Service Agreement Template for Recruitment Businesses (UK 2025)
Last updated: February 2025
Why Recruitment Businesses Need a Service Agreement
Recruitment service agreements define the terms on which an agency introduces candidates to clients, covering fee structures, rebate periods, candidate ownership, and the critical definition of when an introduction has been made. These agreements must protect the agency's commercial position when candidates are hired through alternative channels after being introduced, and address the increasingly common scenario of clients sharing CVs internally or with other group companies without authorisation.
Key Clauses for Recruitment
- Introduction and candidate ownership definitions
- Fee calculation, invoicing triggers, and payment terms
- Rebate scale and conditions for early leavers
- Transfer fee provisions for temp-to-perm conversions
Common Mistakes
- Not defining what constitutes an introduction broadly enough to cover informal meetings, LinkedIn introductions, and forwarded CVs
- Failing to include anti-circumvention provisions preventing clients from hiring introduced candidates through alternative channels to avoid fees
Template Sections
- Candidate introduction and ownership definitions
- Fee schedule with rebate scale for early departures
- Anti-circumvention and extended introduction period
FAQ
What is a reasonable rebate period in a recruitment service agreement?
Industry standard is a sliding scale: 100% refund or replacement if the candidate leaves within 4 weeks, reducing to 75% at 8 weeks and 50% at 12 weeks. Some agreements extend to 13 or 16 weeks. The rebate should be conditional on the client providing a suitable working environment and not materially changing the role from the original specification.
How should a recruitment service agreement define an introduction?
Define introduction broadly to include any method by which the candidate's identity is made known to the client, whether through CV submission, verbal recommendation, LinkedIn profile sharing, informal meeting, or any other means. Specify an introduction validity period of typically 6-12 months during which the introduction remains active even if the client initially rejects the candidate.
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Get Started FreeThis is guidance for UK businesses, not legal advice. Templates are illustrative. Consult a solicitor for complex matters.
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