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Do Splits Only With People You Know

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Jul 2, 2014

Dear Barb,

At the end of last year, I was contacted by a recruiter in New York for assistance on a search they were working. Bottom line is that I provided the candidate who was eventually hired by their client. My candidate started his new job and is doing very well.

Our agreement was that I would be paid 50% of the $32,500 placement fee when cash came in. It is 120 days later and I still have not been paid. The owner of the recruiting firm is not returning my calls. The recruiter I worked with offered to send me $2,500 toward what they owe me, which just adds insult to injury.

If I go to an attorney, I’ll end up losing a good portion of the monies collected. What would you advise me to do in this situation? I’m not a bank and want the $16,250 I’m owed. This is the first time I’ve done a split with another firm and it’s going to be the last.

Frank Z.

Austin, TX

Dear Frank,

Unfortunately, you may have no recourse but to take legal action. I would contact the owner of the recruiting firm one last time. Your message should ask for a response by a specific date or you will be forced to take legal action. You can also ask that your legal fees be paid as part of your lawsuit.

There are some actions you can take to protect yourself in the future:

  • Get your split-fee arrangement in writing including when you will be compensated for your efforts. The agreement should also address the cost of legal action if not paid.
  • The best scenario is that you either know your split partner or met them personally during a staffing and recruiting event.
  • Another great option if you want to do split business, is to join one of the networks who encourage splits between their members

If you do not know the company or recruiter who contacted you for split business, research if they are certified or a member of a professional association like TSA, NAPS or ASA, or if they are a member of their state association. Individuals who have earned their professional certification or are a member of a professional association have agreed to adhere to a strict code of ethics.

Some of these associations offer an arbitration process if there is a fee dispute.

Hopefully, this gets resolved and you are paid the money you earned.

Barbara J. Bruno, CPC, CTS

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