If you are a recruitment agency or a client of one, and you’re in dispute over fees, we’re the people to talk to.
We’ve developed a ‘niche’ specialism over the years in the small but important area of recruitment agency fee disputes and claims. Whether you are a recruitment agency or the client of one, we can provide you with specialist legal support when it comes to a recruitment agency fee dispute. With us, you will get the tactics and strategy to maximise your opportunity to claim your fee or avoid paying one (as the case may be).
The vast majority of recruitment agency fee disputes settle out of court. Our aim is always to help you find a reasonable and acceptable settlement deal, swiftly and economically, wherever possible.
However, if court proceedings are what’s required then our Commercial Dispute Resolution team will happily and robustly fight your cause and greatly improve your chance of a successful outcome.
Initial Assessment: £395
Our Initial Assessment service provides you with a swift and frank assessment of your legal position regarding the disputed fee.
For a fixed price of £395 + VAT we will:
- Assess your situation
- Review the relevant paperwork, emails and terms of business
- Provide you with a frank and business-like summary view of your position and your options
- Suggest the best next steps for you to take
Consistent feedback from our clients is that they find our Initial Assessment to be very helpful in finding out where they stand in a quick and cost-effective way.
We can normally provide an Initial Assessment within one week of receiving all the relevant information from you. In very urgent cases we can normally be faster.
After the Initial Assessment some of our clients then choose to deal with the situation themselves, while many others ask us to help them with the next stage, which usually consists of writing to the other party in the dispute and arguing our client’s position as firmly as possible, aiming to solve the situation to our client’s advantage without the need to go to court. For this further work our advice, support and representation is available at an hourly rate of £300 + VAT per hour.
This further work usually tends to take between 1 and 6 weeks to complete and is mostly dependent on the response times of the other party in your dispute. The work is carried out by our specialist Commercial Contract Solicitor, Gemma Lally, and our Director, Luke Menzies.
The total cost involved in this further work entirely depends on the amount of advice and representation required to resolve your dispute. For recruitment agencies pursuing a debt, the range of possible costs tends to be between £600 and £5,000 + VAT. For employers defending a demand for a fee from an agency, the range of possible costs tends to be between £300 and £1,000 + VAT. In every case we will always aim to help you resolve the dispute as swiftly and as cheaply as sensible and we are happy to regularly discuss the costs with you, so that you feel in charge of the costs and are never surprised by an unexpected invoice.
Please note that if an actual court claim needs to be started or defended, we will refer you to a specialist civil litigator since this is not a service that we offer ourselves. However, we have a 100% success record in avoiding the need to bring or defend court proceedings, due to our pragmatic and commercially minded approach.
Contingency Fee Agreement
If you are a recruitment agency pursuing a fee debt, we may be able to offer you our ‘no win, no fee’ Contingency Fee Agreement to cover our further work for you beyond the Initial Assessment. We will need to have assessed your case before we can decide whether we are able to offer you this option (which will normally be done during our Initial Assessment).
Under our Contingency Fee Agreement you pay us nothing at all unless we help you recover all or some of the outstanding fee from your client, and then our fee is then 20% of whatever amount you recover from that client, subject to a minimum fee to us of £1,500 + VAT. (Please note that, given this minimum fee, it makes sense for you to choose the Contingency Fee Agreement option – where we can offer it – only if you are pursuing payment of a fee that is £8,000 + VAT or above.)
Review of agency terms of business
If you are a recruitment agency we would be pleased to review your terms of business to ensure that they are up to scratch generally, and particularly when it comes to you being able to enforce payment of your fee if a dispute were to arise.
- Full review of your terms of business: £895 + VAT
- Review of the ‘fee recovery’ aspects of your terms: £595 + VAT
- Bespoke review (looking at the aspects you wish us to focus on): charged at £300 + VAT per hour
Recruitment agency fee disputes: case studies
Recent cases we’ve where we’ve successfully helped our clients have included:
- Representing an employer who hired a long-term friend of a manager, but after an agency had sent the company the candidate’s CV. The hire was very clearly because of the existing relationship with the manager, and the CV had been sent speculatively, with the agency doing nothing more to progress the hire. However, the agency was determined to claim its fee. After some robust exchanges, we persuaded the agency to back down and see sense. The ‘effective cause’ of the hire was clearly the long-term friendship, not the speculative sending of the CV.
- Representing an international recruitment agency who had found and put forward a candidate to an employer. After a lot of work by the agency, negotiations over pay broke down and the hire did not take place. But 6 months later the agency found out that the candidate had recently been hired by the same client, possibly as the result of a small amount of further work by another agency. Our client (the first agency) demanded its fee and was initially promised a reasonable ‘compromise’ sum by the employer but then ignored. After we got involved we sent the employer a firmly worded demand, with the threat of legal action, but offering to accept a slightly lower compromise sum with a 7-day deadline. The employer paid up within 7 days.
- Advising an employer who faced two bills for a hire from two recruitment agencies, both of whom sent through a candidate’s CV and neither of whom did that much to progress the hire after that. It involved careful analysis of which agency had done more than the other to be the ‘effective cause’ of the hire. On the evidence of the email trails and the time line, one agency clearly deserved its fee more than the other, and all parties were able to accept the outcome.
- Helping recuitment agencies to review and improve their terms of business so that their wording on fees is more enforceable in court and clearer for all concerned.
Read Luke’s blog on recruitment agency fee disputes, with practical tips for employers and recruitment agencies alike.