Failure to 'tell all' a legal minefield for employers

This is an interesting article I recently read, by Shana Schreier-Joffe . I think it's particuarly relevant for employers going through periods of instability and change.

Kate has written previously about the consequences for employers who misrepresent jobs in terms of increased turnover due to employee's expectations not being met in the job and I think this article provides even more compelling reasons for employers to be upfront with employees.

Richard Dunks

Businesses currently recruiting should be up front with candidates about their business in the current economic climate if they want to avoid exposing themselves to employee claims of misrepresentation by omission.
Companies which withhold important information from prospective employees regarding the future plans and direction of the company or its financial cirumstances, in particular any potential restructuring that may occur in the future, may give rise to legal action by misled employees.

In fact, misrepresentation by omission could affect all companies recruiting in the current environment, and for companies that don't take heed, potential legal action could include claims for damages for lost remuneration, commissions or other benefits the employee had been promised. For example, if a candidate is offered a role overseeing a team of 15, or reporting directly to the CEO, yet three months into the role he discovers that his team will be reduced or redeployed elsewhere, or that restructuring will greatly diminish his position in the company hierarchy, then he will understandably feel disappointed and even angered that the role has changed so dramatically from what had been originally presented to him.

If these changes were envisaged by the company at the time of recruitment and not disclosed to the employee, the employee may well have some legal recourse.
Most employers have been so used to 'talking up' their business to potential employees, that they do not realise how important it has become to be candid in the midst of the current economic climate. Employers who are currently hiring should err on the side of disclosure with candidates.

Employers should carefully consider all communications to candidates regarding the role and state of their business, including any discussions or information provided by recruitment agents acting on behalf of the company. This should include any information provided verbally, in writing or specified within the employment contract. While I can understand why employers might be reluctant to openly discuss potential changes that may occur to their business, or the difficult financial position of the company, potential employees need to have all the appropriate information available to allow them to make an informed decision about their careers and employment situation.

Employers should not hide or try to downplay potential workplace changes, as not all changes are necessarily viewed as reactions to negative business performance. There are many reasons why a relatively well performing business might have plans to restructure or make significant changes to their workplaces, whether to create or maximise a competitive advantage or simply adapt and benefit from current market conditions.

Practical advice to employers:

• Be upfront as much as possible about the state of the business, and any planned changes
• Avoid overstating the role, job stability or future opportunities
• Don't exaggerate the performance of the business

If there are potential workplace changes that are of a particular concern or likely to impact that role, and which may leave the company at risk of litigation, ensure that they are disclosed to the potential employee. If it will significantly impact the role performed by the potential employee or the employee's ongoing employment, then ensure details are recorded in writing in the letter of offer or contract of employment.
Shana Schreier-Joffe is a Partner at Harmers Workplace Lawyers

The original link for the full article is: http://www.smh.com.au/small-business/resources/failure-to-tell-all-a-legal-minefield-for-employers-20090629-d1wj.html

Unemployed? What should you do?

It is very easy to become disheartened when you are out of work and feel that there is a distinct lack of opportunities for you. The employment market is shrinking in almost every sector and the immediate forecast is that it might get worse before it gets better.

If you are unemployed try and stay positive this is not a permanent situation and things will turn around. We are starting to see signs of recovery with more jobs being advertised and a positive attitude among employers that things are getting better.

People respond better to positive, proactive people and if you have a good attitude and present as a happy person your chances of securing a job will certainly be higher. Conversely, people are turned off by negative, pessimistic people.

A number of my candidates who are looking for work have started to seek additional training to broaden their knowledge and skill base so when they do get another job they will actually be able to add greater value than they were previously. Become a better prospective employee.

Our advice in these times would be to have a positive attitude and when interview and job opportunities do come along make the most of them and put your best foot forward. The market is highly competitive and you will not be the only one interviewing for those jobs.

We are finding that the candidates who are getting these jobs are simply interviewing better. They are not better qualified or experienced but they are simply conveying their knowledge and experience in a way that makes them more attractive for the job.

The ultimate goal in any interview is to get the hiring manager to visualise you doing the job. You want them to see you sitting in the chair performing the tasks of the job. The way to do this is by talking about specific examples of what you have done and how you did them in previous jobs and how what you did benefitted the business.

Try and come up with specific work examples in your past that you can relate to the current jobs you are interviewing for. It is more than likely that you will need to perform very similar tasks as you were in your previous jobs. Detailed answers are always better than high level, broad answers because you don’t want to leave doubt in the hiring manager’s mind that you haven’t actually done those tasks.

