Myths of Contingency Recruiting

Contingency recruiting is when an organization engages a recruiting agency to find candidates for an open position. The arrangement is simple, the recruitment agency only gets paid if a candidate they sourced is hired by the company. Usually payment is a percentage based on the candidate salary. There are many reasons this arrangement works for people, but we will cover the common misconceptions around the benefits of this type of solution.

eHire has offered contingency based recruiting services since its founding in 2009 and has a long track record of making successful placements for a large number of clients. Using agencies can give you greater access to a highly qualified candidate network and game-changing hiring expertise. The time and effort savings of using the right recruiting agency can be substantial. 

And while choosing the right agency is important, selecting the right solution for your organization is paramount. 

Are these common selling points fact or fiction?

There are several traditional contingency recruiting selling points to dissect when solutioning for your specific hiring needs. 

1. Low Risk

Primarily known for its “no placement, no fee” structure, contingency recruiting can feel low risk. And while you do not have to pay until a placement is made, you are betting on a hope of a return and not a guarantee. If your company is serious about hiring the right person quickly, the risk is far greater for you not to fill the role. There may be better solutions available to get you as close as possible to a guaranteed outcome. 

2. Cost Effective

In some cases contingent recruiting may be a cost effective way to hire for select positions, especially when compared to building out an internal talent acquisition team. But, if your need includes a high turnover role or multiple highly skilled employees, cost can quickly skyrocket. Scalability gets expensive quickly. And, an obvious downside of shopping for the lowest cost contingent staffing solution is you may end up with the lowest quality. 

3. Flexibility

Contingent recruiting is low commitment and companies can pivot to other needs or change role direction at any point in time. This is best if the position or project is uncertain and hiring plans are unresolved. If your company is serious about hiring, the flexibility you need is in the ability of the solution to support unforeseen changes and in a team that can guide them through any adjustments. You will need a solution that pivots with you, not that you pivot away from moving you further from your desired outcome.

What other options are out there? 

There are several outcome-based solutions you should consider.

1. Retained Search 

Retained Search is different from Executive Search. This model can be used for all types of roles, not just executives, where your company is serious about hiring. You may pay fees at certain deliverables, or checkpoints, along the hiring journey getting you as close as possible to a guaranteed outcome. This solution allows you greater visibility into the search and includes guidance through the intricacies of hiring such highly specialized employees.

2. Proactive Recruiting Solutions

If you're hiring because of an anticipated need, proactive recruiting solutions may be a good fit. An anticipated need could be churn, growth, parental leave, etc. You will engage a recruiting agency to lay the groundwork for hiring so that when the anticipated need arrives, your candidates are what eHire calls “decision ready”. Proactive Recruiting is best for hiring multiple needs of a repeatable skill set or highly critical roles that cannot have downtime. This is a great solution for scalability, avoiding pressure, opportunistic hiring, and a shortened time to fill.  

3. Project Recruiting

Project Recruiting works well when the size and scope of your hiring needs doesn’t align with other solutions and may require help with project governance, reporting, and agile frameworks. Your company may be hiring over a dozen highly specialized employees for critical projects. You need market intelligence, compensation planning, and a tech-enabled recruiting resource. While this may be the most complex solution, you need a highly customizable service offering that is outcome-focused. 

When looking outside of internal talent acquisition do your research and ask the right questions. Traditional contingent hiring has been successful for lots of companies but that doesn’t mean it’s the best choice for you. Focus on services that are outcome-based and accommodate your needs.

eHire is happy to answer any questions about different service offerings and help build the right solution for you. Book a meeting today.