Recruitment Contract Template

Recruitment Contract Template — Placement Fees & Guarantees

Define placement terms clearly, establish guarantee policies, and protect your business with a contract built for recruiters and staffing agencies.

Contract Template

1. Parties & Agreement

Identifies the recruiter or staffing agency and client entering into a recruitment services relationship.

This Recruitment Services Agreement ("Agreement") is entered into as of [DATE]:
Recruiter: [YOUR NAME/AGENCY], located at [ADDRESS] ("Recruiter")
Client: [CLIENT NAME/COMPANY], located at [ADDRESS] ("Client")
This Agreement governs recruitment and staffing services described below.

2. Recruitment Services & Structure

Specifies recruitment type (retained, contingency, contract staffing) and services included.

Recruitment Type: [RETAINED SEARCH / CONTINGENCY / CONTRACT STAFFING]
Services Included:
  - Candidate sourcing and screening
  - Resume review and initial interviews
  - Candidate presentation and coordination
  - Reference checks
  - Offer negotiation support
Position(s): [JOB TITLE(S) AND DESCRIPTION(S)]
Exclusivity: [EXCLUSIVE / NON-EXCLUSIVE]
If exclusive: Client will not engage other recruiters for these positions

3. Placement Fee Structure

Defines fee calculation, payment schedule, and fee triggers.

Fee Structure:
  - Retained Search: $[AMOUNT] retainer + $[AMOUNT] upon placement
  - Contingency: [X]% of first-year salary (minimum $[AMOUNT])
  - Contract Staffing: [X]% markup on hourly rate
Fee Calculation:
  - Based on: [ANNUAL SALARY / HOURLY RATE × HOURS]
  - Includes: Base salary, guaranteed bonus, sign-on bonus
Payment Terms:
  - Retained: [X]% retainer due upon signing, balance upon placement
  - Contingency: Due within [X] days of candidate start date
  - Contract: Billed [FREQUENCY] with timesheets
Late Payment: [X]% monthly fee after [X] day grace period

4. Candidate Guarantee & Replacement Policy

Establishes guarantee period and replacement terms if placement doesn't work out.

Guarantee Period: [X] days from candidate start date
During guarantee period, if placement doesn't work out due to:
  - Candidate voluntary resignation
  - Candidate termination for performance or cause
  - Candidate failure to meet job requirements
Recruiter will provide replacement candidate at no additional fee
Guarantee does NOT apply if:
  - Client lays off candidate due to business changes
  - Client changes job requirements significantly
  - Client terminates candidate without cause
Replacement must be for same position and requirements
Only one replacement provided per original placement

5. Non-Solicitation & Exclusivity

Prevents fee avoidance and protects recruiter and client interests.

Direct Hire Protection:
  - If Client hires Recruiter's candidate directly (bypassing Recruiter), Client pays full placement fee
  - Look-back period: [X] months from candidate introduction
  - Applies even if Client finds candidate through other channels after introduction
Off-Limits Period:
  - After Agreement ends, Client may not hire Recruiter's candidates for [X] months without paying fee
Recruiter Non-Solicitation:
  - Recruiter will not solicit Client's employees for [X] months after Agreement ends
Exclusivity: [IF EXCLUSIVE - Client will not engage other recruiters]

6. Candidate Sourcing & Presentation

Defines sourcing methods, candidate presentation process, and timeline expectations.

Sourcing Methods:
  - Job board postings
  - Direct sourcing and outreach
  - Referral networks
  - Social media and professional networks
Candidate Presentation:
  - Recruiter will present [X] qualified candidates within [X] weeks
  - Each candidate includes: resume, summary, interview notes
  - Client will provide feedback within [X] business days
Client Responsibilities:
  - Provide detailed job description and requirements
  - Participate in candidate interviews
  - Provide timely feedback on candidates
  - Make hiring decisions within reasonable timeframe

7. Reference Checks & Background Verification

Clarifies responsibility for reference checks and background verification.

Reference Checks:
  - Recruiter will conduct initial reference checks
  - Client may conduct additional reference checks
Background Verification:
  - [INCLUDED / CLIENT RESPONSIBILITY / AVAILABLE AS ADD-ON]
  - If included: Standard background check included
  - Advanced checks (credit, drug testing): Additional fees
Recruiter warrants candidates are presented in good faith based on available information
Client responsible for final hiring decision and verification

8. Contract Staffing Terms (If Applicable)

Defines terms specific to contract/temporary staffing arrangements.

Contract Staffing Arrangement:
  - Candidates are employees of Recruiter, not Client
  - Recruiter handles payroll, benefits, taxes
  - Client pays hourly rate + markup to Recruiter
Contract Duration: [TEMPORARY / PROJECT-BASED / ONGOING]
Conversion Fee:
  - If Client hires contract employee permanently: [X]% of annual salary
  - Conversion fee due within [X] days of conversion
Termination: Either party may terminate with [X] days notice
Client responsible for workers' compensation if applicable

9. Confidentiality

Protects confidential information shared during recruitment process.

