Model 04: Contingent / Agency — The Default Model and When It Stops Working

Contingent recruitment is one of the most common recruitment models used by Australian businesses.

And it is easy to understand why.

There is no upfront cost. Fees are only paid when a successful placement is made. The model is flexible, familiar and gives employers fast access to recruiters who may already have candidate networks in the market.

In the right situation, it can work well.

The issue is not the model itself.

The issue is using it for every role, every hiring need and every stage of growth, even when the business would benefit from a more structured approach.

What the Model Actually Is

In a contingent recruitment model, a business engages a recruitment agency to source and present candidates for a specific vacancy.

The fee is only payable if the agency successfully places a candidate.

In Australia, recruitment agency fees are commonly charged as a percentage of the successful candidate’s first-year salary. Several Australian recruitment pricing guides place standard permanent recruitment fees broadly between 15% and 25%, with some variation depending on role level, sector and seniority. (source)

This makes contingent recruitment attractive because there is usually:

• No upfront payment
• No formal long-term commitment
• A clear success-based fee
• Quick access to candidate activity
• Flexibility for one-off hiring needs

For many businesses, this makes it the natural starting point.

When It Works

Contingent recruitment can be a strong option when the role is straightforward, urgent or occasional.

It works best when:

• The vacancy is immediate and speed is a priority
• The business is making a one-off or infrequent hire
• The role sits clearly within the agency’s specialist market
• The agency has an existing candidate network for that role type
• The business does not have internal recruitment capacity
• The hiring process is simple, clear and ready to move quickly

Used in the right way, contingent recruitment can be practical and effective.

It gives businesses access to recruiters without committing to a retained or embedded model.

The Structural Problem

The challenge with contingent recruitment is that the model is built around a success-only outcome.

That can create pressure on speed.

Recruiters are only paid if they place the candidate. When a recruiter is managing several active roles across several clients, their time naturally has to be spread across the briefs most likely to progress.

This does not mean the recruiter is not capable.

It means the model influences behaviour.

In some cases, the process can become focused on getting candidates across quickly rather than investing deeper time into mapping the market, qualifying motivation, testing long-term fit and building a more complete shortlist.

That can create issues such as:

• Fast CV submissions with limited depth
• Candidate fit that looks right on paper but is not fully tested
• Less market mapping for harder roles
• Limited time spent on passive candidate engagement
• Lower commitment when the brief is not exclusive
• A reactive process rather than a structured search

The model rewards successful placement, but it does not always reward the time and process needed to achieve the strongest long-term match.

Multi-Agency Briefs Can Make This Harder

Many businesses assume that briefing multiple agencies will increase their chances of success.

Sometimes, it does create more activity.

But more activity does not always mean better recruitment.

When three agencies are briefed on the same role, each agency knows they are competing for the same fee. That can reduce the level of time and depth each recruiter is willing to invest, especially if the role is difficult, the brief is unclear or the client is slow to provide feedback.

The result can be:

• Duplicate candidates
• Rushed submissions
• Inconsistent candidate messaging
• Less ownership of the process
• Confusion in the market
• A weaker candidate experience

For simple, active-candidate roles, a multi-agency approach may still work.

For specialist, senior or hard-to-fill roles, it can create more noise than value.

The Cost Question

Contingent recruitment can feel low risk because there is no upfront cost.

But no upfront cost does not always mean low cost.

At volume, success-based fees can add up quickly.

For example, if a business makes three hires at $90,000 each and pays an 18% to 20% fee, the total recruitment cost would be approximately $48,600 to $54,000.

That may be completely reasonable for three well-matched hires.

But when hiring volume increases, the business should start asking whether the model is still the most efficient option.

Once a business is hiring regularly, especially across multiple similar roles, alternative models such as retained recruitment, annual retainers or embedded recruitment support may provide more consistency, better planning and stronger cost control.

When It Stops Working

Contingent recruitment may start to underdeliver when:

• Hiring volume becomes consistent
• Roles are niche, senior or highly technical
• The business needs deeper market mapping
• Candidate quality is inconsistent
• Multiple agencies are sending similar CVs
• Hiring managers are spending too much time screening
• The process relies on speed instead of structure
• Recruitment costs are increasing across multiple hires
• Candidate experience is becoming harder to manage

These are signs the issue may not be the agency.

The issue may be that the business has outgrown the model.

The Better Way to Think About It

Contingent recruitment still has a place.

It is not outdated. It is not ineffective. It is simply not designed to solve every hiring problem.

The strongest recruitment strategy is not about choosing one model forever.

It is about knowing which model suits the role, the market and the hiring demand.

Contingent recruitment can be useful for urgent, straightforward or one-off roles.

But when hiring becomes more complex, more frequent or more business-critical, the process needs more structure.

That is where embedded recruitment support can help.

It gives the business a more consistent recruitment function, while still keeping the process aligned to internal priorities, hiring managers and business needs.

Final Thought

The contingent model is not the problem.

Using it as the only model, regardless of role type, hiring volume or complexity, is where the gaps begin to show.

The question is not whether contingent recruitment works.

The better question is:

Is it still the right model for what your business needs now?

Ready to Talk?

If you would like to discuss which recruitment model is right for your business, we offer a no-obligation diagnostic conversation.

Contact Barclay RPO: barclayrecruitment-rpo.com.au

Or reach out directly to Andre van der Merwe, Managing Director.