3 essential contracts for recruiters

Charles BrecqueCharles Brecque
Last updated on:
May 24, 2022
Published on:
May 24, 2022

Read our guide to recruitment agency terms of business agreements

Read the Guide

Contracts are essential for growing your recruitment agency regardless of whether you are an established recruitment agency or an independent recruiter. Recruitment businesses can use contracts in a number of situations ranging from sourcing suitable candidates to becoming an employer. Contracts help recruiters gain clients whilst protecting their business by clearly defining the rights and obligations of both parties. This article lists the 3 legal agreements recruiters should use to grow their business and how to create them whilst keeping legal costs under control.

Engage with clients using a non-disclosure agreement

A client's hiring needs and plans are often confidential which means that recruiters will need to enter into a non-disclosure agreement (NDA) with a prospective client. The key contract term of an NDA is the definition of confidential information and how long the recruiter must keep it secret. NDAs can also be used by employers during the recruitment process when discussing plans or company information with potential candidates.

Source candidates with a recruitment agency terms of business agreement

Companies that wish to hire candidates through a recruitment agency should enter into a recruitment agency agreement which is also known as a recruitment agency terms of business agreement or simply recruitment agency terms and conditions. Recruitment agencies should use terms and conditions which are fair and meet legal requirements as they will be scrutinised by the legal teams of your clients. The key contract terms which should be defined in the recruitment agency agreement include how recruiters are paid and the minimum number of qualified candidates the contract recruiter will propose to the client. Recruiting is hard and does not always go to plan which is why the contract terms should also detail what happens to the recruiters fee when a candidate leaves early.

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Grow your team with employment contracts

Hiring a team is something recruiters will also need to do as they grow their business. Hiring a consultant or contract recruiters on a contract basis can be useful in the short term to keep up with demand but your business will grow more in the long term if you hire employees. A contractor is only interested in completing work in the context of jobs whereas a startup company culture will encourage employees to think out of the box and grow the business in new areas. When hiring employees, it is essential to use employment contracts which are robust yet fair in order to prevent a former employee from soliciting  clients or using proprietary and confidential information for their own services such as candidate and resume databases.

How to create lawyer-approved contracts on no legal budget

Now that you've identified the contracts you need to source clients, fill roles and hire employees, you'll need to draft these agreements. You can consider using a solicitor or law firm to tailor the agreements to your requirements but this can be expensive. Moreover, you will need to pay for an e-signature solution and new templates each time there's a legal update. A more effective solution is to use a contract management platform like Legislate which includes e-signing and lawyer-approved templates you can tailor to your specific requirements. Legislate also makes it easy to track contracts post-signature and the data they contain such as payment terms and amounts. Legislate allows you to reduce your legal risk cost-effectively whilst offering a professional experience to your clients and employees. To start creating contract with Legislate, simply sign up or book a demo.

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