Recruitment Agent Fees

[Dolby]

Is it more beneficial for an agent rather try get the highest salary possible for an applicant, with regards to what she charges to the employers?

I've heard they get a percentage of annual salary of the placement - so 5% of R100,000.00 would be her fee if she placed you. However, I've also heard that saving on the employer budget for a salary means she gets a portion of the saving too ... so 5% of R80,000.00 as well as a bonus/higher perecentage for saving R20,000.00 budget on the salary.

I'm tending to think the former is the way it works and she'd go for the best salary - just wanted to check with any employees that have used an agent?

 

[Uraeus]

Yep that's how it works. Its in the agents best interest as well as your best interest to get the highest
salary possible, although the actual negotiation of the salary will be up to you when you actually have the
interview with the employer.

Recruitment agents can charge around 15%+ of your annual salary. Which means if you get offered a position that they have sourced and you accept, then they will be asking for their 15% cut, up front from the employer.

Be careful though, cos if you accept the offer from the employer, then get cold feet and go back on your acceptance, then YOU will be liable for that 15%.

Quite an epic business model

I have used a recruitment agency before, you usually find the big corporate companies will use them.

In general I'd rather scout the big business websites "Job" or "Careers" pages, as it is more favorable for the company to employ you directly cos then they save quite a bit.

But going through the recruitment agency has benefits for the company, in that they will source other candidates for no extra fee if you leave within 6 months.

My 2c

 

[Dolby]

Thanks Uraeus!

That's what I thought - wanted to check though. I had no idea it was so high though ... ouch

 

[Fiekus]

In a previous role I've dealt with many agents, as a recruiter. Their % can also vary depending on the salary bracket, e.g. they will charge up to 20% if the annual salary is < R350k and 15% for anything above that.

 

[Ejeckt]

I' ma agency recruiter. Normal contingency recruiters charge a % of the annual guaranteed salary or CTC. Headhunters and retained agency charge a fee upfront, and then the rest once a candidate commenced employment with their client.

I've never heard of a situation where the agent gets a bonus fee for finding a "cheap" candidate.

In terms of salary the agent is often on your side, trying to push and motivate for highest possible salary.

 

[Other Pineapple Smurf]

...
In terms of salary the agent is often on your side, trying to push and motivate for highest possible salary.

I call BS, continue to drink your industries cool-aid. In the last two years I've been dealing a lot with agents and all except one agent was pushing for the lowest salary I would accept.

I use to be in sales and would often discount a product to close the deal, I don't believe agents are any more different as its all about commission.

By accepting a lower deal the candidate is more attractive to the employer: a senior Java developer who will accept R30Kpm is more likely to get the job than another senior who wants R40Kpm.

Agents will always insist on asking what I earn first, they will never tell me what the job offers. Two years ago I was earning half of industry standard and agents thought I was their next meal check as they all pushed for a 10% increase on my then salary.

I now tell agents to lift their skirts first to see if its worth my while. Needless to say I don't get many offers anymore.

 

[ToxicBunny]

^^^

Know exactly what you are talking about.

I now don't even give an agent the time of day unless they tell me the salary range for the position... if its worth my while then I tell the agent what I will accept as a lower figure (which includes at least a 10% increase over my current salary).

Even doing that I've had an agent put me forward for a job at 60% of my current salary. Both me and the prospective employer were livid. We apologised to each other, ended the interview and then I proceeded to give the agent a monumental ear bashing over the phone. I figure he did as well cos i got a very apologetic email later in the day from the agents manager.

 

[Recruit2network]

Recruitment Agency fees

I agree Ejeckt. Bonus fees for a "cheap" candidate is bogus.

I' ma agency recruiter. Normal contingency recruiters charge a % of the annual guaranteed salary or CTC. Headhunters and retained agency charge a fee upfront, and then the rest once a candidate commenced employment with their client.

I've never heard of a situation where the agent gets a bonus fee for finding a "cheap" candidate.

In terms of salary the agent is often on your side, trying to push and motivate for highest possible salary.

 

[F1 Fan]

^^^

Know exactly what you are talking about.

I now don't even give an agent the time of day unless they tell me the salary range for the position... if its worth my while then I tell the agent what I will accept as a lower figure (which includes at least a 10% increase over my current salary).

