Friday, 28 February 2014
Recruitment headaches can be avoided
John Mehtam is our employment law expert and he said many companies turned to recruitment agencies to find key personnel for high profile positions.
“Recruitment agencies usually work on a commission basis, with their fee payable once the ideal candidate takes up their post. The fees are calculated on a percentage of the successful applicant’s overall remuneration package, not just their salary, and although these costs have reduced lately, you could still face a hefty bill.
“But the problem comes if the person who appeared to be the perfect fit for your company doesn’t work out. What if they resign in the first year for personal reasons? Or they take up another offer or you find they’ve lied about their qualifications and experience? You could find you’ve spent all that money and yet your vacancy is once again left empty and you’ve been left high and dry.”
John said there were steps companies could take to protect themselves before the process even began.
“Check your recruitment agency agreement allows for a refund of fees if the new staff member’s employment ends in the first year – if it doesn’t, make sure you insist on this point being included.”
John said most agencies would agree to refund their fees on a sliding scale, but employers should demand 100% be repaid if it turns out that the agency didn’t carry out sufficient pre-employment checks.
“You should be able to claim recruitment agency fees directly from the employee involved, but not if the agency has already reimbursed you. Set out the arrangement in their appointment letter, but make it clear that the clause will run out on the first anniversary of their employment.
“It’s difficult enough to find the right staff to ensure your business runs smoothly and efficiently, without being left out of pocket if things don’t work out, so employers must look out for themselves and protect their interests.”