, is the agency which would be the fee payer and it is the agency that has the obligation to account to HMRC for any tax. So the fee payer has to deduct the tax from payment made to the intermediary and account for that tax to HMRC in accordance with the status determination, if the status determination says that the arrangement is inside IR35. Of course, if it is outside IR35, you simply pay them gross in the usual way.

There is a risk though that if the end hirer is not the fee payer but it fails to meet its statutory obligations to carry out a risk assessment, issue the status determination statement and tell the fee payer what to do and tell the fee payer whether or not the fee payer needs to deduct tax then automatically a liability to account for that tax moves from the fee payer to the end hirer. So if you have contractors coming into your business, you are operating on a self-employed basis, it is very important firstly to make sure you have processes in place so that you can identify whether they are potentially subject to IR35 and secondly to make sure that the assessments are done correctly and the right status determination is issued.

In addition, if you are the end hirer and it turns out that the fee payer is insolvent or is wound up or is resident overseas or importantly if HMRC think there is no reasonable prospect of them recovering the tax from the fee payer, within a reasonable time then they will be able to seek that tax from the end hirer.

So, not being the fee payer does not necessarily mean that there will never be an obligation to account for tax. So this is where the contracts become very important, really careful allocation of that risk to make sure that those assessments are done accurately and that where tax needs to be deducted, it happens during the life of the contract because if you are held liable after the end of the contract and your agency has disappeared or your sub-contractor has gone so that HMRC cannot chase them, then you can end up on the hook for that.

So what do we do? First of all, the key is to work out where the contractors are in the business. For some businesses that is very easy, there might only be four, five maybe six of those. There are other businesses out there that have thousands and thousands of potential contractors who may well be caught by IR35.

So we locate them, we identify their roles and if you have lots and lots of them it is important to allocate them to particular risk groups and that might depend on the kind of work they are doing. It might depend on the way in which their contractual arrangements work, so how they are brought in to the business and it might also depend on whether these are individuals who are providing specialist services for a fairly short period of time, or whether they are really integrating with your own teams for a more significant period such as, for example, IT services often are much more integrated into the business than say, for example, a specialist contractor who comes to do something very specific in relation to the office, for example.

So the risk assessment enquiries need to be tailored to those groups because there will be different things that are likely to determine the status for IR35 purposes. There are different areas of risk for those different groups. So we pull all the information together, look at the tests, carry out the analysis and review the results. There is an HMRC tool called CEST which is Check Employment Status for Tax. That has been updated in the last year, it is better than it was but it does rather require you to have done most of the thinking and most of the analysis before you put the information into the tool and HMRC say they will stand by the results at that tool if all the relevant information was inputted correctly, which is slightly like saying we will rely on the fact that it has given the right answer if the right answers were given to the tool in the first place.

It is a little bit circular, so you do need to think very carefully and I would, in particular, be very wary of giving any of those kinds of questionnaires directly to the contractors and asking the contractors to fill them in because, with the best will in the world, there will be at least a subconscious tendency to want to give the answers that will spit out the correct results at the end so it is very important that the end hirer business does that analysis itself.

Think about, where are they, who are they, what do they perform in terms of services, how long have they have been with us, that can be really key because if someone is only there for a month or six weeks it is highly unlikely that they will be deemed to be an employee but if they have been there for a couple of years and are really seen as performing an integral role in the business and the chances of them being caught under IR35 are pretty high.

Also think, how easily distinguished from the employees are there. What practical things can we do to make sure that we can tell and that people coming into the business can tell who is the contractor and who is an employee.

The more detailed answers you can elicit to that questionnaire, to that risk assessment process, the more accurate the results are likely to be and the better the chance you will have of coming to the correct result of making sure that tax is deducted if it needs to be and if it does not need to be, making sure you have got a really good defence if the revenue were ever to query the basis on which you have made that assessment.

Are there any specific areas in relation to the way that the contract is formulated or more importantly, the way that the arrangements work that could make a difference to whether or not IR35 applies.

If, for example, your main risk area is that you have someone who has been with the business for a little while but they are on a day rate and so it looks as though they are paid regardless of the quality of work that they do, they might be paid even if they make mistakes and they will have to rectify them and that day rate just accrues and then is payable at the end of the month.

