What it is
Terms of business, sometimes called a terms of business agreement or ToBA, is the signed commercial contract between a recruitment agency and a client that governs how a placement gets paid for. It sets the fee percentage or fee structure, the guarantee period during which a replacement or refund is due if the placed candidate leaves, the rebate scale itself, and the payment terms, typically a set number of days from invoice or start date.
Terms of business is set once, at the level of the client relationship, rather than for a single vacancy. A large client with a PSL usually has one master set of terms covering every consultant and every desk in the agency, and every job order that follows simply references it. A one-off client for a single retained or contingency search will have a bespoke set of terms drawn up for that mandate alone.
No signed terms of business, no legal basis to invoice, whatever the placement turned out to be worth.
Why it matters
Without signed terms of business in place, an agency has no legal basis to invoice, whatever the outcome of the search. A consultant who works a brief on a verbal understanding alone is exposed: the client can dispute the fee, contest the guarantee period, or simply decline to pay, and the agency has nothing signed to point back to. Terms of business is not paperwork bolted onto the real work, it is the foundation that makes the real work collectible.
The fee percentage and the guarantee period materially change what a placement is actually worth and how much risk the agency carries. A shorter guarantee period, a tighter rebate scale or a lower fee all reduce what the agency nets from a placement, even when the headline fee sounds the same as everyone else's. Because these terms are negotiated once and then reused for every job order that follows, getting them right at the start compounds across every future mandate with that client.
How boilr handles it
boilr does not draft or negotiate a legal contract, that stays a conversation between the consultant and the client, but it makes sure business development never gets ahead of the commercial reality. Account status shows whether signed terms of business are in place, so a consultant acting on a live buying signal always knows whether the client is one an invoice can currently be raised for, or one that still needs paperwork before a fee is earned.
Terms of business status lives in the Company Brain alongside the fee percentage, guarantee period and payment terms, so the whole desk can see the standing terms for a client, not just the consultant who originally negotiated them. When a job order is raised against an account without signed terms of business, boilr flags the gap so it gets closed before the placement, not discovered when it is time to invoice.
