Glossary of Human Resources Management and Employee Benefit Terms
Contingency recruiting is when an organization hires a recruiting agency or contract recruiter to find candidates for an open position. The recruitment agency or contractor only gets paid if a candidate they find gets hired by the organization. The agency or contractor’s fee is a percentage of the salary of the position, typically around 20 percent.
Contingency recruiting can be an advantageous recruiting strategy, especially if:
An organization doesn’t have an in-house staff of recruiters
An organization needs to quickly fill a position
The position doesn’t require rare or specialized skills
It’s not a senior-level or executive-level position
The disadvantages of contingency recruiting include:
There isn’t a guarantee that the recruiting agency or contractor will find a suitable candidate.
Because contingency recruiting is based on a “no hire, no pay” fee structure, they’re incentivized to source large quantities of candidates, not necessarily all of high quality.
Contingency recruiting doesn’t mean outsourcing the entire hiring process: organizations still have to do the time-consuming work of reviewing resumes, determining who to interview, and performing the interviews.