Positive Action Vs Positive Discrimination
One of the first questions I am asked when discussing a recruitment campaign is ‘can you guarantee a diverse shortlist?’ To answer anything other than ‘we will do everything we can but there are no guarantees’ might be disingenuous; nevertheless, it’s hugely frustrating for councils to hear.
It is inevitable that selection panels will be disappointed with homogeneous shortlists. Countless studies have for years confirmed that genuinely diverse workforces are more creative, innovative, and produce better decisions. They also have a deeper understanding of their customers and audiences. We know that councils are persistently under the spotlight as organisations who should be getting this right.
The Black Lives Matter movement has shone a brighter light on social inequality and diversity and will be a powerful catalyst for change. For now, however, we can achieve progress together through the choices we make locally. Doing this properly means gaining clarity on some basic principles.
First, what is positive discrimination? An employer falls foul if they appoint or seek to appoint an individual based purely on a protected characteristic rather than experience or qualifications. Protected characteristics include race, gender, age, disability, religion, and sexual orientation.
It is illegal under the Equality Act 2010 to set quotas to recruit or promote a specific number of people with a protected characteristic. There are of course some occupational exceptions e.g. a women’s refuge can apply a requirement for its staff to be women.
Second, what is positive action? Positive action became legal in 2011 and comes into play when an organisation is deciding between candidates who are equally qualified. In this situation, an employer can choose to appoint an individual from an underrepresented group if they are as qualified and fit for the role as the other candidates.
Positive action can also include employers taking measures to address issues within their organisations to support employees with a protected characteristic to overcome disadvantage and discrimination.
In an effort to leave unsuccessful diversity recruitment strategies behind, many organisations are now implementing targeted development programmes for existing staff. These can be very effective in progressing fourth and fifth tier managers whilst enhancing the reputation of your organisation. Councils need not work in isolation; you could partner and work within regional clusters to develop talent and OD programmes that extend opportunity and choice for our future leaders.
As experienced recruiters we are already playing a valuable role in enhancing diversity in different sectors. Coaching and guidance on navigating unfamiliar recruitment processes is a small part of the puzzle but has enormous impact in helping to fulfil potential.
To find out more contact penny.ransley@starfishsearch.com
Leadership journeys, expertly navigated
2020 and the rise of the wholehearted Board
The longer–term implications on boards of 2020 will not only affect the way they operate in future, but also how they are built and how they are led. Both the Covid-19 crisis and the Black Lives Matter movement have shone a light brightly on some longstanding issues that many suspected were already there. The transition from the pandemic now forces positive change and growth. While governance structures, and trustee selection and utilisation, are ripe for review, for some boards the events of 2020 have already led to a much more fundamental look at the board’s role and capability. Here, thedevelopment of those teams is perhaps based on a realisation that experience and skills alone are not enough to govern well. Instead, resilient, sustainable boards require people who bring their whole selves to the board room to participate: diversity in its truest sense.
Perhaps the four biggest questions boards are now asking themselves are:
- Are we still relevant? Even for boards that have previously championed inclusion and diversity, this remains a massive question. In order to govern their organisations effectively, and to have rich and rounded debate, boards must be able to reflect the experiences and perspectives of their audiences and client groups. Inclusive and balanced boards with diversity that reaches through and beyond the most talked about or visible protected characteristics is essential. Painting by numbers on a board is not enough: boards that move with confidence into the future will be diverse in a three-dimensional way – their background, their experiences and their engagement. They will be supported by a board culture that sets the conditions for true diversity to flourish and reach its potential in terms of creativity, insight, ‘connectedness’ and challenge power.
- Are we still talking about the right things? One of the mistakes many boards make lies in forgetting to take a step back and review whether they too need to change in line with the executive they are overseeing. Executive leaders are looking to their boards more than ever before to support them in navigating uncertainty, and to help them innovate and seize opportunity in a challenging transition phase. Boards are exposed and their organisations vulnerable if they are unable to provide the right gauge of leadership at the right moment. Boards that have come through Covid successfully have been adaptable as a team and as individuals, able to assess quickly the implications of environmental factors on service users and audiences, and have had the visibility they need across huge swathes of the operating environment to make connections.