Be positive, up skill where you can and prepare for interviews so that you can get the hiring manager to visualise you doing the job. Good luck.

For further information and advice on how you can take advantage of the economic downturn to improve your competitive advantage contact Gareth McClurg or Richard Dunks on (07) 3229 5750.

Using psychometric testing for recruiting and developing staff

Psychometric tests aim to measure attributes like intelligence, aptitude and personality. They are frequently used in recruitment (in conjunction with other methods) to determine how a candidate might perform in a given role. In general, psychometric tests (used for recruitment) do not analyse emotional or psychological stability and should not be confused with tests used in clinical psychology. Employers are reporting increased numbers of job applicants, psychometric testing can be a very effective tool in the selection process to determine the most suitable applicant. Given the cost of getting a hiring decision wrong it makes sense everything in your recruitment arsenal to make sure you get it right.

Psychometric testing is not just for big corporates or high level/technical roles. There are wide range of different testing methods and tools designed to measure, assess or analyse various factors, in fact there are so many tools that one of the most difficult steps is determining what, if any test would be most beneficial.

The first step you need to take before considering psychometric testing is to think about what the main purpose and key responsibilities of the role are, and how this person will need to fit in with the overall organisation and culture. Separate the essential, desirable and peripheral skills/attributes. Once you have a thorough understanding of what you need, you can determine what psychometric tools might be relevant. Remember that you don’t need to test everything, there are many factors that can be determined without the need for testing and you need to decide what is appropriate for your role. For example while it might be appropriate to test the basic technical and numeric skills of a graduate accountant, it is probably unnecessary to do so with an experienced Financial Controller. It is also important to understand the benefits and limitations of psychometric testing in general.

Psychometric testing allows you to measure and analyse specific information that may otherwise be very difficult, or time consuming to accurately gauge. For example, if you know from past experience that the most successful candidates for your role have been highly intelligent, it makes sense to consider intelligence as a fairly important selection criteria. An IQ test will accurately measure intelligence, although as an interviewer you may get a ‘feel’ for how intelligent a subject is your views are based upon your own perceptions and observations, there is a possibility that you could over, or underestimate a candidate’s intelligence. If you are using a credible testing method you can be assured that the results are an accurate indicator of the candidate’s ability or potential without relying on guesswork or intuition.

Candidates are putting their best foot forward during the interview process. They will provide referees they are confident will sing their praises, assure you that they are experts in all your selection criteria and convince you that they are a great fit for the role. Candidates are not stupid, they know what you are looking for (it was in the job ad!) and they are experts at telling you exactly what you want to hear. Unless you have spent time in a previous role perfecting your interrogation and lie detection skills it is wise to use other methods to validate their claims.

There are many psychometric tools that can be used, not only in recruitment but in the retention and development of staff as well. For example, personality or behavioural profiling can be used to gain an insight into particular traits, areas of strength, weakness, work style and preferences. We have all heard the saying that employees don’t leave companies, they leave managers. I think the majority of employees would consider it a ‘career limiting move’ to criticise the boss’s management style; if you understand how individual employees might respond to different situations you can adapt your own style to bring out the best in your staff. Similarly, you can use profiling for internal promotions or reorganising work-flow. By reallocating tasks amongst staff members to suit their abilities and preferences you can increase job satisfaction and organisational efficiencies. We have worked with several client’s recently to re-organise their work-flow and task allocations based upon personality profiling and there has been a significant increase in morale and job satisfaction and also a marked (but smaller) improvement in productivity and output.
Although there is some argument that candidates can ‘fake’ answers to psychometric tests, well researched tests make it very difficult for a candidate to ‘cheat’. Credible testing will have significant research and validity studies to prove that it provides consistent and accurate results, however you should still use other methods during recruitment such as interviews and reference checks to provide you with the ‘bigger picture’.

Tools that rely on self assessment, such as personality profiling are generally accurate, however unlike methods such as IQ testing (where you either know the answer or you don’t) there is a greater chance of a participant being able to ‘fake’ a particular personality because they are ‘self reporting’ and may either have a poor self perception or believe that they need to answer the questions in a way that reinforces what they believe you are looking for (and not what they are actually like). You need to satisfy yourself (ususually through interviewing or reference checking) that the information presented is accurate and representative of the candidate.

