Zapoint starts as demand to automate hiring grows

November 16, 2007

by Christopher Calnan

Last week’s launch of a Brookline firm with software that converts resumes into charts for job recruiters is the latest regional entrant into an automated hiring software market that’s growing 22 percent a year.

The growth is being fueled by fierce competition to find qualified workers more efficiently, and New England firms are taking notice and carving niches.

Zapoint Inc. fired up operations with five employees and market-ready software that applies algorithms to information on resumes, to help employers compare job candidates.

“We call it a two-second resume,” said Chris Twyman, founder and CEO of Zapoint.

Zapoint’s software was developed with the help of a $250,000 angel investment, said Twyman, former senior director of solutions marketing for New York-based CA Inc. And while some companies, such as Zapoint, are focused on specific recruiter applications, others such as Chelmsford-based Kronos Inc. already offer a wide range of work force and human capital software suites. Kronos added to its arsenal this week with the purchase of Deploy Solutions Inc., a Newton-based firm that makes employee selection and hiring software.

The technologies being spun out of these companies look to effectively manage the avalanche of information the Internet has made readily available. Databases and online job boards have collected resumes beyond the point of manageability, said Art Papas, who co-founded online recruitment software company Bullhorn Inc. in 1999.

“It’s total overload,” he said. “And recruiters need tools to help them make sense of it.”

Boston-based Bullhorn now generates $8 million in annual revenue and employs 95 workers, Papas said.

Spending in the United States on automated hiring software is expected to rise from an estimated $750 million in 2006 to $2 billion by 2011, according to Lisa Rowan, program manager for human resources and talent management services at Framingham research firm IDC.

Twyman, who also helped launch UrbanFox, a United Kingdom-based online trading solution for telecommunication carriers, said Zapoint is approaching 1,000 members (users who submit resumes) after one week of operations. Revenue comes from fees paid by recruiters, which range from $2,000 to $5,000. Posting resumes is free, and workers who are selected by employers receive a $1,000 reward, Twyman said.

Zapoint’s plans include raising a $3 million to $4 million Series A round of venture capital next year.

Competition among automated hiring software companies in New England, however, is growing. Last year, Ireland-based recruitment software maker, Candidate Manager Ltd., opened a North American headquarters in Boston. And in 2005, H Three Inc., opened for business in Cambridge with a referral reward payment software system.

Other New England competitors include Zoom Information Inc., BrassRing LLC and Authoria Inc., all based in Waltham. Wayland’s Softscape Inc. and Auburndale’s Deploy Solutions Inc., also develop human resource software, including recruiting.

Nationally, the recruitment software space includes Pennsylvania-based Kenexa Corp., which bought BrassRing for $115 million last year, and PeopleSoft Inc., which was bought by Oracle Corp. in 2005.


Listing Top Jobs but Charging Candidates to Seek Them

November 14, 2007


RECRUITERS with six-figure jobs to fill know better than to post them online and start a stampede of marginally qualified job seekers. But they also know that the Web is the easiest way to find applicants.

The Web’s surprising answer to the problem? Charge them to look.

A growing number of niche sites devoted to high-end jobs are finding that applicants are willing to shell out a few dollars — or a few hundred, in some cases — for the chance to get access to job ads. The strategy will not help the big online job boards find more applicants for entry-level positions, but analysts say it is ideal for sites like, ExecuNet and others seeking the senior executive crowd.

It turns out that having the job candidates pay is a great screener, and employers love it,” said Charlene Li, an Internet analyst with Forrester Research.

Ms. Li said that the online employment category, which is dominated by Monster, CareerBuilder and Yahoo’s HotJobs, is expected to generate about $1.9 billion in revenue this year, up from about $1.6 billion last year. But she said that the category in recent years has undergone an explosion in the number of job boards that serve specific niches. (Industry executives say that there are roughly 40,000 job boards online.)

The upper-level jobs niche has been slower to develop, though, because companies typically hand off such jobs to corporate recruiting firms. Those firms, like DHR International and Korn/Ferry International, set up their own Web sites, but those sites are used mainly to market the firms’ offline services instead of connecting applicants with companies online.

To fill that void, several former HotJobs executives introduced in 2003, with the mission of posting only those jobs with annual salaries of $100,000 or more. At the time, the company made an odd bet — that it could attract more applicants if it charged them a monthly entry fee of $30.