- What does this mean for our people? Boards are rightly asking themselves whether they are still equipped with the right skills, experiences and perspectives. Plans for board succession may now change radically, or be further defined in a way that takes a broader range of qualities, values and attributes into account. Subject matter expertise,capacity to support and scrutinise in key areas (such as data or legal, people and finance) and leverage and influence will still be valued by boards to a greater or lesser degree. However, the broader life experiences that have until now been viewed as somehow separate to professional value will gain in importance, with the rise of a new and more rounded view of what it means to be an effective board member.
- Who are we choosing to walk forward with? A time of crisis, of review and then of consolidation will emphasise the importance of friendships and alliances. This is a time to think laterally about those partnerships that will count in delivering impact. There is no doubt that the events of 2020 have been a catalyst for new conversations; while competition for resource will intensify, there is a major opportunity to break down unhelpful barriers between organisations where they share common goals. Now is the time when finding willing partners and embracing innovation and creativity together can be more valuable than ever – and more fulfilling.
While pre-2020 many boards have looked great on paper and felt good in practice, there is now an unrivalled opportunity to move to a new way of being. After all, a year of tough decisions, of unprecedented demand on time and potential, must mean something positive in the end. It is precisely this challenge that the spirit of many trustees and their chairs was always meant for.
www.starfishsearch.com
Starfish Search. Leadership journeys, expertly navigated.
How to hire great finance leaders through economic uncertainty
It seems that almost every TV and radio advertisement is using the slogan “now more than ever” at the moment. Now more than ever, we should be shopping at Aldi. Now more than ever, we should be dying our grey roots… Well, now more than ever, organisations need to think hard about how they can recruit the very best finance leaders.
The role of Finance Director or Chief Financial Officer is not only an essential part of a charity’s mitigation of negative risk; great FDs are trusted partners to the Board and Senior Management Team as they assess the healthy risks required to capitalise on new opportunities in a challenging market. Below are our observations on how charities can hire the very best talent first time.
- Start with your Board. The role of the Finance, Audit & Risk Committee is quite rightly to provide scrutiny over the charity’s financial activities, internal processes and governance to protect it from being in a weak or exposed financial position. However, ensuring that there is also sufficient strategic finance knowledge on your Board will promote best practice within the charity through appropriate levels of financial analysis and challenge power.
- Not all CFOs are the same. What is right for a £500m charity, is not necessarily right for a £50m charity. That is not to say that the individuals within those organisations could not be inter-changeable, though the requirements may not be the same. When recruiting, you will need to think about what is most important to your own organisation and tailor the brief accordingly.
- Beware of your own unconscious bias when interviewing. Removing unhelpful or irrelevant criteria or judgements about where an individual has studied or worked previously will help you attract a broad shortlist of the best FDs; it is also the only way that the Sector can truly hire diverse talent. Do not be afraid to ask searching questions about what made someone choose the path they have – you might just be surprised at the response and it shows you actually care about their personal motivations and career plans.
- Test creativity in thinking. Finance leaders should be providing challenge, promoting innovation and supporting non finance professionals right across their organisation. Ask candidates what their personal legacy will be in their current organisation and what opportunities they have spotted for yours. This will ensure your new FD has the biggest and most positive impact on your charity when they join.
- Do not be afraid to hire on potential. Fulfilling potential is one of the most powerful ways of developing diverse talent pools for the future. Charities can be understandably nervous about appointing first-time FDs who may not bring the same breadth of experience in areas such as influencing Boards, but this does not mean they can’t do it. Test the candidate’s thinking around how they might tackle a situation, rather than look for examples of times where they have done it. Consider the support they may need and whether your culture and working practices provide the right conditions for them to develop in role. Understanding what innovation and fresh thinking they bring will also offer a platform for them to stand out from others in an interview – and potentially in role. This is especially important for today’s rising talent amongst senior finance professionals, many of whom can be characterised by a strong commitment to continuous professional development. This cohort of rising FDs has developed through senior management experience gained during the tough times: they can be creative, engaged, curious and forward-thinking.
