Employers often lament that it’s hard to find “good people.” There are a number of ways in which employers seek out “good” employees, including job postings, referrals and third party recruitment.  It is the latter tactic that has put a wrinkle in a number of files I have handled. While third party recruitment is a very effective way to separate the wheat from the chaff, it can pose risks for employers if the recruiter’s mandate and responsibilities are not well-defined. In that sense, finding a good recruiter may be tougher than finding a good employee.

A Recruiter is an Agent of an Employer

Recruiters can be deemed to be agents of the employer.  While they are separate legal entities, recruiters are acting with the authority of their employer clients. In some cases, employers may be responsible for a recruiter’s actions and, more importantly, a recruiter’s statements to potential employees.  (See Reiss v. CCH Canadian Limited, 2013 HRTO 764 (CanLII)).

Issues may arise if a recruiter misstates the details of the position to an employee, such as the salary or responsibilities. Similarly, it is problematic if the recruiter does not properly communicate the expectations of the employee to the employer, such as promotion opportunities or flexibility in work hours. It is important that employers use reputable recruiting agencies and that the terms of the recruiter’s mandate are well-defined to avoid these issues. Otherwise, employers can be on the hook for a recruiter’s statements, misstatements or omissions.

Importance of a Recruiter’s Evidence in Subsequent Disputes

The recruiter is not merely a player in the pre-employment process, but may have a critical role post-employment, such as in any subsequent wrongful or constructive dismissal litigation.

For example, after a termination, an employee may challenge the validity of the employment contract, which puts the negotiations regarding the signing of the employment contract, including the recruiter’s involvement, at issue.

If the recruiter made and retained detailed notes and records of the dealings with the employee, including encouraging the employee to seek legal advice or having a specific discussion about an important term of the employment contract, it may help thwart the employee’s after-the-fact argument about the enforceability of the contract. Put simply, the recruiter’s evidence can help to show what the employee truly bargained for when signing up with an employer.

In addition, the recruiter’s evidence about the recruiting process will be important if an employee argues that he or she was induced to leave secure employment (e.g. Did the employee first approach the recruiter?  Did the employee apply to other positions offered by the recruiter?).

Recruiting the Recruiter

The importance of a recruiter’s responsibilities should not be underestimated.  Recruiters provide great value to growing businesses, but as with the outsourcing of any essential service, employers should take care to ensure that the recruiter is qualified and prepared. While not every instance of “broken telephone” amongst the recruiter, the employee and the employer will be problematic, the employer should take care to do its due diligence when recruiting the recruiter to minimize the impact of any miscommunications. We recommend the following:

• Employers should thoroughly research the recruiting agency to ensure that it is reputable. If employers are delegating the job of recruitment, the recruiter has to be up to the task.

• There should be a clear contract between the employer and the recruiter that sets out:

– what employees the recruiting agency may and may not approach; and

– what representations may be made (and must not be made) about the employer and the role.

• The recruiter should keep detailed notes about any contract negotiations and should confirm any discussions with the employee in writing. The employer should obtain copies of those notes and other communications with the employee and keep them in the employee’s file.

• The employment contract[1] should explicitly state that any representations made by the recruiter do not form a part of the employment contract unless they are expressly set out in the contract.

In short, employers must: recruit a diligent recruiter; spell out the terms of the mandate in a clear contract; and let the hunt begin for the “good people” you need to grow your business.

Jennifer Heath

About the Author: Toronto Employment Lawyer Jennifer Heath is an enthusiastic lawyer who is dedicated to improving the health and productivity of her clients’ workplaces. Jennifer advises clients on a wide range of common law, contractual and statutory obligations, including those obligations under the Employment Standards Act, 2000, Labour Relations Act and the Human Rights Code.  Her work also involves representing clients before the Superior Court of Justice, the Small Claims Court, the Human Rights Tribunal and the Ontario Labour Board.

[1] If you are not using employment contracts for your employees….well, you should!  Look out for my blog in the new year about why employers should be using employment contracts.