Even doing that I've had an agent put me forward for a job at 60% of my current salary. Both me and the prospective employer were livid. We apologised to each other, ended the interview and then I proceeded to give the agent a monumental ear bashing over the phone. I figure he did as well cos i got a very apologetic email later in the day from the agents manager.

Talk about stupid. Who in there right mind would even bother setting up the interview. The worst thing about interviews is that you shouldn't discuss salary immediately. But I don't see how that makes sense and the prospective job may not live up to your salary expectations. So you go through all that effort for nothing.

 

[AlmightyBender]

I call BS, continue to drink your industries cool-aid. In the last two years I've been dealing a lot with agents and all except one agent was pushing for the lowest salary I would accept.

I use to be in sales and would often discount a product to close the deal, I don't believe agents are any more different as its all about commission.

This. Agents commissions are maximized by maximizing the number of placements rather than maximizing the salaries of those placements. For every R1000 extra salary, the recruiter gets R1800 in commission. So for a R240000 p.a. salary, they will get a R36000 commission, and for R252000 p.a. salary they will get R37800 commission.

It is better for them to get two R36000 commissions than one R37800 commission.

TL;DR version:
They don't care they just want to place you.

 

[InvisibleJim]

Agents will always insist on asking what I earn first,

This is actually what they should do. Even before they speak to you about a specific job they should be gathering current information about you, your availability, what you expect to earn, what you are wanting to earn, how flexible are you on location, what you are doing/want to do. THEN they talk to you about specific opportunities which match your skills and situation.

Traditionally, recruitment consultants are trained not to tell people that a job pays x amount because x is usally a fuzzy number to some degree or other and also they want a true answer as to what the candidate's parameters are, not influenced by what they think they can get away with.

Although a poor or unethical recruitment consultant may try to use your salary information to beat you down (which isn't really in their interest on a number of levels) you can shoot yourself in the foot if you aren't honest and forthcoming about your current salary and expectations which can lead to either underselling yourself or pricing yourself out of the position.

 

[InvisibleJim]

This. Agents commissions are maximized by maximizing the number of placements rather than maximizing the salaries of those placements. For every R1000 extra salary, the recruiter gets R1800 in commission. So for a R240000 p.a. salary, they will get a R36000 commission, and for R252000 p.a. salary they will get R37800 commission.

It is better for them to get two R36000 commissions than one R37800 commission.

TL;DR version:
They don't care they just want to place you.

I would agree with the above(although I haven't checked your sums). Also remembering that 15% ish of the starting salary is the placement fee to the agency, not the commission to the individual agent which is more likely to be 10-20% of the placement fee and often will be subject to a threshold amount of revenue before they qualify for commission.

 

[Albereth]

I don't know about agents beating people down. But I also don't know about agents boosting salaries either. There is always the discussion between employer and prospective employee. But I guess that if there are many agents for the same position then cheap candidates make sense

 

[nfbs]

Recruiters just increase their percentage they charge claiming they do extra screening so I dont think they neccesarirly push for higher salaries. Then it requires the candidate to go for a waste of time interview with the recruiter which I hate.

 

[InvisibleJim]

I don't know about agents beating people down. But I also don't know about agents boosting salaries either.

Inflating a candidate's salary wouldn't be ethical as it would be at the expense of the client or could price the candidate out of the role unnecessarily. The agent should however be matching your reasonable salary expectations to what the client reasonably has allowed to pay for the position ie. is an acceptable proposition from both sides.

Cost is obviously an important factor but it shouldn't be the only one. Would you rather pay an amount within your budget for a strong candidate who meets all your requirements or try to save by paying less by recruiting someone who is less experienced or skilled?

 

[Ancalagon]

Be careful though, cos if you accept the offer from the employer, then get cold feet and go back on your acceptance, then YOU will be liable for that 15%.

Only if you sign an agreement with the recruiter to that effect beforehand.

If you are the candidate, never sign any agreement with a recruiter, and never give them any money. If they ask for money, you run a mile.

There are SO many recruiters out there, it really doesnt matter if you p!ss one or two off.

 

[Wyrd]

Only if you sign an agreement with the recruiter to that effect beforehand.

If you are the candidate, never sign any agreement with a recruiter, and never give them any money. If they ask for money, you run a mile.

There are SO many recruiters out there, it really doesnt matter if you p!ss one or two off.

You are the commodity. You get traded. The commodity doesn't have to pay for itself -that's insane.

(pardon the use of the impersonal 'it')