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.
In the staffing and recruiting industry, a written and signed agreement is your safeguard against the uncertainties of the future. It lays out the agreed-upon terms, sets the expectations for all the involved parties, and is used to avoid confusion.
If you’re new in the business, you may find yourself scouring the internet to create a contract, and mostly, you will find dozens that encourage specifications down to the last detail including the exact job title for your candidates. This move might be a great way to organize candidate files. It may also attract clients. But from a collection standpoint, it is a gateway to unfortunate circumstances.
What’s wrong with a job-specific contract?
To state it simply, job-specific contracts make collecting fees difficult. As we mentioned earlier, contracts are binding agreements between the parties involved and set the boundaries of the transactions.
Here are a few things that you have to remember if you’re considering using a job-specific agreement:
- Some clients might use the job-specific contract against you. We root for a good agency-client relationship but you can never be too complacent when it comes to business. We have encountered numerous cases where the clients take advantage of staffing agencies by using the wordings in the contract against them. So, it is a must to review and reconsider all the content of your agreement before getting it signed.
- Multi-skilled individuals could be hired for another position other than what was specified in the contract, and if they are, you will certainly have a difficult time collecting your fee. Worse, you may not be able to collect at all because the court might throw the case as unenforceable.
- Double or triple-check every part of the contract, especially if you are determined to specify the position of your candidates. Do not include copy-paste sentences and terminologies only to make it sound fancy. You need to make sure that you understand everything and that your contract serves as your protection and does not harm your chances of collecting in the future.
In the past three decades, we have encountered different scenarios and different reasons why a client thinks they do not owe a fee. One of the top excuses that we repeatedly encounter is that the candidate was hired for a different position. Now that you know that job-specific contracts lead to impending troubles, we sincerely hope that you would avoid using these in the future.