Recruiter
From Wikipedia, the free encyclopedia
- See also: Military recruitment
A recruiter is someone engaging in recruitment, which is the solicitation of individuals to fill jobs or positions within any group, such as a sports team or corporation. Recruiters can be divided into 2 groups: those working internally for one organization, and those working for multiple clients in a 3rd-party broker relationship, sometimes called headhunters.
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[edit] Internal recruiters
An internal recruiter is member of a company or organization and typically works in human resources (HR), which in the past was known as the Personnel Office, or just Personnel. Internal recruiters may be multi-functional, serving in an HR generalist role (hiring, firing, exit interviews, employee disputes, contracts, benefits, recruiting, etc.) or in a specific role focusing all their time on the activity of recruiting. They can be permanent employees or hired as contractors for this purpose. Contract recruiters tend to move around between multiple companies working at each one for a short stint as needed for specific hiring purposes.
[edit] Third party recruiters or headhunters
A third party recruiter can work on his/her own or through an agency and acts as an independent contact between their client companies and the candidates they recruit for a position. They can specialise in client relationships only (sales or business development), in finding candidates (recruiting or sourcing), or in both areas. Most recruiters tend to specialize in permanent or full-time, direct hire positions or contract positions, but occasionally in both. They will often utilize Internet recruiting to help in their recruiting efforts.
Those recruiters who specialise in contract placements (where the candidate is typically paid hourly for temporary work) may divide their labours into two functional groups, with one group working to sell to clients and open job orders, and the other group focusing on recruiting candidates. Both staffing and consulting firms employ recruiters specialising in contractor placement. Most recruiters today working in this area are compensated with a base salary, but receive a commission or bonus that is somehow tied to the number of placements they make.
Third party recruiters who specialise in placing job seekers in full-time positions with their client companies are more often referred to as headhunters. It should be noted, however, that many recruiters resent being called headhunters, and vice-versa. Typically Headhunting is associated with a higher degree of industry knowledge and a more specialised, less 'blanket' approach. Whereas a recruiter may place an advert or place calls with no prior knowledge of the individual they are contacting, a headhunter will attempt to know about the subject's previous employment history, education, etc. He will make contact on the premise that 'on paper' the candidate is suitable for the role, whatever their current situation. Poaching employees away from their current employment in this manner gives headhunters their name.
Additionally, Headhunters vary from Executive Search Agents/Professionals who typically have a wide range of personal contacts within the area in question, a detailed specific knowledge of said area, and typically operate at the most senior level. Executive Search professionals are also involved throughout more of the hiring process, conducting detailed reports and interviews as well as only presenting candidates to clients where they feel the candidate in question will fit into the employment culture of the client. Executive Search Agencies typically have long-lasting relationships with clients spanning many years, and in such cases the suitability of candidates is paramount. It is also important that such agencies operate with a high level of professionalism, and thus usually cold calling or other techniques often associated with recruitment are shunned.
Executive Search agencies often also provide clients with (legal) inside rumours gleaned from contacts within their clients' competitors.
Compensation methods for recruiters specialising in direct hire placements fall into 2 broad categories: contingent and retained, both of which are explained below. Retained recruiters present opportunities and oversee the interview and placement process for their clients.
Third party recruiters make their income through sales commissions generated from the fees that they collect from their clients. Some recruiters also receive a base salary or a draw against future commissions.
Due to the differing nature of Executive Search, in the interests of maintaining long lasting relationships with Client companies, compensation may have further layers. An example of this is the promise to perform an additional search with no charge if the originally placed candidate resigns or is fired within the first 12 months of employment.
[edit] Retained search
High-end executive search firms get a retainer (up-front fee) to perform a specific search for a company officer or executive position. Consequently, retained searches tend to be for positions that pay in the $200K+(US) range.
Search fees are usually 33% of the annual compensation of the recruited executive. Fee payments are made in thirds, 1/3 of fee paid on initiation of the search, 1/3 paid thirty days later, and 1/3 paid upon placement of the candidate. It is important to note that in a retained search you are paying for the time and expertise of the search firm. You have employed the firm to conduct the entire recruitment effort from beginning to end, until the candidate has started working.
Retained recruiters work for the organizations who are their clients, not for job candidates that need to find a job.
