How to read a recruitment agency proposal
Fees, deposit, guarantee, exclusivity, scope: the 5 clauses to check before you sign, what you can negotiate in each, and how to calculate the real cost of a placement.
The 5 clauses that set the price.
For each one: what the contract says, what to check, and what you can negotiate.
Fees
Which pay the percentage is based on, base salary only or base plus variable pay, and how to cap it.
The deposit at signing
What you pay before you even see the first candidate, and how to make it deductible or avoid it.
The replacement guarantee
How long it lasts compared with the probation period, what triggers it, replacement or refund.
Exclusivity
How long it runs, and whether it stops you from hiring through your own channels.
The scope of the assignment
What is included, the timelines, and the candidates you already knew before the assignment.
The real cost, calculated
The formula to compare two proposals, a worked example, and the questions to ask before you sign.
You have a proposal on your desk.
- HR manager or HR director at an SMB who gets an agency proposal and has to approve it fast
- Executive or site manager who signs off on the hiring budget
- Hard-to-fill role, technician or manager, where an agency seems like the only option
Before you sign, put a number on what the vacant role already costs you.
Overtime, subcontracting, lost output: the cost per week, to set against the agency's fees.
Your next hire is one reply away.
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