In the April 14, 2015 Ask The Headhunter Newsletter, a reader says getting referred for a job by a headhunter cost him the job — because the employer didn’t want to pay the fee.
I applied for a job on Indeed.com at a medical facility. A person called representing herself as working for the facility. She did a five-minute pre-screening interview, and set me up for a phone interview with an HR representative. The short version of this long story is that the organization wanted to hire me, but wasn’t able to because of a recruiting fee of $12,000.
I’ve been informed that this recruiting company has put a six-month “lock” on my name. Is this legal? This kind of thing has never happened to me before. I’m appalled that they can get away with it! Do I need to contact the state attorney general’s office? I never signed any documents stating any agreement for them to represent me. Please help!
This is a deep crack in the law that you’ve fallen into. Employment agencies and third party recruiters (a.k.a. headhunters) are not regulated everywhere. The recruiter has submitted your resume as one of her referrals — and if the employer hires you as a result of that referral, it may owe the recruiter a fee.
(Of course, the recruiter serves a purpose. Without her, you may not have gotten the interviews with this employer. But her intervention should not cost you a job!)
I’d do two things.
Get the facts first
Call the employer’s HR office. Don’t tell them what happened. Just ask whether they have a contract with that recruiter.
My guess is they do not, but the recruiter’s referral may be interpreted by the employer as an obligation to pay a fee to hire you. That’s the crack in the law.
Recruiters will sometimes find and use resumes like yours as an entree to a company they don’t have a contract with. They will threaten the employer with a lawsuit to collect a fee, because they were the source of the referral. This may not stand up in court, but the easy way out for the employer is not to hire you. So you lose. My guess is that’s what’s going on here. The loose interpretation of the law might be that if the hospital hires you within six months of the referral, it owes the fee. After that, there’s no fee. That’s what the “lock” refers to.
But all this is questionable. What recruiters like this one bank on is an HR department’s unwillingness to risk legal action — which is silly.
What’s important for you to realize is that — I’m sorry to say — you are at least partly responsible for all this:
Have you ever put your resume on an online job board? Then you may have slimed yourself because anyone who has access to that resume can do exactly what that troublesome headhunter did with your implied blessing. You’d have a hard time convincing a judge or jury that the headhunter did anything wrong if your resume is already widely available.
Excerpted from How to Work With Headhunters… and how to make headhunters work for you, p. 114.
Use regulatory powers
The second thing I’d do is call your state’s department of commerce. Find out whether the recruiter is licensed. Not all states require licensing. If yours does, and she’s not, she’s out of luck. I’d explain that to the employer — and I’d turn her in to the authorities..
Of course, it’s possible the recruiter has a contract with the hospital. In that case, what the lock means is the hospital has agreed to pay a referral fee for up to six months after a referral is made. Thus the lock is not on your name, but on the employer. You are not bound by a contract you are not a party to.
But here’s the risk you face, and it’s significant: If this recruiter circulates your resume to lots of employers, under her letterhead, such referrals may be construed by those employers as an obligation to pay a fee to hire you — even if you later apply directly. A good headhunter or recruiter would never refer you to any employer without your knowledge or consent. An unsavory recruiter will plaster your resume all over kingdom come — under her letterhead.
There are two sections of How to Work With Headhunters… and how to make headhunters work for you that you’ll find helpful in the future. “How should I judge a headhunter?”, pp. 26-27, defines a set of standards that good headhunters adhere to. “How should I qualify a headhunter?”, pp. 28-33, goes into great detail about how you can separate the good headhunters from the unsavory ones.
Some of the book is about how to protect yourself, but most of it is about how to leverage headhunters and recruiters to your advantage.
Assert yourself & protect yourself
I would immediately send the recruiter a certified letter, with a return receipt, stating that she is not to refer you to any employers, and demanding that she notify you what companies she may have already referred you to. Again, recruiters like this one bank on people not fighting them legally. It can be a nasty game.
Depending on what you learn, you may want to contact your state’s department of labor and employment. Explain what happened and ask their advice. If the recruiter misrepresented herself as an employer, I’d consider filing a complaint of consumer fraud and possibly identity theft, citing the recruiter’s misrepresentations, and for her failure to tell you that it would cost a fee to hire you.
Much depends on whether the employer is willing to stand up to the recruiter. I doubt the employer or the recruiter would want to see an article in the newspaper about a job seeker in a tough market finding out he got screwed out of a job because of all this.
I’d love to know what you learn and decide to do. This is a murky situation because much depends on who did what, and on whether the employer has a contract with the recruiter.
Keep this in mind: None of these agencies or recruiters work for you. Their client is always the employer. They have no contractual obligation to you, or you to them. Yet many such firms will use phrases like, “We will represent you…” They do not represent you. The employer pays them, and their fiduciary duty is to the employer. But it’s an odd business, because they can imply that they represent you — with the result that employers might lock you out of jobs due to the fee they’d have to pay.
Finally, remember that posting your resume or profile online makes it easy for anyone to “refer” you to an employer and to claim a fee. You can fight this, of course — but good luck, because employers are more likely to protect themselves than fight to hire you.
Has a recruiter or headhunter ever cost you a job? What would you do if you were the job hunter in this week’s Q&A?