Can recruitment agencies charge me?

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Recruitment agencies must constantly modify their hiring strategies to meet their current clients’ requirements in the recruitment industry. However, it’s equally important to attract new clients to stay at the forefront of the competition, particularly in times of fierce competition.

If you’re at the point that you’re contemplating hiring a recruiter, there are a variety of factors you must be aware of. Naturally, one of your primary concerns will cost. It can be challenging when you’re recruiting with the smallest resources. 

This guide will explain the various options and the typical fee charged by the agency to ensure that you get the best value for your money.

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What is a recruitment agency?

The recruitment agencies are the middlemen (and women!) who are between you (the applicant) and their customers (the hiring). Their goal is to locate candidates that meet the needs of their clients. They earn their money through successful matches. To achieve this, they employ consultants in recruitment (resources) who locate the candidates, interview them and evaluate them for a specific position or job. They then communicate with the employer and pass it to the candidates they believe are suitable for the job.

How do recruitment operate agencies?

When an employer has to recruit an employee for the first time, typically, they provide an agency for recruitment (or multiple) with the job description. The job description will then be given to a department and team that searches their CV database for suitable candidates that match the description. If they cannot find any that correspond, then they take a look and check out other sources. After identifying an appropriate group of potential candidates (a shortlist), they’ll begin conducting interviews to find the most appropriate candidate and then pass these resumes to the company.

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Costs of working out

There isn’t a size fits all solution to the amount you’ll need to pay a recruiter.

  • Factors that contribute
  • Percentage Charges
  • Kinds of Agency Fees

Factors that contribute

The amount that recruitment agencies charge is contingent on the jobs you’re looking to fill. For instance, if hiring for a senior position, there is a higher cost than that for junior jobs.

Some sectors are notorious for having a shortage of skills or being difficult to fill positions. The industry will affect the final cost.

For instance, the need for applicants to fill tech and IT positions is extremely high. In some instances, the place of work can be an important part.

In the same way, costs will also depend on the degree of involvement of the agency and the number of posts you’re hiring. Also, they consider the salaries of the positions you’re advertising.

In light of this, there’s no fixed fee for the fees charged by recruitment agencies. 

This can help you ensure you’re getting the most cost for their service.

Percentage charges

In general, the agency’s fees are paid in proportion to the annual salary of the job you’re looking to hire for. That’s why it’s less expensive to hire for senior positions.

However, this percentage could fluctuate based on the positions you’ve assigned to the agency.

If you’re thinking of hiring an agency, discuss these numbers before signing so that you don’t have any issues in the future.

The fees brakes into three kinds which we’ll cover in greater depth in the next section so that you’ll know how much the companies charge for recruitment.

The rate charged generally reflects the salary advertised. To help you in understanding the way these fees calculate, we’ve illustrated below:

Junior position – advertised salary of £10,000

You would pay £1,000 per hire because agency fees would be around 10%.

Executive position – advertised salary of £20,000

You could spend up to £4,000 per hire if you pay agency fees of about 15-20%, which are typically the most common costs.

Kinds of recruitment agencies Fees

There are three major kinds of fees for recruitment, and they can be broken down into:

  1. Temporary worker charges.
  2. Temp-to-perm fees.
  3. Fees for permanent placement.

Knowing the basics of these costs can assist you in avoiding any legal actions after having enlisted candidates.

Temporary worker charges

The first thing you need to know about temporary workers is that they are under the authority of the recruiting agency. This means it will be the recruitment agencies that pays for the candidates.

The agency will recoup it from employers and can be able to charge a fee that covers the entire cost they have to cover.

A fee for temporary use composes of:

  • The base pay is either hourly or daily.
  • Other related costs (Holiday Pay, Sick Pay, Holiday Pay, National Insurance, etc. )A profit margin (or markup) that allows the company to earn a profit.
  • The margin is a percentage added on top of the basic salary, which allows the agency to earn profit.

Temp-to-perm fees

There are situations where employers want to modify the contract of a temporary worker into an ongoing one. What do you think? There’s a charge for this.

It crucial to note that temporary employees are employed technically by an agency. Therefore, should a client wish to hire a temp worker on a full-time basis, the agency has the right to charge a transfer cost – to pay for the “lost value.’


Two ways an employer could get around paying the transfer fee.

1.   An agency is legally bound to allow employers to extend the temporary employee’s duration. If an employer selects this option, no fee is due until the end of the extended period.

2.  Employers can employ an ex-temp worker for free, up to 8 weeks following the conclusion of the work or 14 weeks after the beginning (whichever is later).

Clients are not uncommon to temporarily bring an employee to another company. In this case, the agent entitles to charge a transfer cost without the option of extending the duration of employment. The middle employer does not gain in any way from it.

Fees for permanent placement

For permanent workers, the costs divide into two types. Most commonly, it is contingent recruitment, where the company pays the agency when they successfully secure a placement.

Another option retains that recruitment. In this case, agencies pay in stages, typically at the beginning of the process, when they produces an initial list of candidates. A final settlement pays when places someone.

What is the difference? Contingency recruitment forces the agency to fill vacancies quickly, and the employer will pay them if they are successful in their hiring.

However, retaining a candidate and paying an upfront payment means that agencies can devote more time to the ideal candidate.


Final Words of Recruitment Agencies

Suppose you not convince that hiring an agency to recruit is an ideal choice. In that case, you should consider that it could bring additional advantages that are hard to quantify immediately but very real. A recruiter can “sell” your business to the candidate as they make the candidate sell to you. Companies that recruit can cut down an entire month of searching to one or two days. Understanding the best time to use effective methods can help reduce the stress of attempting to find a new employee and retain your employees and guarantee your employment’s long-term success.

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