Unfortunately it does sometimes happen that employers inadvertently or deliberately hire a candidate that was introduced previously to them by a recruiter and not realize that an introduction fee is still payable – even though it may be up to 12 months since the recruiter introduced them.
This can happen due to sloppy applicant tracking on the employer’s side, the recruiter not tracking candidates months after the initial introduction, the line manager not realizing due process or that the HR department has already got the candidate on file, or yes especially in tough times, the employer wanting to deliberately avoid recruitment fees.
The fee of the recruiter hinges on the definition of “introduction”. An introduction is usually the presenting of a suitable candidate to an employer that the employer had not had an application from within the past six to nine months.
The opposite also applies. Many times the candidates presented won’t be hired straight away. The role may stall due to budgets or projects being stalled. Once they come back on though, the recruiter is still eligible for a placement fee for that candidate if hired – even if it is a different role. Recruiters also cover themselves for this instance by saying that if the employer decides to take on candidates within six months following their introduction there is a fee due to the recruiters. Some recruiters have this period last up to 12 months.mark
The logic behind this being that the recruiter has done all the hard work locating the candidate and introducing them, that if the client stalls the placement this should not affect the recruiter’s fee.
The candidate knows that they have applied through the agent previously but doesn’t bring it up as they don’t understand the process or they just want a job.
The recruitment market is a small market, instances like this are in most cases discovered after the candidate has been working for a while on site.
As you can imagine, the recruiter is none too happy to find out when they do occur. In most cases the employer has made an honest mistake.
The process that follows is that the recruiter contacts the most senior person in the company that is over recruitment and alerts them to the signed clauses in their contract with them. They then send evidence of the introduction to the company along with an invoice for their recruitment services. A good recruiter will habitually keep email records and date stamp resumes as well as comments on conversations in a CRM tool,
Some employers don’t like hearing this and really kick back hard. It is these ones; the ones that “protest too much” that are most likely the ones that deliberately tried it on to avoid a fee in the first place – the covertly hostile employer.
Some line managers are ignorant of the clauses, and when brought to their attention try to invalidate the contract, and most in this case try to use intimidation “we won’t use you again” stories.
For the recruiter both these types of clients are at the very least liabilities to their business and unless the employer can convince the recruiter that things will be different in the future AND pay the fee, the recruiter is best not to have them as clients.
The other type of response is the employer who has made a genuine mistake.
Sometimes another agency will try to represent the same candidate. If employer is not aware of where the first introduction came from, they will pay the second recruiter – even though the second recruiter is not legally eligible as they were not the first to introduce. If the first agency discovers this, the employer will end up with having paid two bills! The second agency should of asked the candidate if they had applied via another agency. Sometimes candidates “forget” or don’t care. Unethical agencies will still try to submit the candidate even if they have been represented already.
Sometimes the candidate applies directly a month after the role has been closed by the employer, and the employer takes them on. The recruiter is still eligible for a fee if the candidate is taken on within the introduction period.
In these cases the recruiter and the employer work out a fee that is reasonable for the placement. For contractors this includes the margin that the recruiter would of made on the contractor over the duration of the contract.
So what is the best answer?
Don’t use recruiters? Not always the best solution.
Use only one recruiter? Sure if they can deliver every time within 3 weeks.
Use a candidate tracking system to log applicants? Now there’s a good idea!
A simple spreadsheet and internal policy that states that all new hires must be compared to this list is a cheap solution.
What about an online piece of software that tracks where the candidate first came from, maintains a searchable database including email job alerts, joins up with your careers section of your website, allows you to post adverts to Seek, MyCareer and CareerOne and have agencies enter their candidates into it?
Have a look at Perform Zone, this software can allow you to gain 20% more candidates from your advertisement campaigns and end up saving you money.