The evolution of the Finance Director across the Social Sector over the past decade has empowered and enabled finance leaders to operate in a genuinely advisory capacity at the heart of decision making. Only by having a great finance leader can an organisation really achieve its ambitions in an intelligent, well-managed and sustainable way. Do not be afraid of taking appropriate risks when hiring any great leader; be sure to challenge your own thinking and perceptions when you meet an impressive candidate who does not 100% meet your initial brief. Not only will lateral thinking open up the doors to a wider and more diverse talent pool, it will probably also get you and your Board thinking differently too.
Starfish Search provides senior executive search and interim management services to create strong and diverse leadership teams. Our focus is on developing effective leadership by enabling people to fulfil their potential. We promote individuals from all backgrounds and want new leaders to be encouraged to enter the frame. As trusted partners, we provide balanced, thoughtful recruitment advice based on intelligence and insight and ask the difficult questions that help clients appoint the best, not the predictable.
Senior recruitment in the social sector: what to expect
As we emerge from the crisis phase of the COVID-19 pandemic, organisations are once again starting to think about the future.
For many, May and June 2020 will present the first opportunity to take stock and assess the impact of the coronavirus response, while starting to plan different scenarios for the remainder of the year. For others, the remaining Spring months offer the opportunity to progress recruitment to critical roles that was originally planned for February and March.
We have continued to support our clients throughout the lockdown period. Our three key messages for organisations who are considering recruitment to non-executive, Director and CEO appointments in the months of May, June and July are:
If you are a talented executive director looking for your first CEO job, this is your moment. CEO appointments in mainstream sectors or subject areas are still attracting a strong response. Expect to see fewer serving CEOs in the field; unless these candidates had planned a move for themselves in 2020 and were already open-minded to it, they may be less likely to engage with the idea of a move at the moment.
Many leaders we have spoken to feel a duty to their current Board and are loyal to their teams. With fewer experienced competitors in the field, this is the time for talented executive directors to shine. If your organisation is open to a first-time CEO, you may have exceptional choice.
Expect higher numbers of applicants for senior executive roles. Although it is still too early for many organisations to count the true cost of COVID-19, uncertainty and nervousness within the workforce is nonetheless reflected in significantly higher applicant numbers.
If you are advertising a role that has a mainstream role title, expect to receive a higher than normal level of interest. It is likely that this response will be drawn from a variety of sectors.
While this may sound appealing to those seeking a cost-effective approach to recruitment, beware: within the higher numbers, we have experienced a much higher volume of candidates who have not given consideration to the organisation or context.
While overall numbers are up, focused search is still producing the top contenders for jobs; effective and thorough screening is also essential. We anticipate further increases as we enter the Summer period, once it becomes clear that organisations are unable to continue employing the same numbers of staff.
Searches for particular Chair and Board member appointments will take longer to complete. Overall, the market of suitable and available non-executives has contracted. This is because high calibre applicants who are already serving on boards are now being asked to increase their time commitment significantly, in order to help those organisations through the transition phase. For many, this will make it impossible to commit to a new role for the time being.
The lockdown period has presented an unrivalled opportunity to access very senior people without the usual structure and boundaries of the working week. Paid non-executive Chair posts are continuing to attract a good response, subject to the usual considerations (financial health of the organisation, reputation and strategic priorities).
Voluntary chair roles where the organisation is funded through contracts, membership or another comparatively stable source, are also continuing to attract high quality applicants in smaller numbers.
All Chair candidates are taking their time to carry out additional due diligence and may require greater access to detailed information. Mainstream charities with a historical reliance on fundraising, for example, may appear to present a more mixed opportunity, especially while the impact on future income is yet to be understood. For this reason, our role as advisers and brokers on these appointments has become more fundamental.
….
All organisations will need effective leadership and governance if they are to transition successfully out of the current period. They must have the right skills, experiences and perspectives at the top to make confident choices about the ‘new normal’, and to begin the process of planning for a new future.
These appointments continue to require outstanding people with the vision, commitment and tenacity needed to take organisations, and possibly parts of the sector, forward. While current conditions mean there may be additional questions for candidates to ask, these roles remain outstanding opportunities to restore, revive, and deliver positive change for good.
