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The Fordyce Letter

Straight Talk for the Recruiting Profession

Articles tagged 'contracts'

Ask Barb

Lesson Learned: If You Signed It, You Have to Live With It

Ask Barb

Dear Barb:

How do I get around signing agreements that are written by my clients?

We just got burned by a client who hired someone from us and demanded a refund after nine months. I didn’t even realize the terms were refund vs. a replacement.

I have no intention of refunding the fee because I think their contract is unreasonable, but this is one of our best clients and I don’t want to lose their business. How can I make them see this situation from my point of view?

Can you give me a short script I can use when contacting them back? I’m a fair guy, but a refund after nine months is a ridiculous request.

John S., Fort Smith, AK

Dear John:

Jeff's On Call!, Staffing

Can I Protect Myself From Being Temp-Napped?


Hi Jeff,

Thanks for providing such a great site.

I have a question regarding the validity of buyout clauses in temporary employment contracts. I own a small contingency staffing business in CA. I’m wondering whether a staffing firm can legally defend a buyout clause in their W2 offer letters or 1099 independent contractor contracts to prevent a candidate simply approaching a different supplier for the same client and engaging with them for their services in the same role?

We’ve had issues where the candidates once placed, negotiated a better deal with a competing agency, and simply switched to their employ instead. This is done with the blessing of clients who don’t seem to care that we were the ones who recruited the consultant in the first place. In general, client contracts are biased to favor the client, in that there is no restriction about receiving the same candidate from a different vendor.

If so, is there a specific form the buyout clause needs to take, i.e. specific wording that it should include, preclude?


Oh No! The Hiring Manager Wants to Present the Offer

2 minute coaching logo

Editor’s note: Each month, Gary Stauble offers quick, easy-to-implement ideas on various subjects. This month’s topics have to do with when to start a search, your inner dialogue, and presenting offers.

Topic #1: Should you start a search without a signed agreement?

We were all likely taught that you should never start a search without a signed agreement. This makes good sense for many obvious reasons. However, what do you do if a hiring manager authorizes you to send people for a search but does not return your agreement promptly?

Fees, Jeff's On Call!

Think You’ve Got A Case? Here’s How We Decide

Placements and the law logo

Proving you earned your fee is far different from earning it. Since we accept collections on a contingency fee basis, we become your partner in the investment. For this reason, we have developed guidelines to decide whether to invest our time and money. Using them has enabled us to attain a 93% collection rate. Here they are:

1. Is The Recruiter Being Realistic?

It’s natural for unpaid recruiters to be angry. Some say they’d rather see us get the money than let the employer get away with not paying. Others insist they want far more than the full amount as compensation for their pain and suffering. We admire them, but suggest they call their local bar association for a referral.


How Well Do You Know the Basics? Take Jeff’s Quiz and See


Do you know the laws relating to placement?  Take this quiz and find out!  The correct answers are at the end.

Need help? Check out Jeff’s previous columns here.  You can also consult his extensive collection of tips and information on his website www.placementlaw.com.

A. The offer in the contract between the recruiter and client is:

Fees, Jeff's On Call!

Even With a Week One Falloff, Your Fee Is Still Due


Hi Jeff

I enjoy reading your posts and replies on The Fordyce Letter. All of us in the recruiting industry appreciate your insight and thoughts along with a forum to discuss here on The Fordyce Letter.

Here is our firm’s dilemma:

A long-time client that we have been working with to help build their growing organization asked us to find a HR talent acquisition recruiter.

I have a duly signed and executed search agreement signed by the director of Human Resources. We identified, screened, presented several candidates for the position. A strong candidate was identified and pre-screened for the role by us. We presented the candidate, and were asked to set up an interview with the HR director. The candidate interviewed and received/accepted a written offer, which I negotiated. The candidate passed reference, background, drug tests and started the position. Unfortunately the candidate resigned after two days due to a family situation. Below is an excerpt of our search agreement paragraph 2:

Fees, Jeff's On Call!

Can You Get Paid Even When You Don’t Make A Placement? Yes, Says Jeff


Dear Jeff,

Thank you for the excellent advice that you give all of us recruiters. Your column, along with The Fordyce Letter, have guided me through many sticky situations that have come up throughout the years. You folks are the greatest!

I have been working on a contingency basis with a company that wanted to use the same recruitment agreement as a company that they had acquired. They gave me six sales jobs to work on.

I identified good candidates for three of the six territories and was starting to submit more applicants for the other three territories. I then received an email from the sales director that the company had just entered into an exclusive agreement with another recruiter, and I can only work on the three of the six territories that I have been working with. After all of this, only one of my applicants will be getting a job offer. Do you believe that I have any remedies? (They also suddenly want me to sign a new contract with the main company, although, the contract will be canceled immediately.) 

The Business of Recruiting

Everything That’s Wrong with Contingency Contracts and Some Ways To Fix It

Signing Contract

I imagine at some point back in the 60’s and 70’s the concept of providing recruiting services under a contingency arrangement made sense. Back then many “employment agencies,” as they were known, were exactly that: clearing houses for local companies they held established relationships with. As such, the fees — usually 10% of the employee’s first year’s salary — were paid by none other than the employee.

I ought to know, since as late as 1985, I obtained two interviews in Southern California through this arrangement. I still remember the companies: Roadway Express and Gallo Wine. At the end I did not accept either job. In my mind, any company that feels their job is so precious that I’m expected to “pay for it” is setting the stage for the wrong career path for me.

Jeff's On Call!

Protecting Your Full Fee In Sales Placements

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.

Meet Jeff at the upcoming Fordyce Forum in June. Register now  to become eligible for a free, private, confidential one-on-one consultation with Jeff at the conference. Consultations are limited, and will be scheduled on a first-come, first-served basis, with Jeff arranging the time directly with you.

What Client Says:

“We hired the candidate at a lower starting salary.”

How Client Pays:

Business, Fees, Jeff's On Call!

Collection Tip: Be Careful of the Words You Use

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. And FYI: Meet Jeff at the upcoming Fordyce Forum in June. Register now, save $200, and become eligible for a free, private, confidential one-om-one consultation with Jeff at the conference.

What Client Says:

We hired the candidate as a consultant.

 How Client Pays:

Over the past decade, employers have been cashing in on the consulting boom.  Unfortunately, contingency-fee recruiters have been the paymasters.

When you send a fee schedule that contains any of these 10 words, you’re aiming your recruiting revolver at your fee-free foot: