How agencies hire recruiters through rec2rec firms

What a rec2rec firm does

A rec2rec firm, short for recruitment-to-recruitment, is an agency whose candidates are recruiters. It places consultants, researchers, team leaders and branch managers into other agencies, staffing firms, RPO providers and in-house talent teams. For an agency owner, it is the same service you sell to your own clients, pointed back at your business.

The work looks familiar, but the judgement is different. A useful explainer on rec2rec from Happlicant describes three things that set it apart: billing history matters more than the CV, desk specialisation runs deep, and most moves happen quietly because the recruiter does not want a current employer to know. Those three points are also what you are paying for when you use one.

A rec2rec consultant keeps track of recruiters by sector and by seniority, and knows who has outgrown a desk. That network is the asset. A job advert on a board mostly reaches recruiters who are already looking, and the strongest billers often are not.

How rec2rec firms usually charge

Most rec2rec placements are contingent permanent hires. You pay nothing until a candidate you were introduced to accepts or starts, and the fee is a percentage of the first year's pay. The details live in the firm's terms of business, so read them before you accept the first CV.

One public example shows how the pieces fit. The standard terms of Aspire Rec2Rec, a UK firm, set the fee on first-year remuneration in three bands:

The same terms make the fee payable if you engage the candidate within six calendar months of the introduction, invoice when the hire starts, and ask for payment within 14 days. Where the pay cannot be worked out, they set a flat fee of £10,000. These are one firm's published terms, not a market rate, and many firms quote case by case.

The rebate is the other half of the price. In the Aspire terms, a candidate who never starts earns a full rebate, a hire who leaves in the first two weeks earns 80%, and the scale falls to nothing from the ninth week, less a £150 administration fee. The client only qualifies when the invoice was paid on time and the firm hears of the exit within seven days. A guide to rebate policies from ElixRS puts a typical rebate period at between one and three months, extendable to six.

When to use one, and when to hire direct

A rec2rec fee on a senior biller is a real cost for a small agency, so the choice deserves a few minutes of honest arithmetic. Compare the fee with what an empty desk costs you each month, and with how long your own search would take. The table sets out where each route tends to fit.

Many agencies use both. They hire juniors directly and keep a rec2rec firm for the one or two senior seats a year that change the business.

How to pick a rec2rec firm

Choose a firm the way you would want a client to choose you. Ask for evidence, not promises, and test whether the consultant understands your desks.

• Sector fit: ask which agency desks they have filled in the last year, and whether those match yours in sector and contract type.
• Billing checks: ask how they verify a candidate's billings, and what proof they show you before an interview.
• Confidentiality: ask how they approach recruiters who are still employed, and how your name is protected before the shortlist.
• Restrictions: ask whether they will avoid approaching your own staff while they work for you.
• Shortlist size: ask how many candidates they expect to send, and how fast, so you can judge their reach.

A firm that answers vaguely on billing checks is a warning sign. The figure on a recruiter's CV is a claim, and the rec2rec consultant should be the first person who tests it.

Questions to ask before you sign the terms

Read the terms as carefully as you would want your own clients to read yours. A review of agency terms of business by Flint Bishop, a UK law firm, notes that receiving a CV or arranging an interview usually counts as an introduction, which starts the fee clock. It also flags restriction periods and transfer fees, where a fee applies if the candidate is hired elsewhere on your recommendation.

1. What counts as an introduction, and how long does the restriction period run?
2. Is the fee based on base salary only, or on total first-year pay including commission and bonus?
3. When is the invoice raised, at acceptance or at the start date, and how many days do you have to pay?
4. What is the rebate scale, what are the qualifying reasons, and what notice must you give?
5. Is there a cancellation fee if you withdraw an offer after acceptance?
6. Does a lower fee apply for a second hire, or for an exclusive brief?

Pay attention to how commission is treated. Recruiters often earn a large share of their pay as commission, so a fee on total first-year pay can be far higher than one on base salary alone. Agree the estimate in writing, because some terms charge an extra fee when the real figure turns out to differ. Questions about what a contract means for your business in law belong with your own adviser.

Making the hire stick

The rebate protects the fee for a few weeks, but the real return comes from a recruiter who is still billing a year later. Brief the rec2rec firm the way your best clients brief you, with the desk, the accounts the hire will inherit, the targets and the pay plan. Then plan the first month before the start date, so the new consultant has live roles to work on from day one.

Keep the firm informed after the start, too. It knows the candidate well and can often head off a problem early, which serves both of you better than a rebate claim in week six.