That is precisely the opposite of the approach used by mass-market employment sites, which charge applicants nothing but charge companies varying fees to post job openings.

In its early years, was slow to grow, partly because it did not attract enough job postings to justify the site’s cost. But as employers and corporate recruiters learned that they could find qualified applicants for nothing, the number of job postings jumped.

Now, according to Marc Cenedella, the chief executive of, the site listed 70,000 jobs last week and is on pace to exceed $30 million in sales this year from about 1.4 million subscribers. And the site now counts Microsoft and the EMC Corporation as clients.

“We’re doing the same thing that’s done in national parks: put a price on it so you get the right number of people,” Mr. Cenedella said.

Mr. Cenedella said that the company is not yet profitable, but is “cash flow positive.” The number of subscribers who hear about the site from word of mouth, he said, has nearly doubled, to 34 percent, in the last three years.

Mr. Cenedella, who was a senior vice president at HotJobs when the company was acquired by Yahoo, said TheLadders would expand in the coming months to include jobs with annual salaries of $75,000 or more. (Only about 10 percent of the roughly 150 million workers in the country earn $100,000 or more, he said, while 20 million earn from $75,000 to $100,000.) Even that lower salary threshold, however, is high enough to attract job candidates who will pay to see the listings.

Ms. Li, of Forrester, said that TheLadders and other fee-based online job boards could face difficult times as baby boomers retire and the job market opens up.

“Companies say they’re going to lose 30 percent of their forces over the next five years, and those will all be upper-echelon jobs,” she said. “So if you’re paying to look for jobs, in some ways it’s signaling that you’re not a very good candidate.”

Heather Hamilton, a staffing manager at Microsoft who uses the site to fill marketing positions, disagreed. “If you’re not serious, you’re not going to pay the money,” she said. “That’s a big part of why we’ve found TheLadders to be more fruitful than other job boards.”

Some of the big online job boards have also tried to aim at the highest-paying jobs. In 2000, Monster started, which screened prospective job seekers to ensure that they were worthy of the best jobs, but the service failed to attract a following and Monster shut it down.

Other sites devoted to six-figure salaries and senior executives say that they, too, are thriving. ExecuNet, a service based in Norwalk, Conn., charges about $400 annually, or $39 monthly, for its online networking, industry data and job listings, among other things.

According to David B. Opton, the company’s chief executive, the business has about 25,000 subscribers, but their average income is $221,000 and the average age is 48. Job postings have increased about 30 percent over the last year, he said, and, perhaps as a result, ExecuNet’s membership has risen 15 percent.

Networking sites have become an increasingly important tool for companies looking to fill senior positions. LinkedIn, in particular, has emerged as a favorite trolling ground for corporate recruiters across the spectrum of job levels.

The online market for high-priced talent extends beyond full-time workers. Take HotGigs, for example. The company, which is based in Minneapolis, provides job listings for contract workers. In the three years since its debut, its customer base has grown to nearly 70,000 consultants who pay $100 yearly for the right to answer job listings
from about 19,000 companies and recruiters.

Doug Berg, the company’s chief executive, says the idea of paying to apply for a job is foreign to some people.

“We get a lot of people who e-mail us and say they shouldn’t have to pay for a job,” he said. “Our thing is, if you’re a professional consultant, you have to learn how to market yourself. Besides, if I didn’t charge, every wannabe in the world would come in.”


Computer says: ‘You’re hired’

November 14, 2007


Edgars Consolidated Stores (Edcon) is something of a national institution in South Africa. Since 1929, the chain of department stores has supplied generations of South Africans with clothing and footwear, from school shoes to funeral suits.

Naturally, keeping a network of more than 1,000 stores in South Africa, Botswana, Namibia, Swaziland and Lesotho fully staffed is a big challenge for the company’s human resources department, which oversees a workforce of 20,000 people – especially in the busy run-up to Christmas, when its headcount doubles.

Widespread unemployment in South Africa, meanwhile, means that for every position the company advertises, it receives approximately 100 applications, according to executive HR manager, Andrea Wiehahin.

“We’re very aware of the need to handle those applications sensitively,” she says. “Our job applicants are our customers as well, and even unsuccessful candidates need to be treated with respect, so that they go away from the experience with a positive feeling about the Edcon brand.”

To compound the issue, she adds, economic and political transformation in South Africa means that the company needs to demonstrate compliance with a complex web of government-mandated employment equity policies.

