By Aaron Dodd, Operation Director of the Mindset Group
In 23 November's Recruiter Daily Daryl Keeley, MD of specialist recruiter MACRO commented that “Low-balling” clients damage recruiters’ reputations. He is right of course, but the issue is more directly related to the contingent recruitment model.
If a recruiter is retained they are done so on a project fee basis, incorporating staged payments. The fee is negotiated up-front and is usually based on a percentage of the EXPECTED final salary package. The very act of up-front negotiation ensures that both the recruiter and the client are very aware of the salary on offer. There is no room for surprises down the track at offer time, so the low-balling scenario will not exist and the recruiter’s and client’s reputations will not be compromised. Further it commits both parties to a ‘shared risk’ model. Under the contingent model, all the risk lies with the consultant, hardly an equitable fair contract!
The other point to note is that if a client is offering a very low salary for a role and will not change their mind or their offer, why accept the assignment in the first place? If the role is going to be impossible to fill (or retain an effective candidate in) why do work that you ultimately won’t be paid for? It will make better use of time to use that non-billable time to find better new clients than to spend billable hours doing unbillable work recruiting for roles that can’t be filled due to low salary offers.
In summary therefore the Daryl Keeley’s accurate consequences of low-balling can be effectively negated with the retained model and a more selective approach to the work a recruiter actually takes on.