Permanent, temporary and contract hiring
Recruitment agency fees: what an employer actually pays
Three different billing models sit behind the phrase agency fees, and they are not variations of each other. A permanent placement is charged once, conventionally as a percentage of the first year salary. A temporary worker is charged as a rate per hour that covers the worker's pay, the statutory on costs and the agency's margin, for as long as the assignment runs. A transfer fee arises when a temporary worker is taken on directly, and the Conduct Regulations restrict when one can be charged at all. Tell us how you are hiring and recruitment agencies will quote you.
What happens next
- Set out the hiring: permanent, temporary or contract, the sort of roles, the volume and the timescale. Two minutes, no account.
- We pass your details to recruitment agencies that supply those roles in your area, and to no one else.
- They contact you directly with their terms of business and rates. Compare, appoint, or decline.
Recruitment Agency Fees is an independent site operated by Ellul Solutions Ltd. We are not a recruitment agency and we are not affiliated with any agency, regulator or professional body named here. We pass the details you submit to relevant recruitment agencies, who contact you directly; we may receive a fee from those agencies, and you pay nothing for the introduction. Percentage figures on this site are market convention as understood in 2026, labelled as such, and are not published averages or standards; nobody sets recruitment fee levels in the UK. Statutory points are drawn from the Employment Agencies Act 1973 and the Conduct of Employment Agencies and Employment Businesses Regulations 2003 as shown on legislation.gov.uk on 14 August 2026. This site provides general information about how agencies charge and is not legal, employment law or tax advice.
How recruitment agencies charge employers, by hiring type
Last updated
The billing model follows the type of hire, not the agency. This table sets out the models an employer will encounter, how each is invoiced, what the charge actually covers, and what moves it. Percentage conventions are labelled as convention throughout: nobody sets them, they are negotiated, and quoting them as rules would be wrong.
A comparison of the charging models used by UK recruitment agencies supplying employers in 2026, by hiring type. The statutory points are taken from the Employment Agencies Act 1973 and the Conduct of Employment Agencies and Employment Businesses Regulations 2003 as shown on legislation.gov.uk, checked on 14 August 2026, in particular the restriction on charging work-seekers in section 6 of the Act and the restriction on charges to hirers in regulation 10 of the Regulations. Percentage figures described as convention are market habit, not standards: no statute, regulator or professional body sets recruitment fee levels in the UK and every term here is negotiated between agency and employer. Obtain written terms of business for your own hiring through the form above.
| Hiring type | How the agency invoices | What the charge covers | What moves it |
|---|---|---|---|
| Permanent placement, paid on hire | A single invoice raised when the candidate starts, conventionally calculated as a percentage of the first year salary. Market convention for mid level permanent roles in 2026 sits in the mid teens to low twenties percent, negotiated down on volume and up for scarce roles. Convention only, nobody sets it | Sourcing, screening and introducing candidates, with the agency carrying the cost of unsuccessful searching | Seniority and scarcity, whether the agency has exclusivity, the volume you can commit to, and the rebate terms you require |
| Permanent placement, fixed fee | A flat sum per hire agreed in advance, independent of salary, sometimes staged across the process | The same activity, priced as a service rather than as a share of the salary | Whether the agency is confident of filling quickly, and how many hires are committed. Common on high volume, well understood roles |
| Temporary worker supply | A charge rate per hour worked, invoiced weekly or monthly for as long as the assignment runs. The charge rate covers the worker's pay plus statutory on costs plus the agency's margin | Payrolling and employment of the worker, statutory on costs, cover for absence, and the flexibility to end the assignment | Pay rate, shift pattern and unsociable hours, the on costs the agency carries, volume, and how hard the role is to fill at that rate |
| Contract and day rate supply | A charge rate per day, with the contractor engaged through the agency, an umbrella company or their own company depending on the arrangement | Contracting, payment and compliance administration, with the agency in the contractual chain | Scarcity of the skill, contract length, notice terms, and the employment status and tax treatment agreed for the engagement |
| Temp to perm transfer | A transfer fee when a temporary worker is taken on directly. Regulation 10 restricts these terms: they are unenforceable unless the contract lets the hirer elect an extended period of hire instead of paying the fee | Compensation to the agency for losing an ongoing charge rate income | Whether an extended hire election is offered as the Regulations require, how long the worker has already been supplied, and whether the relevant period in regulation 10(5) has passed |
| Preferred supplier or volume arrangement | Agreed rates across a defined set of roles for a defined period, often with service levels attached | Predictable terms and reduced administration in exchange for committed volume | The volume actually committed, the breadth of roles covered, payment terms, and whether the arrangement is genuinely exclusive |
- Recruitment fees in the UK fall on the employer, not the candidate: section 6 of the Employment Agencies Act 1973 restricts charging a work-seeker a fee for finding them work, and the exceptions in regulation 26 of the Conduct Regulations 2003 apply only to occupations listed in Schedule 3 to those Regulations.