That is a big challenge, but Edcon is evidently handling it well. In a 2005 survey conducted by management consultancy Deloitte, it was named one of the 15 best companies to work for in South Africa and the best company to work for in the retail market.

Edcon makes sure it has the internet on its side. When a store manager has a vacancy to fill, they enter the details of the position on the company’s new Softscape Apex HR system. It is automatically forwarded to the relevant senior manager for approval, and from there, it is posted on the career section of the company’s website (  ), as well as online job boards, such as Career Junction (  ).

The e-recruitment process does not end there. Job seekers submit their applications over the internet via the website, and those applications are subsequently held and managed in the Softscape system.Around three-quarters of all applications Edcon receives are now made over the internet, says Leon Vermaak, Edcon’s business integration manager.

The system’s talent acquisition tools, meanwhile, enable managers to search applications, retrieve details for prospective employees, contact them and organise interviews, explains Alex Bart-feld, Softscape’s director for the EMEA region.

Not only that, the system also holds a wealth of information about the company’s recruitment processes, adds Ms Wiehahin, enabling the HR team to report on metrics relating to ethnic diversity in the workforce, as well as calculating the time and cost involved in bringing new hires on board.

Like Edcon, organisations around the world are finding that the internet provides the perfect platform for attracting recruits and streamlining their applications. In fact, it is critical in a world where the job of finding, attracting, selecting and securing top talent
has never been more important, according to Peter Cheese, managing partner of management consultancy firm Accenture’s 3,500-strong Human Performance practice.

“The thing that’s driving attention on recruitment is a general shortfall of skills,” he says. “The demographics of developed countries are against us, and that’s put a great deal of pressure on how companies attract and retain talent,” he says.

Certainly, things have come a long way from the days when job seekers would frequently find that the careers section of a company’s website offered no more information than a generic e-mail address for the HR department. “A whole host of developments are fuelling e-recruitment right now: internet-enabled HR systems, e-mail, online job boards, social networking sites, virtual worlds, and so on. As a term, e-recruitment covers a huge array of tools, but they have one thing in common: the internet,” says Mr Cheese.

Take KPMG, the management consultancy, for example, or the Royal Bank of Scotland, or data storage giant EMC – all three have held careers fairs in Second Life, the online “virtual world”. And in a recent survey of IT recruiters by the Association of Technology
Staffing Companies (ATSCo), 58 per cent said that social networking sites such as LinkedIn, Facebook and MySpace are more useful for recruitment than print advertisements. Eighty-three per cent, meanwhile, said they used those sites to trawl for potential job candidates.

“Sites such as LinkedIn are an incredibly powerful form of recruitment, as it puts the power in both parties’ hands – the recruiter in identifying the right candidate and the individual in deciding whether or not to engage in an offer,” says Dan Nye, CEO of LinkedIn.

“Some people are connected to hundreds of professionals across industries and borders, which in turn are connected to thousands more. This immediately places a well-connected recruiter in touch with a large number of possible candidates.”

But it is those organizations that have tightly integrated their e-recruitment tools with their back-end HR systems that have achieved the most notable successes – and that is true whether those back-end systems are hosted in-house or by a third party specialist, under the software-as-a-service (Saas) model, according to Colin Tenwick, chief executive of hosted talent management software specialist Stepstone, a company that offers both options.

“An all-encompassing e-recruitment tool won’t just post vacancies to a website and capture applications,” he says. “It will provide a robust framework for all the processes that surround bringing new recruits on board, and then managing their performance for as long as they work for you,” he says.

Such systems need to be capable of doing some pretty heavy lifting. Mobile services operator Orange, for example, uses Stepstone’s i-Grasp system to process about 80 per cent of the 5,000 applications it receives each year and currently holds 50,000 CVs, says David Roberts, Orange’s employer brand manager.

I-Grasp enables Orange’s 200-strong HR team to promote the company culture to applicants from the first contact, he says, primarily the company’s careers portal,  , as well as a number of retail recruitment microsites.

It also helps to ensure that applicants are kept informed of the progress of their application, via e-mail and text message – and that was certainly welcome to Elly Hallwood, who joined Orange’s in-house legal team as senior counsel in August this year, after applying for the job via the portal.

“I was kept informed all the way down the line,” she says. “Moving from a law firm to an in-house legal department can be quite a transition, but the amount of information that I received from Orange regarding my application made the whole process much less stressful.”

