If Your PSA Has a 30, You Might Find the Client Plays Dirty

Editor’s Note: Every Monday Jeff Allen offers you a tip about what you should do to ensure you never miss out — or get beat out — of your well-earned fee.

What Client Says:

We’ll pay you that percentage of the candidate’s first monthly paycheck.

How Client Pays:

Check your fee schedule or the client’s PSA (placement service agreement). Watch for references to:

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  • A 30-day guarantee. Even a clearly-stated replacement guarantee can backfire if the fee is not unequivocally based on projected, first-year compensation.
  • Rebilling after a month. Anticipating an additional fee based on actual compensation after the candidate is employed for 30 days is inviting a 30-day period for computation.
  • Jobs where fees are customarily charged on a monthly basis. Office support, industrial, and other support occupations shouldn’t be identified on the fee schedule.
  • A temporary fee tied to the first 30 days. That will likely be all you’ll receive.
  • Invoices being payable within 30 days. Payment terms don’t belong on a fee schedule. They belong on an invoice after a placement is made. Even “Net 30 Days” discount terms or monthly service charges should be carefully separated from the fee schedule terms.

When there’s an ambiguity in a document, it’s construed (interpreted) against the party who created it. As if that weren’t enough, you have the burden of proof by a preponderance of the evidence.

Annualized fees will be due if you just remove anything 30-days or monthly from your documents!

John Zappe is the editor of TLNT.com and a contributing editor of ERE.net. John was a newspaper reporter and editor until his geek gene lead him to launch his first website in 1994. He developed and managed online newspaper employment sites and sold advertising services to recruiters and employers. Before joining ERE Media in 2006, John was a senior consultant and analyst with Advanced Interactive Media and previously was Vice President of Digital Media for the Los Angeles Newspaper Group.

Besides writing for ERE, John consults with staffing firms and employment agencies, providing content and managing their social media programs. He also works with organizations and businesses to assist with audience development and marketing. In his spare time  he can be found hiking in the California mountains or competing in canine agility and obedience competitions.

You can contact him here.


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