Managing expectations for both the legal recruiter and the employer is vital

to a happy successful working relationship. The search agreement is

one of a couple places to do this. 

Since I am speaking to employers and mostly lawyers, I assume you know the very

basics of contract law. Also this blog post/e-mail is not giving legal advice but rather

pointing out the critical elements of the recruiter legal agreement.

6 Elements to the Legal Recruiter Agreement

1) Type of Search 

There’s two general types of searches: retained or contingency. 

Retained requires a payment upfront and some sort of fee payment schedule based on steps in the recruiting process. The more popular search is contingency because recruiters are not paid until a candidate is placed. There are pluses and minuses to both. Retained tends to be exclusive also meaning other recruiters cannot submit candidates for the search or the retained recruiter get credit.

2) How will the fee be calculated? 

This subject always creates the most anxiety for employers. 

Traditional fees are a percentage of the first year’s compensation for the placement. The percentage ranges from 20-35%, which is usually negotiated. 25% is the standard rate. Sometimes the compensation includes bonuses whether upfront or at the end of the year.

In contrast, some recruiters charge a flat fee based on certain criteria. This arrangement is less popular with recruiters but helps eliminate the overall cost question with employers.

3) When will the fee be paid? 

Employers who opt for a retained search begin paying the fee immediately and pay the balance when the candidate is placed. 

Contingency searches usually pay recruiters 30 days after the candidate starts with the employer. Some fees can be too large for some employers as a single payment and a payment schedule is usually negotiated.

This usually become 2-3 payments every 30 days. It is also not uncommon for the fee to be paid in part of full on the first day the candidate starts or even at offer, acceptance and resignation. 

4) The Guarantee 

What if the placed candidate leaves prematurely?  

Usually, if the placed candidate was asked to leave or left voluntary within 180 days, the recruiter would be responsible to refund a portion of the fee received or promise the employer to replaced the candidate. This is rare but should be prepared for. If the employer asks the now employee to leave, the guarantee should not apply if it’s because of work demand lacking or arbitrary reasons. Some employers also set the guarantee period for 90 days up to 12 months.

5) No poaching 

Generally speaking, if a recruiter agrees to recruit and place a candidate on behalf of an employer, the recruiter and the recruiting company does not have the right to pull candidates from the employer at the entire company (or a specific office) for some specific period of time. And usually that time is limited to 6 months. The NALSC Code of Ethics refers to this practice as well.

6) Time limit on candidate submission 

When a recruiter submits a candidate, the employer needs to acknowledge receipt and then the clock starts ticking. Recruiters cannot claim rights to a candidate they submitted 2,3 or 5 years ago and is placed by a recruiter or on their own volition if they do not stay in active recruiting relationship with.

The agreement should stipulate some period of time when a recruiter cannot cry foul if the employer decides to hire the candidate referred but the recruiter stopped working within a reasonable period of time. The standard varies between 6-12 months. This matter is on a case by case basis because some candidates do take longer than 12 months such as general counsel and partner searches.

Related Pages

Ethics, Legal Recruiting & Accountability

How to Select the Right Legal Recruiter

How to Create LinkedIn Company Pages 

Sourcing Attorneys through LinkedIn Groups

3 Steps to Sourcing Attorneys on Twitter

Using Job Boards to Source Attorney Candidates

For more information on our legal recruiting services, contact us.

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