The HR Dictionary
Contingency recruitment refers to a type of recruitment in which a recruitment agency collects fees from clients only when a qualified candidate is searched and placed by them for the position in question.
Contingency vs Retained Recruiters
The primary distinction between retained and contingency recruiters is how they are compensated. Recruiters that work on a contingency basis are only compensated when they find a candidate who accepts a job offer while a predetermined upfront payment and further remuneration are made to retained recruiters once they successfully find a candidate to fill the position.
Pros of Contingency Recruiting
- Contingency recruiting allows the organization to pay the recruiters only if a qualified applicant found by the agency is hired.
- The organization can avoid upgrading office premises to make room for recruitment specialists by outsourcing the recruiting activities.
- Contingency recruiters are driven to meet deadlines if the organization has to fill a position promptly.
Cons of Contingency Recruiting
- There is no assurance that the contractor will locate a qualified applicant.
- The hiring process is not entirely outsourced when contingency recruiting is used. Organizations still have to spend time evaluating resumes, choosing which candidates to interview, and conducting the interviews.
Afterward, candidates shortlisted through contingency recruiting and retained recruiters are usually added to an Applicant Tracking System (ATS) for processing by the organization. In some cases, ATSs are available in-built into HR software as well.