Contingency recruiting is a type of hiring practice, where outside companies screen and evaluate the best candidates for a certain position. Contingency recruiting may be a firm of one or two persons only, or may be large firms with many employees analyzing perspective candidates for jobs. Unlike a contract recruiter who receives a flat fee for services, contingency recruiting firms are paid upon the successful hiring of a proposed job applicant.

Contingency recruiting services usually include research into a potential employee’s personality type, full background checks, and verification of references, experience, as well as claimed and appropriate education. Depending upon the firm, contingency recruiting may offer elaborate personality testing, lie detector testing, drug testing, or other research methods to try to find the best employee for a prospective company.

Those signing up with a contingency recruiting service who are job searching, do not usually pay a fee to the recruiter. Instead, the company hiring the employee pays a fee, if and only if the contingency recruiting firm provides an appropriate candidate. Usually, contingency recruiters have contracts with companies looking for employees, and the fee for services upon hire is agreed upon prior to the contingency recruiter doing any work.

Since contingency recruiting works on contingency basis, fees for such recruiting tend to be higher than flat fees charged by contract recruiters. Business experts suggest that contingency recruiting may be the best way to hire a single employee, but may become very expensive if multiple employees need to be hired.

Often the fee associated with the successful hiring of a candidate rest between 15-30% of an employee’s first year’s salary. So a contingency recruiting firm might receive 30,000 US dollars (USD) for facilitating the hiring of an employee who will make 100,000 USD. Unlike the contract recruiter, however, contingency recruiting involves a higher element of risk, so most feel their higher prices are justified.

Contingency recruiting firms often maintain databases of prospective employees, which help make selecting candidates for jobs easier. One can seek out contingency recruiting firms if one is looking for work. Many looking for jobs feel that working with a contingency recruiting firm is slightly more successful, since the firm must be highly motivated to get people hired, or they make no money.