I have come across many hiring managers who would reject a candidate based upon their psychometric testing without hesitation if they did not perfectly fit the ‘profile’ for the job. Dismissing a candidate based purely on their psychometric testing may be warranted in some unique cases, however it would be unwise to rely solely on the results of a subjective test in making an assessment on suitability. Factors such as high stress levels, mental illness, tragic events such as a death in the family or illness can potentially affect the results of a test; wherever possible, you should use multiple methods to reinforce results.

There are so many complexities to human beings and factors that influence who we are, it would be impossible to define a person through a series of tests and assessments, so while they can be useful, keep in mind that each individual test will have their own benefits and limitations. Putting some thought into what you really want to achieve out of testing will not only save you money but ensure that you are using the most appropriate tools to achieve your objective.

For more information about psychometric tools please contact Kate.

Recruitment 101: Hiring the right candidate for the job

The market has definitely changed in favour of employers recently, which is great news for the many businesses who have struggled to find quality staff. In the past, you might have been lucky to receive a handful of resumes for any job advertised, whereas many of our clients are now reporting that they are being inundated with resumes, great news again, right? Anybody who has had the experience of arriving to work on a Monday morning to find their inbox flooded with job applicants knows that it’s not always such a great feeling… when everyone has gone home for the day and you are still tackling the mountain of resumes (on top of the usual workload!) you may feel strangely ungrateful.
The real question is how do you take advantage of all this choice and find the most suitable person for the job?

Screening
In a perfect world, every candidate would have a cover letter tailored to your job criteria, with the job market getting tighter hopefully more candidates will engage in this practice as it makes screening resumes quite easy. Don’t spend too long reading resumes, you should be able to get a ‘gut feel’ for how suitable a candidate is in 30 seconds. Create a yes, no and maybe pile for resumes and (depending on volume) consider a quick phone screen with the yes and maybes. A phone screen is not a telephone interview, keep it brief – if you like what you hear from the candidate you can always expand on the conversation later.

Interviews
If you have done the screening process well, you should be left with a handful of people who, on the surface match your needs very well. Face to face interviews give you an opportunity to really put the candidate ‘through their paces’, and equally for the candidate to gain an understanding of the environment and role they have applied for. Many people comment that they can tell almost as soon as meeting a candidate whether they will suit the job, be careful of making judgments so quickly as many interviewers who form a positive impression of a candidate focus too much on selling the job and have a tendency to hear the ‘good’ answers a candidate gives and filter out the ‘bad’ as this subconsciously reinforces their own first impression.
Behavioural or competency based interview questions are essential in an interview. Candidates are putting their best foot forward during an interview, they want the job and know what you want to hear. Don’t just take people on their word if they say they can or have done something in the past, ask them for specific examples to support their claims.


References, Background Checks & Testing
These are subjects that I am quite passionate about, it is NEVER a waste of time to conduct thorough checks on a candidate. But your candidate is great right, they would never lie to you? Unfortunately 80% of candidates exaggerate claims in their resume, with approximately 20% taking more creative liberty with qualifications that they do not hold, jobs they didn’t do and lengths of time with their employers. Telephone references are always preferable to written references, I have never seen a bad written reference and don’t know anybody who would feel comfortable putting negative feedback on paper. It is not always possible to get two references from direct managers in the last couple of jobs a candidate has held for a variety of reasons (boss moved on, company folded etc), but be wary of the candidate who has an excuse for why they can’t provide referees for too many roles. One point that I cannot stress enough is to verify that you are talking to a genuine referee (and not a mate, yes you would be surprised how many people try this); the easiest way to do this is by calling the business, rather than a mobile and confirming the person’s name and job title with a receptionist before being put through.
You have a right as a prospective employer to enquire about any gaps in employment history, and also to confirm the employment periods and job titles a candidate has held in the past as these are material representations a candidate makes in order to get the job. I have often called employers not listed as referees to confirm employment only to be informed that the person never worked there, held a completely different title or the dates of employment were wrong. For many people going through this process might seem like overkill, you need to decide what is reasonable for your role. I once discovered a candidate applying for an accounting job had been in jail for fraud, and covered it up by lengthening his employment history at a previous role. While these situations are thankfully the minority, you take a huge risk missing by simply assuming that people are telling the truth.

