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Job Hunting: Should You Pay?
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Facts for Consumers from the Federal Trade Commission
Job-Hunting: Should You Pay? -- July 1992
If you are looking for a job in the U.S. or overseas, you may
come across ads that promise results placed by employment
assistance businesses. Although many of these firms may be
legitimate and helpful, others may misrepresent their services,
promote fictitious and out-dated job offerings, or charge large
upfront fees for services that often may not lead to a job. Some
ads may direct you to call a '900' telephone number for job
information. You will be charged either a flat fee or a
per-minute charge for each '900' call, and the charge usually is
much greater than the toll for an ordinary long-distance call.
Other ads may ask you to visit the company's place of business
for assistance in resume preparation, letter writing, and
interviewing skills.
Before you contact any employment service firm, follow the
suggestions at the end of this brochure for choosing a firm that
is right for you. Also, before you pay or commit to pay for
domestic or overseas job information or placement -- whether by
calling a '900' number or by signing an employment services
contract -- know what you will get for your money. This brochure
explains how different types of employment firms operate and what
questions you should ask when considering their services.
Types of Employment Service Firms
Do not judge an employment firm by its name. Classified
advertising and telephone book listings do not always make clear
the differences among employment services. Many names are used
loosely and interchangeably, such as "employment agency,"
"personnel placement service," "executive search firm," or
"executive counseling service." What is important to find out is
what services the firm offers, how much those services cost, and
who pays. If you, rather than an employer, are required to pay
the fee, find out if you must pay even if the employment service
does not find you a job.
This publication discusses six basic types of service
companies/agencies that offer assistance in obtaining employment.
They include: public employment services; employment agencies;
executive search services; temporary help services; executive
counseling services; and job listing services. Here are some
descriptions to help you identify each type.
l The federally-funded and state-operated public Employment
Service, also known as the Job Service, operates in all fifty
states, the District of Columbia, Guam, Puerto Rico, and the
Virgin Islands. There are some 2,300 points of service
nationwide, of which approximately, 1,700 are considered
full-time, full service offices. The Employment Service provides
its services free of charge to both employers and job seekers.
Openings range from entry level positions to technical and
professional positions. The Employment Service provides access to
the Interstate Job Bank -- a nationwide source of job
opportunities. It also provides links to numerous employment and
training programs in each state, including programs for the
disabled, minorities, older workers, veterans, welfare
recipients, and young people.
l Employment agencies or personnel placement services work to
fill specific positions available within companies. Their purpose
is to bring applicants and employers together. In many cases, the
placement fee is paid by the hiring company, but in some
instances, where state law permits, the fee may be shared by you
and your employer are billed to you, usually after a job is
secured. Employment agencies are commonly licensed in the state
in which they do business.
l Executive search firms or executive recruiters are hired by
businesses to find the "right" person for a particular job within
a company. (These recruiters are sometimes referred to as
"headhunters.") The executive who is hired does not pay the fee;
fee payment is part of the agreement between the hiring business
and the search firm. Executive search firms usually subscribe to
a code of ethics established by industry members, and some are
licensed by the states in which they do business, as required by
state law.
l Temporary help services are companies who provide workers to
businesses on a temporary basis. Businesses pay an agreed upon
wage to the temporary service for work performed by its
employees. Workers are then paid by the temporary service firm,
not by the temporary employer.
l Executive counseling services or career counseling services
assist job seekers with career decisions more than job placement.
They may provide such services as skill identification and self
evaluation, resume preparation and letter writing, and general
information about companies in a particular geographical area or
job field. Fees can range up to $4,000, and payment is often
required before services are provided. You probably will have to
pay this fee even if you do not find a job. Placement is not
guaranteed. Executive counseling firms may or may not be
licensed, depending on state law.
l Job listing services or advisory services sell information,
sometimes through '900' telephone numbers, about obtaining
employment in the U.S. or abroad. Information may include lists
of job openings, general tips on conducting a successful job
search or interview, and broad guidance in resume writing.
Advisory firms often require an upfront fee, which usually is
charged even if you do not find a job through the firm. Be aware
that some listing services and advisory firms may place ads that
appear to offer jobs when, in fact, the firms are selling only
employment information.
Choosing the Right Employment Service Firm
Consider your needs carefully. What type of employment assistance
do you want and what will it cost?
l Know what a '900' number call to an employment listing
service will cost before you make the call. Reputable companies
will state these costs upfront. If you have fraudulent '900'
number charges on your telephone bill, ask your phone company to
delete them, although the company is not legally obligated to do
so.
l Ask any employment assistance company you contact who pays
for its services, you or the employer, before you sign a
contract.
l When you are required to pay, ask the company if payment
must be made before services are given and if you are required to
pay even though you do not find a job.
l Look for an employment service that regularly fills the sort
of position you are seeking. If you are a writer, look for a firm
that hires people with that skill. Classified ads in newspapers
or trade magazines are a good source for finding specialized
employment agencies as well as positions.
l Realize that employment service firms only can promise to
help you find a job; they cannot guarantee that they will find
you a suitable one.
l Check with your local consumer protection agency and the
state Attorney General's Office to find if they have received any
complaints about an employment company with whom you intend to
sign a contract. You also can ask these agencies about any state
laws concerning employment.
l Most important, read the contract carefully before you sign
it. If the sales representative makes claims that are not in the
contract, remember the contract is what counts.
Free Resources
There are a number of free sources of employment information, in
addition to the newspaper classified ad section.
Job Service offices post job vacancies. They also provide some
counseling and referrals to other job resources.
Local and county human resources offices and information referral
services offer some placement assistance. They can give you the
names of other groups that can help, such as labor unions or
federally-funded vocational programs.
University and college career service offices usually limit their
assistance to students and alumni, but some may let you look at
their job listings. They may be a good reference for free job
information.
Local libraries also can be a good source of information. Ask the
librarian to direct you to material that can help you write a
resume, conduct an interview, or compile a list of companies whom
you might contact about job openings.
For More Information
To learn more about employment service firms, write to your local
Better Business Bureau. You also can send for the free FTC
brochure '900' Numbers by writing to: Public Reference, Federal
Trade Commission, Washington, D.C. 20580.
If you have a problem with a firm, contact your local consumer
protection office, Better Business Bureau, the appropriate state
licensing board, or your state Attorney General. Although the FTC
cannot intervene in individual cases, the staff monitors job
placement practices and would appreciate copies of your
correspondence. Write to: "Job Scams", Correspondence Branch,
Federal Trade Commission, Washington, D.C. 20580.
3/81; 10/83; 11/87; 5/91
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