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The "Backdoor Hire": A Recruiter’s Guide to Getting Paid

You found the perfect candidate. You interviewed them, prepped them, and sent their CV to the client.

The client went quiet. "We've put the role on hold," they said.

Three months later, you check LinkedIn. There is the candidate, working for the client.

You send an invoice. The client refuses to pay. "We found them on LinkedIn ourselves afterwards."

This is the "Backdoor Hire." It is the bane of the recruitment industry. Millions of pounds in fees are lost every year because agencies rely on a phone call instead of a contract.

Here is how to lock the backdoor and protect your introduction fee.

1. The "Effective Cause" Problem

The Scenario: You send a CV. The client says "Oh, we already have this CV on file from a year ago." They hire the candidate. You claim the fee.

The Legal Reality:

Under UK law (the principle of Effective Cause), simply being the first to send a CV isn't always enough. You must prove your introduction was the effective cause of the hire. If the client had the CV but did nothing with it, and you arranged the interview that got them the job, you might win. But it's a messy fight.

The Fix:

Your Terms of Business must override "Effective Cause."

The "Deemed Introduction" Clause: "An Introduction is deemed to occur when the Agency provides the Client with any information about a Candidate."*

The "expiry" Clause: "If the Client hires a Candidate introduced by the Agency within [6/12] months of the Introduction, the full fee is payable, regardless of effective cause."*

This contractually binds them to pay, even if they claim they "saw them on LinkedIn later."

2. Hiring for a "Different Role"

The Scenario: You introduce Sarah for a "Sales Manager" role (£50k). The client rejects her. Two months later, they hire her as a "Sales Admin" (£25k). They say: "It's a different job, so no fee is due."

The Fix:

Your definition of "Engagement" must be broad.

"Engagement means the employment or use of the Candidate in any capacity, whether temporary, permanent, or self-employed."*

If they hire her to make tea, they owe you the fee.

3. The "Third Party" Referral

The Scenario: You send a CV to Client A. Client A doesn't hire them, but passes the CV to their friend at Client B. Client B hires the candidate. Neither pays you.

The Legal Reality:

You have no contract with Client B. But you have a contract with Client A.

The Fix:

A "Third Party Passing" Clause.

"If the Client passes details of a Candidate to a third party which results in an Engagement, the Client is liable to pay the Intro Fee as if they had hired the Candidate themselves."

This stops clients acting as free CV distributors.

4. The Rebate Clawback

The Scenario: You place a candidate. You get paid £5,000. Three weeks later, the candidate quits (or gets fired). The client demands a 100% refund.

The Legal Reality:

Legally, unless your contract says otherwise, you earned the fee when the candidate started. But commercially, clients expect a rebate period.

The Fix:

Tie the Rebate to Payment.

"Rebate/Refund guarantees are only valid if the original invoice was paid within [14/30] days."

This is your golden lever to get paid on time. If they pay late, they lose their insurance policy. Most agencies forget to enforce this.

5. Regulations (The Conduct Regs)

The Scenario: You charge a candidate £50 to "rewrite their CV" and put them on your database.

The Legal Reality:

Illegal. Under the Conduct of Employment Agencies and Employment Businesses Regulations 2003, you cannot charge a work-seeker for finding them work.

Your contracts with clients AND candidates must be compliant with these regulations (e.g., opting out of the regulations for IT contractors/limited company workers).

Why Contract Review is Your Headhunter

Recruitment is fast-paced. You often send terms attached to an email.

AI contract review ensures your terms are actually finding their way into the "contract" (battle of the forms). It checks your Rebate clauses, your definition of "Introduction," and your Third Party liability. It ensures that when you find the talent, you get the treasure.

Disclaimer: The information in this article is for general guidance only and is not intended as professional legal, financial, tax, or medical advice.