Retained search against contingency recruitment
| Retained search | Contingency | |
|---|---|---|
| Payment | Staged, part on engagement, independent of outcome | Only on a joiner |
| Exclusivity | Normally exclusive for the role | Usually several firms in parallel |
| Work performed | Market map, approach, assess, manage the process to close | Match against an existing candidate network and submit |
| Candidate source | People not looking | People available and, usually, actively looking |
| Typical use | Leadership, board and scarce specialist roles | Roles with reasonable candidate supply |
| What you should ask for | The map, the approach list, and the reasons people declined | Speed and a submission that fits the brief |
The output most employers under-use is the market map and the decline reasons. A search that produces four candidates and eleven declines has told you something useful about how your organisation, your compensation and your reputation look from outside, and that is often worth more than the shortlist.
What a good search process looks like
- A brief that describes the problem the hire is meant to solve rather than a list of qualifications. Senior candidates are moved by the mandate, not by the job description.
- An agreed target list of organisations, and an explicit off-limits list on both sides, before approaches begin.
- Named approach discipline. Who the firm speaks to and what they say about you becomes your reputation in that market, and it is being said in your absence.
- Assessment against defined competencies, with written evidence, not a personal endorsement from the partner who made the introduction.
- A managed close. Senior appointments fail at the counter-offer and at the notice period, which for Indian senior roles routinely runs to three months, so the firm's job continues past acceptance.
- Reference checks taken late, discreetly, and only with the candidate's consent, since an early call to a current employer can end the candidate's existing job.
Confidentiality, in both directions
A headhunted candidate is employed elsewhere and is not looking. That creates obligations most employers handle carelessly.
- The candidate's employer should not learn about the conversation from you. Interview scheduling, reference calls and internal discussion all leak, and the consequence lands entirely on the candidate.
- Keep the candidate list out of general circulation internally. A shortlist that circulates by email to eight people will reach someone who knows one of the candidates.
- Be careful what the candidate tells you. A candidate who arrives with their current employer's pricing, client list or pipeline is showing you what they will do to you later, and accepting it can implicate you in a breach of their confidentiality obligations.
- Where the candidate is bound by a confidentiality agreement or a restrictive covenant, take a copy and take a view on it before the offer rather than after the resignation.
On restraints, the Indian position is not the American one. A post-employment restriction that prevents a former employee from working elsewhere is generally unenforceable as a restraint of trade, while confidentiality obligations and non-solicitation of clients and staff stand on different ground and are treated more sympathetically. Verify the position under the Indian Contract Act, 1872 and the case law on restrictive covenants before relying on any restraint, whether it binds your candidate or your own leavers.
Working with a search firm without wasting the fee
- Decide whether the role is genuinely a search. If people are applying and you are choosing between them, you are paying search fees for contingency work.
- Move at the speed the candidate is being asked to take a risk at. A senior candidate who has taken a covert call is exposed for as long as your process takes.
- Do not run a retained search alongside three contingency firms. The market notices, and the same candidates get approached by four people about one job.
- Agree the off-limits period on your own employees. A firm that places someone with you and calls them a year later is recycling your hire.
- Insist that the candidate hears the same story from you and from the firm. Compensation structure, reporting line and mandate misrepresented at approach are the most common causes of an early exit.
- Record the outcome. Search fees at senior level are large enough that joining ratio and two-year retention per firm should inform the next engagement.
Statutory reference
- Act
- Indian Contract Act, 1872
- Section
- Indian Contract Act, 1872: agreements in restraint of trade, under which a post-employment restriction preventing a former employee from taking up other work is generally void, subject to a single exception, for the sale of goodwill. Digital Personal Data Protection Act, 2023: candidate data collected during a search, including data gathered before the candidate has expressed any interest. Emigration Act, 1983: registration as a recruiting agent where the search is for employment outside India
- Key limits
- Post-employment restraints on a candidate's freedom to work are generally unenforceable in India even where the contract contains them, which is a different position from the one a multinational parent may assume. Confidentiality and non-solicitation obligations are treated differently and are not automatically void. Verify the current case law position before relying on any restrictive covenant, and verify the data protection basis for holding information about a person who has not applied. Under notification G.S.R. 843(E) dated 13 November 2025, sections 3 to 17 - the grounds for processing, notice, consent, the general obligations of a data fiduciary and all of the data principal rights - take effect eighteen months from that date, on 13 May 2027. Only the definitions and the Data Protection Board and penalty machinery are in force now. Separately, processing for employment purposes runs on the section 7(i) legitimate use and not on consent, and the erasure duty in section 8(7) yields where retention is necessary for compliance with any law, which is the position for statutory payroll and register retention. Section 27 says only that every agreement by which anyone is restrained from exercising a lawful profession, trade or business is void to that extent, with one exception for the sale of goodwill where the limits are reasonable and only so long as the buyer carries on a like business there. Everything beyond that flat rule, the distinction between a restraint operating during employment and one operating after it, the more sympathetic treatment of non-solicitation, and the enforceability of post-employment confidentiality in respect of genuinely confidential information as against general skill and knowledge, is JUDICIAL rather than statutory. The entry marks these as the general position rather than citing them. The copy also carries no last-updated stamp: every provision is verified as at 2019 and no later.
Frequently asked questions
What does a headhunter do?
Identifies and approaches people who are employed elsewhere and are not applying for jobs, then persuades them to consider a role and manages the process to a close. You are buying access and persuasion rather than CV supply.
When is retained search worth the cost?
When the people who could do the job are not applying anywhere, which is usually leadership, board and scarce specialist roles. If candidates are already applying and you are choosing between them, you are paying search fees for contingency work.
What does off-limits mean?
The organisations a search firm agrees not to recruit from, usually because they are its clients. It matters in two directions: it limits where the firm can search for you, and it should stop the firm approaching the people it has already placed with you.
Can we rely on a candidate's non-compete with their current employer?
Generally not in India, where a post-employment restraint on working elsewhere is usually void as a restraint of trade. Confidentiality obligations and non-solicitation of clients and staff are treated differently, so read the actual clause and take a view before the offer.
How do we protect a candidate we are headhunting?
Keep the shortlist out of general internal circulation, schedule discreetly, and take references only late and with consent. The candidate is employed elsewhere and is not looking, so a leak costs them their current job rather than costing you anything.
How Engage tracks search engagements
Engage keeps search candidates on the same pipeline as direct applicants, with the source, the firm and the date of first contact recorded, so ownership and off-limits questions have an answer. Joining ratio and retention by firm are visible per engagement, which is what tells you whether the next senior search should go to the same partner.
See recruitment in Engage