Is it possible instead to pay them by reference to certain deliverables? So when the project reaches a certain stage or when they have delivered certain types of work and reached milestones along the way, rather than making it a monthly payment. Do you need to change the logos, for example on any clothing that they wear which is specific to the job? Do you need to change the business cards? All of those sorts of things.

Consider whether, if you have high risk roles within the business, is it better to put them on shorter, fixed-term employment contracts. Although, of course as soon as you put them on an employment contract, they start to build up those employment rights. Can you revise the standard terms on which you bring people in? Can you change any benefits which they might accrue? At this time of year, for example, we would say if you have a Christmas party for employees - a little bah humbug as it may sound inviting your contractors is really not a good idea, but if you are putting on a hospitality event to which you invite your main external suppliers - perhaps your customers or clients and it is a much more outward facing third party event then that might be a more appropriate event to invite the contractors to join in with.

And then of course, the best thing you can do to mitigate IR35 risk, is to have as few people as possible who are potentially within the scope of it. So we have seen a number of clients who have said they will not take anyone on as a contractor unless they know that they are an employee of the sub-contractor entity and that their PAYE has been dealt with appropriately or they are an employee of an umbrella company - a reputable umbrella company which does deduct tax properly.

Be a little bit careful with umbrella companies - there are some really good ones out there. There are some that are much less compliant of the type that originally evolved to implement some tax avoidance type arrangements. If you are looking at umbrella companies, just ask to see an example payslip. Ask them some questions about how they deal with the tax for the workers that are being supplied.

It sounds as though this is deeply personal information but what it really comes down to, is if you are the end user business; this is your potential tax liability. Equally of course, if you are the fee payer and those are reasonable questions to ask because you might say, well look, if I am not properly satisfied that these workers are having tax deducted then I will have to do an IR35 assessment; issue a status determination and if necessary, deduct the tax at source and then there is a risk of double taxation and the individual will then have to go to HMRC to claim some back.

Or they simply may not be awarded the contract in the first place.

Implementation; have a think about it, discuss with your advisers the recommendations that you need to implement; agree a strategy. Think about the policy you have to bring contractors in, in the first place as well as any contractor you might need to update before April.

It feels at the moment as though April middle to late spring is a long time away but it does take a long time. You have to make sure that all of these arrangements are in place for payments which are made after 6 April.

Some of that could relate to work which is done in March. Of course, Christmas will be here upon us before we know it and then suddenly it is January and February and the time is up. So if you have not thought about IR35 already, now is absolutely the time to deal with that.

Create a contractor database. Make sure you have a list somewhere of all the contractors you use, so that you know when they started working for you, when they are due to finish. Keep an eye on those renewals, be really careful if you have six month or one year contracts which keep on renewing.

You might need to have some changes in the structure. You might need some hard and fast rules about how long contractors are taken on before they then have to go off the books.

If you have third party suppliers, then have a think about how you are going to contract with them. How you make sure the information goes backwards and forwards. Make sure the determinations are there. Make sure your appeals process is in place. There is no point having a couple of sentences at the bottom of your determination statement if you do not have someone who is ready and trained up to handle any appeals if they come in.

Communications between you and your teams, internally with your suppliers and sub-contractors and, of course with HMRC are always key.

Here we are, make sure you have as well as policies, good processes in place. I have mentioned alternative structures. Be a little bit careful about fully outsourced services because this is a term which is bandied around a lot. Some suppliers will say, well we provide a fully outsourced service and therefore we are the end client in relation to the people that we are providing to you. In some cases that may be true, in other cases either that is not quite the case in the first place because they are more integrated into your existing teams than you realise or things might change throughout the life of the contract.

Even when you are bringing on board fully outsourced services, it is a good idea to have some wording in there to put the onus firmly on the outsourced service provider and make sure that everything is dealt with accurately just in case something changes and that does come back to bite you.

If you are procuring construction services, remember that IR35 always takes priority over the Construction Industry Scheme. The Construction Industry Scheme is an arrangement whereby for certain sub-contractors in the construction industry you normally have to deduct income tax at source before paying those people.

There will be sub-contractors who are eligible to receive payment gross. Just because your supplier is eligible to receive payment gross under CIS, that does not mean that if IR35 applies you can forget about the tax deductions. If IR35 applies, you have to make those tax deductions regardless of CIS.

