Beware Of Companies That Want To Hire And Don't Knew What They Want To Pay

Believe it or not, many companies start searching for new talent and do not know what they want to pay.

Every recruiter knows this story.  You get a call from either an officer or the HR Director of an agency or a company.  They give you an assignment; sometimes the specs are well thought out, sometimes not.  But when the recruiter asks for a salary budget for this new hire, the client says, “You know the business.  You tell us.”  This happens with both contingent recruiting (They hire, then pay) but can happen with a retained search as well (They pay up front).  However, when there is no salary budget, retained recruiters often back out of the assignment; many contingent recruiters will pursue the assignment in the hopes of making money.  It is almost always a fool's errand. 

If there is no salary budget, the search will almost always end in a  disaster.  It often turns out that the company is unrealistic in their expectations in terms of experience and cost.  Or, the budget has not been approved by managers.   And it happens all the time. 

The response to “you tell us” is generally to name a salary range based on the job description.  That range is generally acceptable, or it may elicit a budget ("Gee, we were thinking of spending less...").  But here is the real issue. In well-managed companies, the CFO or CEO has to approve the hire and should have approved the job and budget prior to a recruiter being called. .

Assuming that the budget has been accepted, the recruiter starts looking for appropriate talent.  When  a candidate is introduced to the client, they are always told the candidate’s current salary and their expectations for this job.  That goes without saying for a competent recruiter.

It is almost inevitable in these circumstances that if and when an offer is made, it is at the lower end of the agreed upon specifications.     Previously, I have written that when a recruiter gives a salary range to a prospective candidate, inevitably the candidate sets his or her mind only on the highest number they have heard.  And when the company offers the job at the lowest end of their spec or, worse, makes an offer even lower (It happens all the time), there is probably a 75% chance that the job gets turned down.

As a result, I have learned (and it has taken many years) not to accept these kinds of jobs because it almost always results in double or triple work.  The salary always sounds good until the company has to pay it.  Mostly it happens with senior people, but not always.

The problem for a contingent recruiter is that unless their business is successful and well-grounded, the client will not call again if the job is turned down. Nor will they call again if they can’t get an accepted offer.

I have learned that often this kind of assignment is kind of like looking at homes or apartments just for the fun of finding out what is out there.  It rarely results in a purchase.

Candidates should always ask the recruiter what the job is paying and the recruiter must reconfirm the salary when introducing a candidate.  It is also permissible for the candidate to ask the first person they interview with what the salary range is for the job.