Ending unethical recruitment fees: what’s holding back progress?

One in every twenty workers globally is a migrant worker. Migrant workers fulfil vital roles in many sectors and locations, and are often critical to the operations and supply chains of international brands.

Despite the significant contributions of migrant workers to the global economy, many are still charged recruitment fees when seeking employment. These fees can leave workers impoverished and sometimes in conditions of forced labour. Our research shows that in the shipping industry alone, almost a third of seafarers have been asked to pay a recruitment fee to secure a job onboard a merchant vessel. 

IHRB, and its partners in civil society, as well as many businesses all believe in and are committed to the principle that it is the employer who should pay these fees, not the employee.  We have long advocated for the Employer Pays Principle, which affirms that no worker should pay for a job. The costs of recruitment should be borne not by the worker but by the employer.

Signs of change 

We have worked with major companies as part of IHRB’s Leadership Group for Responsible Recruitment to drive uptake of the Employer Pays Principle in business practices around the world. Organisations including The Responsible Business Alliance, Verité, ICCR, Aim Progress, Consumer Goods Forum, Issara Institute and many other business focused organisations, along with UN agencies, have all developed programmes to educate, build capacity and encourage companies to adopt responsible recruitment policies. The International Organisation for Migration (IOM) has also developed IRIS, its flagship initiative to certify professional standards amongst recruitment agencies.

Thanks to such efforts, there are some signs of positive change. There are currently 400 companies listed on IHRB’s Responsible Recruitment Register - our database which lists businesses and associations with policies that prohibit the charging of recruitment fees to workers. 

But the reality facing many migrant workers and businesses is that realising responsible recruitment practices free from fees to workers remains a significant challenge.

Uncomfortable truths

There are several things that hold back progress:

1. Lack of viable economic opportunities at home means there is an oversupply of workers seeking employment abroad. They lack reliable information and cannot easily access jobs in other countries without the services of a recruitment agency. Lacking other options, these workers are willing to accept (but seek to manage) degrees of exploitation.
2. The enormous number of recruitment agencies globally results in intense competition, reducing leverage with hiring managers. The price for recruitment services falls lower and lower until it is only possible for an agency to make a profit by charging fees to workers. Furthermore, many recruitment agencies are too small to be able to operate effectively in  dynamic international markets. They do not have the capacity or resources needed to make applying international recruitment standards viable.
3. In some key recruitment corridors, the national associations of recruitment agencies deliver poor service. Associations where admission of agencies is automatic on receipt of a government licence lack market incentives to deliver good service. Often they fail to enforce their own codes of conduct amongst their members. They may also be riven by vested interests and political factionalism. Failure to adhere to international standards means these associations are not eligible to join the international body representing recruiters - The World Employment Confederation.
4. Corruption in many recruitment corridors is deeply embedded and entrenched. This can include payments for government services. Ironically, some efforts to add increased safety provisions in recruitment processes merely provide further opportunities for corruption by government officials as well as additional hurdles for migrant workers, recruitment agencies and businesses to navigate. At company level, hiring managers may find themselves in a unique position to solicit bribes or other favours from recruitment agencies.
5. Certification of agencies has proven to be difficult. The IOM IRIS initiative has set a high bar that agencies have struggled to achieve given the current lack of needed additional resources and capacity building opportunities. 
6. It is not easy for an existing agency to transition completely to an Employer Pays model. A typical recruitment agency currently operating a “worker pays” model may employ up to 20 staff and have a range of other business costs. They will have an existing customer list often built over many years that expects low or no cost recruitment. Cash flow may be an issue for agencies if workers are not paying fees up front. Converting overnight to an Employer Pays Model is difficult to achieve, and  may require a transition period where continual progress is monitored and support is provided.
7. Brands, even when committed to responsible recruitment, may lack leverage over suppliers where they are not responsible for a significant proportion of the production output. They may also lack clear visibility of supplier arrangements with recruiters.
8. It has proven difficult to separate recruitment practices from other concerns and requirements relating to worker rights. The expectations on recruitment agencies operating in low-wage labour markets,  within often unregulated or poorly regulated systems where they have little leverage,  have been overwhelming and in some cases  acted as a brake on progress.
       

Breaking the log jam

The demand for responsibly recruited workers has grown, and yet companies are still struggling to find recruitment agencies providing services that ensure practices consistent with international standards on recruitment fees.

An increasing number of recruitment agencies are willing to operate to an Employer Pays model. But many agencies need support, encouragement and incentives as they transition to a recruitment fee free business model. 

Since 2023, IHRB’s Responsible Recruitment Register database has provided a regularly updated list of businesses, business associations and certification bodies with policies that prohibit the charging of recruitment fees to workers. 

We are launching a new feature within the Responsible Recruitment Register focused specifically on recruitment agencies.  The new feature lists recruitment agencies already working to an Employer Pays model, whilst also providing a route for any agency that is prepared to make the switch.

The Responsible Recruitment Register lists recruitment agencies who, based on publicly available information, appear to be delivering, or are able to deliver, recruitment services without charging fees to workers. The new feature is intended as an aid to businesses seeking to work with agencies showing a level of commitment to responsible recruitment, and for agencies to indicate their ability to do so. Crucially, this additional component of the Register is tiered to identify different levels of progress and commitment to responsible recruitment, from those fully compliant with a certification such as IOM IRIS, to those who have undertaken initial training and shown potential to deliver a recruitment fee free model.

There are potential drawbacks and challenges of this approach. For many recruitment agencies, transitioning to the Employer Pays model overnight will not be possible. Agencies committed to this transition will need support, and accountability of those who make commitments to responsible recruitment needs to be developed. 

However, IHRB hopes that by supporting agencies fully committed to responsible recruitment as well as those on the journey towards that goal, the Register will increase the service options for businesses seeking to recruit workers in line with international standards. We believe it is an important step in driving lasting change among recruitment agencies operating around the world. 

IHRB welcomes feedback on the Responsible Recruitment Register and the new feature focused on recruitment agencies. Those interested in wider discussions on the responsible recruitment of migrant workers are also welcome to join us either in person or online at the Global Forum for Responsible Recruitment 2025 in Bangkok on 20-21st May. Registration is now open.

Visit the Responsible Recruitment Register.