The Silent Killer of Recruitment Fees: How to Protect Yourself from Backdoor Hires

Backdoor hires—when a client hires a candidate you introduced without paying your recruitment fee—are one of the biggest challenges recruitment agencies face. You invest time and effort in sourcing top talent, only for the client to bypass you and hire the candidate directly, leaving you unpaid for your work.

It happens more often than recruiters would like to admit, and the impact can be devastating, costing agencies tens, even hundreads of thousands in lost revenue. But with the right strategies, you can protect your business from backdoor hiring.

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What Exactly is a Backdoor Hire?

A backdoor hire occurs when:

• A client hires a candidate you introduced but avoids paying your fee.
• A company claims they were already in contact with the candidate before your introduction.
• A candidate is hired through a different department or entity within the same company.
• A company delays hiring a candidate you introduced to avoid paying your fee under your contract's terms (e.g., hiring them after 12 months).

So, how do you prevent backdoor hiring and ensure you get paid for your work?

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1. Strengthen Your Terms of Business (TOB)

Your contract is your first line of defense against backdoor hires. A poorly written contract makes it easier for clients to exploit loopholes, while a well-crafted one ensures you're covered in all hiring scenarios.

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Key Contract Clauses to Include:*

• Definition of Engagement & Introduction: Clearly define what constitutes an "introduction" and an "engagement" to prevent clients from claiming prior knowledge of a candidate.
• Time-bound Clause: Specify that your fee is due if the client hires the candidate within a set period (e.g., 12 months) after the introduction.
• Non-Circumvention Clause: Include provisions to prevent clients from referring candidates to affiliated companies or different departments to avoid fees.
• Acceptance of Terms by Conduct: State that by engaging with your candidate (e.g., interviewing), the client accepts your terms, even if not signed.

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2. Use Anonymous Candidate Profiles

One of the most effective ways to prevent clients from backdooring your candidates is removing identifying details from CVs before sharing them.

What to Remove:

🚫 Candidate name
🚫 Previous employer names
🚫 Personal contact details

Instead, provide a branded profile with: 

✔ Skills, qualifications, and experience summary
✔ Availability and salary expectations
✔ A unique reference ID for tracking

Once the client expresses interest, you can then share the full CV along with your terms. This prevents them from tracking down the candidate on LinkedIn or reaching out directly.

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3. Implement Technology Solutions

Leveraging technology can help prevent and detect backdoor hires:

• Candidate Tracking Systems: Use Applicant Tracking Systems (ATS) to monitor candidate submissions and client interactions, ensuring a clear record of all activities.
• Automated Alerts: Set up alerts to notify you when clients access candidate profiles or engage in discussions, allowing for early detection of potential backdoor hires

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4. Maintain Strong Communication Channels

Regular and transparent communication with clients can prevent misunderstandings that lead to backdoor hires:

✔ Regular Updates: Keep clients informed about the recruitment process and candidate status.
✔ Open Dialogue: Encourage clients to discuss any concerns or intentions regarding candidates, fostering trust and collaboration.

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5. Educate Your Clients

Ensure clients understand the recruitment process and the importance of adhering to contractual agreements:

✔ Clarify Terms: Discuss your TOB with clients to ensure they comprehend their obligations.
✔ Highlight Consequences: Explain the implications of backdoor hires, including legal actions and damage to professional relationships.

Regularly review and update your practices to stay vigilant against potential breaches.

Backdoor hires can be frustrating, but by tightening your contract, tracking interactions, and staying vigilant, you can significantly reduce the risk of lost fees.

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✅ Key Takeaways:

• Always have watertight terms that define introductions and engagement.
• Use anonymous CVs to prevent direct hiring.
• Track client activity and follow up persistently.
• Attach terms to every submission.
• Be ready to enforce your terms if necessary.

Cited Sources:

1. NPA Worldwide: Preventing Backdoor Hires
2. HireGuard: Here Are 10 Ways You Can Prevent Backdoor Hires