The benefit to the client is obvious. Instead of dealing with a wide range of recruiters and being subject to lots of different sets of terms of business, they can deal with all recruiters on the PSL in a uniform way. This in turn streamlines processes and costs for the client. However, this can lead to potential pitfalls for the unwary recruiter, used to dealing on its own terms.

Here are some of the key pitfalls recruitment agencies should watch out for when entering into the PSL terms:

Your terms will no longer apply

If a recruiter signs PSL terms, then the supply and subsequent hire of a candidate will be subject to those terms. Such terms typically will include a longer lead time for payment.

Redefining “Introduction” 

PSL terms will generally have a narrower definition of what constitutes an introduction for the purposes of a fee being payable. Typically, PSL terms will state that an introduction is only made where the client has requested assistance with filling a vacancy (which potentially rules out fees for speculative candidates).

Exclusion of third-party Introduction fees

PSL terms may include a clause which specifically prohibits fees arising where a candidate is introduced by the client to a third party. This can be problematic where the client is part of a large corporate group and wants to move a candidate around between group companies.

Rebates and Refunds

PSL terms will have much wider powers in regard to claiming rebates and refunds for candidates that don’t work out.

Entire agreement clauses

When a candidate was supplied under the recruiter’s terms, but hired after signing PSL terms, what happens to the recruiter’s fee if a candidate is mid-placement and then PSL terms are signed. Under what terms does the recruiter invoice? An entire agreement clause will usually state that the PSL terms supersede and replace any terms that were in place between the parties.

 

Using a PSL can be useful in many ways, but it is important to keep in mind the limitations they place on a recruiter’s ability to be paid for its services.

To find out more about PSL terms, please contact Aaron Heslop.

The Community Business Awards celebrate the outstanding contribution that both individuals and businesses have made in the St Albans District and the perfect opportunity to showcase achievements to clients, suppliers, stakeholders, and the local business community. The awards are put on by the St Albans District Chamber of Commerce, who provide a platform to connect with fellow businesses in St Albans and the surrounding areas of Harpenden, London Colney, Redbourn, Sandridge and Wheathampstead.

Abby started with us as a Marketing Apprentice, just under two years ago, where she has recently qualified as a Marketing Assistant. She continues to work hard, helping the Marketing team and departments across the board.

The Young Employee of the Year Award recognises stand-out young business stars across the St Albans Business District, where they must be under 30 years old and in the business for 5 years or less.

We are really pleased that Abby is a finalist for this award and wish her the best of luck for the award ceremony in November.

Thank you to everyone that nominated.

A new Scale-Up Visa route will open to applications on 22 August 2022. A new route to entry, this is aimed at individuals with talent, a high level of qualification and skill.

For employers who are registered sponsors and experiencing rapid growth (needing to “scale up”), this route is designed to make the process of sponsoring visas quicker and easier.

Sponsored Scale-up visa applicants must have a valid Certificate of Sponsorship from an A-rated Scale-up sponsor have the specialist skills required to continued growth of the Scale-Up business and authorised by the Home Office to sponsor the job in question under the Scale-up route.

To qualify as a Scale-up, a sponsor will need to show:

• annualised growth in either turnover or staffing of at least 20% for the previous three-year period and
• a minimum of 10 employees at the start of the period.

Much of the flexibility of this new route is that unlike other immigration routes, a sponsoring employer need only confirm that an applicant is expected to work for them for at least the first six months of their visa.

The job for which the applicant is sponsored must be (amongst other things):

• a minimum skill level of RQF Level 6 (graduate level) (on a list published by the Home Office of jobs with their occupation codes and salary ‘going rates; and
• a salary threshold of at least £33,000 per annum (higher than a Skilled Worker’s £25,600), the ‘going-rate’ for the sponsored job and at least £10.58 per hour; and
• applicants must meet an English language and finance requirement.

Under this flexible immigration route, a second stage exists during which Scale-up Workers no longer require sponsorship. If applying after two years under the Scale-up visa, a worker would need to show that they had sufficient PAYE earnings for at least 12 months during those initial two years, in addition to a Scale-up Worker’s English language and finance requirements which at this stage are likely to be met automatically.

Provided these criteria are met, the visa application process would then be fast-tracked by the Home Office.

This is a route which could lead to settlement after five years, and applicants could bring dependent family-members. However, the individual would only need to be sponsored for the first six months, meaning that a sponsored employee would have more freedom to leave the employer and work elsewhere.

Employers utilising this route may therefore wish to consider other retention mechanisms, such as bonuses, restrictive covenants or repayment of visa fees on leaving.

If you are interested in finding out more about the new Scale-Up visa, click here to speak to Solicitor and Partner, Emma Peacock.

Read the second article in the series, Global Business Mobility visa by clicking here.

And the third, here: What is the High Potential Individual visa?

A few businesses are already setting up subsidiaries in the UK and the EU to deal with many of the issues arising from Brexit.