The biggest benefits of effective e-recruitment, however, are encapsulated in two key metrics: time to hire and cost to hire. At Hyatt Hotels, for example, a hosted talent management system from Taleo has cut the process of hiring a front desk employee from four weeks to five days, according to Randy Goldberg, Hyatt’s executive director of
recruiting. And hotels that have moved both managerial and hourly  positions online have reported a 50 per cent reduction in recruitment advertising spending.

But above all, it is quality of candidates that really counts, says Michael Gregoire, CEO of Taleo. “If e-recruitment means you get people on board quickly and at a lower cost, then that’s great, but what companies really need to know is whether they’re hiring the kinds of people that have a material positive impact on their organisation,” he says.

That kind of insight, he adds, can only be achieved with a robust set of HR tools that enable companies to manage their ongoing performance in attracting and retaining talent.

Or as Mr Bartfeld of Softscape puts it: “The story doesn’t end when you click on the ‘hire’ button.”


Dispelling the myths of the internet job search

November 14, 2007


Online job searching has evolved from a novelty into an essential career tool in the 10 years since I co-wrote one of the earliest guide books to using the new technology.

At first, internet job searching may seem quick and easy; however, having a strategy for navigating through millions of postings on thousands of sites helps increase the odds of landing a job, or even an interview. It helps to separate the myths that have evolved along withthis multi-million dollar business from the realities that can help both job seekers and recruiters get better results from internet job search tools.

Myth 1: The big boards post the lion’s share of openings.

Reality: Only about 30 per cent of the jobs at major corporations are listed on the big job boards, according to research firm iLogos. Fewer than 25 per cent of internet users worldwide regularly use job boards. There are many more options to include in job research.

Corporate websites and niche sites, such as professional and industry associations, have grown in size and importance. For example, employers use their own sites to avoid the rising cost of job board advertising; they find the high volume of resumes produced by the big  boards does not necessarily translate into actual hires. More often, they rely on industry and professional association sites and job aggregators to get the word out about new positions.

Employment search engines, which aggregate jobs from corporate sites, are invaluable to any job hunt, especially now that jobs are global. Top sites include JobRapido in Europe, in Asia and in the US.

To get specific vacancies in front of candidates with the required skills, corporations will also opt in the future for targeted search services, such as Yahoo Network’s Behavioral Targeting and Google Adword.

Myth 2: Internet technology makes landing a job easier.

Reality: A job search requires persistent, hard work. Seasoned job seekers understand that the internet is a 24/7 research tool, better used to identify pockets of opportunity than as a vehicle to apply for a job.

Employee referrals remain the number one source of new hires for corporations. To find a new job, seekers need to use every strategy at their disposal, including talking with friends and colleagues, tapping into professional networks, and pinpointing specific companies in their industry.

Internet searches are just one of many tactics to use in an overall strategy. Job aggregators can identify companies that are hiring in an appropriate geographic location and career categories – but that information should be used to initiate networking with the aim of securing an interview. Technology does not eliminate the competition for the best jobs, but it can help seekers stay ahead of the pack.

Myth 3: Placing a resume online reaches recruiters.

Reality: Maybe. Just as likely, job-hunters are helping marketers sell their products and services. For example, with 40m US seekers regularly visiting job boards, the temptation to view this huge audience as a marketing bonanza is too great for many vendors. In some countries there is little regulation monitoring the business conduct of the online recruiting industry.

Job seekers need to be cautious about sharing their personal histories with any site that purports to offer interesting opportunities. Research by the DirectEmployers Association shows that nearly 50 per cent of job seekers have privacy concerns with general boards.

Over the next few years, we are likely to see an emergence of recruiting industry standards as a way to assure job seekers that ads genuinely represent job openings, and that information will remain confidential.

Myth 4: Social networks are distinct from professional networks and play only a marginal role in job searches.

Reality: Social and professional networks are more connected than ever thanks to the internet and using all networks effectively is essential in getting a job. Job seekers worldwide are using Facebook, LinkedIn, Bebo, and MySpace to build contacts, learn about job opportunities and find out what it is like to work at a specific company.

Social networking sites are new tools to help get credentials in front of people who can help with landing a job. A key advantage is that these sites give some control over who is part of the network. By contrast, when someone posts their resume on a job site, they have little control over who sees it, or whether it reaches the people who do the hiring.

