How to get the most out of your agency Presented by Steve Woodward MREC Cert RP Business Manager – Workmates Maintenance
Introduction • Who am I – Steve Woodward • What do I do – Workmates Maintenance • Why am I relevant to you – I only supply staff to your industry “why do these people keep calling me”
Perception is everything • A necessary evil • Worse than estate agents • Time-wasters • Don’t listen • Just CV pushers • Have I missed anything?
Recruitment Agencies What types are there - • High Street or local suppliers • Specialist industry or sector companies • Large multi-discipline companies • Master vendors
What can they be good for? • Holiday cover/long term sickness cover • Increased work load • A short term solution whilst a permanent member of staff is found • Casting out the net to get candidates that may have not seen your advert for position.
The common goal of recruitment • Generate sales and revenue by making a margin on the staff you supply and the charging of a fee for placing a permanent member of staff • All agencies do this but for some that’s all they care about
Exceptions to the rule But there are exceptions - • Agencies that charge realistic rates • And ones that think about - Long term business relationships not short term gain
What should I expect as standard • Obtaining the best candidates with the right checks • A service that meets your expectations • An agency that listens to your needs and adapts • A service that complements your business rather than hinders it. • And that the agency listens and is honest
What extra can an agency offer • The creation of a Preferred Supplier List • Providing a spend rebate/discount • Only paying VAT on the agencies margin not the whole charge rate.(**) • The offer to work in partnership with an agency • Invoices produced how you want them • Better and longer payment terms
Question the agency what you get for your money • How do they interview their candidates • What information do they obtain on candidates before they are sent to your company • What information do they obtain from candidates • What do you expect from an agency to justify their charge rate?
An open book – insiders guide to charge rates How do agencies pay their candidates – • PAYE + Holiday • PAYE Paid in rate (PIR) • Self employed (CIS) • Ltd company
CIS or LTD company pay type • Pay rate £12 per hour • Charge rate £15 per hour • The agency margin will be £3 per hour This is possible because – • An agency is not required to pay Employers NI on a self-employed person • So a clear margin of £3 (£15 - £12) is made by the agency
PAYE paid in rate (PIR) • Pay Rate £12 per hour • Charge rate £15 • Your margin will be £1.55 per hour This is due to – • When somebody works PAYE the agency must cover the clients NI contribution. • Calculated by £12 (pay rate) + £1.44 (Employers NI 8.3%) • = £13.44 - £15 • = £1.55 margin per hour
PAYE with Holiday • Pay Rate £12 per hour • Charge rate £15 • The agency margin will be £0.44 per hour This is because – • An agency must cover employers NI • Plus allow for 24 days a year holiday • £12 (pay rate) + £1.44 (Employers NI 8.3%) + £1.12 holiday pay 10.7%) = • £14.56 - £15 = £0.44 per hour margin
What else effects a charge rate • Market pay rates • Inflation • The cost of living • Rising fuel costs • Location of the proposed job vacancy • Size of contract • Size of client and possible client spend
Conclusion • Use an agency that is regulated by the Recruitment and Employment Confederation (REC) • Find an individual consultant that you can build a relationship with Your views - • Please take 5-mins to give me your views
Any Questions • PLEASE be as blunt and honest as you wish • I will endeavour to answer your question as to how I would have worked as your agency • And please don’t worry I have broad shoulders Thank you for your time