Towards the future: why professional interim managers have a role to play in the post COVID-19 transition period
The crisis phase of the COVID-19 pandemic has continued to evolve at an unprecedented pace. But while those charged with leading and governing organisations – across all sectors – remain focused on steadying the ship, the last week marks a sizeable shift in thinking and attitude. In particular, the many leaders we have stayed in touch with during this period – wherever they are working – have now started to look ahead.
Few will tell you that they have the answers. Like most of us, they have been listening to an increasing number of influential voices, each busy painting a picture of what our lives may look like as we come out of the biggest global health crisis of our lifetimes. From these varied sources, we are all starting to shape our own view, and piece together our own emerging picture of what the future could hold post lockdown and, longer term, post coronavirus.
Even in such unprecedented times – and very likely precisely because of them – effective leadership depends on practical, real world solutions. For many organisations, continued uncertainty and ambiguity will delay long term commitments. However, the skills of interim managers – especially in handling change and transformation, and in sense-making from chaos – will make these professionals a fundamental part of the senior transition team.
Here are our top six observations on how best to source and utilise the best interim talent:
1.As we emerge from crisis management to business continuity, organisations are likely to find internal capacity is limited and look to appoint strategic advisors on a short-term basis, for example in areas such as workforce planning or financial modelling.
2.A recent YouGov poll commissioned by the RSA( https://flo.uri.sh/story/262445/embed#slide-0) showed that fewer than 10% of people want a complete return to normal after lockdown is lifted and organisations will already be thinking about their future delivery models and the impact on their workforce. Even though people feel confined by lockdown, most have valued the time at home and agile working. Digital capacity within organisations was mobilised at lightning speed and will likely go further. As organisations build capacity and seek investment in technologies to enable more remote working, we expect to see a spike in requirements for interims with experience of digital transformation and innovation.
3.Organisations will be starting to onboard employees virtually; this will continue and can be utilised for Interim hires. Interims have proven track records in their fields and can be relied upon to deliver on objectives set even in a virtual environment.
4.The future of some organisations is already uncertain. We are expecting to see more collaboration (including mergers) between similar organisations to survive; this puts added strain on stretched workforces. We work with many Interims who have specific talents around Mergers and Acquisitions, Restructuring, Organisational Design. Strategic intervention at this time could add significant value. You may not have the expertise internally and acting quickly will pay dividends. External interim leaders can make tough decisions without fear of fallout from the organisation.
5.The environment we are working in now is unchartered territory especially for CEOs – consider hiring Interim expertise at CEO level, Interim Managers can empower you to make the best strategic decisions for your organisation.
6. You may have gaps on your leadership team and a weakened infrastructure at this time means more work for the CEO – Interim Managers can help fill these gaps and give extra capacity to executive teams.
The interim market is strong. Outstanding experienced leaders can be accessed quickly and cost effectively by any organisation looking for remedial or specialist support. Like everyone else, people who have chosen to invest in an interim leadership career are keen to add value and expertise to organisations in these changing times. Many are uniquely equipped to join senior teams at short notice and provide essential support with their trademark resilience. As we move deeper into the stocktaking and transition phases of the COVID-19 response, we would encourage organisations to think laterally about the solutions they may need, and to consider the benefits that this community can offer.
Can you really hire to roles in the Social Sector in such difficult times?
The last few weeks have seen more dramatic change and upheaval than many of us have experienced in our lifetimes, with limitless different personal and organisational reactions to the covid-19 situation as it has continued to unfold. Despite everything, organisations still need leaders who can help strengthen their response to the crisis, and transition out of it, whether new Board members, interim or permanent staff.
We have been asked the question about when and if it is worth recruiting at the present time. Starfish Search has remained available to support the Sector during this period and our advice to those leading organisations, based on our own experience, recognises the unprecedented times we are in. Here are our top five observations:
- While organisations choose to respond one way or another, response to this situation is personal. As one client put it, when deciding whether to continue hiring in such a fast moving situation “this is both everything and nothing”. The nature of this particular stage of the crisis, and lack of precedent for it, has elicited the widest range of personal responses and about as many shifts in perspective and priority. The most challenging aspect of searching in these conditions is the requirement to connect with people at a time when there are so many different reactions, and before people can really see the light at the end of the tunnel. It can be hard to anticipate and takes skill, sensitivity and time.
