Today’s guest blogger is Wilson Cole. He is the CEO of BackdoorHires.com and Adams, Evens & Ross, the nation’s largest credit and collections 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. Adams, Evens, & Ross has helped more than 3,000 staffing and recruiting firms recover more than $1 billion in past-due debt and is an NPAworldwide Endorsed Program.
The first clue can be observed in what the candidate says. When prompted to take an assignment at a company, if they respond that they previously tried to get hired there in the past but never heard back or that they receive recruiting emails from the company but never respond, those are telltale clues that a back door hire could be on the horizon.
The excuse the company will use for this sort of back door hire is that they “already knew the candidate, so a fee is not due.” Samantha says that the best way to avoid a back door hire in this situation is to send an email to the recruiter specifying that the candidate has been in contact with the company previously but they are not currently employed so the staffing agency is re-presenting them and a fee would be due. Samantha says that another thing to listen for from your candidate is, after the interview, if the hiring company tells the candidate to submit their resume through a different person with the hiring company.
Clue #2 is “do they know of them?” Specifically, the staffing company should confirm with the hiring company whether or not they know the candidate AND that the candidate is seeking a position, before the candidate is presented. The second part can be very important in niche industries where everyone knows everyone, but a company may not specifically know that your candidate is also looking for a job. Samantha says a good way to prepare for problems that can arise from this clue is to have language in the contract/agreement to the effect that “the hiring company has 72 hours to say that they know the candidate and that the candidate was in active consideration within the last 30 days, and if so, to provide documentation (such as when they were interviewed).”
The 3rd clue is when a staffing company presents a client, the candidate is interviewed, everything is moving toward a successful placement, but then the search to fill the position is suddenly put on hold, with no reason (or a flimsy reason) given. Wilson says it is wise for the staffing company to follow up with that candidate in the next 3-12 months, otherwise that staffing company could be missing out on money due to a back door hire. Wilson also repeats the importance of having a signed contract with language similar to “a fee is owed if a candidate is hired within a specified time period from last discussion or presentation.” Samantha and Wilson agree that “discussion or presentation” is open to interpretation, but they also agree that having that language in the contract and an email trail showing ongoing communication of a candidate is important to have in general.
The 4th clue of a back door hire is similar to the last one, and sometimes happens simultaneously, when a client (hiring company) stops returning calls after an interview with a candidate has taken place. Samantha adds that if the candidate also removes the staffing agency or recruiter (that setup the interview) on LinkedIn too, that is a bad sign, but more on that later. Wilson says that in his experience, 80% of the times when this clue and/or the previous clue is present, there is not a signed contract in place so the hiring company thinks they can get away with a fast one.
Like the previous clue where the hiring company stops returning a staffing agency’s calls, clue #5 is when the candidate stops returning the staffing agency’s calls. Wilson says that sometimes candidate are flaky, but what he typically sees is that candidates try to bypass staffing agencies after they realize they know someone on the inside of the hiring company, especially someone who is willing to split a referral fee with them.
The 6th clue, as eluded to before, is when the candidate drops the recruiter or staffing agency from LinkedIn. Wilson reiterates this clue is the reason why recruiters and staffing agencies that rely on LinkedIn alone to guard against back door hires are bound to get into big trouble. As companies become more informed, and some just trying to save some money, they are telling candidates they back door hire to do one of the following: 1) don’t update their LinkedIn profile, 2) delete the recruiter or staffing agency, 3) block the recruiter or staffing agency. Wilson says this is these tactics are specifically why AER’s system for checking for back door hires does not rely on LinkedIn whatsoever. Lastly, Samantha says that if a staffing agency encounters any of these clues, to play it cool and not react too strongly to them, or run the risk of saying something (such as “oh don’t worry about it” in response to a hiring company saying they already knew the candidate) that will undermine their collections case down the line.
Wilson estimates that if staffing agencies watch for the clues discussed here and check LinkedIn, then they will find about one-third or one-half of their back door hires. He estimates it is even possible for staffing agencies to find around 80% of their back door hires, if they designate a chunk of resources (around $3600 per year, per recruiter) in the form of hours spent by staff monitoring/tracking candidates. A better alternative is to contact AER about their back door hire software that checks hundreds of data points and costs a fraction of $3600 per recruiter, per year. Best of all, AER’s system finds about 96% of back door hires; far and away a larger percentage than staffing agencies would be able to find on their own. If you have any questions on the specifics of AER’s back door hiring system, email him at Wilson@backdoorhires.com or Samantha at Samantha@backdoorhires.com.