Let me share with you a few of the darker sides of this type of Back Door Hire:
1. Sometimes when they tell you they paid another recruiter, they are lying and there was never another recruiter.
2. We have seen on a few occasions where the HR manager takes your candidate's resume you sent over, and they forward to another recruiter they have worked with for years. In a few cases, we have uncovered that the HR manager was receiving a cash kickback from another recruiter. This type of Backdoor Hire does not happen often, but it does happen from time to time.
Let me also say that sometimes you will hear the argument “We paid someone else”, and what you find out is that they paid an internal referral to an employee that recommended this candidate. If you hear this argument, please understand that this is a totally different type of issue and they definitely owe you a fee.
This usually happens once you tell the candidate about this position; HR then searches the company through LinkedIn, finds out there is someone at the hiring company who used to work with the candidate and reaches out. These fees will be owed because you were the procuring cause. If it had not been for your actions, the candidate would not have reached out in the first place.
Now, what do I recommend you do first when you are told, “We paid another recruiter"? Go through your checklist. Do I have a signed contract, and what does it say? Do a little digging and ask who presented the candidate first. Ask who the other recruiter was that they paid. Did the candidate know of this position before you talked to them, and do you have proof that you disclosed the position to the candidate? (Helpful hint from the author: it is always much easier if you have an email documenting that you told the candidate about this position, and he confirms in writing that he does not know about this position.)
Once you get this information, call me and let us talk about the specifics of your Backdoor Hire. These types of collections are VERY difficult to collect, and if the debtor has said, “I am not paying you because [we paid someone else],” please keep in mind that they have said the magic words I mentioned a few chapters ago. You need to stop talking and get either your attorney or myself involved.
Case Study Number One:
Fortune 500 company
Fee Owed: $26,000.00
Reason for the Dispute: They paid another recruiter that presented the candidate 6 weeks after my client had presented the candidate. The hiring company and our client had a signed agreement stating they are owed a fee if the candidate was hired within 12 months of the last presentation.
Resolution: After working our way through the layers of bureaucracy and the hiring company's legal department, the hiring company paid the full fee and our client rebated 50% back on two future hires. This was a win/win scenario. Our client was paid, the hiring company received some value back, and our client saved a revenue source.
Case Study Number Two:
Mid-Sized 100,000,000 Sized Company
Fee Owed: $19,000.00
Reason for the Dispute: They said they paid another recruiter, but after a little research we found out that they DID NOT pay another recruiter. It was, in fact, an internal referral. We also found out that about one week after our client presented the candidate an internal employee made the recommendation, and they paid him a small finder’s fee. Our client did have a signed agreement, and we collect the full fee of $19,000.00.
Footnote: If our client did not have a signed contract, we would have been lucky to get half of their fee.
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