The Staffing Edge Blog

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Chelsea Henry

Chelsea Henry is the team leader of risk management at The Staffing Edge. Chelsea’s passion for working closely with others in a challenging but rewarding environment is what makes her an important asset to our members. Chelsea has over 10 years of customer service experience—five years specifically dealing with risk management in the staffing industry—and is JHSC certified. Through research, Chelsea helps keep members up to date on current legislation involving employer’s rights, and deals with their day-to-day challenges with labour laws. Outside of work, she enjoys spending time with her family, DIY projects, and photography.

Recent Posts by Chelsea Henry

Why Payroll Funding May Be a Better Choice Than a Bank Loan for Your Staffing Agency

Posted by Chelsea Henry


Mar 25, 2019 9:00:00 AM

Why Payroll Funding May Be a Better Choice Than a Bank Loan for Your Staffing AgencyWhere are you getting the money to pay your job candidates? You’ll need to be sure you have the funds to pay them each and every pay period. You may not be able to rely on incoming funds from your clients either. Clients may pay for your services on 30-, 60-, or 90-day terms. They may also pay late.

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You might think a bank loan will be the solution to your problems. With an injection of cash, you’ll be able to keep operating and paying your workers, at least until your clients’ payments arrive.

The bank loan isn’t always the best option. In fact, you may have a better option available in the form of payroll funding.

What Is Payroll Funding?

Payroll funding is designed to help you manage the demands of payroll. Unlike a bank loan, it offers ongoing support.

In the staffing industry, this is incredibly important. Staffing is often a cash-negative business, with salaries and subcontracting accounting for more than 85 percent of operating costs. The more you grow, the more money you’ll need to pay additional workers, and your new clients’ bills may not be due for 90 days.

A one-time bank loan won’t resolve cash flow issues. Even if you think the issues are temporary, the staffing industry is full of twists and turns. You never know what the business cycle is going to throw at you.

Ongoing Funding as You Need It

What are the advantages of choosing payroll funding over a bank loan? The first major benefit has already been covered. It’s the ability to get the funding you need on an ongoing basis.

Bank loans are one-time injections of cash for the business. While they have their place, payroll is an ongoing expense for a staffing agency. A one-time cash injection is like slapping a bandage over a larger cash flow issue.

Funding designed for payroll recognizes this reality. That’s why it’s also flexible, meaning the amount given can increase or decrease alongside your needs. A growing business will need more, while a business facing a slowdown will need less. Payroll funding acknowledges your changing needs.

Banks Back Loans with Hard Assets

When you go to take out a loan at the bank, you’ll likely be asked to provide collateral. If you’re using the money to buy a house or a car, you can provide this with relative ease.

When it comes to getting ongoing financial help with your payroll activities, though, you may not have the assets the bank wants to see. Without collateral, the bank may not give you a favourable interest rate or may reduce the amount of the loan. Some banks may refuse to offer a loan at all.

Banks Don’t Understand Your Needs

This points to a fundamental problem with using a bank loan to fund your payroll activities. The bank just doesn’t understand your staffing agency’s needs.

Bank loans are rigid, one-time use financing options, unlike flexible payroll funding options. Worse, the bank will ask for hard assets to back the loan, which you may not be able to provide.

Finally, the bank is likely to offer you funds and funds alone. They can’t offer you the expert advice a back office service provider offering payroll funding can offer.

If you’re in need of new financing options for your staffing firm’s payroll activities, consider working with a back office provider that offers payroll funding. You may have just found the best solution for your payroll needs.


What Is a Worker Classification Program?

Posted by Chelsea Henry


Mar 11, 2019 9:00:00 AM

What_is_a_Worker_Classification_ProgramIf you hire independent contractors or temporary workers for your business, you must have a worker classification program in place.

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You might ask what the purpose is, and you’ll probably ask why you need one. What does this type of program do?

This guide will help you understand what a classification program is designed to accomplish, and why you must implement one.

The Ongoing Issue of Worker Classification

As the gig economy continues to gear up, work is changing. More people are moving away from the traditional employer-employee relationship. In Canada, self-employment is on the rise.

This changes the traditional workplace relationship. Self-employed individuals are commonly identified as independent contractors, and your responsibilities to them will vary. They are not employees, and you must treat the two classes of workers differently.

