In NPAworldwide, we define split placements as a single placement involving two recruiters from two different recruitment firms. One represents the employer with the open position and the other represents the candidate. Three-way placements occur when a third entity, typically another recruiter from another firm, gets involved. We normally see this manifest when the third recruiter (who does not represent the client OR the candidate) introduces the other two parties and receives compensation for making the introduction, or when there is one recruiter with a job opening and two recruiters representing the same candidate. We discourage three-way placements for a number of reasons, including:
- If the party with the job is *not* an NPAworldwide member, and does not pay their partners, there is no recourse available through our network. Members can be indemnified if another member fails to pay a portion of the fee, but that remedy is not available for non-members.
- A split placement is earned when one party’s information triggers the other party’s interest in a candidate. This means that the job-side recruiter needs to have a compelling job with a strong client relationship and the candidate-side recruiter needs to have current, firsthand information about the candidate that clearly establishes a good fit for the open role. A third-party, who is merely introducing the other two partners may not meet the test of triggering interest. In our network, there is an expectation that each party to a placement does substantially more work than this in order to earn compensation.
- If there are multiple recruiters representing the candidate, there is an increased chance of the candidate receiving conflicting information about the role, interviews, salary, benefits, and more. Additionally, it’s not uncommon for a candidate to refer other potential candidates, which can create conflict if it’s not clear which recruiter has the right to treat those referred candidates as their own.
- An additional pitfall in three-way placements is if each candidate recruiter expects different compensation for the placement of the candidate. One person might say, “I’ll take half of whatever is collected from the client.” Another might say, “I expect 50% of the client fee, which needs to be *at least* 25% of the candidate’s compensation.” This can create a situation where someone gets substantially less money than they should (and that is before the fee gets split in three ways instead of just two).
There is an old saying that “many hands make light work” but adding extra people to a split placement often creates more work/trouble than it solves. If you’re in the position to introduce potential trading partners, consider doing so without compensation. It’s a great way to broaden your network and you may find that you’ll be rewarded in the long term with additional revenue opportunities.