Your company is growing, you need to hire IT talent and you need to hire them fast. You try to hire by yourselves but months go by with nothing show for it, and you decide to engage an IT recruitment firm that specializes in your geographical domain. But before signing on the dotted line, you should review their recruitment agreement. We try to explain what is included in recruitment agreement and what to watch out for. Please note, this article is not a legal advice.
1. Overall Recruitment Agreement
Basically the recruitment agreement you would sign is for a permanent employee that you will be hiring for. Recruitment agencies in general will provide a service where they will advertise, search, qualify and present qualified talent to you so you can interview them.
You will want to make sure the recruitment agreement covers the exact services you will get from a recruitment agency, how much it will cost you, and when you have to pay for those services.
Make sure you check the exact language of the agreement when you own the recruitment agency money, some agency charge you when you hire a candidate and candidates starts working, others charge you just for trying to find someone.
Some IT recruiters will ask you to use their firm as the only firm to fill a specific job. Exclusive usually means that you will not use another agency to recruit on this specific position. Sometimes, excusive means that even if you yourself fill the position, you will own IT recruitment agency money. So make sure to review the exclusivity terms. Most agencies ask for 30-60 days exclusivity, but some others might ask for 6 months, and some other ones do not even specify the length.
It is always a good practice to have some kind of expiry date, if agency can not find someone suitable for you, you can fire them and use another agency. It is also a good idea to limit exclusivity for 1 specific job only and have an exit clause – when and how you can terminate the agreement.
3. Knowledge of Candidates
Most agencies charge you money for “introducing” you to the candidates. You should know how the specifically introduce candidates to you.
Sometimes, you might want to clarify that you will not pay a fee when you a) already know a candidate because you found and interviewed them via Linkedin for example or they applied via your job post on Indeed for example, b) another agency already presented that candidate so you will not be liable for double fee, c) IT recruitment agency can not provide you with details about candidate or fails to setup an interview with that candidate.
4. Recruitment fees
How much does the agency charge? Many different agencies charge different rates depending on the industry. What you might want to check is when you have to pay the fees. Some agency charge a retainer fee – where you have to pay a partial fee upfront and then the rest on hire. Some agencies ask for payment on candidate’s start date while others give you more time to pay. Some agencies charge you money even if you do not end up hiring their candidate.
5. Replacements Guarantees and Refunds
Most agencies provide a guarantee where they will replace a candidate within a certain time if that candidate is fired or quits. In the agreement you might want to check what you need to do to make sure the guarantee is in place – in some cases, replacement only works if you pay the fee on time. Most of the times, when candidate is laid off , agency wont be replacing that candidate. Some agencies specify that if you change your job description , the replacement guarantee is no longer valid.
Most agencies do not provide refunds, but extend a credit, so if candidate is fired, and you do not need to replace that candidate, you can apply the fee you paid to another placement within specified period of time.
You might want to review the recruitment agreements sent to you by agencies as there might be some discrepancies within that agreement. Things to check would be what exactly the agency would be doing for you, exclusive or not, how they will present candidates to you, how much you have to pay and when, if candidates will be replaced and how.
Last but not least, its always best to work with an established agency like Kovasys IT Recruitment.