So you’ve decided to become a recruitment consultant and work from home. Great initiative! However, before you can start recruiting top talent, you need to figure out a commission structure that will motivate you to hustle, reward you for your wins, and still leave room for a work-life balance.
This guide outlines the different commission structures for recruiters so you can choose one that aligns with your remuneration target and desired flexibility. We go on later to highlight the different factors that influence how much commission you may earn as a recruiter.
Do Recruiters Get Commissions?
Recruiters do earn a commission. In fact, as a franchise recruiter with Recruiter Startup, you get the lion’s share of your placement fees, up to 90%.
Why You Should Opt for a Commission Payment Structure
Recruitment commission structures reward your success and hard work. The more placements you make, the more money you earn. This creates an incentive for you to continually improve your skills and exceed targets.
Recruiters commission also provides an opportunity for high-income potential. You may wonder, how much commission do recruiters make? As a franchise recruiter with Recruiter Startup, there are no caps on what you can earn. The average income among our associates ranges from £40,000 to £100,000 per year, with the potential for more among those able to build a large, successful recruitment desk.
Overall, if you want autonomy, flexibility, and unlimited earning potential, then recruitment agent commission is an ideal compensation structure for you as a recruiter. Recruiter Startup’s generous 80–90% commission structure means you get to reap the rewards of your efforts. Why not give it a try?
Having established how the commission structure works in the recruitment industry, let’s analyse the different options available to recruiters.
4 Common Recruitment Commission Structures and How They Work
When you start recruiting remotely, your ultimate consideration should be how you’ll earn a commission. The good news is there are several common forms, depending on your recruitment agency’s organisational structure.
These include the following:
- Percentage of placement fee
- Split placement fee
- Salary plus commission
- 100% commission (Charge and earn)
1. Percentage of Placement Fee
This is the most popular recruitment commission model — in this flat rate commission structure, recruiters earn a percentage of the total placement or recruitment fee charged to clients. The rates vary depending on the recruitment agency and the type of roles being filled — entry-level, executive, permanent placement, etc. Recruiter Startup operates based on this recruitment commission structure, offering as high as 80–90% of the placement fee as commission.
2. Split Placement Fee
This is common if you’re working with another recruiter representing the client company. With this model, the placement fee is split between you and the other recruiter, often 50/50 or 60/40. The split may be adjustable based on performance. This guarantees you a good portion of fees but may limit your earning potential.
3. Salary Plus Commission
Some companies pay a base salary plus a commission on placements. The flat rate salary provides stability, while commissions give you earning growth potential. The split can vary, but the commission usually amounts to 40% of the total pay.
4. 100% Commission (Charge and Earn)
As the name suggests, you earn the entire placement fees you generate. This high-risk, high-reward model provides unlimited earning potential for career growth. It’s best for experienced recruiters with an established client base or those willing to put in effort in developing major client accounts.
The model you choose depends on your risk tolerance, experience level, and support needs. Don’t be afraid to negotiate the percentage or split that works for your unique situation. The opportunities are endless, so do your research and go after a commission structure that will set you up for success!
Understand that businesses usually don’t offer the same rate for every recruiter. Your level of experience and industry specialisation will determine your commission, as we’ll see in the next section.
3 Factors That Determine Your Recruitment Commission Rate
The recruiter commission structure varies considerably, depending on factors like:
- Your recruiting specialisation
- The hiring company
- Your recruiting agreement
1. Your Recruiting Specialisation
The roles and levels of positions you focus on recruiting for directly impact how much you get paid as commission. Generally, the higher the salary and seniority of the roles, the higher your commission percentage. For example, executive recruiters typically earn a higher commission than recruiters focused on entry-level hires.
The demand and supply of candidates in your area of specialisation also play a part. If there is a shortage of strong candidates, companies may offer a higher commission to incentivise both internal recruiters and external recruiters.
2. The Hiring Company
Your commission is greatly influenced by the compensation policies of the companies you work with. Some companies offer higher commission rates (up to 30% of the employee’s yearly salary) to attract top recruiters, especially for hard-to-fill roles.
Established companies with strong hiring budgets will often pay recruiters more. On the other hand, small startups may only be able to offer 20% commission. It pays to build relationships with companies that value recruiting and offer competitive compensation.
3. Your Recruiting Agreement
The specific terms outlined in your recruiting agreement or contract determine your exact commission percentage and how much money your recruitment agency makes.
This typically depends on factors like:
- Base Salary (if any): A lower base usually means higher commission and more incentive to fill positions.
- Exclusivity: Exclusive agreements with one company often imply higher commission rates.
- Responsibilities: Taking on additional duties during the hiring process, like screening, interviewing, or onboarding, may increase your commission.
- Performance Incentives: Some companies provide opportunities to earn bonuses, profit sharing, or equity in addition to your standard commission. Meeting key performance metrics can also increase your commission over time.
By understanding the drivers behind a recruitment consultant’s commission, you can find the right opportunities and negotiate the best possible rates. Focus on building a niche, choose companies that truly value your contributions, and push for the most competitive agreement to maximise your earning potential.
Remember that with the Recruiter Startup franchise recruiter program, you can build a remote recruitment desk from the comfort of your home and grow your own agency with great flexibility. Become your own boss today — contact us to get started.
Frequently Asked Questions
What is the commission structure in recruitment?
The commission structure in the recruitment industry defines how much recruiters earn when they achieve specific goals, such as successfully placing candidates. Commissions are either calculated as a percentage of the total recruiter fees earned or as a fixed amount. A commission structure is usually put in place to incentivise recruiters to meet targets and to help align their efforts with the company’s/agency’s overall business objectives.
How much do recruiters make in commission in the UK?
On average, a recruiter can expect to earn around 30–35% of the total amount billed in a year. This percentage includes their base salary (usually a flat fee), commissions, and bonuses. However, it’s important to note that individual earnings are influenced by factors like experience, performance, and the specific commission structure set by the candidate and recruitment agency.
How much do recruiters make per-hire?
Recruitment professionals working for staffing agencies often earn a contingency fee per hire. This fee for recruitment agencies typically ranges from 15% to 20% of the candidate’s first-year starting base salary but can be up to 30% for positions that are difficult to fill. It’s important to note that this fee is not deducted from the candidate’s salary but is an additional fee paid by the employer (the client) to the staffing firm.
What is the average recruiter commission in the UK?
The average recruiter commission in the UK (plus base salary and bonuses) is typically around 30–35% of the total amount billed per year. Some recruiters may have different commission rates or additional incentives based on their achievements or the nature of their placements. It’s recommended that recruiters clarify their commission structure with their employers to have a clear understanding of their potential earnings.
A good understanding of the commission structure for recruiters is important in determining the roles you fill and the company you work for. While the options vary considerably and may seem confusing, we hope the information provided in this post guides you towards making a decision that aligns with your career path. And if the thought of building a remote recruitment desk right from the comfort of your home appeals to you, our franchise recruiter program may be the right fit for you — it comes with a competitive commission structure, too. Contact us today for more details!