Today’s guest blogger is Wilson Cole. He is the founder and CEO of Adams, Evens & Ross, the nation’s largest credit and collection agency designed exclusively for the staffing and recruiting industry. In 2008 he was inducted into INC Magazine’s, “INC 500” for being the CEO of Adams, Evens & Ross, the 307th fastest-growing privately held company in America.
Clients are starting to tell us that the economy is picking up, and for the first time in years they are starting to feel optimistic. This is a good thing. I am seeing cash flows improve from debtors as well, so we will all keep our fingers crossed and hope that this positive sign continues.
One of the issues that I have seen a very large increase in is back-door hires and conversion. I would be willing to bet that if I had 100 clients go back and check their candidates, 25% of our clients would find that at least one of their candidates was hired over the last 12 months. Yes this is a problem, but it is also a big opportunity. If you are willing to take the time and spend an afternoon checking LinkedIn, I would bet that you could find $15,000 to $45,000 in placements.
The reason I bring this point up is because the economy is improving, and debtors now have more money in their bank accounts. The chances of them paying you once you bring the hiring of your candidate to their attention has greatly increased from a few years ago. Then, debtors used to prefer to hold on to their money and prefer that you sue them because it bought them more time. Now, with sales increasing and cash flow improving, the debtor will more likely just cut a check vs. having to spend the money on an attorney.
So what should you do if you learn that one of your temps or candidates was hired by your client? The following suggestions may be helpful:
- Pull an inventory of your paperwork. Do you have a signed agreement? Do you have an email trail? Can you show clearly that the client knew it was your candidate and if they hired that individual, then a fee would be owed?
- Reach out to the hiring company and inform the company of its unfortunate “oversight.”
- Send the company an invoice. If you have to guess what is owed because you do not know what they are paying your candidate, then take an educated guess. Use the higher side of your best guess without being out of line of course (if the candidate’s potential hire meant the company had to pay the fee, then contact the former candidate to find out what he or she is being paid).
- Send an invoice with a specific date. For example, don’t have the invoice say net 10 days or due upon receipt. Have your invoice read 5 – 10 days from the day you cut the invoice. If today is March 2 then you would put Due March 12 — 20XX.
- Send the invoice, and wait until the first day after the invoice was to be paid.
- Then call and send a letter giving the client 5 days more. Give an exact date.