Is it ever ethical to charge the job seeker?

There has been a spate of articles recently about TheLadders – specifically, how the site is a bad deal for job seekers. To wit:

when I see the new commercials for The Ladders, I want to puke on my shoes…the jobs on The Ladders can be found on sites like LinkUp, Monster, and freakin Craigslist. - Laurie Ruettimann

Or how about this?

What does TheLadders do to enhance anyone’s job hunting prospects — especially C-level executives? Virtually nothing, nada, zippo, zilch. This most flagrant faker among the job boards, which pretends to be exclusive and “$100k+”, is the source of hires less than 0.07% (yes, that’s percent) of the time, among employers polled. (Source: CareerXroads survey, p. 19) - Nick Corcodilos

What’s the problem? Isn’t TheLadders (or, for that matter, JobFox) just like Monster or CareerBuilder?

Well…no.

Traditional job sites make most of their money by charging employers – for job postings, resume database access, site advertising, custom emails, and other types of services. In essence, they sell access to the job seeker. That’s why these sites spend a lot of time promoting and advertising themselves – they need the job seekers to keep their employers happy.

TheLadders and other ‘candidate-pay’ sites are different – they turn this revenue model on its head. They charge the job seekers to access the jobs and employers. Seems like a hard sell when the majority of sites offer job and employer access at no charge, right? The candidate-pay sites claim that their jobs are not available elsewhere. Sometimes they will offer additional services as part of the ‘membership’ fee. (Of course, that doesn’t mean they don’t charge employers – they usually do, just not for job postings).

The ultimate ‘promise’ made by candidate-pay sites, then, is access – you’ll be able to reach jobs and employers that you simply can’t reach elsewhere.

So what is the case made against TheLadders by Nick and Laurie? Simple – false advertising. In fact, you can find most of the jobs elsewhere. Also, TheLadders makes an additional claim – ‘only $100K jobs’. As someone who has subscribed to the site in the past, I can tell you that – at least during that time period – this claim simply isn’t correct. I found numerous jobs under $100K (as has Nick and many others).

Enough about TheLadders. This raises a bigger question: is it ever ethical to charge the job seeker for access to jobs and employers?

Yes. If the site is truly offering something of real value to the job seeker, then I think it isreasonable to charge. Note my qualification: “something of real value”. For example, perhaps the site screens each job posting it allows on the site, verifying the company, offer, and qualifications. Or perhaps it provides a private forum where job seekers and employers can interact. Maybe the candidate gets discounts on insurance, services, and the like. What is offered will depend on the seeker audience.

As a job seeker, I have used sites that really did deliver value for the money I paid them. And, as I mentioned above, I have used sites that didn’t deliver value. I promptly cancelled the latter.

So, kudos to Laurie and Nick for telling job seekers about sites that don’t deliver on their promises. And kudos to the sites that do deliver on their promises.

Comment by Chris Hofstetter on January 25, 2011 at 11:27am: What are your thoughts on companies like The Barrett Group that charge a fee to the candidate for exploring "unpublished" executive level positions?

Comment by Jeff Dickey-Chasins on January 25, 2011 at 11:39am: Chris: basically, I think it still boils down to value - are they actually delivering something of value to the candidate? If they are, more power to them - if not, I think we in the industry need to talk about it, so the candidate knows the risks going in.

Morgan: It is a good idea - using a subscription cost as a 'qualifier' - but I think it's unethical to charge for jobs that are available elsewhere. Particularly when there are subscription sites that DO actually screen jobs.

Comment by Paul Basile on January 25, 2011 at 11:55am: I agree, TheLadders doesn't do much for anyone. Unfortunately, some ideas are commercially sound i.e. people pay (there's one born every minute) but we don't like the idea because it doesn't offer value. So why do people keep buying if there's no real value? Markets aren't perfect.

Should jobseekers ever pay? Your answer is correct: if there is real, personally-received value. Mostly that's not the case.

Comment by Jeff Dickey-Chasins on January 25, 2011 at 11:55am: Good point, Morgan - I agree.

Comment by Nick Cox on January 25, 2011 at 11:57am: Good post Jeff, If i was the job seeker I think i would be more upset about the fact some of the jobs advertised on The Ladders can be found elsewhere without having to pay a subscription fee for access.

On the flip side of this though they cannot stop a recruiter/employer placing the same advert on other job boards as well as their own so i can't really see a way round it either.

Comment by Jason Monastra on January 25, 2011 at 11:58am: This is an interesting discussion considering no one actually runs through the gauntlet the sites that offer literally no value to employers. Sites like Hotjobs, CareerBuilder, huge fishing nets with holes large enough for whales to swim through offer little value at best. The percentages for jobs posted to people actually hired from the response are in the same percentile margin as listed above for the Ladders. So what are really talking about - is the money from the job seeker more imporant since they have less to spend then the big corporate companies? I see very few people challenging the notion of the traditional model of charging the company. Fact is most of these sites offer little value to either side.

The ideal situation would be a job board/portal that actually had customer interaction, a liason for the customer and the candidate to ensure the potential for success increased. For example, posting of the jobs and then having someone at the board actually run screens, make calls and generate interest in the role. Sift candidates to an extent, rule out bad applicants, and even schedule interviews. Kind of a light recruiter service. That is value and stop paying 300 plus a posting for garbage.

Comment by Jeff Dickey-Chasins on January 25, 2011 at 12:03pm: The pay per candidates or pay per response model is offered by some sites as an alternative to the traditional job posting model. Don't have a feel yet on how successful it has been for either the job sites or the employers, though.

Comment by Kimberly Roden on January 25, 2011 at 12:20pm: Great post Jeff.

I'm raising my eyebrows at LinkedIn lately. They claim to "get hired faster" if you start paying for their Jobseeker Premium Account and that "premium subscribers are twice as likely to be contacted by recruiters." LinkedIn is making a lot of claims and they are not able to back them up with hard information. I've asked.

I agree with you in that it's certainly okay to charge a jobseeker for a value-added service that will benefit them and truly help them in their job search. It goes along the lines of having a professional write your resume. The difficulty lies in a situation where you have a vulnerable jobseeker who will buy into false claims like The Ladders. Jobseekers, like all consumers, have to do their homework and research before punching in those credit card numbers.

Comment by Paul Basile on January 25, 2011 at 12:27pm: Jason, I certainly agree, the value received on job boards is very low. I think we can do a great deal more than you suggest though. The real power of the internet is data analysis and we have a lot of highly relevant data; let's use it.

Comment by Salvatore Petrara, CPC on January 25, 2011 at 12:54pm: As Recruiters we utilize a variety of tools and techniques to generate candidate flow, there is no one shot methodology that works we have to use several.

The same goes for companies that advertise. Today companies are using a plethora of sites to advertise their openings. If TheLadders had positions/postings that were exclusive to their site the amount would be very small and results returned to candidates would be a handful at best.

A Staffing "agency" in the State of New York is allowed to charge the employer and the candidate. This is where the term "agency" comes from. 5% fee from candidates, 5% fee from companies, and yes a fee to the State of NY (just like a realty fee or hair-dresser fee)

Today there are very few (if any) true agencies with this model.

Always remember, if you are a company or client; "Buyer Beware"