Job searches require research and networking in multiple ways. Avoid getting trapped in front of a computer screen. Individuals may one day be able to identify a dream job by going online. Until then, understanding the realities of internet job search help seekers become more successful.


In India, Poverty Inspires Technology Workers to Altruism

October 30, 2007

Manohar Lakshmipathi does not own a computer. In fact, in India workmen like Mr. Manohar, a house painter, are usually forbidden to touch clients’ computers.

So you can imagine Mr. Manohar’s wonder as he sat in a swiveling chair in front of a computer, dictating his date of birth, phone number and work history to a secretary. Afterward, a man took his photo. Then, with a click of a mouse, Mr. Manohar’s page popped onto the World Wide Web, the newest profile on an Indian Web site called

Babajob seeks to bring the social-networking revolution popularized by Facebook and MySpace to people who do not even have computers — the world’s poor. And the start-up is just one example of an unanticipated byproduct of the outsourcing boom: many of the hundreds of multinationals and hundreds of thousands of technology workers who are working here are turning their talents to fighting the grinding poverty that surrounds them.

“In Redmond, you don’t see 7-year-olds begging on the street,” said Sean Blagsvedt, Babajob’s founder, referring to Microsoft’s headquarters in Washington State, where he once worked. “In India, you can’t escape the feeling that you’re really lucky. So you ask, What are you going to do about all the stuff around you? How are you going to use all these skills?”

Perhaps for less altruistic reasons, but often with positive results for the poor, corporations have made India a laboratory for extending modern technological conveniences to those long deprived. Nokia, for instance, develops many of its ultralow-cost cellphones here. Citibank first experimented here with a special A.T.M. that recognizes thumbprints — to help slum dwellers who struggle with PINs. And Microsoft has made India one of the major centers of its global research group studying technologies for the poor, like software that reads to illiterate computer users. Babajob is a quintessential example of how the back-office operations in India have spawned poverty-inspired innovation.

The best-known networking sites in the industry connect computer-savvy elites to one another. Babajob, by contrast, connects India’s elites to the poor at their doorsteps, people who need jobs but lack the connections to find them. Job seekers advertise skills, employers advertise jobs and matches are made through social networks.

For example, if Rajeev and Sanjay are friends, and Sanjay needs a chauffeur, he can view Rajeev’s page, travel to the page of Rajeev’s chauffeur and see which of the chauffeur’s friends are looking for similar work.

Mr. Blagsvedt, now 31, joined Microsoft in Redmond in 1999. Three years ago he was sent to India to help build the local office of Microsoft Research, the company’s in-house policy research arm. The new team worked on many of the same complex problems as their peers in Redmond, but the employees here led very different lives outside the office than their counterparts in Redmond. They had servants and laborers. They read constant newspaper tales of undernourishment and illiteracy.

The company’s Indian employees were not seeing poverty for the first time, but they were now equipped with first-rate computing skills, and many felt newly empowered to help their society.

At the same time, Microsoft was plagued by widespread software piracy, which limited its revenue in India. Among other things, the company looked at low-income consumers as a vast and unexploited commercial opportunity, so it encouraged its engineers’ philanthropic urges.

Poverty became a major focus in Mr. Blagsvedt’s research office. Anthropologists and sociologists were hired to explain things like the effect of the caste system on rural computer usage. In the course of that work, Mr. Blagsvedt stumbled upon an insight by a Duke University economist, Anirudh Krishna.

Mr. Krishna found that many poor Indians in dead-end jobs remain in poverty not because there are no better jobs, but because they lack the connections to find them. Any Bangalorean could confirm the observation: the city teems with laborers desperate for work, and yet wealthy software tycoons complain endlessly about a shortage of maids and cooks.

Mr. Blagsvedt’s epiphany? “We need village LinkedIn!” he recalled saying, alluding to the professional networking site.

He quit Microsoft and, with his stepfather, Ira Weise, and a former Microsoft colleague built a social-networking site to connect Bangalore’s yuppies with its laborers. (The site, which Mr. Blagsvedt started this summer and runs out of his home, focuses on Bangalore now, but he plans to spread it to other Indian cities and maybe globally.)

