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I guess, upon reflection, that’s a little harsh.

Certainly, we lawyers do enough to irritate our clients (and everybody else) often enough that we must learn to be more tolerant of the well-meaning, but irritating, questions which clients ask us again and again and again and again. What really irritates me is the conversation that usually goes something like this:

Joe Recruiter: Can you send me a copy of that “but for” law?

Me: No, I can’t. What does your contract say?

Joe Recruiter: What’s that have to do with anything? Why can’t you just send me a copy of that law that says “If but for my actions, the employer wouldn’t have hired the candidate, then I’m entitled to a fee?”

Let me try this long-winded way to express my frustration.

For years, the scourge of drivers in northeastern cities has been the squeegee guy, an enterprising but annoying individual who approaches drivers stopped in traffic and, before they can react, begins soaping their windshields so he can charge them for cleaning it with a device I only know as a squeegee. Let’s say this happens one day to Joe Recruiter, who immediately launches into the time honored defense to the squeegee guy – windshield wipers on full power and geysers of washer fluid – while shouting out something endearing like “Why don’t you get a real job, you bum?”

Suppose this particular squeegee guy drops his equipment, approaches Joe Recruiter and calmly replies, “You know, I’d love to get a job, but I just can’t find one. I don’t know what to do.” Joe has the answer, for just a couple of blocks ago, he noticed a “help wanted” sign on Bob’s Drug Store.

“Try Bob’s Drug Store,” Joe states. “They’re hiring. Maybe you’ll have some luck there.”

A couple of weeks pass. Joe is driving down the same street, looks out his window, and there is a clean-shaven, freshly combed squeegee guy walking down the street with a lilt in his step and a smile on his face. Noticing Joe, the squeegee guy comes over and announces “I not only got that job at Bob’s Drug Store a few weeks ago, but they’ve already promoted me to Manager. I cannot thank you enough for your advice. None of this would have happened were it not for you.”

Joe’s charity knows limits. After all, he’s supposed to get paid for making placements, and didn’t he just make one? “But for my actions, Bob’s Drug Store would never have hired the squeegee guy,” thinks Joe. “I think I’ll send Bob’s Drug Store a bill.”

Well, do any of you who might still be reading this believe that any court would award Joe Recruiter a fee? Of course not. Why not? Simply because Joe had no contract with Bob’s Drug Store, “but for” law or not.

When a court is trying to determine whether you are entitled to a fee, it will not look first at “but for” or proximate cause concepts, rather it will look first at your contract. America’s really quite a good country in this way. You don’t have to ask some pompous lawyer like me questions like “What happens if I refer a candidate whose resume is already on file with my client?” Or, “What happens when my client tells me the candidate answered a newspaper ad after I referred him?” You get to decide what happens on your own.

The “law,” is your contract. If you want a “but for” law to apply, put it in your contract. If you want the first referral to get the fee, make that a part of your agreement with your clients. Of course, if you don’t get your contract signed by your clients, you also have to prove that your clients have agreed with you as to what the law is. We’ll leave that discussion for a later time.

So, if the law is so simple that the court will enforce whatever you put in your contract, where did all this “but for” stuff come from? The problem is, frankly, you guys have not taken advantage of the opportunity afforded you by the American free enterprise system. Most of you really don’t have a complete contract, you simply have a document which states the amount of your fee, without really describing what it is you do to earn the fee. When there’s no explicit statement in your contract of what it is you have to do to get paid, a court must try to figure it out for you.

Most state appellate court decisions that have considered this question have analogized contingency recruiters to real estate brokers, and concluded that the recruiter is entitled to its fee if it shows its actions caused the employer to hire the candidate, something which is often harder to do in practice than in theory. On the other hand, a court in at least one state, Washington, has held that a proximate cause requirement is not part of the standard “employment agency” understanding. The evolution of a “but for” concept to determine when you are entitled to a fee has not occurred because courts have specifically adopted it, but because, as a practical matter, it usually will help you determine whether you have caused the hire.

But why leave the question of what you have to do to get paid up to lawyers and judges? Only appellate court cases serve as binding precedent within a particular state, and the fact is, that in probably well over a majority of the states, there has yet to be any appellate court decision concerning whether, in the absence of contract language to the contrary, a recruiter is required to demonstrate that it is the proximate cause of a candidate’s hire.

So, rather than asking your lawyer to send you a copy of a “but for” law, do this:

1. Figure out what you want to be the law in connection with your placements (and yes, remember, that your contracts aren’t going to be the “law” unless you can show that you got your clients to agree to them). Do you want to be entitled to a fee if your efforts cause the client to hire the candidate?

Do you want to be entitled to a fee if your candidate is hired within a specified time, even if your referral had nothing to do with the hire? Do you want to be entitled to a fee if you are the first party to do something, such as refer a candidate or arrange for an interview? You may not want to limit your thinking to what you want your “law” to be – also consider what you can prove in court and to what your clients will agree.

2. After you have decided what you want the law to be in connection with your placements, send a copy of your contract to your attorney along with a statement of what you want the effect of that contract to be, and tell the attorney if your particular contract isn’t accomplishing your desires, change the wording of the contract so that it does so.

3. Then, when you have to go to court, you can show up with your contract, and you won’t have to look around for any “but for” law to bring with you

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Biography

Robert Style is special counsel to the firm Astor Weiss Kaplan & Mandel, LLP; with his practice focused on the area of Employment law. Since 1976, has maintained a private practice in Philadelphia, Pennsylvania  focusing on employment and corporate law, with an emphasis on the representation of clients engaged in various aspects of the staffing industry. Prior to that, from 1969 to 1976, he served as Vice President and General Counsel of Snelling and Snelling, Inc.

He has served as general counsel to various staffing industry trade associations, including the National Association of Personnel Services (since 1977), the Pennsylvania Association of Personnel Services and the Mid-Atlantic Association of Personnel Consultants. His representation of staffing industry clients has included counseling, contract preparation, litigation relating to employment discrimination issues, fee collections, enforcement of employment agreements, as well as issues arising out of the Fair Labor Standards Act, Family and Medical Leave Act and the Employee Polygraph Protection Act, mergers and acquisitions, workforce transition issues and co-employment issues. He has spoken on staffing industry issues to associations, networks and employees of staffing firms, and has addressed clients of staffing companies on labor and employment law issues.

Bob has written frequently on issues affecting the staffing industry and is the author of the Certified Personnel Consultant's Legal Manual, the manual used by the National Association of Personnel Services in connection with its CPC program.

His presentation will include an overview of what you must know to prepare for the certification exam, and he will answer any questions attendees may have about the study material or the laws affecting various aspects of the staffing industry.

Mr Style is  also the Counsel for the National Association of Personnel Services. (rstyle@sprynet.com). (215) 732-7131.

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