- Regulation 10 of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 makes a temp to perm transfer fee term unenforceable unless the contract provides that, instead of a transfer fee, the hirer may elect for an extended period of hire specified in the contract.
- Regulation 10(4) and (5) provide that a transfer fee term is unenforceable where the worker starts with the hirer after the relevant period, which ends on the later of 8 weeks from the day after the worker last worked for the hirer through the agency, or 14 weeks from the first day they worked for that hirer through that agency.
- Permanent recruitment is conventionally charged as a percentage of first year salary and temporary supply as a charge rate per hour covering pay, statutory on costs and margin. No statute, regulator or professional body sets either level: both are negotiated on every arrangement.
Cite this page
“How recruitment agencies charge employers, by hiring type”, Recruitment Agency Fees, https://recruitmentagencyfees.co.uk/ (updated 2026-08-14). A comparison of the charging models used by UK recruitment agencies supplying employers in 2026, by hiring type. The statutory points are taken from the Employment Agencies Act 1973 and the Conduct of Employment Agencies and Employment Businesses Regulations 2003 as shown on legislation.gov.uk, checked on 14 August 2026, in particular the restriction on charging work-seekers in section 6 of the Act and the restriction on charges to hirers in regulation 10 of the Regulations. Percentage figures described as convention are market habit, not standards: no statute, regulator or professional body sets recruitment fee levels in the UK and every term here is negotiated between agency and employer. Obtain written terms of business for your own hiring through the form above.
Questions, answered directly
How much do recruitment agencies charge employers?
It depends on the hiring type. Permanent placements are conventionally charged as a percentage of the first year salary, commonly in the mid teens to low twenties percent for mid level roles in 2026, lower on committed volume and higher for scarce roles, with fixed fee per hire also widely offered. Temporary and contract supply is charged as a rate per hour or per day covering the worker's pay, statutory on costs and the agency's margin. All of these are market convention and negotiation, not rules: no body sets recruitment fee levels.
Do candidates pay recruitment agency fees?
No, not for finding them work. Section 6 of the Employment Agencies Act 1973 restricts charging a work-seeker a fee for work-finding services, and the exceptions in regulation 26 of the Conduct Regulations 2003 apply only to occupations listed in Schedule 3 to those Regulations. Regulation 5 also prevents work-finding being made conditional on a worker buying other services or goods.
What is the difference between a permanent fee and a temp charge rate?
A permanent fee is a one off charge raised when the person starts, conventionally calculated on their first year salary. A temporary charge rate is an ongoing hourly amount invoiced for every hour worked, made up of the worker's pay rate, the statutory on costs of employing them, and the agency's margin. They are different commercial products and comparing one against the other tells you very little.
Can an agency charge me if I take on their temp permanently?
Only within limits. Regulation 10(1) of the Conduct Regulations 2003 makes a transfer fee term unenforceable unless the contract also lets the hirer elect an extended period of hire instead. Regulation 10(4) and (5) make it unenforceable where the employment begins after the relevant period, which ends on the later of 8 weeks from the day after the worker last worked for you through that agency, or 14 weeks from the first day they did.
Are recruitment agency fees negotiable?
Yes, and more of the agreement is negotiable than the percentage. The calculation base, the rebate period and its exclusions, the introduction period, exclusivity, payment terms and the treatment of overtime on temporary supply are all matters of agreement. Committed volume and a defined period of exclusivity are what employers offer that agencies most reliably price for.
What is a preferred supplier list arrangement?
An agreement under which an employer channels hiring through a defined set of agencies on agreed rates for a defined period, usually with service levels attached. The employer gets predictable terms and less administration, the agency gets committed volume. The terms only produce value if the volume is real and the arrangement is genuinely honoured.
Is this introduction service free to use?
It is free to you, and there is no obligation to use any agency that gets in touch. We pass your details only to recruitment agencies supplying the kind of roles you describe in your area, and they contact you directly. We may receive a fee from those agencies, which is how the service is funded.