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Fixed Fee Vs Contingency Recruitment

Fixed Fee vs Contingency Recruitment

If you are currently using a contingency-based agency, you are likely going to be paying anywhere between 10-25% of salary as a finder’s fee, which can easily be tens of thousands of pounds.

Taking a full-time, national living wage job (currently £7.20 an hour) on 40 hours a week equates to a salary of approximately £15000. Based off a fee of 10%, you will have fees of £1500 associated with recruiting that individual. For higher paid jobs, you can quickly see how the fees quickly increase!

There are agencies, such as Hiring People which provide a service which provide a very similar service for a fixed fee. Services which might be provided include:Advertising the job online

  • CV filtering
  • CV searches (using online job databases)
  • Telephone interviews
  • Interview scheduling

There is one major difference that does need to be raised; with a fixed fee recruiter, their fees are payable whether or not you actually recruit from their efforts. The incentive on the fixed fee agency, is naturally winning your repeat business!

So why would you use an agency over having a member of staff manage internally? The simple answer is time.

If you are only recruiting a couple of members of staff each month, it is highly likely to be significantly more cost effective for you to use an agency over having a member of staff employed in house.

Fixed fee recruitment is particularly beneficial within the service sectors.

An example might be a company with 10 locations within Manchester. They are able to achieve significant recruitment savings.

Within their 10 locations, they generally have to recruit for a couple of members of staff each month, generally with very similar requirements (a customer service advisor). As their locations are all fairly similar, their recruitment partner is able to only place one job advert online, only do one CV search.

The only parts which the company has to pay for twice is the telephone interviews and the interview scheduling.

As you can imagine, this results in significant cost savings compared with working with a contingency based agency.

Before you work with your existing recruitment agency, consider using a fixed fee recruiter first. With Hiringpeople’s fees starting at £495, even for the most junior roles, significant savings can be made.

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