Do agencies take a chunk of your salary?

[Waaib]

If the recruitment company is paying her, then she is employed by the recruitment company. The funds that the recruitment company receives is then deducted before paying their staff a salary. This is almost like a temping position ... sounds unfair but that how it works. If this is it then it is not a recruitment but something like a labour broker.

Temping positions are (in my view) more like a few days or weeks and specific to jobs that need no handover.

If the job is a few months like a programmer doing a once off IT project then it's a known as a contract.

What is unfair in my experience is that sometimes the agency tells the person what the rate per hour is but does not mention how much their fee is. They might say you'll earn R150 per hour and we take 15%. The person often thinks, 'oh 15% is not that much' but when they get paid it's much more than they expect.

With all jobs I reckon you should always ask what you will clear after all deductions to be sure you know where you stand. Even get it in writing if possible.

 

[Sly21C]

Labor brokers (LB) are also sometimes called body-shops.

Lets say a company has an accountant that takes 6 months maternity leave.
The company calls the LB for a replacement accountant.
The LB find a freelance accountant and agree on a rate per hour or week or for the whole 6 months with the accountant. Lets say the fee for 6 months is R120,000.
The LB then contacts the client and says the rate for the 6 months is R150,000.
Accountant gets R120k the LB keeps the R30k as a type of finders fee.
Same applies for hourly / weekly work.

This guy who works for the labour broker said in the email that his client(civil engineering company that I will work for if I get or accept the job) is a company that is looking for someone with my experience and qualifications, he also mentioned that I will be offered a permanent position at that company and that the salary is negotiable.

I am not sure from the email if the labour broker will pay me or if the client will pay me, but I think the client will pay me because the labour broker also said in the email that he (labour broker) will forward my CV to the client and that I must just let him(labour broker) know.

 

[Waaib]

This guy who works for the labour broker said in the email that his client(civil engineering company that I will work for if I get or accept the job) is a company that is looking for someone with my experience and qualifications, he also mentioned that I will be offered a permanent position at that company and that the salary is negotiable.

I am not sure from the email if the labour broker will pay me or if the client will pay me, but I think the client will pay me because the labour broker also said in the email that he (labour broker) will forward my CV to the client and that I must just let him(labour broker) know.

Many labor brokers are also recruitment agencies. They essentially offer both services. If you go permanent from day one then it's probably just a standing finders fee. 15% - 20% of your annual salary normally. You don't pay this, your new boss would pay this directly to the labor broker. Like a form of commission. Just ask the guy what he is offering. Ask who you will work for.

What often happens is that someone contracts to a company for a few months through a broker and then wants to join them as a permanent employee. If that happens the labor broker looses his monthly contract fee so they say to the client that you going perm is fine but they must pay the finders fee.

 

[Dolby]

I worked for Labour Brokers for about 5 years - and as mentioned, the company pays the LB and the LB pays you.

They take a cut of your salary - but I'm not too sure what the percentage is. At one job, it was rumoured to be 40% - but I can't vouch. They do this as long as you are through them. I had a company take me on 18 months and two others for a year.

Permanent is simply a once off fee, a percentage of salary.

(yea - same as many people have said ... just wanted to type something)

 

[Waaib]

Nice one Dolby - heading for the Big 5k I see.

It's actually not such a bad deal for the company that is getting the person from the agency. The costs related to hiring someone permanently are quite high. If you include pension, medical aid, etc (cost of getting rid of perm staff is high too) it may well work out cheaper for them for have contractors through agencies that perm staff. So they don't mind paying the extra fee to the agency. For the employee it's also an opportunity to get exposure to several environment without looking like you are job hopping.

 

[Dolby]

Nice one Dolby - heading for the Big 5k I see.

It's actually not such a bad deal for the company that is getting the person from the agency. The costs related to hiring someone permanently are quite high. If you include pension, medical aid, etc (cost of getting rid of perm staff is high too) it may well work out cheaper for them for have contractors through agencies that perm staff. So they don't mind paying the extra fee to the agency. For the employee it's also an opportunity to get exposure to several environment without looking like you are job hopping.

I think thats why at least one of the conpanies only took guys from a LB

They were an IT company and burnt during the bubble burst in 2001ish.

 

[krycor]

They do on an hourly basis where you are employed and paid by the agency, it can be quite a high% and you find places like Telkom doing this a lot as the agency people are contractors thus they afford more flexibility with less cost of e.g. med aid etc Also VERY often you will find perm staff being out performed by contractors lol and this model works very well where staff turnover is high.