- Messaging needs careful thought. While we have been searching throughout this period, the style of engagement we have used has been different. Searches at the moment need to be framed in the current context, highlighting the hiring organisation’s role and position. A strong focus on delivering outcomes for the organisation and those who depend on it, rather than the ‘process’ of recruitment, is helpful along with clear and honest messaging.
- Professionalism will mean loyalty for many. Accepting and respecting values is everything when hiring at this precise moment. For some CEOs and Directors, it is not the right time to consider a move although many will happily start the conversation and forge links. Those who had planned to make a move this year, pre coronavirus, are engaging well and searches are moving because of them. Those who can see how their organisations may transition out of it are also engaging, although it may feel like early days. The real test lies in the ability to secure commitment from top candidates. Many feel a strong sense of duty to their current organisations and teams. When leaders have been furloughing staff, they are naturally concerned about the ethics and optics of recruiting at the same time. But again, the situation is moving quickly.
- Time and access is on our side. Longer timescales are giving people the mental space they need to consider a new opportunity properly and at a pace they can manage as they lead organisations while juggling work and home lives. Technology – such as Zoom – has made it easy to engage with people meaningfully despite social distancing measures. In some instances, engaging with people outside of the confines of a traditional office environment have made for a richer connection, and of course, we are all expecting the practices of old to change for good. As ever, flexibility in the process is helpful. Levels of accessibility at the moment are exceptional making this a productive time to hold conversations with people about their current experience and pressures, along with their plans for the future.
- Proceed with non-executive search. Levels of availability, combined with the emphasis on good governance and stewardship to steer the course make this a good time to search for non-executives. Bear in mind that highly effective non-executives with existing board appointments may be in increasing demand by their current boards as the impact the coronavirus crisis starts to become clear, and the route out of it. Some non-executives may find that, after all, they are not in a position to consider taking on something new. For them, this is not just about the period of lockdown, but about being there to support the longer term future of their organisations.
Many organisations are holding off making decisions about hiring now for obvious reasons – they are still in crisis mode, are experiencing major financial and broader uncertainty, or are simply not yet in a position to prioritise particular posts. But it is, for many, a question of time; as the situation evolves, organisations and the sector at large will begin the process of transition. We will all have a role to play in shaping the ‘new normal’ and building the future together.
However, others will need to and want to proceed with recruitment for key roles at the present time and there is no need not to, so long as the process remains sensitive to the circumstances. Flexibility is key. Some searches will move slower than others depending on the role or even the prevailing values within that community. But all search can succeed with sound and realistic planning and an authentic focus on engagement and connection.
Embracing transparency
Earlier this year we held a client round table event under Chatham House Rule to discuss the topic: ‘If transparency builds trust, what’s stopping us from embracing it?’ 15 charity CEOs and Industry leaders joined us. Thanks to 11 London and Trust Impact for partnering on this event and Kate Lee, CEO of Clic Sargent for giving such an insightful and honest appraisal of how transparency around impact reporting has created positive change both internally and externally at Clic.
In an age of misinformation, trust and transparency hold powerful currency. But in the non-profit sector, the fear of speaking honestly about failures is still holding many leaders back. Are they right to be afraid, or should they take the plunge and issue a ‘warts and all’ impact report?
Last week, 11 London teamed up with non-profit experts Starfish and Trust Impact to hold a breakfast event with 15 charity CEOs and industry leaders, hosted by broadcaster Liz Barclay, where we discussed how speaking honestly about failure can build trust. Here are 11 key insights from our debate about why it’s good to be transparent – and how to go about it:
WHY:
#1: Being honest about your failures means people believe your success stories: one charity that saw an uplift in major donations was told: ‘Because of the honesty, I believed everything else’.
#2: Transparency also builds engagement: your donors and beneficiaries will feel included in your challenges (as they should), rather than sold to.
#3: Honesty can win awards as well as hearts – as Clic Sargent’s ‘Hands up, we’re not perfect’ annual review proved.
