These people fall into the 'headhunter' class; they look and act very much like the agencies described above. To many clients and applicants, there is no difference between a Contingency Search Firm and an Agency. There is a distinct difference, however; Search Firms generally get a position requirement from a client firm and conduct a search for applicants who match the requirements. The search is conducted via calls to an existing database of known candidates who match or may know people who match and 'cold' calls from lists or leads on people who may be a match. The key here is that these calls are made to applicants who are not necessarily looking for a position and need to be sold on the opportunity. This is in contrast to an agency, which is always making calls on behalf of an applicant who wants a new position.
Contingency Search Firms require a higher skill level from the recruiting staff because of the need to have more knowledge in the particular field and more sophisticated techniques regarding searching for and selling an applicant. An agency recruiter just needs an applicant, which is provided, and a list of people to call.
As a result of the differences above, Search Firms tend to fill positions in the higher salary ranges and positions that have high skill requirements. However, Agencies and Search Firms overlap and compete in many areas and often have characteristics and methods that blur their definitions.