Retained vs Contingency Recruitment

Retained vs Contingency Recruitment: Which is Right for Your Business?

When you need to hire, choosing the right recruitment model can make the difference between a quick placement and a long-term success story. For employers in Glasgow, Paisley, and across Scotland, two models dominate the industry: retained and contingency recruitment.

At Allstaff, we work with businesses of all sizes and sectors, helping them choose the right approach for their hiring needs. Here’s what you need to know before deciding.

Understanding Recruitment Models

Defining Retained and Contingency Recruitment

Retained recruitment: An exclusive partnership with one agency, where the client pays an upfront retainer. The agency commits dedicated resources to the search, often working in milestones until the position is filled.
Contingency recruitment: A no-win-no-fee model where multiple agencies may compete to fill the same role. The agency only gets paid if they place the candidate.

Key differences include commitment level, methodology, and exclusivity. Retained recruitment is relationship-led; contingency recruitment is speed-driven.

The Current Recruitment Landscape

Market trends show retained search is favoured for executive and specialist hires.
Contingency is common for volume hiring or roles where speed is more important than depth.
Economic conditions and talent availability influence model selection.
Technology – from AI sourcing to advanced candidate matching, is shaping both approaches.

Comparative Analysis of Recruitment Methods

Financial Considerations

Retained: Payment is typically split into stages (e.g., one-third upfront, one-third on shortlist delivery, final third on placement).
Contingency: Payment is due only on successful hire; usually a higher percentage fee to reflect the risk to the agency.
ROI depends on role type, urgency, and retention goals.
Both models have hidden costs if the wrong hire is made — from productivity loss to replacement expenses.

Quality and Success Metrics

Candidate Quality

Retained search gives deeper market access, often to passive candidates who aren’t applying to adverts.
Contingency searches rely more on active applicants, though strong networks can yield quality matches.
Retained candidates are often more committed to the process due to the personalised approach.

Success Rates

Retained placements tend to have higher completion and retention rates.
Contingency can deliver faster hires, but not always with the same longevity.
Candidate and client satisfaction often score higher in retained searches for senior roles.

Service Level Differences

Process Depth and Exclusivity

Retained search provides dedicated resources, market mapping, and exclusivity — meaning every potential candidate in the market is considered.
Contingency spreads recruiter focus across multiple clients, which can limit depth but increase speed.

Recruiter Commitment

Retained consultants are accountable for delivering, given the upfront investment.
Contingency recruiters are incentivised to move quickly and compete effectively.
Retained often includes post-placement support, while contingency is more transactional.

Strategic Decision Factors for Businesses

Organisational Considerations

Large companies with ongoing specialist recruitment needs often prefer retained partnerships.
SMEs or businesses with limited recruitment budget may opt for contingency.
Internal recruitment capability and employer brand strength influence the choice.

Position-Specific Factors

Executive and Leadership Roles

Retained is ideal for C-suite and senior management positions.
Provides confidentiality, deep candidate vetting, and strategic alignment for high-impact roles.

Specialised and Technical Positions

Niche roles benefit from the targeted, relationship-led nature of retained search.
Technical skills verification and market scarcity often justify a retained approach.

Business Circumstances

Companies in growth phases may use contingency for speed and flexibility.
During restructuring, retained can ensure the right leadership is in place.
Geographic expansion often requires a mix of both models, depending on role type.

Implementation and Optimisation

Hybrid Approaches

Some businesses blend both methods:

Use retained for leadership and hard-to-fill positions.
Use contingency for volume or time-sensitive hiring.
Hybrid fee structures tie payment to performance milestones.

Selecting the Right Recruitment Partner

When evaluating agencies:

Check sector expertise and track record.
Ask about success rates and candidate retention.
Look for cultural alignment and transparency.
Beware of overpromising or vague processes.

Measuring Recruitment Effectiveness

Define KPIs: time-to-hire, cost-per-hire, quality-of-hire, retention rates.
Review results regularly with your recruitment partner.
Adapt strategies to reflect market changes.

Future Trends in Recruitment Models

Expect more data-driven insights in both retained and contingency searches.
AI will enhance candidate sourcing but won’t replace relationship-led recruitment.
Fee structures may evolve to combine the best of both worlds.

Final Word

Choosing between retained and contingency recruitment isn’t about which is “better” it’s about which is right for your role, budget, and timeline. Many businesses use both strategically, depending on their hiring needs.

At Allstaff, we guide employers across Scotland through this decision, ensuring every hire delivers long-term value.

Q: What’s the main difference between retained and contingency recruitment?
Retained involves an exclusive, upfront agreement with one agency; contingency is a no-win-no-fee model where multiple agencies may compete.

Q: Which model is better for executive hires?
Retained search is usually more effective for senior roles due to depth, confidentiality, and strategic alignment.

Q: Is contingency recruitment faster?
It can be, especially for roles with a large pool of active candidates, but speed may come at the expense of depth.

Q: Can I use both methods in my business?
Yes. Many employers use retained for leadership roles and contingency for volume or urgent hiring.

Q: Which model offers better candidate quality?
Retained generally provides more targeted, committed candidates, particularly for niche or senior positions.

Q: Does retained recruitment cost more?
Fees can be higher upfront, but the ROI often balances out through better retention and performance.