#4: The cultural pressure that ‘this must work’ can freeze things up. Conversely: ‘Transparency has improved our internal culture. Because people have permission to fail, they’re trialling stuff.’
#5: Integrity is important to a new generation of job candidates – a transparent organisation attracts a bigger, better pool to recruit from.
HOW:
#6: You can’t start being open with the outside world if your own team don’t feel they can admit their failures. So grow a culture of transparency within your organisation first.
#7: Build psychological safety in your team. By giving people permission to fail, and ensuring that ‘failure’ isn’t seen as personal, you also empower them to learn.
#8: Your donors and beneficiaries are part of your team, so talk to them as though they are – you could even ask service users to write your review!
#9: Honesty provides a real opportunity to educate people about how complicated your work is – so don’t be afraid to be complex with some audiences.
#10: Thank your team members personally for being honest – one CEO recommends a handwritten letter.
AND FINALLY…
#11: If you’ve already aired your dirty laundry, no one else can wave it around. One CEO was told by a journalist: ‘I couldn’t find anything out you hadn’t already said.’
IR35 SUMMARY
IR35 Summary
From April 2020 the administration of IR35 was meant to have changed, this got delayed for a year due to Covid-19. IR35 known as intermediaries legislation was introduced in 2000 by HMRC to stop ‘disguised employees’ from avoiding tax by operating as contractors, whilst working in a similar way to employees. The liability has mostly fallen on contractors, until April 2020, when hirers will be responsible for assessing the IR35 status of contractors.
Hirers Responsibility
From April 2020 Hirers across the private and not for profit sectors will be responsible for conducting ‘reasonable care’ in case-by-case assessments of contractor’s IR35 status. Hirers will be liable for these assessments meaning it is important to consider the key factors outlined by HMRC to determine whether a contractor operates ‘inside’ IR35 or ‘outside’ IR35.
Contractors Responsibility
Private sector and Public sector contractors have been impacted differently by IR35. From April 2020 private sector contractors will be subject to the same process as public sector contractors. Hirers will assess the status of a contractor to determine how their relationship most aligns with IR35 regulation. Factors such as in work practices and written contracts can be part of the assessment, so it is important for contractors to understand how they can demonstrate most accurately, their service.
IR35 excludes “small” businesses, meaning the contractor could still be responsible if their business falls in line with two or more the following;
- Annual turnover is no more than £10.2 million
- Balance sheet total is no more than £5.1 million
- No more than 50 employees.
In this case a contractor will be responsible for determining their own IR35 status and paying relevant taxes/dividends etc.
IR35 Key Aims
The changes to IR35 are important to HMRC as they aim to stop contractors from intentionally avoiding tax or attempting to pay reduced tax by changing employment status not job role. For example, an employee could stay within one company and maintain the same responsibilities, whilst officially leaving as an employee on a Friday and returning as a contractor on a Monday. Often this reduces the amount of tax payable by the contractor, whilst they sustain the same job role and income. HMRC will use IR35 legislation to ensure contractors providing a service will pay broadly the same tax and national insurance contributions as an employee would.
Outside IR35
If a contractor is identified by a hirer as outside IR35 they are deemed to be operating a genuine business. Contractors outside IR35 are responsible for paying their own salaries and tax payments. Even if a hirer has declared a contractor outside IR35, HMRC can still investigate a contract. Although the hirer is responsible for the assessment, it is important for contractors to produces relevant evidence and ensures they agree with the outcome. It is the legal requirement for a hirer to provide evidence of assessment to a contractor when requested.
Inside IR35
If a contractor falls inside IR35 they are subject to PAYE and considered an employee for tax purposes. Recruitment agencies or umbrella companies can act as an employer by paying through their payroll, deducting tax and NICs. To ensure the required tax is paid, a contractor may be required to make a deemed payment of income tax at the end of the tax year. If HMRC determine a contractor inside IR35 who has been operating outside IR35, the contractor (or hirer in the case where unreasonable care has been placed), will be responsible for paying income tax, interest, NICs and penalties payable during the accounting period in question.
Who is Responsible?