Whether you are already operating from the UK or managing a production line across the Channel, considering setting up or buying a business, here are some tips to bear in mind in the event of a “no-deal Brexit”:

1. Mergers & acquisitions – if you can manage the risk of currency volatility, then at law, the event of “Brexit” is unlikely to have a major impact on the regulations relating to UK share sale/purchase transactions unless they are affected by competition regulation.
2. Employment – Unless special arrangements are put into place by the UK, employing and recruiting new EU nationals in the UK will require work and residence permits. Each European country (UK included) is currently setting out their own set of rules.
3. Shorter contracts – Your business model should allow enough margin to absorb currency fluctuation which will also have an adverse effect on your ongoing contracts if they cannot be terminated on short(er) notice.
4. Transfer of EU data to the UK – It is not expected that the EU will confirm on short notice that the UK legislation is “adequate” to allow the transfer without additional protections of personal data to the UK from say a French or German company. Until then, businesses will need to use EC Standard Model Clauses. However, these clauses do not cover all circumstances.
5. Intellectual property rights (IPR) and parallel imports – IPR will need to be registered both in the UK and in the EU. In addition, UK businesses will no longer benefit from the EU doctrine of exhaustion, which prohibits IPR holders from enforcing their rights in respect of the resale of goods originally sold in the EU with their permission. This will give more opportunities to EU businesses to block parallel imports in Europe from their UK competitors. Consider also changing your “.eu” domain name now.
6. Cross-border traders – Suppliers are advised to set up companies in the UK to ensure the continuity of the production and reselling chain and keep their market share in the UK.  If you buy your components from local suppliers, have you thought about conducting an audit of where they source their materials?
7. EU regulations – Review your contracts to address issues such like a reference to Italian/EU law as the applicable law to the contract, or a EU court (say Paris court) being competent to hear a dispute, or where the territory of your contract states “the EU”, or where the contract refers to a EU regulation. For example: is your business subject to the EU’s eCommerce Directive? Or what steps might you need to take to comply with separate UK and EU regulators in the future?
8. Distributors’/resellers’ insurance documents and trade/VAT/import papers should be in place and in this context, consider some of these questions and consider training staff:
   • Are you familiar with terms such like: INCOTERMS, or being registered with an EORI number, being an Authorised Economic Operator, processing a customs and Safety and Security Declaration, the temporary tariff schedule for imports to the UK?
     Do you know which country would be best suited to support your supply chain to EU customers/suppliers?
   • Do you have access to bank guarantees required by Fiscal Representatives?
   • If you are a business that is stockpiling, have you checked with your insurer or insurance adviser on whether you are still fully insured?

Your business does not have to deal with Brexit alone.  Please contact Paul Marmor as well as your tax advisors who should be able to assist.

Franchising has been lauded as a tried and tested way of growing a business by using the entrepreneurial skills and capital (without incurring debt or interest charges) of others.  It has also sometimes misguidedly been promoted as a solution for ailing businesses. Leigh Head, gives his Top 10 Tips for any aspiring Franchisor and what they should look out for to grow a business.

1. Competition – Find out who is likely to be competing with you for franchisees. This means researching to see who is franchising not only a business which is similar to yours, but also what other franchises are available for sale at the sort of price you are proposing to charge for your franchise.  Not all prospective franchises are wedded to the idea of only selling goods or services of the type being provided by your franchise.  Many are concerned with starting their own business and approach franchising with an open mind, but with a good idea of what they can afford.  They will therefore be looking at franchises within their price range.

2. Franchisee selection – Establish and stick to your criteria for those whom you consider to be suited to operate your franchise – do not lower your standards in a moment of weakness. The temptation is very great to lower standards when recruiting the first few franchisees or when the growth in your network is not keeping pace with your expectations.  If you are forced to do so for sound commercial reasons, do so in the full knowledge that it is highly likely that these franchisees will become troublesome in the future.

3. The future – Ask yourself what are you doing now that will make your franchisees want to renew their franchise agreements when they expire.  Franchising is a long-term proposition and franchisors who do not look to the future will find that their franchise network will diminish in the longer term.

4. Two Businesses – As a franchisor you have two businesses.  The first consists of supplying goods or services to your customers via your company-owned units.  The second is that of franchising.  Do not forget that your franchisees are your customers and that your obligations as franchisor to your franchisees are different and a good deal more onerous than those to your customers.  Remember also that the customers of your franchisees are your customers too, albeit indirectly.

5. Management skills – Improve your management skills and those of your staff.  The management of a franchise network is an art – not a science.  The big challenge your staff (who will be employed) will face is managing franchisees who are not your employees, but independent business people in their own right.  Managing them as managers of a branch business will not bring the best out of your franchisees and will lead to confrontation.

6. Support – One of the key obligations of a franchisor is to support its franchisees to the extent that it is necessary to sustain them in their business.  To avoid disappointment and accusations that you fail to keep your promises, always under-promise and over-deliver.  In this way you will gain a reputation for doing what you promise and more often than not, more than what you promise.  Whatever you do, do not fail to deliver what you promise.

7. Exclusive Territories – If you are granting exclusive territories, ensure that you have the necessary protocols and mechanisms in place for dealing with turf wars which can break out amongst franchisees.

8. Performance Targets – If you impose minimum performance targets you must be able to justify their imposition and the basis upon which they are calculated.  Make sure that they are reasonably achievable and be prepared to impose such sanctions as you may have reserved in the event that they are not reached, otherwise you will lose credibility and have problems in enforcing targets when others fail to reach them.

9. Standards – Do not tolerate sub-standard franchisees – they affect the whole network and certainly their neighbouring franchisees.  Failure by a franchisee to comply with your “system” is a mortal sin.  Uniformity is the key.  The key to your success and that of your franchisees is uniformity of business practices, uniformity of marketing image and uniformity of the quality and manner in which products and services are delivered to customers.

10. Bad may be good – Remember that it does not necessarily follow that the most demanding franchisees are the worst franchisees. Often, it is the most demanding franchisees who are also the best in your network.  That may be a coincidence or it may be that it is precisely because they are demanding of themselves and good at what they do, that they are demanding.  Better to have a very demanding franchisee who is firing on all cylinders and growing his or her business like topsy, than to have a quiet, compliant franchisee who merely chugs along with a tendency to use you as a crutch.

Contact Leigh Head for more information.