Jeff on Call: Two Fees, One Candidate?

Mar 5, 2009


Q: Can the employer be required to pay two fees for hiring the same candidate?

What? Two fees for one placement?

Absolutely! It happens around a half-dozen times a year in our office.

We estimate employer applicant tracking systems are less than 10% effective.
Job title differences, department differences, maverick managers, slow HR departments,
software glitches, or other things will slip the candidate through.

Many clients try to protect themselves with PSA (Placement Service Agreement) terms
like, “If a candidate is in our database, you won’t get the fee.” So if you see this, be sure
to insert a short time-limit (like three business days) for the client to notify you in writing
of a prior submission. This gives you the opportunity to check the facts.

Then “fill it and bill it or kill it!”

Be careful of the, “We already know him!” trick when some employee of the client has some acquaintance (real or imagined) with the candidate. If they worked for the same previous employer, this happens frequently.

The prior referral must be tied to some objective, verifiable acts, like a written employee submission for a referral fee (“bounty”).

An e-mail or regular letter from the client explaining the referral period and notice requirement is another simple way to clarify this.

If there’s no PSA that short-circuits your fee schedule, use a referral period.

We don’t lose cases because we use this wording:

“Our fee is due in the event a candidate we present is engaged to perform services, directly or indirectly, in any capacity by the client or any of its affiliated entities, within one year from the date of our last communication with the client regarding the candidate.

It is also due if the client refers the candidate to any other person or entity and the candidate is engaged to perform services within one year from the day of the referral from the client.”


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