Compared to the responsibility previously being held in the main by the contractor, the changes in 2020 will require hirers to conduct assessments before engaging with contractors. Hirers will be responsible for determining whether a contractor falls inside or outside IR35. A hirer may become liable for tax that should have been paid during an accounting period by a contractor, if the hirers cannot demonstrate ‘reasonable care’ within the assessment.
What constitutes reasonable care?
To assess a contractor the following indicators can be reviewed. It is important for a hirer to use a demonstrable level of care when assessing contractors to avoid financial liability. There are no direct requirements laid out by HMRC to outline reasonable care. Reasonable care can be demonstrated by conducting case by case assessments opposed to blanket determinations that do not accommodate for individual circumstances.
Key Indicators for Hirers
Although ‘reasonable care’ has not been elaborated on by HMRC, there are key indicators that hirers can use in making their determination, based on learning curves of the public sector. These indicators can be displayed in working practice as well as written contracts between contractors and hirers.
3 Core Factors: Supervision – Substitution – Mutuality of Obligation
Supervision and Control should remain largely with the contractor if operating outside IR35. As a contractor has been instructed for their service, they should maintain autonomous control of the process. For example, working times, schedules or working locations. If a hirer is involved in this area of service, HMRC could deem the employment relationship inside IR35.
Right of Substitution enables contractors to substitute themselves with another worker or instruct help from other workers. This should be possible when operating outside IR35, as it demonstrates that the contractor has been instructed based on their skills/qualifications not based on them personally. This clause is not at the cost of the hirer, as reasonable grounds will allow them to veto substitution.
Mutuality of Obligation affects both parties. When a contractor operates outside IR35 they hold no obligation to accept ongoing jobs from hirers. Instead, contractors are obliged to accept a job offered to them on a project-by-project basis. Overall, a client has no obligation to offer a contractor more work in the future, and a contractor has no obligation to take such work on.
Other Indicators
Financial Risk is considered a key indicator of contract work outside of IR35. Contractors payments are often subject to the delivery of their service, unlike employees who are unlikely to receive a negative impact to their salary, based on poor performance. Contractors often receive payment when a service is complete or at key milestones of a project. If a worker is receiving a regular or guaranteed income they are likely to be inside IR35.
Provision of Equipment such as resources, training and insurances provided by the hirer could be considered as indicators of employment (operating within IR35). Contractors providing their own equipment, training and insurances is likely to constitute as business outside IR35.
Employee Benefits commonly associated with employment such as holiday pay, sick pay and pension contribution can all be considered indicators of an employment relationship inside IR35.
Get in touch with Starfish if you are an Interim candidate or a hiring client. We have the skills and expertise to advise you on the best ways to approach the IR35 changes effective in April 2021.
catherine.kift@starfishsearch.com
07591 952632
So you messed up. So what?
This is an unprecedented moment in time, where the old rules no longer apply. So what does this mean for the future of leadership in the social sector?
In the age of bluster, having the courage to own your mistakes can be a positive strength, say Matt Hunt, Juliet Taylor and Matt Stevenson-Dodd.
We got cocky, we thought anything we did would work’. Last month on Channel 4, celebrity chef Jamie Oliver was filmed breaking down in tears about how his restaurant business had failed, and admitting the mistakes he’d made. For someone so clearly committed to driving social change, and remaining in the media spotlight, wouldn’t this confession be damaging? Not according to psychologist Guy Winch in his 2018 article in Psychology Today1: ‘Some people have such a fragile ego, such brittle self-esteem, such a weak “psychological constitution”, that admitting they made a mistake or that they were wrong is fundamentally too threatening for their egos to tolerate.’ By contrast, ‘It takes a certain amount of emotional strength and courage to deal with that reality and own up to our mistakes.’
In an age dominated by blustering ‘strong man’ politics both sides of the pond, a frank admission of fallibility could be decidedly refreshing. And those who ‘fess up to failure are in distinguished company.
Many of our most iconic success stories exemplify how we can ‘fail forwards toward success’, to quote CS Lewis. Just look at Steve Jobs (fired by Apple), Michael Jordan (cut from his high school basketball team) or James Dyson (5,126 failed prototypes and all of his savings spent before inventing the bag- less vacuum cleaner).