That is all I have on IR35 for now. Happy to pick up comments later and meanwhile I shall happily pass onto Vivienne. Thank you.

Vivienne Reeve: Thanks Zoe. Hi everybody. I am going to talk to you for about ten minutes about recruiting in the pandemic. There has been a lot of focus on redundancies understandably and sadly over the last couple of months as COVID continues to have an impact, but it occurred to me a couple of months ago that for employers facing increasing demand who happily need to recruit to face fresh challenges, how do they manage the recruitment process effectively and fairly where there are likely to be record numbers of people applying for every job?

I am sure I do not need to tell you, there are huge numbers of people applying for every job going. The issues I am going to talk to you today are split into three sections: planning, designing and some final points.

Planning: I think what we need to start thinking about in order to craft a job application that encourages those who are qualified for it to apply as far as we can. To be clear about what the job is and what the requirements are. So, where you can it is about being specific. Testing a draft advert with your colleagues to make sure you have got the right points across.

It is really important to document the business need for the role that you are advertising so this is clear internally but also when you go externally and afterwards if there is any challenge or issue there. I will come back onto challenges at the end.

It is thinking about where and how you advertise the role? Other platforms or methods that you plan to use; accessible to everyone or are certain groups potentially excluded, so can people with hearing issues listen in if there are any audio parts or an interview. Is the platform and application process you are using, is it compatible with read and speech software, for example?

Many employers, obviously have been using blind assessments for some time to reduce the risk of prejudice on the grounds of gender, gender assignment, nationality, race, ethnic background, age, disability - most of the protective characteristics an anti-equality act essentially.

If you are not already doing that, could you do it? Many jobs at the moment, as I expect lots of you are doing, are done from home and may need to be done from home for some time, but actually are we advertising for roles that are going to be working from home initially and then there is going to be an expectation that perhaps next spring or next summer you will want people to work on a site or in an office?

Or actually is the role that you are advertising fully-flexible, in that you would want somebody to be based at home anyway.

I think that is really important. It is not easy necessarily to know the answer to that now but just thinking about it so you can start managing expectations is helpful.

Lastly it is about thinking, can you support flexible working to enable applicants from groups which may have additional responsibilities such as caring. So that is mainly women, at the moment; and disabilities for example, to do their work. Can you be flexible about the hours and how they do the job?

The next section is about designing the process. There are a number of equality considerations here. The first is to mind your language. Use plain English, in a simple font and structure in a format that is easy to read for people, for everybody but particularly for people who are neuro-diverse.

Might the language you use put some applicants off? There has been studies about gendered language and implicit stereotypical assumptions. In that vein, bear in mind there is quite a lot of evidence worldwide that women tend to be more influenced than men by the must have elements of a job role for example and are much less likely to apply for it if they think they can only meet say, 60-70% whereas men are more likely to apply if they have that or less.

Thinking about accessibility and flexibility in the process. If you are using a digital assessment, is that accessible to applicants who are deaf or blind, dyslexic, neuro-diverse or people who might be dealing with Asperger's?

If assessments are timed, you need to think about whether it puts those with disabilities at a disadvantage. For example, various mental disabilities or conditions mean that people process information at a different speed or perhaps they are less able to adapt to new information without any warning?

It might be that those skills are what you need in a role or it might be actually that there are things that you would like, but you could work with a different way of doing things and it is important in that instance to think about that because there is case law of a government body who were not flexible enough and they breached the Equality Act.

Just finally on that point, bearing in mind that if your questions come as a certain surprise, they might disadvantage disabled applicants.

Happily, I am pleased to see there is a lot more discussion now about AI and technology. Algorithms are not free from bias. It is good to see that there is more scrutiny over the data behind AI as there needs to be. It is thinking about what knowledge you have of the assumptions made and the mechanics of that assessment.

It is having a critical mind and trying to find out what the information is that sits behind the AI that is being used. It might be that you have contracted that to another company so it is thinking about asking for that background information.

Only ask for the personal data you really need? Be careful about what you ask about - medical information in particular. There is a risk of a successful disability discrimination claim if you ask more than you should - either for the interview itself or the role that you are recruiting to and then you choose not to recruit based on that information.

It could be, a decision not to recruit is a coincidence but you might find you are in difficulty there if you have asked more medical information than you needed to.

