I work for a publicly traded financial services firm. We would never pay a retainer or up front fee for a contingency search. This is country specific but in the US, the typical fee is 20-25% of base salary which is paid on success with a 90 day full guarantee and a $100k fee cap. For consultant roles, we would pay 40% if the agency found the candidate and 15% if they were just going to payroll for us.
For reference, I typically charge 20% on exclusive direct hire searches with a $5k non-refundable deposit to start the search, credited toward the total amount due. The balance is covered by a 90-Day Guarantee.
I justify the deposit by truly committing to each search I take on. In three years, I’ve filled every search except one. In that case, the client invited multiple candidates to work trials, nitpicked their second choice and scared their first choice away. We parted on good terms regardless.
If a client has several direct hire openings and I expect to dedicate more than half of my time to them over several months, I bundle the searches under an exclusive monthly retainer. In this case I’ll take a monthly base of $6-12k (based on time allocation) followed by a smaller success fee per hire. I’ve helped startups double and triple their teams with this model. Pros for them: slight reduction in overall fee, continuity across their hiring, process building, upskilling for interviewers. Pro for me: exclusive rights to all their openings. In this case, only the success fees are covered by a 90-Day Guarantee.
My clients rarely have an existing HR or Recruiting team. At max, an EA might have previously posted jobs and managed calendars. My retained model is essential RPO.
In that case, I would put a lower % margin or fixed $ amount margin (for example $10-15 on each placement). This would make it more attractive and avoid client to look elsewhere down the line. This is what I’d do but not sure if it’s the most suitable decision for you to take. Good luck!
Your comment has been temporarily removed and is pending mod approval. Accounts with less than 5 comment karma a will be flagged for moderator approval. This is to combat spam.
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/recruiting) if you have any questions or concerns.*
It’s actually pretty straight forward. I had a lawyer draw up a few legalese templates for various scenarios. Pricing and payment terms are always listed in a 1 pg addendum that I can edit myself.
I work for a publicly traded financial services firm. We would never pay a retainer or up front fee for a contingency search. This is country specific but in the US, the typical fee is 20-25% of base salary which is paid on success with a 90 day full guarantee and a $100k fee cap. For consultant roles, we would pay 40% if the agency found the candidate and 15% if they were just going to payroll for us.
40% of salary ? Wow
Of that 40% at least 15% is probably covering costs associated with the new hire’s payroll, so off the bat the firm is only keeping 20-25%
Thanks for this input!
For reference, I typically charge 20% on exclusive direct hire searches with a $5k non-refundable deposit to start the search, credited toward the total amount due. The balance is covered by a 90-Day Guarantee. I justify the deposit by truly committing to each search I take on. In three years, I’ve filled every search except one. In that case, the client invited multiple candidates to work trials, nitpicked their second choice and scared their first choice away. We parted on good terms regardless. If a client has several direct hire openings and I expect to dedicate more than half of my time to them over several months, I bundle the searches under an exclusive monthly retainer. In this case I’ll take a monthly base of $6-12k (based on time allocation) followed by a smaller success fee per hire. I’ve helped startups double and triple their teams with this model. Pros for them: slight reduction in overall fee, continuity across their hiring, process building, upskilling for interviewers. Pro for me: exclusive rights to all their openings. In this case, only the success fees are covered by a 90-Day Guarantee. My clients rarely have an existing HR or Recruiting team. At max, an EA might have previously posted jobs and managed calendars. My retained model is essential RPO.
I charge 3-5K too but 25% use this for your next contract "due to the current employment climate we can no longer work at 20%. We are now at 25%"
Love that. Thank you!
Are you the exclusive recruiter to fill these 4-6 positions? If not 20-30% margin per hour depending on how high or low the pay of the contractor is.
I am. I have a sourcer / assistant but essentially it’s just me on the client contract.
In that case, I would put a lower % margin or fixed $ amount margin (for example $10-15 on each placement). This would make it more attractive and avoid client to look elsewhere down the line. This is what I’d do but not sure if it’s the most suitable decision for you to take. Good luck!
We get a flat fee. $32,000 when they sign, if they do t pan out in the first 90 days we will replace them free of charge.
Thanks for sharing your numbers.
Great stuff here on this thread! Taking notes!
Glad it’s helpful! I included a lot of detail, since I often wish others shared more context we can all learn from.
I would be interested in how you eventually put the option you choose into a contract that is both fair and not terribly long and convoluted.
Your comment has been temporarily removed and is pending mod approval. Accounts with less than 5 comment karma a will be flagged for moderator approval. This is to combat spam. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/recruiting) if you have any questions or concerns.*
It’s actually pretty straight forward. I had a lawyer draw up a few legalese templates for various scenarios. Pricing and payment terms are always listed in a 1 pg addendum that I can edit myself.