Recruitment to recruitment firm MerlinCorp claims to have solved the problem of newly recruited consultants failing to hit targets.

Instead of charging an upfront fee for the services of a recruitment consultant it places, MerlinCorp will charge clients according to the profitability of a new recruit.

Company director Paul Davis claimed the scheme would help prevent the untenable situation where a client employs a new consultant who then subsequently decides the role is not for them just outside the three-month rebate period. This leaves the client without the consultant but having to pay a hiring fee to the rec-to-rec firm.

MerlinCorp keeps in contact with management and the recruit, monitoring targets and performance.

Fees are based upon a percentage of the cash each candidate makes, in line with a traditional rec-to-rec fee. The fee is then amortised over the first year to share the risk and the rewards.

Davis, who runs the company with co-director Liz King, claims the structure is more attractive to institutional investors and helps smooth out seasonal trends that may affect specialist recruiters.

He added: “When you recruit a new member of staff whose primary goal is to hit a profit target, why should you be left high and dry if this is not achieved?

“Our company uses a process to establish what each candidate sees as their unique key drivers and, more importantly, what their previous frustrations are,” he added.

“This is now underpinned by the guarantee that if we get it wrong, everybody loses. However, if we get it right, everybody wins.”