Confusing questions...predictable answers
What does a recruitment agency do?
A company that is looking to fill an open position will often utilise the services of a recruitment agency. The agency will employ a number of techniques for sourcing suitable people such as advertising, their database and referrals. Once identified as potentially suitable, candidates will be interviewed by the agency before presenting a CV to the client, usually with some form of profile or assessment. The agency will then manage the recruitment process on behalf of the candidate and client by facilitating and organising interviews, feedback and hopefully an offer of employment.
Recruitment agencies charge their clients for this service. Candidates are not charged in any way.
How do recruitment agencies get paid?
Recruitment agencies charge their clients a fee for successfully finding a candidate for their role(s). This normally happens in one of two ways:
1. If the role is a permanent role, the agency charges the client a percentage of your annual salary. Fees vary but it is important to note that this fee in no way has an impact on the amount of money you will be offered – it is a separate transaction.
2. If the role is a contract role, the agency charges the client a percentage of your hourly or daily rate. Again, fees (or in this case, margins) vary, however it is important to note that the margin does not (or at least depending on who you’re dealing with, it should not) influence the amount of money you take home. The margin is how the agency charges their client for services including the sourcing, screening and facilitation of a wide range of recruitment activities. In addition to a margin, the agency charges the client a range of on-costs associated with things such as workers compensation insurance and payroll tax. There is also normally a small administrative charge.
Why use an agency?
Companies usually employ the services of a recruitment agency because recruitment can be a lengthy and time consuming process that can take them away from their core business. Agencies are also able to attract a wider variety of potential candidates through greater advertising reach, a large database of candidates and broader networks of contacts.
Job seekers will usually find that the majority of jobs are handled by an agency. This can be a little frustrating as, in an ideal world, it’d be nice to know what company you’re applying for! As it’s a very competitive industry, agencies will normally be cautious about revealing company details to you until they are sure that you are legitimately interested in the position.
Going through an agency though does have its advantages. Firstly, the agency will normally have some experience with your potential employer, meaning that they can advise you on how best to present your CV and prepare yourself for interview. Further, agencies will normally interview a large number of candidates for a position in order to find the most suitable people for the role. This means that you are more likely to have the chance to present your case personally, rather than relying on your CV to get you through the door. Perhaps most importantly, an agency can guide you through the recruitment process, which can be difficult to navigate.
If you are an independent contractor, going through an agency has other significant advantages. For example, particularly in IT, insurance requirements and therefore associated costs are very high – a lot of companies are now demanding upwards of $10M professional indemnity insurance. This is a significant cost that an agency will cover on your behalf and is normally built into to the margin they on-charge to the client. Another advantage is access to roles. As a professional contractor you probably don’t have a lot of time to look for your next contract while working on your current one. Agencies are therefore a good single point of contact with the market and can provide access to jobs you normally wouldn’t know about. Additionally, there are a number of other advantages depending on your unique situation.
What happens if two agencies send my CV to the same client?
Agencies usually have terms of business in place with their customers that state a period of exclusivity over candidates they represent – usually 12 months. This is designed to stop clients avoiding payment of a recruitment fee by hiring a candidate direct and to ensure that the client does not have to pay a fee to every agency that sends in your CV if you’re successful.
In the event that more than one agency presents a CV to a client, it is usually the case that the client will deem the fee payable to the agency that sent the CV first. There are certain situations where this will not apply however, for example in the unfortunately fairly common event that an agency sends a candidate’s CV without the permission or knowledge of the candidate.
The best way to avoid your CV being sent to the same client is to ensure that you know where your details are being sent. An agent should always disclose this to you before sending your details anywhere. If your details have already been sent to a client that another agent wants to send your CV to, you should insist that they not do so until you have checked with the original agent. If they send your details anyway you should immediately contact the original agent who should be able to sort things out for you. You may be asked to provide an email describing what happened in writing. You may also have some recourse of action against the offending agency based on privacy laws.
If your CV does happen to get sent to the same client twice it should not normally reflect poorly on you if you have handled the situation correctly. It should be noted however that not disclosing that your CV has been sent previously (either by yourself or another agent) reflects poorly on everyone, including you.
If in doubt, ask the agent that will give you a predictable answer you trust!
For further questions please don't hesitate to contact us:
03 9013 0022 or email: enquiry@predictable.com.au
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