Working with Recruiters: The Different Types and What They Do

Working with Recruiters: the Different Types and What They Do

If you are working with recruiters, you may find it helpful to understand the relationship between the recruiter and the hiring company and the relationship between a recruiter and a potential employee.

Recruiter or Placement Agency

The companies that use recruiters to fill a position pay recruiters for their services.  Hiring companies do not accept unsolicited resumes from recruiters.  Therefore, all recruiters are working under contract, and they work on behalf of the hiring company.  If you are a working with recruiter, you are valuable to that recruiter.  The recruiter will not charge you a fee.

There is a different type of staffing firm called a placement agency.  These agencies work on behalf of job seekers and may charge job seekers a fee for finding them a job.  The distinction between a placement agency and a recruiter is that placement agencies find jobs for people, and recruiters find people for jobs.

Contingency Recruiter or Retained Recruiter

Sometimes, people try to explain the difference between contingency recruiters and retained recruiters in terms of the compensation.  There was even a benchmark set at $100,000-a-year for a point where a person would rise above contingency recruiters and pass into the realm of retained recruiters.  At that time, I had contracts for retained work under $100,000 a year and contracts for contingency work above $100,000 a year.  My relationship to the applicant did not change based on these contracts.  I had jobs to fill and needed people to fill them.  So at times, a recruiter may have some contracts that pay them a non-refundable advance payment (a retainer) for their services and have contracts for payment after the job has been filled.  More recently, some retained firms have also done contingency work (The Directory of Executive and Professional Recruiters).

In practice, how a recruiter is compensated is not important to you as a potential employee.  The contacts the recruiter has in relation to the type of contacts you need to further your career is important.  Since contingency recruiters and retained recruiters both work under a contract and given that financial benchmarks are not that useful in the changing landscape of compensation, the best way to work with a recruiter is to help the recruiter understand your experience and the type of job you are seeking.  If the recruiter has jobs that fit your experience, he has a network that is valuable to you.  Typically, the sterling silver of retained search firms are conducting searches where the level of contact is with the board of directors and the level of search is for “C” level managers, that is, Chief Executive Officers, Chief Revenue Officers, and so forth.  When people at that level of experience contact me, I refer them to Tom Snyder, who hired many people from me when he was an executive in the CPG industry.  Tom has placed over 50 C-level executives.  The Chicago office of Spencer Stuart, where Tom works, is the most effective consumer goods executive staffing practice in the country.

You and the Recruiter

Recruiters are called headhunters, because they hunt for people.  They get on the phone and call people.  They email people.  They research for prospects.  They are looking for fits like ring sizes.  Hiring companies pay recruiters for their skills in finding those fits.  Applicants as a potential employees have value.  They are the diamond ring.  The hiring company is the ring buyer, the customer.  The recruiter is the jeweler.  He takes a measure of what will fit the hiring company.  If recruiters do not have a fit in their jewelry case, they hunt for one by calling people in their network.  They often look for rings that are not yet on the market.  Therefore, whether the applicants are rings in the jewelry display case or ones who are not yet on the market, the applicants and the hiring companies have value to a recruiter.  If recruiters have the network to fit the needs of the hiring companies and the experiences of the applicant, the recruiters have value to both based on that network.