Retained search: paid in stages, split by who did what.

Executive search is often paid in stages, for example a third at engagement, a third at shortlist and a third at placement. Consultants are paid on billed fees with a heavy split between the partner who won the mandate and the researcher who found the candidate.

Sådan bygges planen typisk

Basis

Billed fee, by stage.

Rate

A share of billed fee to the consultant team, tiered by annual billings.

Split

Partner, consultant and researcher by fixed shares.

Guarantee

Fee partly refunded if the placement leaves within the guarantee period; commission adjusted.

Hvad Prowi gør med den
  • Stage invoices read as they are billed.
  • Three-way split by role on the mandate.
  • Guarantee-period clawback as a rule.
RegneeksempelA 12-consultant boutique

Average fee

€45,000

Team rate

30%

Split

50% partner, 30% consultant, 20% researcher

Guarantee

12 months

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How does commission work for headhunters?

Headhunters are usually paid a share of the fees their firm bills for a search. In retained executive search, the client pays the fee in stages, and the consultant team's share is split by fixed percentages between the partner who won the mandate, the consultant and the researcher. The share often rises with annual billings.

Headhunting and executive search is a commission-driven industry. Fees per assignment are high, and a consultant's pay often follows the fees they bill.

Unlike regular recruitment, where agencies often work on a success basis with multiple competing agencies, headhunters typically operate on a retained or exclusive basis with guaranteed minimum fees.

How we compiled this: Fee levels come from SHRM and a Danish public tender (DTU). There is no public benchmark for typical commission rates or OTE in this industry, so we describe the structures without numbers and use illustrative examples.

Commission Models in Headhunting

According to SHRM, the standard retained executive search fee is about 33% of the role's annual salary, bonus and signing bonus, while contingency recruiters usually charge 20-25% of first-year cash compensation. These are US figures from 2016. In a 2024 Danish public tender (DTU), fees ranged from 13.24% to 18.76% of annual salary, highest for executive and manager roles. There is no public benchmark for the consultant's share of the fee, so the table shows the basis only.

Search TypeClient FeeConsultant Commission
Executive Search (C-level)Share of first-year compensation (retained)Share of the fee, often by payment stage
Senior ManagementShare of first-year compensationShare of the fee
Middle ManagementShare of first-year compensation, retained or contingencyShare of the fee, often split between consultants
SpecialistsShare of first-year compensation, often contingencyShare of the fee, paid on placement

Commission Calculation

Headhunter commission is typically calculated as a percentage of the fee the firm receives from the client. Illustrative example (not a benchmark):

  • Candidate placed with annual salary of $215,000
  • Fee to firm: 30% = $64,500
  • Consultant's commission (30%): $19,350

With tiered commission structures, the percentage can increase with high performance.

Split between a team of three (illustrative example: 50% partner, 30% consultant, 20% researcher):

Team memberShareCommission
Partner50%$9,675
Consultant30%$5,805
Researcher20%$3,870
Total100%$19,350

If the fee is paid in three stages, each stage releases a third of these amounts when the client pays.

OTE in Headhunting

On-Target Earnings for headhunters depends heavily on billings. We have found no public benchmark by role. In Denmark, Statistics Denmark's broad group for recruitment and employment agents (DISCO 3333) earned DKK 48,335 a month on average in 2025, including pension and bonuses (LONS20). Roles that usually carry commission:

  • Partner/Director
  • Senior Consultant
  • Consultant
  • Associate/Researcher

Contingency recruitment works differently; see recruitment agencies.

Special Elements

The headhunting industry has several unique commission aspects:

  • Guarantee period: Many contracts include a guarantee period. If the candidate leaves the position, the search must be restarted without additional fee
  • Retained vs. contingency: In retained search, part of the fee is paid upfront, reducing risk
  • Split-fee: When collaborating between consultants or offices, commission is shared
  • Desk fee: Some firms charge a fixed amount before commission is paid

It is important to understand clawback provisions during the guarantee period. If a candidate leaves the position within the guarantee, commission may be recalled.

Automating headhunter commission

Prowi calculates commission live from CRM data, with fee stages and payments coming in via API or CSV. Team splits, billing tiers and guarantee-period adjustments run as rules, consultants see their earnings in a mobile app, and admins approve statements and send one approved file to payroll.

Book a demo to see your own plan calculated.

FAQ About Headhunter Commission

When is commission paid?

Commission is typically paid when the client has paid the invoice and the candidate has passed any probation period. In retained search, commission may be distributed over the three payment milestones.

What is the difference between retained and contingency commission?

In retained search, you are guaranteed part of the fee regardless of outcome. In contingency, you only receive commission on successful placement, but the rate is often higher.

How much does a headhunter earn per placement?

It depends on the fee and the consultant's share. In the example above, a 30% fee on a $215,000 salary gives the firm $64,500, and a 30% team share gives $19,350 to split. There is no public benchmark for the share.

Can you negotiate your commission rate?

Yes, experienced headhunters with documented results can often negotiate better rates, particularly when changing jobs or after hitting high quotas.

Sources

  1. SHRM, "How to Work Effectively with an Executive Search Firm", 18 July 2016. shrm.org
  2. DTU (Technical University of Denmark), recruitment services tender, appendix 2: prices (2024). dtu.dk
  3. Statistics Denmark, StatBank table LONS20, employment agents and contractors (DISCO 3333), 2025. statistikbanken.dk/LONS20
  4. Statistics Denmark, definition of standardised earnings (in Danish). dst.dk