Hire Power is a monthly column designed to help you recruit, hire and retain the best talent for your company. We’ve got a rotating panel of columnists ready to give you practical, tactical advice on solving your labor problems. Email Chuck Bowen at firstname.lastname@example.org with topic ideas.
Business owners decide to partner with a professional recruiter for many different, but not so unique, reasons. A firm might make a number of offers and might receive the same number of declines from various candidates. Another hiring manager might report that he or she doesn’t have enough (or any) qualified candidates to even extend offers to in the first place.
Still, another client might believe that all the candidates applying for jobs are not qualified and not worth an interview or the client might be too busy to even start looking for applicants in the first place. In all of these situations, a qualified and talented recruiter can assist, provided that companies know what kinds of services to expect and how much to pay for those services.
Recruiters offer different services.
Recruiters generally offer their services on a contingent basis. If you don’t hire anyone from the recruiter, you won’t pay any fee. The challenge with this service is that recruiters will generally need additional information about a business in order to determine whether he or she will be able to assist. Recruiters tend to shy away from jobs that “aren’t fillable” or from clients with “unreasonable expectations.”
Also, clients must be prepared to interview candidates quickly or the recruiter moves on to another higher paying, or more “urgent” client.
Other recruiters offer their services on a retained basis. In this scenario, the client will pay some part of a fee upfront and will pay the remainder after the client has hired the recruiter’s referral.
Most staffing agencies negotiate their fees based on how much business they believe you will offer, how easy or difficult a search will be and the individual recruiter’s workload. Agencies will generally charge a minimum of 20 percent of the first year salary, up to 30 percent in some cases. For this rate, you will generally get a three- to six-month guarantee, with the more confident and experienced recruiters sometimes offering a 12-month guarantee. Recruiters will negotiate these rates and sometimes offer discounts for industry companies for which they specialize.
Services also vary.
A true agency-trained recruiter will call and seek out candidates outside of your typical pool of applicants – not just wait for resumes to come in from ads. The recruiter will get to know the candidate through multiple conversations, will learn about the client’s unique business characteristics and culture, and will make a match based on many factors.
Recruiters will typically check references, negotiate the offer, generate an offer letter, ensure that the candidate starts in a timely manner (two weeks is still standard notice period for candidates terminating employment) and will do follow-up calls to ensure that the client and placed candidate are satisfied.
What recruiters should not do.
There are industry recruiters who “double dip” – the recruiter places a person for a fee, then recruits them back out again when the guarantee is up. The recruiters who get caught say “I was only following up on my placement to see if he or she was happy. They weren’t so I found another job for him/her.” Companies should require that recruiters never recruit out of their firm.
It’s harder to enforce, but keeps everyone honest. Recruiters should also not encourage placements that will harm a candidate’s resume or be a detriment to a client’s business. Some placements just aren’t worth the money. Don’t be afraid to ask a recruiter why they think the match is a solid one.
Like anything else an owner does to protect a business, building a solid relationship with a recruiter who has the best interest of a client’s firm at hand can be a good opportunity to build bench strength, or to amp up a lagging team.