Recruitment Agency Fees

Just like recruitment agencies approach and services differ, so do recruitment agency fee’s. High street, local and generalist recruiters tend to offer cheaper rates than specialist recruitment firms. However there’s obvious benefits to forging a relationship with a recruitment agency that specialises in your market sector. Equally some lower level positions may be better suited to a local high street agency.

Some recruitment agency fees are based on a percentage of the positions remuneration, others charge a flat rate. Some recruiters only offer contingency recruitment, others only retained and some offer a choice of either.

Here we give a quick overview of the difference between Contingency Recruitment and Retained Recruitment, and some of the advantages of both.

Contingency and Retained recruitment explained

It’s a common misconception that all Head Hunters charge retainers and Contingency Recruiters don’t Head Hunt. This isn’t the case.

Contingency recruitment means you only pay the recruitment agency fees on the successful placement of a candidate. Usually once they’ve started their employment with you.

Retained recruitment is when the recruitment fee is paid at staggered intervals throughout the assignment. Normally a percentage of the fee is paid on commencement and the remainder paid either on completion or at agreed stages throughout the recruitment process.

Advantages of Contingency Recruitment Agency Fees

Contingency recruitment is often described as “no win no fee”. You only pay a recruitment fee, once your chosen candidate has started with you. Advantages include:

• No financial risk.
• No commitment to the recruiter.
• One off single fee.
• Fee’s paid only on successful completion.

Advantages of Retained Recruitment Agency Fees

Committed working relationships tend to deliver better results. The retained recruiter knows they have your commitment; in turn they can fully commit to you and to completing your assignment. Advantages include:

• Cost’s the same or less than contingency recruitment.
• More time and resources dedicated to completing your assignment.
• Stronger partnership, driven by mutual respect and commitment, between you and your chosen recruiter.
• Greater focus throughout the assignment.
• Exclusivity on candidates during your search assignment.
• Agreed staggered payments could benefit your cash flow.

Although the recruitment industry often gets a bad press most recruiters, and I suggest those who operate as niche market specialists, value their reputation and want to provide a good service. By forging strong relationships with your chosen recruiter will deliver a better level of service. Through understanding the way each other work and your company culture, your recruiter will become much better at identifying the right talent for you.

When selecting your recruitment partner, don’t just think about the fee, find out about what their service entails in terms of the search and management of the process. Engage with them and give them your commitment – whether that’s on a contingency or retained basis is up to you and your chosen recruitment partner.