Thinking then about who is going to be screening the applications? Trying to have the same team for consistency of approach. Checking and training the team that they have an understanding of equalities law? Do they fully understand the role that they are assessing and what they are assessing for? Is the scoring process clear and objective to everyone?

And then the Zoom factor. I do not think anyone anticipated that they would spend so much of our lives on Zoom, teams and everything else at the moment, but it is important I think a lot of people are good now at Zoom etiquette as it is called, but we do need to be careful to try and minimise distractions and surrounding noise. Not only of the people judging the applications but particularly for those who are applying because they may be neuro-diverse and suffer from distractions particularly if they have something like Asperger's.

The last couple of points I wanted to make are about the candidate experience and keeping a paper trail. I do not know if any of you saw it, but part of the reason for me looking at this in more detail over the last month or so was the Dispatches programme that I think aired in late October or early November about redundancy and job-seeking in the pandemic.

It was heart-breaking to be honest and it showed that two things: there are a huge number of people applying for every job but also there is a lack of humanity in how people are being dealt with in some cases. Some people will be applying for tens or even hundreds of jobs and it can be punishing and really demoralising and I think it is so important to try and be human about it. Even if it is an automated response to say, thanks for your application we cannot give you any feedback to it but I am afraid you have not been successful; is better than hearing nothing.

I was quite surprised about how many people just said, their applications just seemed to go into a black hole because they never heard anything back and you can see why that would be really frustrating and demoralising.

The last bit, which is really important is about keeping a paper trail; keeping an audit trail of decisions made. We need to be sure that we keep a record of who has applied and whether they were invited to interview or not and which candidates were successful and not and why.

It is really important to be able to show objectively, at the time and afterwards, why you decided to recruit this person and not the other.

Thinking about it from a tribunal perspective, which is where I often get involved in advising clients, it is really important now more than ever because there are huge delays in most of the tribunal services around the country, which means that it takes longer for a claim to get from the early stages of filing a claim and a response to the actual full merits hearing. It can be a year and sometimes longer.

By that point, the hiring manager or the interviewer assessors and panel might not remember why they made a decision; I am not sure I would and they might not be employed by you anymore. There may be an employee relations issue with them, meaning that you would not want to call on them anyway. It is important that you have got that documentary record. I think, just logically the greater number of applicants you have got, the harder that job becomes in terms of remembering why you did or did not put forward one person or the other. That is why we need that paper trail.

I will finish there but I hope that has proved interesting. I am very happy to answer any questions. I am going to hand over to Simon now.

Simon Stephen: Thank you Vivienne. Sorry I was just checking my video was actually on. I am conscious of time, but for the next ten minutes or so I will be talking about managing employee risk in the new normal.

I will admit that I was delighted to get a topic on the new normal, given that we do not really know what that is.

The first point we have got there is, is there even such a thing as the new normal. I think the reality is that we do not know what the case will be; what the situation will be in the future. We have got the wonderful news this morning of the vaccine being rolled-out but we do not know the impacts of this and of course, there is no one size fits all. Whatever works for one organisation will be different for another and of course as individuals we all have our own needs as well.

As an organisation, as an employer, it is very difficult to talk about one aspect really. When I was looking at what I was going to talk about, there were two main themes that I thought were emerging and I wanted to deal with.

The first one is the issue of staff wellbeing and mental health. I think we will have all seen in the news the well-publicised impact that the COVID pandemic has had or is having on mental health and I think the reality is that we may not even see the impact of this kind come through for a number of years; particularly maybe with the younger population.

But of course wellbeing is not just about mental health. Wellbeing is about an employee's experiences at work, it is about their physical health and everything else as well and I think COVID has really stretched this. Certainly I know I have had my own challenges working at home for the past eight, nine months with home schooling and different impacts from changing how my children go to school and all these kind of things.

This is a risk which needs to be managed and it is a risk for individuals personally. There are a number of different issues which can arise. Obviously if somebody does have mental health issues then there are risks for them in terms of sickness absence, in terms of ill health and in worst case scenarios, you could be looking at situations of discrimination; for disability discrimination if the issue is a longstanding one or maybe an existing condition that has been exasperated.

