Recruiter fees can be contentious. Clients don’t see the background work involved in sourcing, vetting and placing a candidate, not to mention the number of ‘almosts’, ‘not quites’ and ‘fell at the final hurdle’ moments.
The placement of permanent staff is after all a ‘no win, no fee’ industry.
Even when you do place the perfect candidate things can go awry, you may have done too good a job. You find the perfect candidate in a day or two, interview the following week and have an offer on the table by the end of the week. The client is paying for the quality of candidate you supply, the connections you have built and to have the role filled in weeks not months. However, a certain level of blood, sweat and tears seems to be expected across the board to avoid being asked what value you added.
Honourable mentions must also go to the following scenarios which recruiters face on a daily basis:
- This candidate contacted us directly;
- This candidate was put forward by another agency;
- We love the candidate but now isn’t the right time, maybe in a few months; and
- We want to offer the candidate a 6 month contract and not a permanent role;
The list goes on… but goes a long way to show the value of building long term relationships with clients who want your help.
Much of the above can be dealt with commercially and on an ‘understanding’ between the parties, and there is a value in preserving the business relationship rather than coming to blows over small sums. However, sometimes it’s inevitable, and the contentious nature of the recruitment industry means it is all the more important that you have proper terms and conditions in writing to govern the relationship between you and your client.
Key things to include in your standard terms and conditions
The more detailed and accurate your terms and conditions are, the more you can reduce disputes over the correct interpretation of what was agreed between the parties. The scenarios above can be covered by including provisions for:
Exclusivity periods (if any);
- Defining when an introduction is made and how long it survives for;
- The fees and transition from perm to contractor;
- Your fee and payment terms;
- Any rebate structure;
- Caps and exclusions of liability for acts of the candidate and other losses; and
- Terminating the agreement
It is important, for the reasons set out above, to have clear and detailed terms and conditions when running a recruitment agency. However, to make the most of these documents you must ensure that:
- Staff are trained on the terms, their significance and those provisions that can or cannot be negotiated;
- ‘the battle of the forms’ is avoided and where possible you enter into agreements on your own terms; and
- The terms and conditions are properly incorporated (i.e. a full copy is signed by both parties and dated).
If you require further advice on whether your terms and conditions are working as hard as they should be for your recruitment business, please contact Gurpreet Sanghera, who would be happy to assist.