Organizations that need to fill higher-level positions commonly work with executive recruiting agencies so they don’t have to devote substantial time and effort to this endeavor. Agencies are generally paid in two ways: on a contingency basis or with a retainer fee. The retainer fee usually applies for upper-echelon positions that require significant resources on the part of the recruiting agency. The organization pays a set fee up front to hire a Retained search firm. That fee is nonrefundable even if the organization does not hire any of the candidates. In contrast, a contingency fee is paid after the organization hires an individual recruited by the agency.
When an organization hires a retained agency like Kaye/Bassman, it knows this firm is well-positioned in that particular industry and has a large number of contacts. They have built a list of potential candidates who typically are currently working elsewhere but are open to new opportunities. Some of those individuals contacted the agency directly, while others were sought out and recruited by agency representatives who are colloquially referred to as head hunters.
Retained searches are often preferred for executive-level and other prestigious positions. A new chief financial officer might be recruited in this fashion, for example. A hospital might find a new chief of staff this way if it is not finding suitable candidates within the organization. Top-level managers and legal professionals in various industries also are sought by head hunters. These employees commonly are already earning salaries of at least $200,000 per year. They prefer to only work with agencies known to be the cream of the crop when it comes to recruiters, as they have no time to waste.
For mid-scale jobs, individuals looking for new opportunities may sign up with two or three recruiting agencies. For these types of high-level positions, however, organizations may discard applications from candidates represented by more than one agency. In addition, the person will want to be certain this is the position that looks most appealing within that organization, as many companies do not allow applications for other jobs from the same executive candidate within six months to a year.