The same may be true for other types of employment. For example, temporary or seasonal employees may not be entitled to the same protections as permanent employees. Full-time workers may receive different benefits than part-time workers.

You can see why it’s so important for employers to clearly identify the different classes of workers they employ.

Governments Take Aim at Worker Misclassification

As temporary and contract employment arrangements grow in popularity, it’s become easier for employers to misclassify the people they work with. Governments have been increasingly concerned about this. In the United States, the IRS has initiated a worker misclassification program. The IRS will rule on the classification of an individual at the request of the worker or the employer. Some states have introduced their own legislation and penalties for worker misclassification.

The situation is a little different in Canada, but there’s been growing concerns about the misidentification of worker types. Specifically, there’s concern some employers purposefully misclassify employees as independent contractors in order to put tax burdens on the employees.

In some cases, misclassification is completely accidental. You may believe someone is an employee, but they actually meet the definition of an independent contractor. In this case, you may be paying into programs like Employment Insurance incorrectly.

The situation around part-time, full-time, temporary, and contract employees may also be confused, which can lead to mistakes in your payroll taxes.

The Solution to the Issue

A worker classification program is the solution to the problem. If you hire independent contractors, the best thing you can do is develop a strong classification program.

This program will clearly identify the types of workers you hire. It will allow you to differentiate between types of workers, so you can be sure you’re classifying them correctly.

You must ensure you’re complying with local law. For example, in the US, you’ll want to consult with the IRS’s definitions of employee and independent contractor. The IRS makes clear distinctions in the relationships between contractors and employers, and employees and employers.

If you have control over how a worker completes a job, you likely have an employee on your hands. If the worker can make decisions about the materials, equipment, and even timing of the project, then you’re probably dealing with an independent contractor.

What Happens If You Misclassify a Worker?

As mentioned above, some governments have been taking a stance on employee misclassification. Depending on where you operate, you may face stiff penalties for employee misclassification even if it was accidental.

If you misclassify an employee as an independent contractor, you may be responsible for back payments for Employment Insurance, CPP, taxes, and benefits.

This is why it’s so important to have a worker classification program. There’s a far lower chance you’ll misclassify a worker, which helps you avoid penalties. If you’re unsure, ask for help understanding the regulations in your area and what you can do to ensure you comply with the law.


Topics: Worker Classification

Servicing Clients in the US? 5 Labour Law Differences You Should Know

Posted by Chelsea Henry


Feb 6, 2019 9:00:00 AM

Servicing_Clients_in_the_US_5_Labour_Law_Differences_You_Should_KnowIf you’re running a staffing agency, you may think a great way to expand is to cross the border into the United States. Maybe some of your clients have American branches, or maybe you’re in an area close to the border and know many local businesses that could benefit from your services. You may even be thinking of expanding on a larger scale.

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While international expansion is a great goal for any business, it comes with its own challenges. One of the most common for businesses moving across the Canada-US border is an understanding of labour law.

Labour law in Canada and the US can be quite different. If you’re planning to provide service for clients in the US, you should be aware of these five differences.

1. Understand What a 1099 Employee Is

Employee misclassification is an important legal issue in both Canada and the US. The IRS and many US states tend to shine more of a spotlight on the issue than Canadian governments do.

Part of the problem is the confusion between an employee and a “1099 employee.” A 1099 employee, so named after the tax form you’ll provide them, is actually a contractor. Using a contractor can reduce your obligations to the worker.

Some employers take advantage of these reduced obligations and purposefully misclassify employees as contractors. You might also be at risk of misclassification if you don’t understand the differences between the two terms in the US.

2. At-Will Employment

In Canada, there’s no such thing as at-will employment. You must have solid grounds for terminating someone’s employment with your firm. Termination must be carried out in a specific way, which includes proper notification and the payment of severance.

In the US, at-will employment allows employers and employees to terminate their relationship at any time. Employers don’t need to provide lengthy notice or hefty severance packages. You also may not need as much reason to dismiss someone.

3. Rules around Non-Compete Clauses Vary by State

In Canada, non-compete clauses are somewhat difficult to enforce. Nonetheless, many employers still make use of them. They’re governed by common law.

This is somewhat different from the United States, where non-compete clauses are easier to enforce. The rules change, however, from state to state. Some states will permit the modification of a non-compete clause, rather than striking it out entirely, if it’s deemed too restrictive.

