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13th May 2022
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Demand for staff remains robust
The latest research from KPMG and the Recruitment and Employment Confederation (REC) indicates continued robust demand for staff combined with a shortage of candidates and increased competition has driven many firms to up pay offers for permanent and temporary workers. Employers added permanent staff at the weakest rate in over a year, however, suggesting the labour market might be cooling a bit. Neil Carberry, CEO of the REC, explained: “The number of job placements being made is still growing, but at a more stable rate.” He went on to add: “The labour market has been tightening for months on end, driving near-record growth in starting salaries for new staff . With vacancy numbers also historically high, this is a great time to be looking for a job – and a pay rise to help meet the rising cost of living.”
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Fewer than one in ten firms demand full-time office return
A survey of businesses by estate agent CBRE has found that fewer than 10% of companies have told staff they must come back to the office full-time. The majority of respondents expect to push for a return to more regular office life in the coming months, but just 6% are planning to enforce full-time commuting. Richard Holberton, head of EMEA occupier research at the CBRE, said: "Companies must now decide how much personal autonomy to allow as well as the balance between office and home."
Lloyds plans to prioritise junior staff for pay rises
Lloyds Bank chairman Robin Budenberg said the company plans to prioritise junior staff when reviewing pay packages as they were particularly hard hit by the cost of living crisis. During the bank’s AGM on Thursday, Budenberg was accused by union members of giving employees a pay rise that “doesn't even touch the sides” while paying out £1.4bn to shareholders after raking in £5.9bn in profit. Budenberg responded by saying all awards “are determined by the board's remuneration committee following extremely careful consideration” and that the £399m the bank pays in bonuses is lower than many other major UK banks. He added: “However, we know that as we deliver the next phase of our strategy it's vital that we're able to attract and retain talent and reward our colleagues appropriately. Our bonus awards are directly based on a percentage of our underlying profit.”
HSBC launches $1bn lending fund for female entrepreneurs
HSBC is launching a $1bn lending fund to invest in female-owned businesses over the next 12 months. Sam Cooper-Gray, global head of market strategy at HSBC Business Banking, said: "The level of funding received over time by female-led businesses is significantly lower than male counterparts, while the recent impacts of the pandemic have seen these same businesses disproportionately affected.”
KPMG fined £14.4m for misleading regulators over Carillion audit
A tribunal ruled on Thursday that five KPMG auditors were guilty of misconduct after forging documents in an effort to mislead regulators over botched audits at the collapsed outsourcer Carillion. A sixth auditor, Stuart Smith, settled with the accounting regulator before the tribunal began in January. He accepted a £150,000 fine and a three-year ban as a qualified accountant. Peter Meehan, the partner responsible for auditing Carillion; senior managers Alistair Wright, Richard Kitchen and Adam Bennett; and junior auditor Pratik Paw - were found to have created false spreadsheets and records of meetings in response to questions from quality inspectors about work on Carillion and Regenersis, another outsourcer, between 2015 and 2017. Mark Ellison QC, representing the Financial Reporting Council, said the tribunal found that the four senior KPMG auditors “acted deliberately and dishonestly in the creation of false documents and the making of false representations” to the watchdog. Mr Paw, the junior auditor, acted without integrity but not dishonestly, the tribunal found. Individual penalties, which could run to hundreds of thousands of pounds, will be formally decided in the coming months. The FRC recommended partner Peter Meehan be banned from the profession for 15 years and face a fine of at least £400,000. KPMG UK itself was fined £20m reduced to £14.4m to reflect the firm’s cooperation and willingness to admit guilt. The penalty marks the biggest in KPMG’s history and the second largest levied on any accountant. The firm will also face a “severe reprimand” over the “extremely serious” misconduct. Commenting on the settlement with the FRC, KPMG’s chief executive, Jon Holt, said KPMG was “deeply sorry that such serious misconduct occurred in our firm. It was unjustifiable and wrong. It was a violation of our processes and a betrayal of our values. The FRC is running separate investigations into possible failings by KPMG in the Carillion audits.
MPs want dodgy bosses to go to jail
A group of MPs including Kevin Hollinrake and Dame Margaret Hodge have said bankers and accountants should be held responsible for failings in their checks and balances and go to jail if they fail to prevent economic crime. Dame Margaret said: “It is tragic that it has taken the war in Ukraine to bring the dirty money crisis to a head. We must act in a determined and effective way.” The lawmakers have published a manifesto on economic crime urging the Government to step up the fight against fraud and money laundering. The group praised the Government for pushing ahead with its Economic Crime Bill but urged ministers to strengthen it in the four key areas of transparency, enforcement, accountability and regulation.
Riders at Deliveroo unionise with GMB
Over 90,000 self-employed riders at Deliveroo have unionised with the GMB Union, giving them rights to collective bargaining on pay and consultation rights on benefits and other issues, including riders’ health, safety and wellbeing. Will Shu, Deliveroo founder and CEO, said he was delighted to partner with the GMB in a “first-of-its-kind voluntary agreement.” He said the agreement was “exactly the sort of partnership the on-demand economy should be based on” and would give self-employed riders “flexibility, guaranteed earnings, representation and benefits.” However, the Independent Workers Union of Great Britain, which has lobbied for Deliveroo riders to be recognised as employed, criticised the move. The union said Deliveroo had made a “backroom deal” with the GMB, which “presents no threat to their exploitative business practices.” 
Over 90k civil service jobs to be axed
Boris Johnson has ordered ministers to identify where department jobs can be cut as the PM calls for the size of the Civil Service to be slashed by a fifth. Hinting that the savings could help pay for future tax cuts, the Prime Minister used a Cabinet meeting in the Midlands on Wednesday to demand the cost of government be lowered to reduce the cost of living.
Young Londoners given chance to work on Hollywood productions
London Mayor Sadiq Khan has announced a deal with Hollywood's Universal Studios and Film London that will see young people in the capital given the opportunity to work on movie productions being made in Britain. Universal Studios will enable hundreds of of trainees to work on films, with priority given to Londoners from diverse communities under-represented in the film industry. Jobs as part of the initiative will include digital imaging, props, costumes and being an assistant director.
Twitter announces hiring freeze and departure of two senior leaders
Parag Agrawal faces a potential investor revolt at the Twitter’s AGM later this month over his $30.4m pay package with ISS and Glass Lewis both recommending a vote against the CEO’s remuneration plan.
UK’s accountancy sector sees turnover soar
New figures from the Office of National Statistics show UK accountancy firms generated more cash in March than in any other month on record. Turnover in the sector jumped 14% from February to March to record highs of £4.13bn. Professor Atul Shah said the results were no surprise as the major firms are “highly diversified” through various streams of income on top of their “income base from audit”. But Julie Mathieson, a partner at Kingsley Napley, said the sector should be preparing for “upcoming regulatory headwinds” considering plans to replace the Financial Reporting Council with a new, tougher regulator called the Audit, Reporting and Governance Authority. The accountancy sector’s record high comes as turnover across the whole of the UK’s services sector jumped by a 20% to £243.4bn in March this year. The UK’s legal services sector also saw turnover increase 19% between February and March, to £4.05bn.

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