Caveat Emptor!

The term is actually part of a longer statement:

Caveat emptor, quia ignorare non debuit quod jus alienum emit

(“Let a purchaser beware, for he ought not to be ignorant of the nature of the property which he is buying from another party.”)

This implies that buyers should inspect and or otherwise ensure that they are confident with the integrity of the product or service before completing a transaction.

How does that apply to recruitment?

Labour is essentially a service that you as an employer buy! Over and above normal supply and demand, Labour is also governed by state intervention i.e. the Labour Relations Act. It regulates the relationship between employer and employee and affords rights to employees industry-wide to negotiate and or demand concessions from the employer.

I do not for one moment decry the fact that the rights of workers are protected and regulated. History has shown how workers were, and in many instances, are still abused in the workplace.

However, as a ‘buyer’ of labour services, the law is very clear: Employer, do your homework for the onus rests upon you!

Getting it wrong can be very costly.

One can describe the relationship between employer and employee as similar to a marriage. However, it’s a marriage where the vows were written by the Employment Relations Act and embellished by external parties such as Labour Unions.

The financial implications and other fallouts related to this relationship can be very costly when things go south if the employer is not careful!

Changes to the Employment Relations Act have seen the removal of the ninety-day trial period for businesses with more than twenty workers and replaced by a thirty-day probation period with strict conditions etc. More than ever is it incumbent on employers to ensure that the right person is recruited and appointed to fill that empty space on the work roster. The employer also has to pay for 10 days of Family Violence leave, over and above all the other leave entitlements, etc.

The media regularly reports on Employment Court decisions that went against the employer, often with significant penalties imposed.

Some employers insist on dealing with the recruitment and employment process themselves. Large employers use HR specialists on a temporary or full-time basis to deal with HR matters, including recruitment. Some large organisations have their own recruitment teams.

The risk, however, is probably the biggest among the myriad of small businesses that cannot afford the services of HR specialists or dedicated recruitment teams. They make up the backbone of the New Zealand economy.


Some interesting stats:

  • 97% of enterprises in NZ have fewer than 20 employees;
  • 29% of the workforce in NZ are employed by enterprises with fewer than 20 employees;
  • 96% of enterprises with less than 20 employees are independent operators not owned by others;
  • 28% of NZ GDP is estimated to be produced by enterprises with less than 20 employees;

To cut to the chase: How do you get it right?

  • Comprehensive Job description/task specification. This is very important as it should inform what criteria apply to the position to be filled.
  • Proper initial CV screening to identify the most promising candidates. Be careful of sterile CVs!
  • Effective first interviews. Know what to look for!
  • Proper skills assessment and interviews by the client.
  • Proper background assessments, which should include profile assessments, preferably augmented by psychometrics which will assess

* the cognitive functioning of the candidate

* the personality of the candidate

* the integrity of the candidate

  • Police clearance, and drug testing (if required).
  • A proper employment agreement, signed by both employer and employee.
  • If you use a recruiting service provider, regular follow-ups to assess the progress made by the candidate in fitting into the work environment.
  • A guarantee that the candidate would be replaced within a reasonable period if things do not work out.

If you do your own recruitment – the above is what you have to watch out for.

Caveat Emptor – It does apply to Recruitment!

If you are not experienced in people assessment:

  • ExecuConsult can assist you to appoint the best talent available. 
  • It will be worth your while.
  • You remain in control of the process.
  • You will save time and money.

ExecuConsult 5/2023

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