Why do recruitment agencies charge what they do?

Ever wondered why recruitment agencies charge what they do? If so, this article will explain the factors that influence the fees charged.

Recruitment agencies play a vital role in the hiring process for many UK businesses. They offer a range of services, from sourcing applicants, to vetting the best candidates, to managing the entire recruitment process for their clients.

But the fees they charge can vary greatly, which can make it difficult to understand how they are calculated and what factors influence the amount clients pay.

So in this article, we’re going to explain why four types of recruitment agency – full service agencies, fixed price agencies, temp agencies (also known as staffing agencies), and executive headhunters – charge what they do.

Let’s start by looking at full service agencies…

Full service agencies

Agencies such as Anne Corder Recruitment typically charge their clients (businesses looking for new staff) a variable fee that is a percentage of the new recruit’s starting salary.

This percentage is usually between 10% and 30%, and because it is percentage based, obviously means the higher the candidate’s starting salary, the higher the fee paid to the agency.

However, the key thing to remember about full service agencies is that they work on a no-results no-fee ‘contingency’ basis which means they are only ever paid by a client if and when they put forward a candidate that is subsequently hired by them.

So in practical terms, an agency could invest time and effort (as well as the cost of advertising a role for a client), only for the client to hire a candidate put forward by another agency who would get paid the recruitment fee.

This is despite the fact that the work involved in sourcing the right candidate can often be considerable. It may involve creating the ideal job description after having spent time understanding the business’s culture and philosophy, advertising the role on a number of job boards, filtering a high number of applications, liaising with – and vetting – the best candidates, arranging interviews, and much more.

The costs of doing all these activities is reflected in the percentage fee a full service agency charges, but typically agencies will offer a discounted rate to a client if they are hired on an exclusive basis (meaning they are the only agency looking to fill the vacancy for the business) or if the client uses them to fill multiple roles at the same time or on an ongoing basis.

Fixed price agencies

As the name implies, fixed price agencies don’t charge a percentage of a candidate’s starting salary, but instead charge a set price for their services.

This is because their focus is usually on volume recruitment and the use of technology to generate applicants, as opposed to other types of agencies that take a more qualitative approach and manage the entire recruitment process for their clients, including being involved in candidate interviews and negotiating salaries if required.

Temp agencies

Unlike other types of recruitment agencies, temp (or staffing) agencies typically pay the short-term staff they source for companies themselves.

They then reclaim these costs, plus their fee, from the client who has benefited from not having to register the short-term employees on their systems, saving them time, cost, and inconvenience.

Executive headhunters

Executive headhunters are known for usually charging clients a high percentage fee and sometimes an up-front cost too.

These charges reflect the fact that these agencies are tasked with finding senior level candidates with particular skills and experience who in most cases are not actively looking for a new position. So instead of advertising roles, headhunters carry out research to find suitable potential candidates nationally (or even internationally) and then reach out to them directly to see if they are interested in discussing the new position.

However, as many of these senior level candidates already hold well paid executive roles with other companies, it can take the agency several months – or in some cases, more than a year – to find a perfect candidate who is interested in the new role and willing to resign from their current position to take it up.

The agency’s fees reflect the length of this process and the work involved researching and having in-depth discussions with prospective candidates, as well as carrying out a thorough vetting process that may involve personality and psychometric testing when requested by the client (although some full service agencies also offer this service).


To summarise, recruitment agencies charge the fees they do because of the time involved in providing the services they offer, the expertise required, and the costs they incur finding candidates for their clients.

Read the article ‘The top 10 tips when selecting a recruitment agency’ to find out how to choose the right recruitment agency for your business.


Alex Smith

Recruitment Specialist

I’ve worked in recruitment for the same agency for over 12 years, covering finance, office support, construction, and engineering. Temp and perm. Previously, my line of work was within banking and estate agency.
Favourite food: “Curry (Hot)”
Favourite film: “Heat”

Outside of work

“Gym 5 days a week. Home life consists mostly of entertaining a 3 year old! (for clarification – my son)”

Alex on ACR

“Very refreshing to work for a recruitment agency that genuinely care for their candidates and clients”

E: alex@annecorder.co.uk
T: 01733 235298

Sarah-Jane Bond

Recruitment Specialist

I have spent the majority of my career working in Operational and Project Management roles. I first worked with ACR about 25 years ago as a candidate. ACR secured me a role at RNIB, where I stayed for 15 years, finishing as Head of Operations. Recruitment has always been a big part of the roles I have undertaken and is something that I really enjoy. When you match a fantastic candidate with the right client there is no better feeling!
Favourite food: “Has to be any dish from the Mediterranean”
Favourite film: “There are many, love a chick flick, especially ‘The Holiday at Christmas”

Outside of work

“I love socialising with friends, can always squeeze a bit of retail therapy in around volunteering at Deeping Rangers FC, running their hospitality on match days.”

Sarah-Jane on ACR

“I couldn’t have been more delighted when Nel asked me to join the company and have felt at home since day one. They really do care about providing the best service for their clients and candidates, building genuine relationships with both. The team culture is second to none, everyone supporting and looking out for each other. It is a pleasure to come to work every day.”

E: sarahjane@annecorder.co.uk
T: 01733 235298

Emily Roach

Recruitment Specialist

Emily was a Primary School Teacher for 10 years, before moving into the EdTech space, as a Relationship Specialist for MATs. She joined ACR in July 2023 and particularly thrives when recruiting for Account Management, Customer Service and Sales roles.
Favourite food:
“Spag bol or pizza”
Favourite film:
“The Notebook – or any romantic chick flick really!”
Outside of work
“I have a 1-year-old, so love fun family weekends with my fiancé and son more than anything. Time socialising with friends and family is where I’m happiest.”
Emily on ACR
“The unique culture, values, and style at ACR is polar opposite to other recruitment agencies and what I believed recruitment was. Having previously been a Relationship Specialist, I feel I’m doing the same thing! No hard sell, we truly care about our candidates and clients, and the team culture is 2nd to none!”
E: emily@annecorder.co.uk
T: 01733 235298

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