The staffing and recruiting industry extends across the world with recruiters involved in every industry of workers. These staffing firms have become a go-to for unemployed workers due to their connections and continued success at placing people in jobs; they also have become an invaluable resource for companies who need to hire skilled employees. When a business enters into a contract with a staffing and recruiting firm, they make an agreement with the recruiting firm to find and send candidates for _____ position(s). The company has the ability to look through the candidates and decide which ones they want to hire. The definition of backdoor hiring, or backdoor placement, is when a candidate is presented, and the company hires that person without your knowledge. Doing that allows the company to get around paying the recruiting fee for the employee since they did not hire them as a candidate sent by the firm.
Unfortunately, every staffing and recruiting firm has to deal with the issue of backdoor hires. There are a few ways identify these situations and still collect from those clients. Here are the five best ways to find backdoor hires:
1. Set up a tracking system- You can use either a mechanical system where you have an employee follow-up on your current/former clients every 3 or so months or use an automated system; either way, use your system to track candidates and clients to see if they have been hired after they were presented.
2. Your client tries to back out of the contract- You should always be suspicious when your client tries to back out of the contract after you have started working together. Often, companies will try to avoid paying recruiting fees if they find a way to hire a candidate outside of your presentation.
3. Client outright refuses to pay agreed fee- Once the terms of the contract have been met and it is time to collect your recruiting fee, some clients will argue they do not owe you money because of _____ reason. Many times, this is a sign that the client backdoor hired one of your candidates and they want to avoid paying your agreed fee.
4. A client quickly fills other open positions that you were not recruiting for- One way that we have seen clients try to avoid paying collection fees for backdoor hires is by claiming since the candidate was hired for a different position then they should not pay. Pay close attention to job boards and other websites to see if your client is quickly filling open positions during or after you work with them.
5. Use specialized software- There are a few available technologies that will track down and notify you of any backdoor hires. We offer one that is 100% free to use and will help you identify if any of your clients have done this.
Backdoor hiring is much more common than we would like to believe and every staffing and recruiting company is a victim. Use these tips above to protect your firm and ensure you are not losing profit due to unseemly business practices.