Agent Fees

bamgbost

Hi Guys

2 Questions I have

Firstly, is anyone a recruitment consultant or have an idea on what agencies get when referring successful candidates to a client.
If the pass the interview, does the agent get a fixed amount? i.e. 10%

Secondly, Do you reckon this "fee" that the client pays the agency mean that they are less flexible with salary negotiations. As whatever the more they give the successful candidate, the more the agency gets???
All in all, isit better to apply direct to the company rather than to use an agent??

Cheers

skintpaul

I saw my own temp invoice a few years back, they charged the firm I was at 20% + VAT on top of my hourly rate..


for permanent roles, they probably charge a % of your first year's salary(and any bonus package, depending on the role).

skintpaul

PS.. If going for a well paid job, maybe worth asking what share of fees YOU will get.. (can't hurt to ask!)

asajj

Some companies only recruit via agencies. Some only recruit direct applicants. Therefore it is difficult to say one is better than other as you clearly will lose out on some companies if you rather to apply directly or use agents only.

Some agencies charge high fees but they also provide very high quality candidates.

Permanent staff fees are generally 105-15% of the annual salary I think but if the role is a senior position, this could change.

lufcgirl

I'm a recruiter, and my fees range anywhere from 10-15% of the candidates annual salary depending on the role and what my agreement is with the company.

When I initially take a vacancy one thing I do ask when stating the salary is if it's negotiable. Some companies are fixed, and there's nowhere to go with it. I have a role at present for a sales executive that could be anywhere between £18-£40,000 per year depending on how they perform at interview and past experience! So it's up to the company. I wouldn't say it's better to apply direct, if they want that person and the person isn't happy with the salary you can always try to negotiate.

bevanuk

There generally isn't any kind of fee before you start the job, no incentives for interviews etc.
The only exception to this would be a retained assignment where the client would pay an agency up front for it's services, this is mainly limited to senior/specialist positions.

It shouldn't affect your negotiation power though in a small business everything has a cost associated with it so it's down to the company.

InsideInsurance

10-15% of annual full package for perms
15-20% of amount paid for temps/ contractors of actual days worked. Have seen some cap it to 12 months or such but also known others pay it for over a decade for the same person.

Of course big business can potentially negotiate much lower numbers by promising volume and/ or exclusivity.

Normally they only get paid on success, they dont get paid for getting someone to interview stage etc.

As to negotiation on the candidates money - for perms it makes little difference as its only a one off payment and in theory you could be paying them the negotiated salary for 20 years or more.

For contractors it has more influence as its generally a short term engagement and normally you'd be expecting to continue to pay the fee the longer they stay. That said, due to the pain of time sheets/ invoicing etc some companies wont accept direct temp/contractors but refer them to a preferred agency. I know with one former client they paid 17% agency but for a direct applicant that was successful they'd be forced to go via one agency who got paid 8% for those contractors.

I have bullied agencies before over their rates, where we didnt have the headroom to pay the candidate what they wanted but didnt want the candidate disappearing as soon as someone else offered them their normal rate so basically forcing the agent to cut their margin

TheRecruiter

I would say around 15% - 20% of starting salary is pretty normal, depending on what industry you are in.

I don't think it will effect the level of offer that you receive, companies won't like paying it but if you're the right person for the job then even at 20% it's good value for them.

The cost of having to compromise on hiring by not having enough selection will be much higher.

Buy cheap, buy twice..

bamgbost

Thanks for the useful info guys.

My fear has been that through applying through agencies. They "eat" into my salary potential.

But it seems I've been wrong!

InsideInsurance

bamgbost wrote: »

But it seems I've been wrong!

It depends a little on your job - grade and employment basis (and lesser degree industry etc).

The average management tenure is about 6 years (in the USA at least, couldnt spot any UK stats quickly). So even if you did the basic of splitting the 10-15% over 6 years you can see it isnt much.

A contract developer that will only be in the company for 3 months then yes I will set a day rate of £350/day to the contractor I am factoring in the 20% agency and 20% VAT, if the agent can be negotiated down then the contractor can take more.

Sometimes these negotiations actually happen between the agent and the contractor though and the client is oblivious as ultimately for the above contractor I pay the agency £504 per day. What the agency are doing with the money I dont know, I assume they are giving £420 to the contractor but it could well be they are giving £430 as they've struck a different deal.

ableandy

The only issue with Agencies is that they filter CV's and only send the client the people who they believe are the near perfect fit for the clients role. Whilst this is great in some ways as it weeds out the dross, it can mean that candidates may be filtered out yet they have equivalent qualifications.

I have just moved all my recruitment online and now do it myself and am finding some really great candidates and have saved over £100,000 since December in recruitment fees!