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Jul 29,2021

Candidate Ownership Advice.

Candidate Ownership Advice:

So, what do we mean when we talk about candidate ownership advice? Well, this comes into effect when a client receives an introduction to the same candidate from two opposing agencies. Though it doesn't happen often, it is important to consider what to do in that situation, and how you can ensure the best for you, your candidate, and the agencies. Therefore, we have written this handy little guide if you ever come about such a situation.

As it generally goes, the act of an agency giving a candidate's details to a client falls under a contractual offer, typically on the agency's terms and conditions of business. If the client accepts this offer, by acting on the introduction and arranging to interview the candidate, the agency will ordinarily be entitled to claim an introduction fee.

Practically, if two agencies introduce the same candidate, the client is free to accept one of these offers by arranging interviews with that agency, and they can reject the other. In the instance that there are two parties, it is highly advisable for the client to reject the one which has had the least involvement in the process. Unfortunately, most clients do not actively reject duplicate introductions, and as a result, it becomes necessary to work out who is responsible for the introduction.

"First to Introduce"

To avoid any complications, some clients take the "first to introduce" policy, which unsurprisingly, awards the first agency to submit the candidate details to claim the fee. Most of the time this policy is effective, however, there are some significant flaws to consider:

This policy may encourage poor recruitment practice as agencies rush to submit their candidates irrespective of consent from the candidate. As you may be aware, some agencies adopt this approach and send out mass CVs in bulk to mailing lists which ensures they benefit from the "first to introduce" approach, regardless of their compliance to obligations under the Conduct Regulations and Data Protection Act. Additionally, sometimes an agency might introduce a candidate to a business where the candidate's CV had been sent for other positions previously in the past, maybe even for the same position but it was not picked up. Even if an agency emails a candidate's details to a client, the email may be ignored or lost in their inbox. Therefore, it is not viable for that agency to claim ownership if the email was never read and the second agency was the one to actively discuss the candidate with the client, arranged the interview and managed the entire recruitment process.

"Effective Cause"

Due to these issues, and the court's unwillingness to accept the "first to introduce" approach, an "effective cause" principle has been developed. The effective cause is now well-established in client/agency relationships, useful cases from the recruitment industry include:

  • Wallace Hinds and Associates Vs Lastolite (2000)
  • Law Staff Legal Recruitment Limited Vs Just Costs Limited (2009)

In these cases, the court has instead considered whether the agency had played an effective part in the employment of the candidate. If they were found to not be effective, the agency would have no entitlement to the introduction fee. This has been seen to be the fairer and more practical approach, which recognises the input and acceptance of the process on all sides, and equally benefits the agency which contributed most towards the result.

In summary:

Good recruitment practice, above all else, is to ensure that the best candidate is hired, the client is satisfied and confident in the recruitment process, and that relationships are continued to be cultivated. Having a clear understanding of such principles will prepare you for situations like these and help you to manage them if/when they come up, which in most large organisations or recruitment businesses will happen at some point or another. Therefore, it is best practice to recognise the partners that are having the biggest impact on your business and who are most involved with the processes; if you find yourself in this situation, which approach would you take?

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