Both parties will maintain confidentiality of:
  - Candidate information and resumes
  - Client business information and job requirements
  - Salary and compensation discussions
  - Hiring strategies and processes
Recruiter may share candidate information with Client for recruitment purposes only
Client may not share candidate information with third parties without consent
Confidentiality obligations survive termination of Agreement

10. Limitation of Liability

Limits recruiter liability and clarifies service scope.

Recruiter's liability limited to total fees received for specific placement
Recruiter not liable for:
  - Candidate performance after placement
  - Candidate misrepresentation despite due diligence
  - Client hiring decisions or onboarding processes
  - Indirect, consequential, or punitive damages
Recruiter provides recruitment services, not guarantees of candidate success
Client responsible for final hiring decision and candidate evaluation

11. Termination

Allows termination with notice and defines final obligations.

Either party may terminate with [X] days written notice
Upon termination:
  - Client pays for all placements made before termination
  - Non-solicitation and off-limits provisions continue
  - Retained search retainers are non-refundable
  - Contingency fees due for placements made before termination
If Client terminates exclusive retained search early: [X]% kill fee

12. Signatures

Executes the recruitment services agreement with dated signatures.

Both parties agree to the terms above.
Recruiter: _________________ Date: _________
Client: _________________ Date: _________

Disclaimer: This template is provided for informational purposes only and does not constitute legal advice. We recommend having a qualified attorney review any contract before use to ensure it meets your specific needs and complies with applicable laws in your jurisdiction.

Pro Tips

  • Define fee structure clearly—retained vs contingency vs contract staffing
  • Set guarantee terms—protects both parties
  • Include direct hire protection—prevents fee avoidance
  • Clarify exclusivity—exclusive vs non-exclusive
  • Define valid replacement reasons—not every termination triggers guarantee
  • Set clear payment terms—when fees are due

Key Features of This Contract

Placement Fee Structure & Payment Terms

Defines fee structure (percentage of first-year salary, flat fee, or hourly) and when fees are due (upon placement, start date, or after guarantee period). Retained search requires upfront retainer; contingency is paid upon successful placement. Contract staffing uses hourly margins. Clear payment terms prevent disputes about when recruiters get paid and protect against clients delaying payment.

Candidate Guarantee & Replacement Policy

Establishes guarantee period (typically 90 days) during which recruiter will replace candidate at no additional fee if placement doesn't work out. Defines what constitutes valid replacement reasons (performance, voluntary resignation, termination for cause) versus invalid reasons (layoffs, company changes). Protects both parties by ensuring quality placements while giving clients recourse for bad fits.

Non-Solicitation & Exclusivity Protection

Prevents clients from hiring recruiter's candidates directly without paying fees, and prevents recruiters from placing candidates with competing clients. Includes "off-limits" periods preventing clients from hiring recruiter's candidates for specified time after contract ends. Protects recruiter investment in candidate relationships and prevents fee avoidance.

Direct Hire Protection & Fee Triggers

Establishes that clients must pay placement fees if they hire recruiter's candidates directly, even if they bypass the recruiter. Includes "look-back" period (typically 6-12 months) during which direct hires trigger fees. Prevents clients from using recruiter's candidate pool without paying, protecting recruiter investment in sourcing and relationships.

Sourcing Method Disclosure & Exclusivity

Clarifies whether recruitment is exclusive (only this recruiter) or non-exclusive (multiple recruiters). Defines sourcing methods (job boards, direct sourcing, referrals) and whether recruiter can represent candidates to other clients simultaneously. Retained search is typically exclusive; contingency may be non-exclusive. Sets expectations about recruiter's candidate pool usage.

Frequently Asked Questions

When should I use retained vs contingency?

Retained search is for senior positions where you want exclusive focus and upfront commitment. Client pays retainer plus placement fee. Contingency is paid only upon successful placement, typically for mid-level positions. Retained protects your time investment; contingency aligns incentives with successful placement.

How long should the guarantee period be?

90 days is standard. This gives enough time to evaluate if a placement is working while not being so long that it becomes a burden. Your contract should define what constitutes valid replacement reasons (performance, voluntary resignation) versus invalid reasons (layoffs, company changes).

What if the client hires my candidate directly?

Your contract should include direct hire protection: if the client hires your candidate directly (bypassing you), they still pay the full placement fee. Include a look-back period (6-12 months) during which direct hires trigger fees. This prevents clients from using your candidate pool without paying.

Should I offer exclusivity?

For retained search, yes—exclusivity justifies the retainer. For contingency, it depends. Exclusive contingency means you're the only recruiter, which can justify higher fees, but you're also taking on more risk. Non-exclusive contingency lets multiple recruiters compete, which may result in faster placements but lower fees.

What if a placed candidate quits within the guarantee period?

If the candidate quits voluntarily or is terminated for cause (not layoffs or company changes), the recruiter typically provides a replacement at no additional fee. Your contract should define what constitutes valid replacement reasons versus situations where the guarantee doesn't apply. This protects both parties and ensures quality placements.

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