No Refunds, Just Results: Rethinking Refunds in Recruiting & Executive Search
Introduction
In today’s competitive talent market, securing the right talent can define—or derail—business performance. That’s why it’s critical to partner with a search firm that brings strategic expertise, deep functional or industry knowledge, and a proven process to every engagement.
At SCM Talent Group, we operate as a trusted search partner and advisor—not a transactional vendor. As such, we do not offer refunds on fees earned for services rendered.
Rethinking Refunds in Recruiting – Why Refunds Don’t Apply Professional Services
Refunds are appropriate for products – items that can be returned if they’re defective or fail to meet expectations. But recruiting and executive search are professional services, built on specialized skills, market insights, and intellectual capital.
Think about other professional services:
- If your attorney loses your case, do you get a refund?
- If your tax return gets audited, does your accountant refund the fee?
- If your consulting firm’s strategy isn’t fully implemented, do they return your money?
- If you don’t see progress after hiring a coach, do you get a refund?
Of course not. In each case, you’re paying for time, expertise, and execution—not a guaranteed outcome. The same principle applies to recruiting and executive search.
What You’re Really Paying For
When you engage SCM Talent Group, you’re investing in more than just a hire:
- A curated slate of qualified, vetted candidates
- Market insights and talent intelligence
- Candidate assessments and behavioral screening
- Interview coordination and offer negotiation support
This is the professional service you’re purchasing—not the unpredictable performance of a hire once they’re inside your organization.
Specialized talent professionals can accelerate access to these hard-to-reach talent pools. We find passive candidates using our network of trusted supply chain colleagues. Our trust has been derived from decades of working in this specialized field, along with a very low replacement search rate.
We do not:
- Make any final hiring decisions
- Onboard, train, or manage placed candidates
- Set their goals or performance expectations
- Control internal dynamics or leadership changes
The Better Alternative: A Candidate Replacement Guarantee
Instead of refunds, we offer a candidate replacement guarantee—providing assurance without undervaluing the work already performed.
If a placed candidate exits within the agreed-upon guarantee period, we will conduct a new search at no additional cost. Guarantee periods typically range from:
- 90–120 days for contingency search
- 6–12 months for retained executive search
In these cases, we are effectively doing the work twice for a single fee—because we stand behind our process and results.
Why Refund Clauses Can Do More Harm Than Good
While refund provisions may appear to reduce risk, they often create more problems than they solve:
- Unfairly Shifts Risk to the Recruiter – Even though the client controls the final hiring decision, onboarding, performance management, and team integration.
- Excludes Top-Tier Firms – The best recruiting partners often decline to work with refund clauses, limiting your access to proven firms and talent networks.
- Devalues the Work – Recruiting is a rigorous, consultative process—not a simple transaction. Refunds can effectively amount to working for free—despite the time, effort, and expertise already delivered.
| Refund Clause | Replacement Guarantee | |
|---|---|---|
| Risk Allocation | 100% on recruiter—even post-hire | Shared – client owns onboarding & management |
| Industry Standard | Outdated, declining in use | Common in retained & contingency models |
| Incentivizes Partnership? | ❌ No, creates mistrust | ✅ Yes, fosters long-term collaboration |
| Outcome for Clients | Discourages top-tier firms from engaging | Encourages deeper investment from top firms |
| Cost Impact | Can result in working for free | Provides assurance without loss of value |
Final Thoughts and Employer Advice
Recruiting and executive search are professional services—no different than working with a lawyer, CPA, coach, or management consultant. In each case, you’re paying for expertise, strategy, and execution—not an outcome that no service provider can fully control.
We encourage all employers to modernize their search agreements by removing outdated refund clauses and aligning with today’s professional services standards—fostering stronger partnerships and better outcomes in the process.
The shared risk model of recruiter and employer means that we both have accountability for success and failure. It’s incumbent upon the employer to carefully vet a talent partner who specializes in your specific field and industry. This will help guarantee a successful outcome for your hiring needs. It’s also important for your potential search partner to maybe say “hey, this isn’t the best fit for us. You might want to try X firm who specializes in your field.”
Choosing the right firm and understanding that you also share accountability for the eventual, long-term outcome of the placement can make things a lot smoother from the start.
A replacement guarantee offers the right balance of accountability and value.