Of course, alongside with this staff wellbeing and mental health particularly maybe, can have a massive impact on a business and I think maybe we are seeing this as well with the impact on organisations, with things like employee engagement, with things like productivity. Many of these are linked back to how well the staff feels in a way, in terms of their culture, in terms of how things are done. The whole environment.

I think what we are really seeing is the fact that wellbeing is not just about mental health. It really is the whole environment, the whole place for work. Of course this impact on business if you do not have good employee engagement, you do not have good productivity or people are suffering from fatigue or Zoom burnout and all these things, is that you then have issues for the business.

I mentioned productivity, but in a worst case scenario, there is the risk of people making errors which will have a direct impact and I think if we look at the financial services areas as an example, or indeed any area; in accounts, the example of putting an extra nought or two on a payment can have massive impacts on the business and that could be linked back to staff wellbeing.

I think that, for me, is a big risk that is going to come more to the front as we all work our way through what this new normal may look like.

And then the second point I wanted to talk about, was what I have called business adaptability and I do not think that is a properly coined phrase as yet but I think what COVID has shown in terms of managing employee risk is how flexible organisations need to be. There have been massively changing employee expectations as to what they get from their employer and I think a lot of that has come through the fact of what they realised they are maybe not getting in the first place.

Employer expectations and I will come onto these in the next slide about how they impact but certainly employees expect a lot more now particularly thinking forward; planning, what is going to happen, how is that all going to impact on me.

Coupled with that there are also massively changing remits for a business about what they can and actually cannot do. There is different regulations, there is health and safety, there is the COVID regulations directly for the government. You have got to be flexible, you have got to adapt but you have still got to do it within the framework of what you are able to do.

As on the slide there, how can we look to manage this and manage the employee risk that falls out from it. I have focussed more on the practical and pragmatic points here and I think one of the key things is forward planning. Thinking and planning as far forward into the future as we can, I do not have a crystal ball, I have lost my magic wand which my kids sometimes give me; but we have to start thinking in a creative way to think about how best we can address the issues that are and what we have already seen and about how we are going to address them coming forward.

I have put on the slide the three main ones that spring to mind. Flexible working, this is going to be – it already is a big issue; I think this is going to be an even bigger issue going forward. The very definition of working patterns is going to be changed. I know for speaking for myself that my working patterns have changed because I have had to adapt to the fact that my kids are here from school earlier and they go to school later in the morning for various reasons.

My working pattern has had to adapt around that. Organisations are going to have to plan looking at the make-up of the workforce and forward plan how and where this will change but also making sure that they have got the processes in place to be able to deal with reasonable requests and to be able to adapt and flex and move forward.

Vivienne has spoken already about the recruitment process and I think that is a good example about other processes that need to be adapted but then we have got the thorny issue of return to the office. Will we actually return to the office or will we still be working from home for those of us who are able to do so.

If we are going to return to the office, when and what will that look like. What is the occupancy going to be like? What are the risk assessments going to look like. What can we glean from what we have learnt so far as to what we can do in the future.

All of these things are going to have be very well thought out because without these, then you are going to not be able to meet the employee expectations and it is going to lead onto employee wellbeing issues because - and then this links onto the next bullet point, a key part of all of this and for those who have attended any other talks I have done, communication as I always say, is a key part of managing employee relations and managing risk.

Out of all of this, you can do the most wonderful forward planning, you can research employee engagement in productivity, wellbeing: what can you do to actually meet these employee's expectations I have talked about, but unless you communicate and talk with your employees they understand what you are doing and understand that you are trying to address them, then they are just not going to work.

Communications are going to be absolutely key I think for the future and we have seen that in many examples over the past few months. I have picked out two particular points in terms of communications, which I think have really been drawn out.

One is the use of internal forums. I have put this here because linked to wellbeing, we have worked with a number of clients and spoken to a number of organisations who have really stepped up what they are doing in terms of offering internal forums on things like mental health; so mental health networking groups, mental health support groups, but also really push the agenda on diversity inclusion because all these things are issues which could get put to the side or could get forgotten about or put down the list on the priority but I think it is very much the case that they should actually be kept at the top.

Elevate the priority through COVID to ensure that people still appreciate that those things are key to an organisations' cultures.