Building a site meant to reach laborers earning $2 to $3 a day presented special challenges. The workers would be unfamiliar with computers. The wealthy potential employers would be reluctant to let random applicants tend their gardens or their newborns. To deal with the connectivity problem, Babajob pays anyone, from charities to Internet cafe owners, who finds job seekers and registers them online. (Babajob earns its keep from employers’ advertisements, diverting a portion of that to those who register job seekers.) And instead of creating an anonymous job bazaar, Babajob replicates online the process by which Indians hire in real life: through chains of personal connections.

In India, a businessman looking for a chauffeur might ask his friend, who might ask his chauffeur. Such connections provide a kind of quality control. The friend’s chauffeur, for instance, will not recommend a hoodlum, for fear of losing his own job.

To re-create this dynamic online, Babajob pays people to be “connectors” between employer and employee. In the example above, the businessman’s friend and his chauffeur would each earn the equivalent of $2.50 if they connected the businessman with someone he liked.

The model is gaining attention, and praise. A Bangalore venture capitalist, when told of Babajob, immediately asked to be put in touch with Mr. Blagsvedt. And Steve Pogorzelski, president of the international division of, the American jobs site, said, “Wow” when told of the company. “It is an important innovation because it opens up the marketplace to people of socioeconomic levels who may not have the widest array of jobs available to them.”

Mr. Krishna, the Duke economist, called it a “very significant innovation,” but he cautioned that the very poor might not belong to the social networks that would bring them to Babajob, even on the periphery.

In its first few months, the company has drummed up job seekers on its own, sending workers into the streets with fliers promising employment.

To find potential employers, in addition to counting on word of mouth among those desperate for maids and laborers, Babajob is also relying on Babalife, the company’s parallel social networking site for the yuppie elite. People listed on Babalife will automatically be on Babajob, too.

So far, more than 2,000 job seekers have registered. The listings are a portrait of India’s floating underclass, millions and millions seeking a few dollars a day to work as chauffeurs, nannies, gardeners, guards and receptionists.

A woman named Selvi Venkatesh was a typical job seeker. “I am really in need of a job as our residential building collapsed last month in Ejipura,” she said, referring to a building collapse that killed two people, including an infant, in late July, according to The Times of India.

In Mr. Blagsvedt’s apartment one morning, Mr. Manohar, the painter, professed hope.

He earns $100 a month. Jobs come irregularly, so he often spends up to three months of the year idle. Between jobs, he borrows from loan sharks to feed his wife and children. The usurers levy 10 percent monthly interest, enough to make a $100 loan a $314 debt in one year.

Mr. Manohar does not want his children to know his worries, or his life. He wants them to work in a nice office, so he spends nearly half his income on private schools for them. That is why he was at Babajob in a swiveling chair, staring at a computer and dreaming of more work.


Social networking sites are called ‘better than print’ for recruiting IT staff

October 30, 2007

By Leo King

Facebook, LinkedIn and other social networking sites have become the top tool for hiring IT staff, a new survey among recruitment companies reveals.

According to 58 percent of IT recruitment firms polled by the Association of Technology Staffing Companies, an industry body, such sites are more useful in finding staff than traditional print advertisements. And 49 percent said they were now more effective than internet banner advertising.

But seven in 10 recruiters said job boards provided a better quality of candidates, and two in 10 preferred cold calling. Only 9 percent saw social networking as providing the most appropriate candidates.

Atsco said that the headhunters were favoring special interest groups on the sites to find candidates with the right background and knowledge, over the “scatter gun” approach of finding the right people through print advertising. It admitted, however, that print and online recruitment advertising would remain an important way for employers and recruiters to build brand value and target senior level appointments.

Ann Swain, chief executive at Atsco, said the success of social networking sites as a recruitment tool was a result of their being interactive, as opposed to the one-way communication of print advertisements. She said they offered “a dynamic, two-way dialogue between recruiter and candidate” rather than “another passive form of advertising.”

“Social networking sites make it very easy for recruiters to become trusted advisers to candidates and genuinely get to know them,” she added. “Candidates often reveal far more about themselves on these sites than they would do on the phone or in interview.”

But the survey also revealed that recruitment firms were risking their valuable databases online. Only a quarter of staffing companies currently write restrictive clauses into consultants’ contracts, asserting ownership of databases and contact lists constructed by staff on social networking sites.

As “the lifeblood of the recruitment industry,” these databases needed much more security, Atsco said.

“This is currently an area where contract law is lagging behind social trends and an area of risk that the recruitment industry needs to pick up on,” Swain said.