How the fee is calculated
Contingency recruitment in the UK is almost always priced as a percentage of the candidate's first-year salary. The market sits between 15 and 25 per cent, with specialist and executive search running higher.
The base for that percentage matters more than the percentage itself. Some agreements use basic salary only; others use total first-year earnings, which pulls guaranteed bonus, car allowance and sign-on payments into scope and can add several thousand pounds to the same placement.
- Volume or mid-level roles: typically 15–18 per cent of basic salary
- Specialist, technical and niche roles: typically 20–25 per cent
- Retained and executive search: 25–33 per cent, billed in instalments
- Interim and contract: a daily margin, usually 12–20 per cent of the day rate
What that looks like in pounds
On a £60,000 salary at 20 per cent, a single placement costs £12,000. Three hires at that level cost £36,000 — before any advertising, tooling or internal recruiter time.
Because the fee scales with salary, cost per hire rises exactly when you are hiring your most senior and most business-critical people, and it rises again with every pay-rise cycle in the market.
The contract terms that matter
The headline percentage is negotiable, but rebates, off-limits clauses and ownership periods usually decide the real cost of a bad placement.
- Rebate period: a sliding scale over 8–12 weeks is standard; insist on a genuine refund rather than a credit note or a free replacement
- Candidate ownership: how long an introduced candidate stays attributable to the agency, often 6–12 months
- Off-limits: whether the agency is barred from approaching people they placed with you
- Payment terms: 7 or 14 days is common; push for 30 and align it with the rebate window
Cheaper channels worth building
Most talent teams already have three lower-cost channels: direct applications, an internal employee referral scheme, and their own network sourcing. The problem is coverage — those channels dry up on hard roles, which is when agencies get called.
A referral network sits between the two. You keep the trust and conversion rate of a referral, but you extend it beyond your own employees, and you pay a fixed fee per hire rather than a percentage of salary.
Frequently asked questions
- What is a typical recruitment agency fee in the UK?
- Most contingency agencies charge 15–25 per cent of the candidate's first-year salary. Specialist and executive search typically runs from 25 to 33 per cent.
- Can recruitment agency fees be negotiated?
- Yes. Percentage, rebate length, payment terms and the salary base used for the calculation are all negotiable, particularly if you can commit to several roles.
- Do you get a refund if the hire leaves?
- Only if your terms say so. A sliding-scale rebate over 8 to 12 weeks is common, but many agreements offer a replacement candidate rather than money back.