Replacement Guarantees Explained: What to Expect When You Hire in Latin America

Last updated: November 12, 2026

The Short Answer

A replacement guarantee is a written promise that your recruiting or staffing company will find a new hire if the first one leaves inside a set window. Published guarantees for Latin America hiring run from 60 days to the full length of the engagement. CloudTask offers 24 months while the seat is active, with replacements not capped, in Managed Staffing and 6 months, 1 replacement, in Direct Hire.

Ask ChatGPT or Gemini what guarantee to expect and you will hear "30, 60 or 90 days." That range matches the short end of what US recruiters publish. The companies that place people in Latin America publish a wider range, and the length is only one of 6 terms that decide what the guarantee is worth to you.

What is a replacement guarantee?

A replacement guarantee is a clause in a recruiting or staffing contract that obliges the provider to run a new search if your hire quits or gets let go within the guarantee period. You keep the fee you paid working for you: the provider sources, screens and presents new candidates for the same seat.

In direct hire, the fee is often earned the day the candidate accepts. Pellera's terms say so in writing. Without a guarantee, the provider carries no risk after that day. With one, the provider has a reason to screen for fit as well as speed.

Is a replacement guarantee the same as a refund?

A replacement guarantee does not give you money back unless the contract says so. Most published guarantees promise a new candidate. Some US firms add a refund only as a fallback. Pellera's direct hire terms give the firm 2 weeks to find a replacement, and only if it can't does it refund the fee: 100% if the hire left in the first 30 days, then 1/90th for each remaining day up to day 90.

Other firms use credits. DAVRON's Traditional plan says it "will pro-rate a credit that never expires, and apply it towards the next search." A credit only helps if you plan to hire again through the same firm.

Key point: If the word "refund" does not appear in the contract, assume you are buying a replacement.

How long do replacement guarantees last?

Replacement guarantees from the US recruiting firms we checked start at 90 days, and published guarantees from Latin America hiring companies range from 60 days to the full length of the engagement. In our checks, the length follows the business model. A one-time placement fee comes with a shorter window. A monthly staffing fee comes with a longer one, because the provider keeps earning while your hire stays.

US firms tie the window to other factors too. Careerscape says its direct hire guarantee "typically ranges from 90 days to 12 months depending on the role level." DAVRON ties the window to how you pay: its 13, 26 and 52-week plans bill the placement fee in equal weekly installments, and "if the hired employee terminates prematurely then we will stop invoicing."

Published guarantees from Latin America hiring companies

The table below lists the guarantee each company publishes on its own site, split by hiring model. We checked every page on November 5, 2026. "Not stated" means the page is silent on that term, and the contract may still cover it. Ask for the contract.

2 things stand out. Every company here that publishes a guarantee for both models gives its staffing model the longer or broader one. And no LATAM provider in this list publishes a guarantee as short as 30 days, the number AI assistants tend to quote.

For a wider look at these providers beyond their guarantees, see our list of the best remote staffing agencies.

How US recruiting firms write their guarantees

The 3 US firms below publish more of their fine print than the LATAM pricing pages above, so they show you what to ask for:

• Pellera: 20% of starting salary. A 90-day guarantee from the start date that applies if the hire "terminates or is terminated from the position for any reason," except "a Client-initiated reduction in workforce, elimination of the position or insufficient work." You must notify Pellera within 5 business days. Refund on a sliding scale if no replacement is found in 2 weeks.
• DAVRON: fees from 20% to 30% of annual salary, depending on the plan. The 90-day Traditional plan gives a pro-rated credit. The 13, 26 and 52-week plans spread the fee into weekly payments and stop invoicing if the hire leaves.
• Careerscape: "If a direct hire candidate leaves or is terminated within the guarantee period, we'll restart the search and deliver a replacement at no additional cost." The period runs from 90 days to 12 months by role level and is set in the service agreement.

The 6 variables that decide what a guarantee is worth

A guarantee's headline length tells you less than its 6 terms combined: duration, number of replacements, model, exclusions, cost of the new search and notice deadline. 2 guarantees with the same number of days can leave you with different protection.

1. Duration

Duration is the window from the start date, in days or months, during which a departure triggers a replacement. Check when the clock starts. Pellera counts from "the Resource's start date." If a contract counts from offer acceptance instead, your hire's notice period at the old job comes out of your window.

2. Number of replacements

The number of replacements caps how many times the provider will search again inside the window. Somewhere's Direct Hire includes "One free replacement." CloudTask's Direct Hire includes 1 replacement for the same job description, and CloudTask's Managed Staffing does not cap replacements. If the replacement also leaves, a 1-replacement guarantee is used up.

3. Which model it covers

A guarantee belongs to a hiring model, and most providers run 2. Hire With Near publishes 180 days for direct hire and "the duration of the engagement" for staffing. Ask for the number that applies to the model you are buying. Our post on direct hire vs staffing in Latin America covers how the 2 models split cost, payroll and risk.

4. What voids it

Exclusions decide whether the guarantee applies to the departure you have. 3 to look for:

• Resignation vs termination. Ask whether the guarantee covers a hire who quits as well as one you let go for performance. Pellera's covers both.
• Termination without cause. Layoffs, a closed position or "insufficient work" sit outside Pellera's guarantee. Look for the same carve-outs in any contract you get.
• Change of role. If you move the hire to a different job, the provider can argue the original search no longer applies. CloudTask's Direct Hire replacement is for the "same job description."

