Welcome to The Fordyce Letter:

The Fordyce Letter

Straight Talk for the Recruiting Profession


Fees, Jeff's On Call!

Sendout to A, Hired By B. How Will You Collect?


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Jeff Allen COllection Tip

Editor’s Note: Every Monday, Jeff Allen offers you a tip about what you should do to ensure you never miss out — or get beat out– of your well-earned fee.

What Client Says:

The candidate was hired by another division.

How Client Pays:

This is a “forward pass” situation — sendout to A, hire by B.

The first issue is how the other division learned of the candidate. Then the legal analysis is usually:

  • You can prove an agreement to pay the fee by the client, but it didn’t hire.
  • You can prove a hire by the other division, but it didn’t agree to pay the fee.
  • You can’t enforce rights against either by fee schedules that say “hired directly or indirectly through the employer or any of its affiliates.”

The most important contractual question is whether the ultimate employer is a separate corporation.  If so, it’s a separate legal entity.  That means it’s not on the hook unless you can show there was a conspiracy to avoid payment of the fee.

Absent that, you’ll be asking the court for equitable relief based on the judge or jury’s idea of fairness.  The usual words are unjust enrichment – the client will be unjustly enriched by hiring without paying the fee. You must show that the division knew or should have known you were involved.  You do that by staying close to every candidate.

Treat candidates like your “stock in trade,” dusting them off regularly.  You’ll routinely pick up all of these fees!

More than thirty-five years ago, Jeffrey G. Allen, J.D., C.P.C. turned a decade of recruiting and human resources management into the legal specialty of placement law. Since 1975, Jeff has collected more placement fees, litigated more trade secrets cases, and assisted more placement practitioners than anyone else. From individuals to multinational corporations in every phase of staffing, his name is synonymous with competent legal representation. Jeff holds four certifications in placement and is the author of 24 popular books in the career field, including bestsellers How to Turn an Interview into a Job, The Complete Q&A Job Interview Book and the revolutionary Instant Interviews. As the world?s leading placement lawyer, Jeff?s experience includes: Thirty-five years of law practice specializing in representation of staffing businesses and practitioners; Author of ?The Allen Law?--the only placement information trade secrets law in the United States; Expert witness on employment and placement matters; Recruiter and staffing service office manager; Human resources manager for major employers; Certified Personnel Consultant, Certified Placement Counselor, Certified Employment Specialist and Certified Search Specialist designations; Cofounder of the national Certified Search Specialist program; Special Advisor to the American Employment Association; General Counsel to the California Association of Personnel Consultants (honorary lifetime membership conferred); Founder and Director of the National Placement Law Center; Recipient of the Staffing Industry Lifetime Achievement Award; Advisor to national, regional and state trade associations on legal, ethics and legislative matters; Author of The Placement Strategy Handbook, Placement Management, The National Placement Law Center Fee Collection Guide and The Best of Jeff Allen, published by Search Research Institute exclusively for the staffing industry; and Producer of the EMPLAW Audio Series on employment law matters. Email him at jeff@placementlaw.com.