Would you allow this?

Imagine if you will… you have met with a new client. Taken the time to completely understand their business and their pain… agreed terms of business – both verbally and in writing… Spent hours & hours sourcing… you know… mapping markets, job boards, referral, social media, head hunting. Further hours phone screening… interviewing… preparing profiles… multiple client/candidate meetings… managing an offer… managing a counter-offer… references… and then Mr Underwood gives me a call…

‘Hi Craig, Frank Underwood from VP Recruitment here.’

frank1‘Hi Frank.’ I gush… absolutely sure that he is calling to congratulate me on the fantastic job I have done sourcing and engaging the perfect person for his business. ‘You must be pretty happy with the result… Janie is resigning today and she’s sure she won’t have to work notice so will be available to start on Monday.’

‘About that…’ silence… crickets… the sound of impending doom… ‘I’ve been looking at our cash flow and to be honest. I can’t afford to bring Janie on and pay your fee as well. One of them unfortunately has to give…’

I was stunned… flummergusted (yes I made that word up).

‘What do you mean?’ I asked.

‘Well… the simple facts are… we had to offer Janie $5k more than we originally expected & we have to find that somewhere. I want you to discount your fee by $5k.’

‘Sorry Frank.’ I interjected. ‘When we sent Janie’s profile over, we clearly addressed her salary expectations. If this was going to present a challenge why didn’t you discuss it then?’

‘It slipped through…’

It slipped through?!?!? It effing slipped through!!??

‘Frank.’ I said. ‘The fee represents the work we did for you on this placement. When we signed off on the project you had no concerns… none whatsoever about the fee. Let’s be honest. If you did some work for one of clients with agreed fees up front how would you respond to a negotiation at the end of the process?’

frank3‘Craig.’ Frank responded. ‘This is not a negotiation. Either you discount your fee by the $5k we have had to over pay Janie. Or I’m withdrawing the offer.’

 

I hate being put in situations like this. For one… it is so easy to react impulsively. I could have said.

‘Well I better get on to Janie before she resigns and let her know that you are making ultimatums around not paying agreed fees… just to give her the opportunity to understand just what type of company she is attaching herself to…’

or


frank2
‘Sure Frank I see your point… anything to get this done…’

or

‘As the once great Bucks Fizz sang… Not for all the tea in China… or all the corn in Carolina… You have made a very powerful enemy Frank Underwood. I’m advising Janie to stay where she is. You are nothing more than a dishonest fraud…’

What would you do?

Craig Watson

7 thoughts on “Would you allow this?”

  1. Being a small business ourselves means we understand the issues around cash flow. My instant thought is to suggest some sort of a payment plan so that it’s not such a big hit on a small business in one month. Maybe suggest splitting the fee into 3 payments over 3 months, but by doing this the client forfeits their right have a replacement free of charge if the candidate doesn’t work out.

  2. Craig – your candidate should know they are about to join an organisation that is:

    a) ethically questionable
    b) not able to understand basic commercial processes / agreements
    c) both a and b

    There are plenty of good search firms looking for quality consultants. You’d be doing that candidate a disservice by putting them in there without their knowing what they were signing up for.

  3. Hate this!! Has happened and I hated the fact that I was out in a position where I may have been seen as the person potentially in the way of a candidate landing a role. All too often, it’s tempting to just ‘get it done’, take the hit and move on – but I have been reminded by a coach recently that ‘you get what you tolerate’. So, push back I say, you’ve earned that right. Obviously, the overarching key part in all of this is to have had a thorough conversation about fees etc early in the piece and, beyond this, work with the clients that respect you and don’t dream of bending you over a barrel. You’ll have less clients, but you’ll have good ones, be happier…..and probably make more money anyways!

  4. I think that i would have told him; then i guess that we’ll see you in court: the reasons these guys pull this kind of crap is because, 1) they have no moral compasses; they’re only out for number 1; and 2) because they believe that no one would challenge them and disrupt the status-quo. My grandmother used to say: “Fool me once; Shame on you! Fool me twice, shame on me! Hey a deals a deal; the actions here constitute fraud and they should be taken to task for it. Tell Janie the guys a loser; and stay put. A bird in the had and all that. After that; I would consider legal actions against these individuals. They should not be permitted to get away with perpetrating these kinds of fraud.

  5. ‘Frank – I will call Janie now and let her know that you are dropping her offer by 5,000, please be aware that she already has a counter-offer in her hands from her current company, it might not reflect well on you but if you don’t have the money it’s best to be upfront.

  6. I would try to tell Frank that I am to call Janie so that she is aware that the firm she is about to join has a 5K cash issue.
    “Frank, your firm seems highly at risk ! As your trusted advisor, I would advise you not to spend such big money on a candidate as expensive as Janine. Maybe we should go for a more junior candidate, who could be less afraid by the fragility of your firm”.

  7. Hi Craig – I think you are actually in a stronger position than you may realise as you have contract law on your side here.

    If Frank has signed your terms & conditions that clearly state your fees applicable & when they are due to be paid based upon his agreement to hire, then he cant start to post offer haggle these with you now. Sounds like a company not worth working with in the future anyway, so tell him that your fee is owed with X days as per your terms and end of conversation. If he doesn’t pay, pursue it legally.

    In regards to withdrawing the offer to Janie – he can do that if he wants, but she will also have legal recourse against him for doing so, particularly if she has already accepted & signed their offer of employment and based on that, resigned from her current employer to head to this new opportunity. If she hadn’t signed the offer agreement with Frank as yet, then that may leave her in a spot of bother though.

    Essentially you could politely remind Frank that doing anything he is suggesting here will most likely cost him far more than $5k later on in having to fight & defend against both of those types of claims based on what he is trying to do today. I think you may see him back down quickly from there once he is aware of that. Granted you may not work with him again in the future, but that also doesn’t sound like a bad thing here.

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