Contingency Recruiters usually collect a fee based on a percentage of the first-year compensation. They don’t get the benefit of salary increases or special bonuses. At ScerIS we partner with recruiters and provide a 15% fee applied to compensation paid to their employee placements over a two-year period (shorter if the employee’s employment ends before two years). This placement fee is paid monthly based on total compensation paid to the employee in the previous month.
If the employee’s compensation remained the same throughout the two year period, then the commission paid to the recruiter is comparable to a 30% commission paid on the first year’s compensation (15% per year for 2 years). However, since the fee is calculated on current compensation across 24 months which includes salary increases, bonuses and other compensation, the effective (one-year) fee percentage is closer to 35% to 40%.
Not only does this subscription fee work for the recruiter, it works for ScerIS. Both parties are vested in a great outcome.