On the fence about securing a job through one? Understand their inner workings here

Anyone trying to nail a job will probably be familiar with recruitment agencies. They post a number of job ads, contact you on LinkedIn, and might even ring you up out of the blue. But few job seekers truly understand their process. Here, we lift the lid on this sometimes shadowy world to answer the question “how do recruitment agencies work?” and help you make an informed decision when job hunting in the UK. 

What is a recruitment agency?

A recruitment agency exists to match ideal candidates to vacancies by directly collaborating with companies on their books when there are roles to be filled. Recruitment consultants are continually on the lookout for new opportunities, potential candidates for possible positions, and innovative ways in which to fill roles.

From a candidate's point of view, they can really help with the job-seeking process through guidance and support.

So how do recruitment agencies work?

How do recruitment agencies find you a job? They work in a variety of ways, but the end result is that they want to help you secure a job. If you're signed to an agency, and a relevant position pops up at their end, they'll get in touch with you to ascertain whether this is something you'd be interested in.

Alternatively, they would advertise the job online to find applicants that match the key skills.

Once they've pinpointed suitable candidates, the agency will put them forward to the company, then arrange interviews for those that the company chooses.

Recruiters can help candidates with prepping for interviews, from how to handle a hostile interviewer to how to answer unusual questions, and even down to advising you on what to wear. 

Do recruitment agencies charge candidates?

The short answer – no.

The more detailed answer – you shouldn't be charged by a recruitment agency as it's illegal in the UK to do so under the Employment Agencies Act 1973 and the Conduct of Employment Agencies and Employment Businesses Regulations 2003. These make it clear that UK recruitment agencies aren't allowed to charge a candidate for finding them a job.

Recruitment agencies are paid by the employers from the companies trying to fill job positions. The level of the fee will be determined by the position and type of employment, with all firms liable to pay for a successful placement.

Expert tip: So if an agency asks for payment for their representation, turn away immediately, as it means this is a disreputable company and is not to be trusted.

4 types of recruitment agencies – plus their pros & cons

Check out the difference between contingency and retained recruitment agencies. The other two key types of recruitment agencies listed here are temp agencies and niche agencies, both of which can operate either on a contingency basis or a retained basis.

1. Contingency agencies

It's fair to say that most UK recruitment agencies operate on a contingency basis. At this type of agency, recruiters only get paid if they put forward the person that eventually lands the advertised position.

This means that they need to act rapidly, as they're often competing against other recruitment agencies, as well as the hiring company's HR team.

Pro

It's in the agency's interest to help you get the job you've been put forward for, so they'll give you detailed advice regarding interview techniques and salary negotiation. If you win, they win.

Con

It's also in the agency's interest to suggest as many qualified candidates as possible, so you could be up against countless other candidates all vying for the same role.

2. Retained agencies

If an agency is retained by a client, it means they're paid a fee to find candidates, with further fees paid once the position is filled. This type of recruitment agency model is typically associated when searching for executive and other senior positions, but may also be used in sectors requiring very specific technical skills.

They operate a more stringent selection process, with candidates needing to pass multiple interviews and tests before being put in front of the hiring company.

Pro

Retained agencies undertake a much more thorough searching process, generally approaching candidates directly rather than using job ads.

Con

Retained agencies are unlikely to be competing with other agencies, so may offer less support to candidates during the hiring process.

3. Temp agencies

Sometimes known as staffing agencies, temp agencies specialise in providing temporary workers to a wide range of companies across numerous sectors, so if you're looking for a temporary role, this is the one to choose.

Pro

You'll probably sign a contract with the agency itself rather than the hiring company – this is a common arrangement for temp workers where the agency takes care of your pay and then reclaims these costs from the employer so you don't have to bother with all of that.

Con

If the agency doesn't make it 100% clear how long your employment will last, you might struggle to find the time to look for another role before the current one ends.

4. Niche agencies

A niche recruitment agency, AKA a specialist recruitment agency, operates exclusively in particular industry sectors, offering true expertise and strong relationships in those areas. Needless to say, if you have a desire to work in a specific sector, you should get on the radar of these agencies. The best option is to contact them directly.

Pro

If you're put forward for a role, you're much more likely to be seen as a good fit, and therefore stand a better chance of getting the job.

Con

As niche agencies tend to know the areas they recruit for inside-out, they have very high standards when it comes to putting forward candidates for interviews. If you don't reach up to those standards, you might not get an edge.

How to avoid bad recruitment agencies

Now that you know how recruitment agencies work, it's important to know how to steer clear of those ones that aren't so great. It's no secret that there are some dodgy agencies out there. One common tactic that they use is advertising fake jobs to build up a database of CVs.

It can be tricky to spot an unscrupulous agency, but one good way is to check whether it's a member of the Recruitment & Employment Confederation (REC). The REC is the UK's membership body for recruitment companies, and members on its approved register must sign up to a compliance code and pass a compliance test every two years. To check if an agency is signed up, use the REC Member Directory, an online tool that allows you to search by name or location.

Of course, an agency not being a REC member is not necessarily a reason not to use it, but the lack of member status may indicate that you should inspect that job ad a bit more closely.

Advantages of using a recruitment agency

Having said all that, there are advantages to using recruitment agencies, especially in a crowded market. With them, you get to receive:

  • Access to more jobs. A good recruitment agency should have cultivated robust relations with countless companies, thus opening the door for you to apply for more roles than you could if you were doing it alone.

  • Job search process advice. This can include expert interview coaching, along with CV and cover letter support.

  • Constructive feedback. Knowing about the strength of your application is essential, from how you did in the interview to what a prospective employer said about you.

  • Advice in your field. This is especially beneficial if you've chosen a niche sector.

Recruitment agencies demystified!

Hopefully this article will have answered most of your queries related to “how do recruitment agencies work?” When applying for jobs through a recruitment agency or approached by one, you could ask about their model directly ‒ the worst they can do is refuse to tell you. If they do, just assume that you're being approached by a contingency agency, and go with the flow.

Remember that there are varying advantages and disadvantages to using a recruitment agency. Keep the above key points in mind and you should have a much better understanding of how they can help you with your job search.

Recruitment agencies are not the only tools that can help during your job search. TopCV offers a free CV review to help you uncover if your document is strong enough to land you a job.

Originally sourced from Startups.co.uk, this article has been updated by Elizabeth Openshaw.

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