In Professional Business and Technology Search there are a few variations of recruiting agreements.The two (2) most common are Retained Search and Contingency Search.
Often referred to Executive Search involves a Contract for the services to research, identify, interview (often in Person) and help close a candidate for a specific Management or Executive position, typically VP and above.
The position may be confidential where a company is planning to replace someone, or to recruit from a specific Competitor or to avoid letting Competitors know that you have a weak link in your organization.
TERMS: A retained search agreement is an Exclusive Agreement for a term of 3 months or longer, and no other agencies are involved in the search. The fee is based on the total compensation of the position and is typically 30-35%. The assignment begins when one third (1/3) of the fee is paid up front. The next payment is due in 30-60 days, and the final payment is on completion. Fees are based on total compensation which includes base, bonus and commissions. Travel and expenses to interview candidates are also included. This fee is also paid regardless of whether the client cancels the position, or fills it internally or with any other means.
This search is paid when the Candidate accepts the position and starts working. The fee is based on the total compensation paid as salary. It is not exclusive and may involve other agencies and internal staff recruiting for the position. Fees for Contingency Search will be 30% and are based on the compensation of the position. There is no financial obligation to the Company until a candidate has been hired. The company has no expense except reimbursement for candidate/client interview expense should they want to interview candidates from other areas.
There are three other services offered that have grown in the past decade.
Container or Retingency
A variation of the retained and contingency search agreements.
These are Exclusive Contingency agreements where it involves an upfront commitment to the agency typically $5000 to initiate the start of the search. The total fee is based on 30% of the offered compensation and the remainder of the fee is due on completion and candidate start date. The Container fee is to establish a mutual commitment of time and effort on both the Recruiter and the Client to work actively to fill the position.
Contract or Contract to Perm
This search agreement is an agreement to hire an individual on a Contract basis and/or a contract to permanent basis. These are typically for a period of 90 days with continuation by mutual consent of client and candidate. These agreement may extend years and are typically paid on a Contractual hourly rate. They may include a Conversion fee if the client and candidate agree to change the term to permanent hire.
Hourly Service Fees
Services may also be utilized on an hourly basis to perform all the duties of recruiting.
Fees will be $60.00 per hour for offsite and $75.00 plus expenses for onsite.