If it is practice that you conduct criminal history checks, drug tests or medicals as a condition of employment always be upfront with candidates at the beginning of the process. I have seen people suddenly decide the job they seemed so excited about was not for them after they were informed they would need to be drug tested prior to an offer being made.
Psychometric testing is also often used by employers to analyse a candidate’s suitability and potential in a role. I believe it has a valuable place in recruitment and selection, however it’s important to ensure that the testing is appropriate for the job. If your role doesn’t require a candidate to have advanced mathematical skills it is a waste of time and money to put them through a test that measures this ability, there is no need to put a candidate through the stress of a battery of unnecessary psychometric testing.

It is important to use more than one method (i.e. interview, testing, and references) during the recruitment process to increase the probability that your new staff member will be successful in the role. The below table briefly outlines the predictive success of independent methods, however success is greatly increased when you combine methods.


On a final note, the most common reason we hear from candidates who have left their roles within 12 months is that their expectations in the role were not met. If there is not much room for growth or the candidate will be expected to work long hours it is best to be upfront, you want to find a candidate who will be happy in the job. Going through the recruitment process may seem tedious, but hiring the wrong person is costly, both financially and from a time perspective. On average the cost of getting it wrong is equal to the employee’s annual wage, but this can be far greater in sales or senior management positions. Consider the time it takes you to go through the recruitment process, the time and money spent training and developing the employee, lost productivity while a job is vacant etc etc! Sometimes the recruitment process might seem tedious, but having a happy and productive employee as a result of your hard work is a great feeling that is well worth all the effort!

Kate Klease
Vantage Human Capital

Act Now While The Talent Is Here!

We keep hearing of retrenchments and businesses laying off staff in many different industries in the media every day. This is likely to continue for some time to come. Some say this is the recession we needed to have. This may be true but what this has done has provided a great number of opportunities in a variety of different forms. These opportunities will manifest themselves to those who have their eyes open and to those who are ready to take advantage of them.

We hear all the time of organisations being in the market for targeted acquisitions and strategic asset purchases. These organisations will reap the rewards of such investments in this downturn. Listening to the age old adage “buy low and sell high”, there are plenty of bargains out there, you just need to have your eyes open and cheque books ready.

This business investment analogy is also reflected in staffing and the recruitment of talented people. We have not seen a better time to find quality, qualified staff that will not only have the right attitude and work ethic but an ability to improve profitability through their analysis of cost and revenue.

You may be one of those organisations with a hiring freeze and may have let go of a number of staff in recent months. The entrepreneurial businesses are doing the opposite they are attracting the talent that is available and utilising their skills to help put the business on the right track.

There are a range of strategies which can be deployed to improve cash flow and working capital. You should be looking at outstanding debt levels; reducing your debtors ledger and debtor days will have a massive effect on your bank balance and ability to invest in the future.

A strong Business Analyst or Management Accountant will help identify areas for sales growth and areas for cost reduction. A finance team is seen as a cost centre but the effective teams actually improve the bottom line through revenue creation and cost reduction.

This is the best time to buck the trend and make that investment in your business by employing the talent that is available. You will come out the other side with quality, loyal staff that will help you take advantage of all those opportunities which will come your way.

Don’t wait till it is too late and see the talent pool dry up which is sure to happen towards the end of 2009. Fore more information please call Gareth McClurg on (07) 3229 5750.

How employers can take advantage of the downturn

The current economic conditions are undoubtedly being felt in the workplace today. The media seems to be filled with stories about companies laying off and making staff redundant and job advertisement levels have recently plummeted, which is another indicator that employers are watching their wallets as they brace for the impact of a looming recession.

While many organisations must scale back their workforce or freeze recruitment initiatives to minimise costs and survive, for those firms that are financially stable, now is an excellent time to invest in hiring, retention and training the right staff.

With declining competition among employers for staff and a potential increase in job seekers means that right now could be a great time to hire, with highly skilled and qualified staff softening their salary demands in response to the economic conditions. Similarly you may take advantage of a slowing economy to hire graduates and train them in readiness for a recovery to prevent the chronic skills shortages seen as a result of the 90’s recruitment freezes in accounting, finance and engineering.

Competitors will often seek to imitate successful products, copy pricing or undercut promotional specials, but the quality of your people will help define your business and will be the most difficult aspect of a business for competitors to emulate. Organisations who opt for a ‘lean and mean’ structure as a cost cutting exercise will find that they are left behind by strategic and responsive competitors when opportunities arise.

For further information and advice on how you can take advantage of the economic downturn to improve your competitive advantage contact Kate Klease or Richard Dunks on (07) 3229 5750.