Internal forums as well, we have seen in a recent tribunal case involving transgender and complicated matters but where the respondent companies HR and diversity forums actually heavily criticised; effectively as being nothing but actually there on paper. It is really important to make sure that you have these internal forums and if you do, they are actually used and communicated properly and used.

It is not just the mental health networks, it is not just the diversity inclusion networks but it is any other internal forum, you should have consultation groups and things like that. Making sure that they are kept up to date, making sure they are communicated with and making sure you get that feedback about the employee expectations so you can build that in.

I think the second point on communications is how crucial it is to have these communications coming down from the top.

This tone from the top which we hear spoken about a lot. Certainly my experience of being in-house and private practice, the only way that communication plans work, the only way that you are able to communicate to staff in an effective manner about what you are doing about forward planning, what you are doing to meet their expectations, what you are doing about their wellbeing is to make sure that you have the senior buy-in from the top and it is much more than a tick box/email from somebody senior but actually proactive engagement demonstrating that they really are walking the talk, if you like.

I think the final point, just to close is how this, in my mind, all links to the point of speaking up and I think a big part – we have seen a lot of things in the news about whistle-blowing and about cultures. We have seen issues with the Home Office and Priti Patel and bullying allegations and many other such examples.

I think in my mind, looking to manage employee risk in the new normal, a big part of that is making sure that employees feel comfortable that they are able to raise their concerns so they are able to speak up and also that they are able to then be listened to.

If an individual has specific concerns about their own personal health and safety for coming to work, or concerns about somebody in their family or indeed concerns about how on earth they are going to manage childcare if they do come back to work or priorities change.

It is so important that people have the ability to speak up in what often you hear called psychological safe environments and then are listened and those are fed back.

That was what I was going to talk about, managing employee risk. It is pretty high level I appreciate, but I think given the time constraints hopefully they are pragmatic and practical tips to help you through it. I think now it is passing back to David for questions.

David: absolutely thank you very much Simon. And thanks very much to all of the panellists there. I think the whole topic of - or all four topics are extremely challenging and going to be something that we are all going to have to face from 2021 onwards. Obviously we are really pleased that we are able to partner with Gowling as our legal advisers as well because we are going through exactly those same issues.

If it is okay with everybody, we are right on time the hour that we took up, there are some questions. Some of those I might be able to answer and Lucy, would you mind just flicking through to my final couple of slides and then I will touch on those questions.

If it is okay with everybody, what we will do is quite literally five minutes on the questions that we have. But from our point of view, with regards to IR35 where the majority of questions had come up and Zoe, I think you maybe a little bit busy in answering some of these, we can cover quite a few of these factors - either with the audit and assessment programme that we run which as you can see there, takes you really through from consultancy, practical consultancy, supported by legal advice, right the way through to implementation of a process and touches on all of those points from Zoe.

And the final slide Lucy, if you would not mind?

Is just what we can offer from there. So it is, the audit of the workforce, which was one of the questions that we have, was around should we be reviewing all of our current contractors. Some workshops and training that we can do with hiring managers and also working with contractors, communication is key to this and then helping you to build a best practice model which allows you to, not just implement current changes, but a process that actually works going forward from there.

I will move quickly onto the questions that we had that we have either in the main area and I think I touched on that there.

The first question was, do we have to complete status determinations for those already engaged with us? Zoe, I think these are the four questions. I have got a couple of others that I will ask for the other panellists but over to you really to answer that one.

Zoe: The answer to that is, yes if those contractors are still going to be working with you after the rules change on 6 April and IR35 is potentially a point, yes.

David: Yes. Brilliant. There was one thing I added it into the question and answer section, there are some exemptions from this which is only if you are classed as an SME and follow the regulations and the guidance that actually define you as an SME. Typically that is, I think it is a £10 million turnover Zoe? Is that about right?

Zoe: Mmmhmm.

David: There are some factors, if you need anything more on that, please contact us and we will be help to clarify on that side of things. Another one Zoe, I think it is with you, we will deal with all of the IR35 stuff. You mentioned nine tests, I certainly know of the three core areas: substitution, mutuality and also the financial risk. Anything extra that you would add in terms of those tests?

Zoe: The thing is, I could spend two hours just talking to you about the tests. So I am reluctant here to list because I am bound to leave off that list some really key ones. If you have a look at the CES tool if that is what you are looking at, that will take you the questions that are associated with CES will take you through all of that. There is also some good HMRC guidance in relation to those tests or if you are looking for expert advice, there are all sorts of experts out there who will take you through the test and how they apply in your particular scenario.

