Would you lend a complete stranger $10,000 on a handshake, without
a promissory note or an I.O.U.?
I don't think so.
And yet, recruiters willingly reveal their candidates' names and contact
information -- and even arrange face-to-face employment interviews --
without any written agreement that clearly states their fees and
We're so happy to play ball with employers, we sometimes forget to cover
our bases. Or worse, we tippy-toe our way through negotiations, hoping
to avoid any sticking points that might cause stress.
Later, after we've lost our leverage (or our hard-earned dollars), we
blame the hiring companies for our predicament. But in fact, all they've
done is taken what was handed to them. Fair or not, we only
have ourselves to blame.
To avoid disagreement, confusion or disappointment, I suggest you
protect yourself with a simple, yet effective tool that keeps your
clients on the straight and narrow.
A Fee Agreement, Not a Fee Schedule
Years ago, I used to think that by quoting from my company's fee
schedule, I could lay down the law. Sadly, I learned that a fee schedule
is nothing more than a glorified price list.
Just because you show someone your price list
-- or publish it on your Web site -- it doesn't necessarily mean than
the other side understands or accepts your terms, or promises to pay you
for services rendered.
To protect your investment in time and inventory, always put your fee
and guarantee terms in writing. Assuming the client has agreed to the
conditions, make sure the agreement is signed by an authorized company
representative. A straightforward, one-page fee agreement is one of your
most powerful business tools you can use, because it:
Qualifies the employer. If the other side is reluctant
-- or refuses -- to sign your fee agreement, it either means they have
no interest in working with you, or have no intention of paying you.
Spells out your terms and conditions. By putting it in
writing, you avoid confusion, and nothing is lost in translation.
Highlights the sticking points sooner, rather than later.
Specific aspects of your fee or guarantee may require some
give-and-take. It's best to resolve your differences early on, because
you have the most leverage before -- not after -- the company knows your
candidate's name and phone number.
Demonstrates your professionalism. Amateurs tend to
give away their services, avoid confrontation and fail to establish
ground rules. Is that the impression you want to give?
Sets the stage for a better working relationship. As
Robert Frost wrote, "Good fences make good neighbors." By establishing
clear boundaries, fair terms and self-respect, you'll level the playing
field, and help make the game more pleasant for everyone. I operate
under the assumption that everyone I work with will play by the honor
system. But just in case, I require that all clients sign my fee
agreement before any candidate contact information is revealed.
While I acknowledge that not all agreements are legally enforceable, I
also know that without them, I'm totally defenseless against those whose
memory might fail them, or who might try to take unfair advantage. And
besides, a written agreement helps me get a better night's sleep.