Features of Working with Recruitment Agencies

Effective human resource management is a key success factor in today’s business. Companies often need to find qualified specialists, which requires significant time and financial costs. In such cases, recruitment agencies come to the rescue. However, working with these organizations has its characteristics, which are important to consider in order to maximize the effectiveness of the recruitment process. 

In this article, we will examine in detail the specifics of cooperation with recruitment agencies, including payment for their services, terms of contracts, and specifics of work. We will tell you how to choose the right Agency, what factors affect the cost of their services, and how to correctly form expectations from cooperation. Understanding these nuances will help companies optimize recruitment and avoid common mistakes.

Why companies need to know the specifics of cooperation with recruitment agencies

Collaboration with recruitment agencies is becoming increasingly common among organizations seeking to optimize the hiring process. Knowing the specifics of this collaboration is critical for several reasons:

1. Save time and resource.
Recruitment agencies have an extensive network of contacts and experience in selecting specialists, significantly reducing the time spent searching for candidates. Understanding the steps of the process will help companies manage their resources effectively.
2. Access to more candidates
Recruitment agencies actively work with applicants, allowing companies to gain access to talent that may not be available through traditional channels. Knowing how an agency works will help companies better utilize this potential.
3. Selection quality
Agencies often pre-select candidates and assess their qualifications, which reduces the risk of hiring unsuitable employees. Awareness of evaluation methods will help companies choose the most appropriate Agency for their needs.
4. Understanding the terms and costs
Different agencies offer different terms of cooperation, and knowing these terms will help you avoid unexpected expenses. This usually includes training, search, guarantees, and other services. Understanding all aspects of agreements will allow companies to avoid misunderstandings and set clear expectations.
5. Risk reduction
Understanding the nuances of working with recruitment agencies can help you avoid legal and organizational risks. These may include compliance with labor laws and confidentiality conditions.
6. Choosing the right Agency
One of the most important aspects is choosing the right Agency for your specific needs. Understanding how different agencies work will help you make an informed choice.

Knowledge of all these aspects makes companies more competitive in the market, ensures high-quality recruitment and contributes to the organization’s overall development.

What affects the cost of recruitment agency services

The cost of a recruitment agency’s services depends on several circumstances. Here are some of them:

1. Type of service
Recruitment agencies can offer various services, including search and recruitment, temporary employment, candidate evaluation, and HR consulting. The more services provided, the higher the price may be.
2. Job Complexity
The cost of services may increase if the vacancy requires specific skills or rare experience. For example, recruiting senior staff or narrow specialists or experts is usually more expensive than hiring employees in low-and mid-level positions.
3. Company level
Recruitment agencies may set different rates depending on the size and reputation of the client company. Large and well-known companies can expect higher rates when looking for more qualified candidates.
4. Geographical location
The cost of services may vary depending on the region and the competitive environment in the labor market. In large cities, where costs are higher, agency services are also usually higher.
5. Calculation formula
There are different models for calculating the cost of services:

• Fixed amount: Payment for specific services.
• Percentage of salary: The Agency usually receives a percentage of the candidate’s annual salary.
• Step-by-step payments: Payments can be divided into several stages — for search, for satisfaction, and so on.

6. Guarantees
Some agencies offer guarantees for found candidates, such as replacement within a certain time if the candidate is dismissed. Such additional guarantees may increase the cost of services.
7. Urgency of selection
If you need to find an employee urgently, the cost of agency services can be increased. Express services often cost more because they require more attention and resources from the Agency.

All these factors together determine the total cost of the recruitment agency’s services. Companies planning to cooperate with the Agency should carefully study these aspects and choose the most appropriate offer, considering their needs and budget.

How to choose a suitable recruitment agency

You should consider several important points when choosing a recruitment agency to hire company employees. Here are the main points to consider:

1. Agency specialization
Make sure that the Agency specializes in recruiting employees for your industry or has experience hiring specialists in similar positions. This is important for high-quality recruitment, as the Agency must understand your business’s specific requirements.
2. Reputation and reviews
Ask for reviews from other companies that have already worked with this Agency. Pay attention to cases of successful selection and reviews about the quality of services provided and the level of professionalism.
3. Selection methods
Get acquainted with the methods the Agency uses to find and evaluate candidates. These may include the use of modern technologies, testing, assessment of competencies, etc. The Agency should apply methods that meet the modern requirements of the labor market.
4. Guarantees and terms of cooperation
Find out what guarantees the Agency provides for the found candidates. For example, the replacement period if an employee leaves within a certain period. Discuss the terms of cooperation, including the cost of services and possible additional payments.
5. Team of specialists
Evaluate the professionalism and experience of the Agency’s employees. Qualified recruiters with an understanding of the labor market and industry specifics will be able to offer better recruitment, will always be in touch and will not leave your questions unanswered.
6. Scope and terms of service delivery
Ensure that the Agency is prepared to handle the volume of vacancies you need to close and that it can provide candidates within a reasonable time frame. Ask about the average time required to select candidates.
7. Approach to candidate compatibility by values
A professional agency should consider not only the candidate’s professional skills but also their compliance with your company’s corporate culture. This will help avoid situations where a highly qualified specialist does not fit into the team.
8. Transparency and communication
Evaluate the level of transparency in the Agency’s work. The Agency should openly discuss all stages of the selection process and be open to open communication throughout it.
9. Long-term relationships
Consider establishing a long-term partnership. Agencies interested in building long-term client relationships often take a more responsible approach to their obligations.
10. Cost of services
Compare the prices several agencies offer, but don’t choose just by this criterion. It is essential to consider the price-quality ratio of services. A cheap agency does not always guarantee a good result, and an expensive one does not always provide a complete set of services.

Choosing a recruitment agency is an important step that can significantly affect your company’s success. If you pay proper attention to these aspects, you can select the right partner for recruiting and hiring employees.

How to work with recruitment agency requirements

Considering the factors that affect the cost of recruitment agency services and other requirements for the Agency and the candidate for a vacancy, we recommend that you create a checklist with a list of your requirements. In this checklist, you can mark the results of process analysis and negotiations for each recruitment agency and then select the most appropriate one for the request.

Features of the contract between the recruitment agency and the company

Usually, a recruitment agency enters into a service agreement with the client company. In such a contract, you should pay attention to:

• A list of services that the recruitment agency provides to the company.
• On the terms of service delivery.
• Regarding the cost of the recruitment agency’s services and the calculation procedure.

You can make changes to any terms of the agreement. You should not sign the standard agreement without reading it.
The contract may provide that payment for recruitment services is made after the hired candidate begins to perform their duties.

Outstaffing

Instead of a service agreement, the recruitment agency may offer to conclude an outstaffing deal. Such a contract means that the recruitment agency hires employees. Employees who are registered to work for the Agency will perform tasks for the client company. In this case, the client company may need to enter additional contracts with the recruitment agency to transfer technical functions to employees.

Special features of the prepayment policy

The presence of a prepayment clause in the contract with the recruitment agency may have negative consequences for the business. 

Prepayment creates a risk that the company will not receive services or will face a low quality of service from the Agency. If the company has paid for services in advance, this may reduce the Agency’s motivation to provide high-quality service or actively select suitable candidates.

The absence of a prepayment clause for agency services allows the company to control recruitment better. The company can pay for the Agency’s services only after the successful completion of the contract with the candidate, which contributes to a more transparent and reliable recruitment of new employees. Removing the prepayment clause from the agreement between the hiring company and the recruitment agency helps reduce risks and improve cooperation.