headhunter and agency fees in US

Hello everybody,

what are the typical fees in US for a headhunter/recruitment consultant for the placement of sap senior consultant as a permanent employee?
what are the typical fees in US for an agency for the placement for the placement of sap senior consultant as a freelancer?
what is a typical (monetary) settlement in US with an agency when you change a freelancer contract into a permanent?

Thanks in advance, Christoph

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Permalink Reply by Tim Spagnola on August 18, 2011 at 9:17pm

Has to be at least one RBC member that can weigh in on this one......... working for you Christoph

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Permalink Reply by Bert Shimabukuro on August 18, 2011 at 11:22pm

1. Perm are perm. Doesn't matter if it is SAP or helpdesk since I pay on a percentage basis. For contingency searches, I've had agencies sign up for 15%-20% of a year's of salary with a 6-12 month prorated refund if the candidate leaves. I prefer to pay 20% because I know recruiters will work on the higher commission jobs first. For something truly hard, I would pay 25% one time, but you won't get the easier jobs in the future at that price. That being said, I've always been honestly able to offer future business as an incentive to get better pricing. I've had a few agencies tell me they will not take business under 25%, but I have no problem getting other good agencies to sign up for 15%-20%.

2. If by freelancer you mean on the staffing agency's payroll, I'll pay up to 50% markup on the base rate (e.g. $100/hr paid to consultant, you charge me $150/hr). I assume your fully burdened rate (your cost with taxes and overhead) is about 17%-25% depending of the benefits you offer. If the time starts running longer than 6 month, I'm going to go back to you and try negotiate a lower markup. If it goes over a year, I'm going to expect the person to become an employee or have you charge me at cost. I've had this happen where the consultant would rather have more cash paid as a freelancer rather than take a lower salary with full benefits. The consultant is usually getting benefits at low cost through a spouse's employer.

3. No fee after 90 days if you want to do business with me, but I will acknowledge that 6 months is usually the norm. If we convert before the 90 days. I will pay you a prorated percentage of the permanent placement fee I mentioned in #1.