RETAINED VS
CONTINGENCY
RECRUITMENT.

WHAT ARE THE DIFFERENCES

OF EACH APPROACH?

At Leonid, we work on a retained model, regardless of the role seniority. This means we do take a fee up front, before we begin the search for your perfect candidate.

We believe this works very well; we have a 98% success rate, excellent feedback and lots of repeat custom from companies in the corporate governance and R&D tax sectors. However, we understand that for hiring companies, it can be a bit of a leap at first, particularly for those who are used to working with contingency recruiters as the norm.

WHAT IS RETAINED RECRUITMENT?

When working to a retained model, the recruiter collects a partial fee from clients before the recruitment process begins.

The remainder of the fee is paid upon successful placement of the candidate. The agency will work on an exclusive basis meaning they are the only ones working on the role.

WHAT IS CONTINGENCY RECRUITMENT?

Contingency recruitment essentially means ‘no placement, no fee’.

A recruiter is tasked with filling a role but chances are, they may not be working exclusively on it, and if they don’t succeed in filling the role, then their work goes unrewarded and they move on to the next job.

BENEFITS OF RETAINED RECRUITMENT

100% commitment

With a payment typically made up front, a retained agency is more incentivised to work hard to complete their mandates. Also, since they are working on fewer roles at any one time, they are able to give each role more time and focus.

Candidate exclusivity

Retained recruitment firms will not send their candidates to multiple clients, so there’s no risk of hiring companies having to compete with other firms which the recruiter works with.

Partnership approach

Companies who partner with retained search partners typically enjoy strong relationships and long-term benefits from working together. They also gain valuable market insights, such as salary benchmarking and hiring trends. Consultants will work as an extension of the hiring company’s in-house HR team and will represent the employer brand in the right way.

Industry expertise

Consultants typically have deep knowledge of the sectors they recruit within; they understand the roles and the culture of the company they are hiring for and therefore instinctively know which candidates they need to go after.

More pre-screening

By the time the shortlist of candidates reaches the client, the screening and pre-qualification is done, which simplifies the interview process and saves precious time.

Cash Flow Management

It is easier to keep track of how much money is coming out of the business and when – which in turn enables better planning.

Accountability

With a fee paid up front, clients have a right to hold the recruiter to what they say they are going to do.

Peace of mind

Retained recruitment typically enjoys higher success rates and with the partnership approach, you can feel confident in your talent acquisition team, knowing they are working hard to deliver and leaving you to focus on your day job.

DRAWBACKS
OF CONTINGENCY RECRUITMENT

Less focus from your consultant

Contingency is a numbers game; the recruiter knows that some placements will be won and others lost. As such, consultants don’t tend to cap the number of roles they work on.

The process is more reactive and the candidate pool is more limited

Contingency recruitment typically relies on job ads to bring candidates to the jobs, rather than consultants proactively seeking out those golden ‘passive candidates’ who aren’t necessarily looking for a new role. 

No exclusivity

With consultants working on several similar roles at any one time, they may end up handling multiple offers for their best candidates, which can lead to disappointment when you don’t manage to secure your preferred people.

Multiple suppliers create inefficiencies

With two or more contingent recruiters working on one search, you will be pestered at all different times of the day by consultants chasing feedback.

Unqualified candidates

When the focus is on quantity over quality, agencies may rush to send you candidates which haven’t been extensively screened. This can mean time wasted.

The candidate experience suffers

With candidates being pitched at different employers, it can potentially impact how your brand is perceived by job applicants.

‘Quick wins’ will be prioritised

There’s a danger that more challenging searches will be left until last, when the recruiter is incentivised to fill as many roles as possible.

Lack of accountability

If you don’t commit to your agency up front, then you, as their client, have no recourse if they don’t deliver what you expect of them. As the saying goes, you don’t get something for nothing!