Compensation and Fees of Employment Agencies

The fees levied by an employment agency for services rendered should not exceed the limit that is statutorily established or not included in a schedule filed with a state regulatory agency.

Generally, an employer should pay a fee that has been agreed upon by the employment agency and the employer[i].  In the absence of such an agreement, the statutory fee schedule will be binding[ii].  If alternate proof is produced regarding a fee schedule, then an employer can exempt himself/herself from a fee schedule that is laid down in the statute.

An ambiguous fee schedule included in a contract will be construed against the party who wrote it[iii].  This is known as the rule of contra proferentem.  The rule will be applied only if all the general rules of construction have left a jury unable to determine what the parties intended in the contract[iv].

A contract incorporating a provision to  place a job seeker in a fee paid position without paying the fees will not relieve a jobseeker from his/her obligation to pay an agency’s fees.

Generally a minor is liable for the value of necessaries furnished.  Thus an infant is prevented from renouncing his/her contract with an employment agency if a service that is rendered by an employment agency falls under the category of necessaries under common law and other statutes[v].  While interpreting the phrase ”necessaries”, a court must measure both an infant’s standard of living and the ability and willingness of his/her guardian if s/he has a guardian to supply the needed services or articles.  The concept of “necessaries” must be enlarged to include such articles and services that are reasonably required by an infant to support him/her and those legally dependent upon an infant[vi].

[i] Half v. Levine-Baratto Associates, Inc., 126 Misc. 2d 169 (N.Y. Civ. Ct. 1984).

[ii] Hunt Personnel, Ltd. v. Hemingway Transport, Inc., 105 Misc. 2d 626 (N.Y. Civ. Ct. 1980).

[iii] Alexandria Employment Service, Inc. v. Box, 282 So. 2d 776 (La.App. 3 Cir. 1973).

[iv] Klapp v. United Ins. Group Agency, Inc., 468 Mich. 459 (Mich. 2003).

[v] Hastings v. Dollarhide, 24 Cal. 195 (Cal. 1864).

[vi] Elliott v. Horn, 10 Ala. 348 (Ala. 1846).


Inside Compensation and Fees of Employment Agencies