Problem with staffing company

[newhire2004]

What is the name of your state?What is the name of your state? Florida

7 months ago I accepted a one month contract through a staffing company to work an assignment for a major corporation. After the term of the contract the corporation kept extending my contract due to my excellent performance.
In December 2004 corporation offered me a permanent position which I accepted.

The problem is - in the contract that I signed with the staffing company there is a paragraph saying that if I accept employement with the "client" I or the client will owe the staffing company a finders fee of 20% of my yearly salary.

Now, I don't feel it's fair for the staffing co. to require such big chunk of change, they did not extend any effort to help me get a permanent position. I got it due to my own performance and getting to know people in the corp.

So far I have not spoken with the staffing co., not sure how to proceed and if it's enforcable or not. Anyone had any experience? Thanks in advance.

 

[Beth3]

Now, I don't feel it's fair for the staffing co. to require such big chunk of change, they did not extend any effort to help me get a permanent position. I got it due to my own performance and getting to know people in the corp. Yes, you received the job offer based on merit but they placed you there on the temp assignment, right? If not for that, then you very likely never would have received the job offer. A finders fee of 20% is low. Most staffing agencies charge 30 - 35%.

Regardless of how you feel about it, you signed a contract agreeing to those terms. Before you make the transition, you should clarify with your new employer who is going to pay the fee to the staffing agency - you or them.

 

[SuzieWahoozie]

At this point, I suggest you accept the position and go to work!

Here is how these things normally work...the company that hires you pays the staffing company the fee. My guess is since you have been there 7+ months, the staffing company is going to waive the "finder's fee." They've already made plenty of money off of you as temp for 7 months!

If they decide to take action, it will most likely be against your new employer, but as I said, it is doubtful they are expecting anything at this point.

This all assumes you signed this contract 7+ months ago when you first began working for the staffing company. If you JUST signed the agreement, then I have no answer for you...I'm baffled!

 

[cbg]

It is standard practice and quite, quite legal for a staffing agency to require a percentage (and 20% is not uncommon) of the first year's salary of any employee placed by them, who is hired permanently within the first year after they were first placed. So even if you were hired based on merit, since you were FIRST placed by the staffing agency, yes, it is by no means uncommon for them to be looking for payment of 20% of your first year's salary.

I have never heard of it being payable by anyone but the client. YOU should not be responsible for paying it - your employer should be. And if your employer is in any way on the ball, they were aware of this before they made you the offer. As I said, this is ENTIRELY standard practice.

 

[newhire2004]

Thank you

Thanks to all who answered.

SuzieWahoozie, you are exactly right - I beleive they made plenty of money off me. And yes, I signed the contract initially, when I accepted a one month assignment.

If it's a standard practice, then I'll just sit tight and let the situation resolve itself? I just don't feel comfortable contacting the staffing co. risking saying something "politically incorrect" that they might hold against me.

 

[Beth3]

If it's a standard practice, then I'll just sit tight and let the situation resolve itself? I wouldn't advise that. Yes, it's standard practice that after "X" amount of time as a temporary staffer any placement fee is waived if the individual is hired directly by the client but that doesn't mean that your staffing agency is following standard practice. It's possible that their terms with the client company call for a 20% fee when a staffer of theirs is hired. Period. (Although those terms would be stupid for a client company to enter into.)

This is not an "ignorance is bliss" situation as it could backfire on you, particulary if the agency comes looking to you to pay the fee. (Reputable staffing/placement agencies always charge the fee to the client but again, that doesn't obligate your agency to do so.)

I suggest you speak to your new boss or the HR person and tell them you're confused about any fee that is due if they hire you and who has to pay it. The employer probably will be able to clarify this immediately for you. They won't have entered into a business relationship with the staffing agency without knowing exactly what the terms are and who pays what, if anything.

 

[BelizeBreeze]

At this point, I suggest you accept the position and go to work!

And that would be not only very dangerous advice, but also could lead to an intentional tort action for BOTH the poster and the client company.

Now, why hasn't anyone suggested the obvious?

The problem is - in the contract that I signed with the staffing company there is a paragraph saying that if I accept employement with the "client" I or the client will owe the staffing company a finders fee of 20% of my yearly salary.

Now, I don't feel it's fair for the staffing co. to require such big chunk of change, they did not extend any effort to help me get a permanent position. I got it due to my own performance and getting to know people in the corp.

And that's just tough cookies. You are an adult, you signed the contract and you accepted their efforts to place you and took their money. Now you don't think it's fair?
It's called an intentional tort if you change the contract unilaterally and can subject you AND the client to far more than the 20%.

You want to play with the big boys then learn the rules.