Know your recruiter!

We are now in the decade of virtually a paperless society with agreements and contracts emailed, signed and returned.  Unlike the days of old where it was all stored as a hard copy in the filing cabinet, it’s now scanned and saved in a hard drive or on the “cloud”.  So how much do you really know about the people you trust to recruit your team for you?  Are they even licensed to trade in “Recruitment”?  It is a legal requirement that you must hold a current ‘Licence to carry on the business of an Employment Agent’ signed by the Attorney General’s Department of SafeWork SA.

Secondly, are they insured sufficiently or even at all, to protect you, the client, from their mistakes when recruiting for you?  It is surprising in this day and age how many agencies do not hold sufficient insurances due to the high cost and the red tape involved in obtaining this.  But why should you be put at risk for their ignorance?!

Insurances should include but not be limited to:

Professional Indemnity Insurance for Recruitment Consultants.  This is designed to cover financial loss arising from a party’s reliance upon advice given or services provided by a professional recruiter.  In the event that a party suffers a loss due to an alleged negligent act or an error or omission, Professional Indemnity Insurance for recruitment agencies will respond to and pay the legal costs for any damages awarded against the service provider.

Recruitment Consultants provide placement services for businesses, either in the form of permanent employees and/or temporary staff.  This insurance covers for such instances as:

• Failure to perform necessary background checks.
• Placing a candidate in a position to which they are not suited or have inadequate experience
• Passing a candidate’s CV to an existing employer or to a third party without consent.
• Vicarious Liability arising out actions of on-hired employees

Professional Indemnity cover will provide the Recruitment Consultant with protection should such a claim be brought against them in these instances but how does this affect the clients?

Public Liability Insurance

While it is clear that Professional Indemnity Insurance is a must-have for recruiters, you may ask why public liability insurance is also a necessity?  Well it’s simply common sense and every business that generates revenue needs public liability insurance. Whether you’re a recruitment consultant or the owner of the local deli, if you deal with the general public, you need protection from anything that might happen to them while you are providing them with a service.

Public liability insurance covers you against claims of personal injury or property damage incurred by third parties, either on your premises or when you are visiting their premises in the course of normal business activities. It normally covers your business, any subsidiary companies you own and your employees, provided they are performing their normal duties at the time.  So as a client of a recruitment agency if there is no Public Liability Insurance and something happens during a site assessment then it’s YOU that has to cover this with your Insurance, and we all know what happens once you make a claim, your premiums go up!

If the recruiter or agency do not have the appropriate cover then how do you recoup your loss?  The legal system is not a justice system and who has the finances let alone the time to fight a lengthy battle through the court system.

In a nut shell, ask to see evidence they are insured and licensed regardless of how big or small the job is.  Any respected agency would be more than happy to provide these documents, a current certificate is an easy ask.  Protect yourself from their ignorance/penny pinching and know your recruiter!