Am I Talking to a Contingent Firm or a Retained
often no easy way to tell if a firm is contingent or
retained. But it’s critical that you
know which type you're dealing with when you're talking to a
One of the
key ways to tell is by how enthusiastically you are received if you are
the one who reaches out to the recruiter. If they seem
overjoyed, the firm is probably contingent (many make their money by
marketing good candidates). If they act disinterested, it is
probably a retained firm, because they make their money filling just a
few narrowly-defined positions at a time.
Although they're both
paid by the employer, you need to know if the recruiter you're dealing
with is working on contingency or retainer. Contingent firms are
generally not the best job avenues for six-figure executives. If you’re
well into six figures, you probably don’t want to
deal with contingent firms at all. If you’re earning $100,000, you may
willing to deal with either type (but you want to make sure that the
firm isn’t going to send your résumé to your most likely employers –
you can do
that yourself). If you’re unsure of the difference between the two
Contingent & Retained:What’s the Difference, and Why Should I Care?
names are not revealing. Unless the name is one that is
prominent in the industry (Heidrick & Struggles and Korn Ferry
retained; Management Recruiters branches are contingency firms), the
tell you a thing. A firm name such as Bowzer SearchConsultants could
contingency or retained, as could Fife & Flugelhorn Partners.
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Methods They Use to Contact You Are Not Clear Indicators:
a tough one.It
used to be a dead
giveaway if a job was advertised – the firm was contingent.Now, you’ll find retained
everywhere from membership-only, $100,000+ sites like Ladders, RiteSite
ExecuNet to the popular job boards Monster and Career Builder.You’ll also find
contingent firms advertising
on the member-only sites that used to be reserved for retained search
who in the past refused to pay for advertising.
Call You:Retained firms make an enormous number of cold
calls to candidates not
in the job market.Contingency
this as well, although far less frequently, and they are more likely to
if they are referred to you by a friend.Unfortunately, if you’re at your desk at work
and a recruiter calls out
of the blue, he or she could be retained or contingent.
Firm Web Sites: You can often
determine whether a firm is contingent or retained by checking their
web site, but
read carefully. There is usually an About Us or an Our
Methodology section on a
firm’s web site.
Retained firms will
talk about an extensive process that includes:
Meetings at the client’s site with the hiring
other key people there. Developing a detailed job specification.
Targeting companies in the industry, and
candidates at them.
A description of their interviewing process.
Candidate reference checking techniques.
Contingent firms can’t
afford to do much if any of what is described
above, because they’re not guaranteed payment. Most normally will speak
phone to HR, and once in a while to the hiring manager, take the
description and then run with it.Their
web sites usually aren’t explicit about whether they’re contingent or
but if you dig around, you may find a statement that tells the client
only pay when they hire a candidate.Look for indications of how much work they do
and how many steps they
use.When a very
process is described, the firm is far less likely to be contingent.
and Company Information Released:Unless the search is confidential (because the
incumbent is going to get
fired), a retained firm will be able to tell you not only the name of
company, but will also be able to tell you extensive information about
position, what the hiring manager is like, and provide extensive
about what is expected from the position.Contingent firms generally won’t tell you who
the company is (because
they don’t want you to go backdoor, or get the word out on the street
position, which will allow everyone to go backdoor). If they do reveal
client’s name, they rarely will be able to give you extensive
the position, because they haven’t made site visits, and frequently
even talked to the hiring manager.
out if the search firm rolls out the welcome wagon if
you call them cold. The biggest thing to remember is that
the contingent firm
wants to get you hired or they don’t make any money because of you. The
doesn’t care whether you get hired or not – they only want to complete
searches to their clients’ satisfaction.
you call a retained firm up, you’ll most likely get
blocked by the secretary, and you’ll probably get the cold shoulder if
reach one of their consultants.The
chance that your background is a match for one of the
searches that the search consultant is
working on at the time is miniscule. Retained firms don’t have time to
with candidates who are not possible candidates for their current work.
firms, on the other hand, look for marketable
candidates. If you call them and they act very interested in your
especially if they don’t mention a particular job, you’re most likely
with a contingency firm.
they talk to you about more than one job, it’s a dead
giveaway. With a few rare (and controversial) exceptions,
retained firms don’t
present a candidate to more than one client at a time.Clients
get touchy when they’re paying a
guaranteed fee of $35,000 to $200,000 to a search firm, and they find
firm has also presented the candidate they want to a competitor,
setting up a
bidding war. The contingent firm has no commitment to the client or any
from the client. If they can present you to a dozen clients, they have
a twelve-times greater chance of earning a fee. If the recruiter starts talking
about more than one job, or in any way suggests that they’ll be
to more than one client, the chance is almost 100% that the recruiter
But even this
is not a dead give away. Some retained
recruiters will find ways to test your interest. If they’re working on
a job in
and you’re from the Northeast, but tell them you’ll move anywhere, the
recruiter may also mention a fictitious position in Philadelphia,
to see if you’re merely looking for a band-aid job, or are truly
moving to the Great Smoky Mountains.
directly if they’re on a retainer may get you a lie,
but it’s a way to start.You can gently
ask the search consultant if he is working on a retainer or on
you often won’t get a truthful answer. Some will give you an
and some will give you an ambiguous answer that will make it sound like
are working on retainer. (Some contingent firms may have an exclusive
contingency listing and consider that working on retainer.An exclusive contingency
listing means that
no other recruiter is working on the position, but the client has no
to hire someone that the firm brings to them, and can hire anyone they
their own methods).
way to check is by looking up the firm in Kennedy’s
Directory of Executive Recruiters (The Red
you’re actively looking for a job, you
should buy a copy of this book.Firms
are listed as contingent or retained in the Red Book.Unfortunately, even firms in the retained
section may not be what you consider retained.Some will take a $4,000 retainer, and get the
remainder of the fee on
completion – they’re primarily a contingent operation, and will operate
like a contingent firm.Others
will do a
mix of contingent and retained searches, but tell Kennedy that they
on retained searches, or that they accept contingent assignments
and make their way into the retained section of the Red Book. Some
retained firms don’t care to be listed in the Red Book at all, because
no client uses the book to select a search firm, and they can’t handle
barrage of resumes that it generates.
RiteSite’s list of
600 retained firms contains most (but not
100%) of the true retainer-only firms in the country. If the firm is on
list, you can feel comfortable that it is aretained firm.
Do the reputable
retainer-only firms ever work on
on rare occasion.They’ll
be really sneaky about it, because
they don’t want word to get out. If they do so, they’ll most likely act
they are working on a retained basis.