David: Absolutely and the other question that I answer back, I have put a link in there back to the CES tool. There is a couple of - well we hear lots of rumours about people that are saying that the CES tool is not fit for purpose. It is actually. There are some questions there, we certainly use it on our project consultancy approach where we work with clients and help you to build that process. It does cover the main points that you will need to in terms of those tests but most importantly it will give you a true definition that HMRC - if you have answered it, in a very compliant way and an open and honest way which is crucial for us to make sure we cover, then they will actually support the decision that their tool comes up with, so it is quite important that you do look at the CES tool from that side of things.

The final question, probably the most complicated one and Moira we probably need a conversation around this one, but you have a contractor that has been there for seven years working on a project. Zoe, any recommendations or comments? And then we will move onto the others.

Zoe: I think that is very very high risk for IR35. If they have been there seven years there is a very good chance that they are integrated into the business. By all means look at the other tests but usually when someone has been there that long, they are well and truly within scope so I would proceed with extreme caution on that one and I would echo David, what you just said about CES.

CES was, as I said, improved at the end of last year. Before that, we would absolutely have agreed, it was not fit for purpose. It did not recognise mutuality of obligation. It had lots of holes in it. It still is not perfect, but it is certainly better than nothing and since HMRC will stand by it, if as you say the information is done properly and entered properly, that is really helpful. The key thing is to make sure that whoever is putting that information in, has the full facts. Understands the full circumstances and ideally is very familiar with IR35 and the tests and how they work and the guidance and all of that because then if you have someone who is knowledgeable - answering questions, you have a much better chance of an accurate result.

David: That sounds like the perfect cue-in to saying please give me a call afterwards or send me an email and we will help with our project consultancy arm.

If anybody does have any other questions, we are five minutes over. I have got one particular question I wanted to ask Martin? I am just double-checking that he is still on the call. Which was around Brexit really. Obviously it is such a topical event being as close as it is and with Boris just about to hop onto Eurostar to go back over to Brussels.

If you were to pick one particular factor that you feel the government may change or implement that could affect us within the employment scope Martin, what would you think it may be?

Martin: The one - I do not know whether this is the one that the government will pick, I do not purport to speak for them. I think the one that that would be most useful in the very short-term and least damaging in many ways would be the ability after a TUPE transfer to harmonise terms and conditions or to vary terms and conditions by agreement. The rationale there being that, TUPE is meant to put the incoming employer in the same position as the outgoing employer?

They just step into their shoes and the outgoing employer could always have agreed a variation with its staff so why should not the incoming employer be so inhibited. That is not the same, saying that they should just be allowed to impose it because the outgoing employer cannot just impose it because that gives rights to all sorts of potential claims for instructive dismissal etc.

That is the one I think would be useful to employers and businesses generally and it is been a bit of a bugbear and listened to the underlying European court case 25 or 35 years ago on that, on that point. That is the one I think they might go for first. It depends, if I am blunt about it, how much they choose to pander to the demand for change.

David: Obviously a lot of water to go under that bridge in the coming few days, let alone weeks as we implement and move forward.

We have touched on there on the four main questions and we are nearly ten minutes over now so I will look to draw everything to a conclusion and really just wanted to thank all four of our experts from Gowlings. There are the contact details for the guys themselves. Please feel free to go straight to them with any of the questions that you may well have. Certainly we are moving forward quite extensively ourselves with the IR35 situation. It is paramount to us.

And just to thank you in there. A thank you to everybody for taking part and if there are any questions at all outside of this, please come back to us. One thing that we will be doing is to; we have videoed or recorded the webinar here. This will go live in the next few days on a couple of websites. Our own and also the Gowlings website so we will be able to provide that to anybody if you do want it so you can access through from there.

Again, thank you very much everybody for taking part and the Gowling team, very much enjoyed the topics and what we come up with. I think 2020 has got a lot of interesting factors for all of us so, good luck to everybody. Thank you very much again.

Vivienne: Thank you.

Martin: Thank you, bye-bye.

David: Bye everybody.

Read the original article on GowlingWLG.com

Originally Published by Gowling, December 2020

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