At a corporate level, Silicon Valley tech businesses have long espoused the ‘fail fast’ model of prototyping ideas, testing lots of quickly developed ideas in the live market to see what actually works – as opposed to believing what people might do, so often the currency of market research. Testing first to see what fails, culling it and then rapidly promoting what works seems like common sense – but this approach is only just gaining traction in advertising and communications, which have long favoured a subjective and inflexible reliance on one ‘big idea.’
In the world of social change, where the problems faced by society are extremely complex, and traditional solutions are not reaching those in the most complex circumstances, we need to be brave enough to take risks and try new ideas, work in partnership and share transparently what we learn. Taking risks means we won’t always get things right and that is ok. The learning that comes from failure is often much more valuable for working out new solutions than success. And if those trying to effect social change are open about their failures, it makes the successes they are reporting that much more plausible.
This holds true when it comes to attracting financial support. If you can show what you’ve tried to do but failed, and so indicate where the need is – and where the solution is bigger than one person or one organisation – it can help drive home the case for support. Often the fact that something has failed makes the next iteration of the solution that bit more likely to succeed.
It takes nerves to swim against the tide. But the evidence suggests that far from being seen as a human weakness or a commercial threat, a readiness to admit to failure may yet prove to be your biggest strength.
Humility and authenticity are in fact great leadership qualities. Why then, for many leaders, does a nervousness to share what they have learned from their mistakes remain? As Ellen DeGeneres wisely said, ‘It’s failure that gives you the proper perspective on success’.
We are three organisations who each want our work to contribute to a better society. We share a common belief that social change is everyone’s responsibility and bring different perspectives and expertise to the table.
Our collaboration is based on a belief in co-production and that, together, we will always achieve more.
Trust and Transparency
This is an unprecedented moment in time, where the old rules no longer apply. So what does this mean for the future of leadership in the social sector?
In 2019, society faces vast problems: poverty, environmental destruction, people feeling disenfranchised. Such complex issues cannot be solved by one sector acting alone, or by using the simplistic ‘cause and effect’ paradigms of old.
At the same time, in our digital age, organisations and leaders have greater professional and personal exposure. The days of automatic trust are long gone. Clearly, a new approach is needed – and a new kind of leadership, based on transparency and trust.
We need individuals who will understand the interconnected nature of the issues we are dealing with, try new ways of working together to tackle them, and learn whether their approach works in real time, through world class monitoring and evaluation. They will know when they are successful but also be open when they are not successful – sharing their findings and learning together.
This more collaborative, open style certainly challenges the accepted view of how the social sector should operate. Moves towards greater commercialisation and payment by results over the past 20 years have driven a style of management that is not always transparent – and may, in fact, be less likely to stimulate partnerships. The challenge is to change that in an age where trust will be ever more important, especially for millennials and Gen Z.
The good news is that the face of leadership has already started changing. Even five years ago, recruiters were still seeking leaders with ‘functional’ experience – experienced in management, good with numbers, unlikely to frighten the Board. But today – with increased competition, less stability and more movement between sectors – the old skillset is too rigid. Instead, we actively seek leaders who are agile, creative and externally-focused.
In 2019, the people who are most effective in driving positive social outcomes not only lead and inspire their own organisations, they also look outwards to catalyse change.They influence other organisations, and even sectors, and encourage action based on shared vision. They are flexible, adept at forming partnerships and comfortable with ambiguity.
These leaders also communicate more authentically. They are unafraid to show humility. This means that the way they report on performance may be different – based on a higher degree of openness about failures, and on new, even experimental measures of success.
In a world where the future is unknowable, transformation depends on the ability to continuously experiment and adapt. Leadership that relies on fixed outcomes, or a rigid plan, simply won’t deliver.
If you embrace the risk, things will go wrong. But transparency is also the only way to win lasting trust – and with it, the funds you need to change the world.
We are three organisations who each want our work to contribute to a better society. We share a common belief that social change is everyone’s responsibility and bring different perspectives and expertise to the table. Our collaboration is based on a belief in co-production and that, together, we will always achieve mor