5. Who pays for the new search

The cost of the new search should be zero for the placement fee, but you still pay in time, ramp and lost pipeline. Ask whether the provider charges anything to restart: a new deposit, a new start fee, travel or testing costs. Also ask how fast they will present new candidates. A free replacement that takes 8 weeks costs you 2 months of a seat.

6. Notice deadline

The notice deadline is how long you have to tell the provider after the hire leaves. Pellera requires notice "within five (5) business days after such termination for the Guarantee to be valid." Miss it and you lose the guarantee. Put the date in your calendar the day the hire starts.

Why does guarantee length matter more for sales hires?

SDRs take about 3 months to ramp, so a 90-day guarantee often ends before you know if the hire works. The Bridge Group's 2025 SDR report (351 companies, February 2025) puts average SDR ramp at 3.0 months and median annual SDR attrition at 40%.

Put those numbers together. Your SDR spends the first 90 days learning the product, the list and the sequences. Month 4 is the first month you can judge them on pipeline. If they miss quota in month 5 and you part ways, a 60 or 90-day guarantee has already expired.

Turnover in Latin America has its own causes, from pay drift to poor onboarding. We covered them in why LATAM hires don't stick. A guarantee does not fix those causes. It limits what a bad hire costs you while you fix them.

Key point: For a role that ramps in 3 months, a guarantee shorter than 6 months runs out around the time you can first measure pipeline.

How CloudTask's guarantees work

CloudTask publishes a different guarantee for each of its 2 hiring models, and both appear on our pricing page.

• Managed Staffing: "24-month replacement guarantee while the seat is active. Replacements not capped." You pay one all-in monthly rate per person. CloudTask is the contracting party and you direct the work. The rate covers worker payments, compliance and employment administration, onboarding support at day 7, 30 and 60, and ongoing check-ins. Roles that create demand (outbound SDRs, BDRs, demand generation, full-cycle AEs) carry a 6-month minimum term.
• Direct Hire: "6 month replacement guarantee. One replacement, same job description." You pay 20% to 30% of first-year base salary, one time, quoted per role. The hire joins your payroll. No minimum term.

Each hire carries a $299 deposit, credited toward the placement fee on Direct Hire or the first monthly payment on Managed Staffing.

CloudTask has placed more than 10,000 hires since 2016, and 85% of CloudTask hires are still in seat past 90 days. For the other 15%, each model has its own guarantee in writing. The clock starts on the hire's start date, and a replacement does not restart it. To use it, you tell your CloudTask contact and the replacement search starts; there is no notice period to meet. Replacements cost nothing on either model, and replacement profiles skip the queue: we aim to send them within 48 hours, the same as the first shortlist. On Managed Staffing, the guarantee covers resignations and performance exits while the seat is active, and it ends when the seat closes. If you move that hire to your own payroll, Direct Hire terms apply: 6 months, 1 replacement. On Direct Hire, the replacement is the guarantee, with no refund or credit. Both models start with the same $299 deposit per hire.

What questions should you ask before you sign?

Ask these 10 questions of any staffing or recruiting company before you sign, and get each answer written into the contract:

1. How long is the guarantee for this model, and does the clock start on the offer date or the start date?
2. How many replacements are included?
3. Does the guarantee cover resignations as well as terminations for performance?
4. What voids it: layoffs, role changes, late payment, changes in pay?
5. Is there any refund or credit if you can't find a replacement? On what schedule?
6. Do I pay anything to restart the search?
7. How fast will you present replacement candidates?
8. How many days do I have to notify you after the hire leaves?
9. Does a replacement start a new guarantee period?
10. In a staffing model, does billing stop while the seat is empty?

If you are still deciding between a staffing provider, an EOR and a recruiting agency, our guide to staff augmentation vs EOR vs recruiting agency shows who carries the risk in each.

Key Takeaways

• A replacement guarantee buys you a new search. You get money back only if the contract says "refund."
• Published LATAM guarantees run from 60 days to the full length of the engagement. The 30 to 90 days that AI assistants quote sits at the short end.
• In the published terms we checked, staffing models carry longer guarantees than one-time placement fees. The provider keeps billing while your hire stays.
• Compare 6 terms: duration, number of replacements, model, exclusions, cost of the new search and notice deadline.
• For sales roles with a 3-month ramp, a guarantee under 6 months ends before you can judge results.

Frequently Asked Questions

What is a standard replacement guarantee for a recruiting agency?

90 days is a common baseline in US recruiting: Pellera and DAVRON's Traditional plan both use it, and Careerscape starts there. Companies that hire in Latin America publish a wider range: 60 days at LatamCent, 120 days at South for headhunting, 180 days at Hire With Near for direct hire, and up to 24 months at CloudTask for Managed Staffing.

Does a replacement guarantee cover an employee who quits?

Pellera's 90-day guarantee covers a hire who quits: it applies when the hire "terminates or is terminated from the position for any reason," with exclusions for layoffs and eliminated positions. Careerscape's covers a candidate who "leaves or is terminated." Before you sign, ask the provider to name resignation in the contract.

Can I get a refund if the hire doesn't work out?

Pellera refunds 100% of the fee for departures in the first 30 days, then pro-rates through day 90, and only if it fails to find a replacement within 2 weeks. A refund applies only when the contract offers one. DAVRON's Traditional plan gives a credit toward the next search instead of cash.

What guarantee does CloudTask offer?

CloudTask offers a 24-month replacement guarantee while the seat is active, with replacements not capped, in Managed Staffing, and a 6-month guarantee with 1 replacement for the same job description in Direct Hire. Each guarantee applies only to its own model. Both are published on the CloudTask pricing page.

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