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Recruitment agency fees - How we can help agencies struggling to collect their bills

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The post-recession years in the UK have seen an explosion in employment, with the number of people in work reaching record numbers. Even while wage growth has remained sluggish, the Office for National Statistics (ONS) reports that the employment rate has topped 76.1% in the June 2019 period – the joint-highest figure on record.

This increase in employment has naturally created opportunities for recruitment agencies and high demand for workers means there are now more than 39,232 recruitment agencies in the UK, contributing more than £35.1 billion to the economy every year.

However, despite the growing size of this sector, recruiters are finding it more and more difficult to get their clients to pay their recruitment agency fees.

Reasons why a client may refuse to pay recruitment agency fees

There are a number of different reasons why a recruiter may struggle to get a client to pay the recruitment fee. They are as follows:

The employer may refuse to pay the recruitment agency fees under any or all of these circumstances, which can result in a protracted struggle for the recruitment agency and ruin what may otherwise be a valuable relationship with a client.

Steps you can take to increase the likelihood of your recruitment fees being paid

There are some steps recruiters can take to help minimise this kind of behaviour in clients:

Sometimes it’s not just poor client behaviour that can cause problems with collecting recruitment fee payments. Many agencies, for example, only bill a client after they’ve successfully placed a worker within a role. All of these factors can have a negative impact on agencies’ cash flow.

And, of course, you might want to think about the difference the right debt recovery team could make to ensuring your recruitment agency fee payments are honoured in a timely fashion.

How we can help

If you’re from a recruitment company and would like to discuss improving your cash flow, please contact our Debt Recovery Team.

Disclaimer: Anything posted on this blog is for general information only and is not intended to provide legal advice on any general or specific matter. Please refer to our terms and conditions for further information. Please contact the author of the blog if you would like to discuss the issues raised.