Search firms generally commit to off-limits agreements. These agreements prevent a firm from approaching employees from their clients as candidates for other clients (for instance, if top headhunter recruits the new CEO into Boeing, they will agree not to recommend Boeing executives to other companies). Since they act as management consultants working in the best interests of the clients for whom they conduct searches, it would be counterproductive to simultaneously remove talented executives from the same companies. Search firms will decline assignments from certain companies, in order to preserve their ability to poach candidates from those companies. Very large search firms often insist on guarantees of certain amount of searches before they will put an entire company "off-limits". The official representative body of the industry is known as the Association of Executive Search Consultants (AESC) and is based in New York.
[edit] Delimited Search
Another form of high-end executive search, delimited search, is often improperly categorized as retained search, although there are distinct differences.
Similar to retained search firms, delimited search firms require an up-front fee before engaging the search. Unlike common retainers, however, delimited search commitment fees are refundable if the search firm fails to fulfill certain deliverables defined in the contract. Moreover, the delimited search commitment fee does not follow the typical 1/3, 1/3, 1/3 model of retainers, but rather is a set fee which is then netted off against the final placement of 30-35% of the placed candidate’s first year compensation.
Also similar to retained searches, delimited searches are exclusive to the contracted firm providing the search service, with each search being customized to the client organization’s needs, and the delimited search professionals providing a consultative service throughout the process.
While both retained search and delimited search are service-oriented - focused on clients rather than job candidates - delimited search contracts always (as opposed to sometimes) include a strict time frame for executing the search.
[edit] Relative Advantages
Clients (Companies seeking to hire) often tend work with contingent search firms when filling non-business-critical low and mid-level positions. As contingent search firms generally rely heavily on their databases, and seldom work on an exclusive basis, it is not rare for a client to work with a large number of contingent recruiters on the same search at the same time, in order to maximize the volume of candidate (job seeker) resumes they receive. Beyond the increased volume of candidates that such an approach allows, contingent firms do not get paid until the placement is made (a candidate is successfully hired), and thus the search risk is shifted almost entirely to the search firms. Moreover, contingent search firms often work with clients on a lower percentage fee basis, relative to retained and delimited search firms.
For senior level roles, clients often prefer to work with retained and delimited search firms. Both of these search styles focus on providing a tailored service to clients, relying more on relationships and recruiting ability rather than database information and resume volume. By working exclusively with one firm on such searches, the client generally develops a much deeper relationship with the recruiter, and receives a much higher level of service. With both retained and delimited searches, clients rely on search professionals to provide not just resumes, but also insightful, consultative information about the market in general.
Clients tend to work with retained firms on open-ended searches where it is very difficult to establish a reasonable time frame for completing the search. With up to two-thirds of the total fee being collected before completion of the search, retained search firms are often seen as being the best positioned resources-wise to continue working on a potentially drawn-out search where it is difficult to find and/or recruit the best candidate for the role. In other words, retained search is generally preferred when the position is business critical, but the candidate pool is not easily definable. Although delimited search is gaining popularity, retained search is still the dominant model for executive level search.
Delimited search is often preferred by clients who are seeking a retainer-style service level, while not willing to accept the level of risk that retained search entails. While delimited search does entail up-front fees, they tend to be much smaller than total pre-placement fees that retained search entails. Moreover, delimited search professionals shoulder the risk of their own failure to execute the search within a specified time-frame, offering to refund the up-front fees in such an event. While delimited search is not as desirable for searches that are open-ended in nature, the “ticking clock” is often seen by clients as an incentive that motivates delimited search recruiters to stay more active and involved throughout the hiring process.
[edit] Specialization
Headhunters tend to either be generalists or specialists in a particular niche, with some recruiting firms also specializing in a geographical region as small as a city, and others recruiting worldwide. Niche headhunters may specialize in a specific industry or type of employee, such as medical specialists, information-technology professionals, senior-level executives, or sales professionals.
[edit] Ethics
A recruitment agency would usually sign a contract with its client company stating that it will not take any of their employees and recruit them to other companies. Some client companies go on to use the services of a particular recruitment agency mainly in order to stop them from taking away their current employees.
An ethical dilemma arises in this condition: a recruiter that has placed a candidate in a job that has worked out badly must refrain from pulling that person out for another firm, even if the person is ideal for the new position.
