Fair Pay For Recruiters
I have been in the contract recruitment business now for a period spanning around 15 years and in that time it has never ceased to amaze me how badly recruiters are usually thought of by candidates. As with anything, there’s always going to be a mix of good and bad however the perception seems to be very much that all recruiters are rip off merchants or merely, and this is a phrase I have heard many times “pimps”.
As well as the matter of basic common courtesy (returning phone calls etc.), a great deal of mistrust has always seemed to circulate around one of the most sensitive subjects where people’s work is involved, money. Again this works both ways. I have seen recruiters put literally weeks of work into getting a position for a person, using up personal favours to get the best deal they can for their candidate, just for the candidate to then try to shop out the position for an extra dollar to an agency who’s done zero work at all, and of course can then afford to undercut. Equally I have seen some horrendously high margins taken off people by recruiting companies.
Obviously neither of these positions is fair or reasonable however where money is concerned fairness and reasonableness can soon disappear. It’s for this reason that I have always believed it’s essential to operate a totally open book policy with regard to paying contractors. I have found this particularly important in economic downturns when everyone is struggling and pay rates tend to get reduced as the supply/demand curve moves away from the candidate.
I had believed that things had improved over the years and that I was less unusual in this stance than in the much earlier days of my career when I was working in a much less mature market, however a recent experience a friend had when trying to secure a nursing position showed that the old ways do still exist out these. Trying to get any sort of indication of what fees were going to be charged in order to come to her contracted rate was like pulling teeth.
The more the question was asked the more ridiculous the responses got, even to the point of the recruiter in question claiming he had no idea what the charge rates were and even better, no idea what commissions he got. As I said earlier, I have been around recruitment a while now and also employed and worked with many recruiters. In that time I can’t think of a single one who didn’t know what commission they got, and quite right too as that’s what feeds the family!
In the end after an abrupt termination of the call being followed by a call back from a manager trying to rescue the situation and spending quarter of an hour trying to evade very simple questions, we eventually got as far as a “target margin window” that they business “generally” aims for. And then I wonder how the industry gets such a bad name……..
I have had open book talks with a great many contractors over the years and almost without fail I have found that once they real numbers are out in the open, most people tend to be perfectly reasonable and accept that in the same way that they need to make money to live, so does the person finding them the job and looking after their needs.
When I talk about having an open book policy I simply mean that I have no issue whatsoever telling the candidate exactly what the client is going to be paying me. I will then breakdown the cost elements that have to come out of that charge and what they are for. This then leaves us with a pay figure for the contractor and a percentage for me. If the contractor decides he does not want any of the associated benefits which add to my cost line (for example subsidy on healthcare), then I will throw that back into the pot and add it to their pay. Ultimately there’s just one pot of money and as long as everyone feels it has been split fairly then there’s seldom any issues.
Not only do I tend to find that going “open book” with a contractor over wages increases makes them feel more comfortable about not being “ripped off”, they are genuinely appreciative of someone actually bothering to explain to them how the recruitment side of the business works and what exactly they are getting for the difference in what the client pays and what hits their pay packets.
I also tend to adopt exactly the same policy with clients. I have no issues telling then exactly what I am making off a particular deal. Why should I care? At the end of the day, as long as you are being fair and reasonable and provide value for what you take then others see that as fair and don’t expect a person to work without being compensated.