Recruitment agency contracts are contracts between a business and a recruitment agency for the provision of nonexclusive search and placement services for permanent employment on a contingency fee basis. Within this contract, there will be a number of terms and conditions which must be very carefully considered in order to have a full understanding of any obligations or possible liabilities. These standard documents are often prepared in such a way so as to be advantageous to the recruitment company but need to also be mindful of the recruiting company’s primary objectives. The document should set out in a clear and concise manner the nature of the relationship and also set out alternative provisions, and drafting and negotiation recommendations. In this article, recruitment agency terms and conditions, we take a look at these issues in more depth.
Please click here to find out more about our corporate services
Free Initial Telephone Discussion
For a free initial discussion with a member of our New Enquiries Team, get in touch with us today. We are experienced in dealing with all the legal aspects of recruitment agency contracts, and once instructed, we will review your situation and discuss the options open to you in a clear and approachable manner. Early expert legal assistance can help ensure you are on the best possible footing from the start and also avoid the stress of dealing with these issues on your own. Simply call us on 0345 901 0445 or click here to make a free enquiry and a member of the team will get back to you.
What does a recruitment/employment agency do?
A recruitment agency’s purpose is to assist businesses in filling available positions by identifying skilled candidates who are a suitable fit for the role and the organisation. The firm compensates the recruitment agency for successfully putting candidates in open positions. Recruitment agencies might specialise in a specific area, such as legal services, or in a specific job function, such as sales or administration. Recruitment firms will either actively seek candidates for client-provided openings or will use candidate CVs to link candidates to appropriate positions and companies.
What is a recruitment agency contract?
Recruitment agency contracts specify the terms and conditions under which a candidate is placed in a position and the price charged by the agency for successfully providing its services. Additionally, recruitment agency contracts will spell out the consequences of a recruit leaving the organisation. Often, the employer seeking a candidate and the recruitment agency would enter into a contract. Although recruiters rarely engage into contracts with potential candidates, they will keep their information confidential in the event they remain employed and to prevent employers from identifying them outside of the recruitment agency’s interview process.
Recruitment agencies should not be compensated for unsuccessful introductions. Restriction periods should not be excessively lengthy, as this can be detrimental to both candidates and businesses.
What are the typical terms and conditions found in the contract?
- Definitions
The definitions will carefully set out the meaning behind the words used in the contract. Not every word will be defined but those that are important to the parties, and to avoid any uncertainties, will be explained. Common terms include “client”, “candidate”, “employment”, “fee”, “remuneration”, and “introduction”.
- Obligations of the parties
This will state what the obligations are of the employment agency and the client. Things to include are that the employment agency will use its best endeavours to find suitable candidates but will not be obligated to perform within a fixed period and the employer will need to provide details of the position including place of work, nature of work, hours and pay.
- Fees
Recruitment agencies are compensated in one of two ways: a flat fee or a portion of the starting salary of the successful candidate. Typically, a flat-fee recruitment firm will place workers in lower-income positions. Alternatively, an agency may be reimbursed on a set retainer basis for effectively placing a large number of candidates over a period of time. A percentage fee structure is often reserved for higher-paid roles and may vary according to the income and seniority of the position.
It is also important to state in a recruitment agency agreement whether the compensation for the agency will be determined as a percentage of the starting salary or the starting package.
The fee structure needs to be explicitly stated in the terms and conditions.
- Rebates
Sometimes, when a candidate joins a company, it might not work out as expected for either or both parties. If the employer has paid a hefty fee to the employment agency and the candidate wants to leave after, say, a week a refund will be expected by the employer. In this section of the terms and conditions, a scale of how rebates are calculated will be set out.
- Liabilities and Indemnities
This will state how the employment agency will not be held liable by the employer for any losses that might occur as a result of the placement of a candidate. It could also state any indemnities the employer must provide to the agency during the course of potential candidates being placed.
- Termination
This will set out the circumstances in which the contract might be terminated by either party.
- Confidentiality
This will stipulate that the parties abide by the data protection act and also set out the dissemination of confidential information regarding all parties.
How we can help
We have a proven track-record of helping clients with recruitment agency contracts. We will guide you through the process and ensure all checks are carried out swiftly and efficiently and we firmly believe that with the right solicitors by your side, the entire process will seem more manageable and far less daunting.
How to Contact our Corporate Solicitors
It is important for you to be well informed about the issues and obstacles you are facing. However, expert legal support is crucial in terms of saving you money and ensuring you achieve a positive outcome.
To speak to a member of our new enquiries team today, simply call us on 0345 901 0445 or click here to make a free enquiry . We are well known across the country and can assist wherever you are based. We also have offices based in Cheshire and London.
Disclaimer: This article provides general information only and does not constitute legal advice on any individual circumstances.
Comments are closed.