4. Obligations to Employees with Disabilities

You might be familiar with Canada’s rules around accommodating employees with disabilities. Generally speaking, the employer is expected to accommodate an employee with disabilities, such as providing specialized equipment to use or modifying the duties of the role.

It’s difficult to tell where the employer’s duty to accommodate ends. Canadian courts usually draw the line at significant financial burden to the company, but you may be required to prove that.

In the US, you’ll see your financial threshold is much lower. Companies do not need to undertake “significant” financial burden before they’ll be judged to have fulfilled the duty to accommodate.

5. Creating a Severance Policy or Package

In the United States, you might be expected to create a severance policy or package for your employees. This can be quite different from Canada because severance is usually laid out within provincial law. Even having a policy or package may not override your obligation to provide notice of termination.

In the US, where at-will employment exists, employers don’t necessarily need to provide severance or notice. A severance policy usually favours more senior employees, but you may need to know your way around such policies to provide proper support to your clients.

These are just some of the differences between Canadian and American labour law. There are many more. If you’re expanding into the US, it might be helpful to work with a back office solutions provider who can give you the guidance and the support you need to deliver services to your US clients.


Topics: Compliance and Legislation

How the Gig Economy Is Helping the Staffing Industry Grow

Posted by Chelsea Henry


Jan 23, 2019 9:00:00 AM

How_the_Gig_Economy_Is_Helping_the_Staffing_Industry_GrowTemporary employment has become more common in the last 30 years or so. However, it’s only been in the last decade that people have discussed what’s known as the gig economy.

The gig economy, at first glance, looks a bit like temporary staffing. In it, workers move from job to job or task to task. They may work for a series of employers, one after another, or they may work for a number of different employers concurrently.

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The difference is that in the gig economy, more workers are choosing short-term employment opportunities. It’s also spreading to more skilled professions, such as IT and healthcare. Finally, the gig economy comes with benefits many workers are seeking, such as increasing variety, more freedom in terms of assignments and job types, and even more flexibility in terms of schedules.

The gig economy has also had significant impacts on the staffing industry.

The Staffing Industry Is Equipped for the Requirements of Gigging

As mentioned, the gig economy looks very similar to temporary employment. It does have a fair amount in common with the idea of temporary work. Workers are offered time-limited roles or hired on an as-needed basis. They’re assigned tasks, and when those tasks are completed, they may have the opportunity to re-sign with the employer or move on to the next gig.

Complex legal requirements apply, and the staffing industry has the experience and expertise to help both workers and companies maneuver through this potential legal minefield.

There’s also an increasing focus on finding the right talent. As mentioned, the gig economy encompasses more skilled workers. The staffing industry already has experience finding those workers and matching them with employers.

Helping Clients Adjust to the New Economy

Many employers aren’t equipped to deal with the new demands of the gig economy. As already demonstrated, they may not be ready to deal with the legal demands of hiring contract workers or the administrative burden of bringing on temporary employees.

Many employers are also unaware of what these types of workers are looking for. They may believe most people are still wedded to the idea of a steady 9-to-5 job. In reality, more workers are looking for increasing flexibility. They’re happy to work remotely or have flex hours that allow them to work when it suits them.

Staffing agencies help their clients adjust to these new realities by keeping up with trends and providing valuable expertise and insights. This, in turn, makes their services more valuable.

Helping Workers Find Gigs

Staffing agencies can also assist those who are looking for their next gig. As a result, many agencies are noting an increasing number of candidates who stay on the roster. In the past, permanent staffing meant a candidate was unlikely to stay in your database. Temporary positions were often limited to general labour and administrative positions.

Talented and highly trained individuals are now more likely to stay on your roster of candidates for a longer time. They may be willing to accept more than one job at a time as well, provided the gigs can work together.

As the gig economy continues to grow, both employers and workers are turning to the staffing industry to find each other.


Topics: Staffing Industry

How the Wrong Funding Option Could Be Costing You Money

Posted by Chelsea Henry


Jan 2, 2019 9:00:00 AM

How_the_Wrong_Funding_Option_Could_Be_Costing_You_MoneyEnsuring you have the right funding is crucial to keeping your operations afloat. This is especially true for a staffing agency owner. Whether you’re just starting out or you’re in the middle of expanding your business, the right funding options will keep the cash flowing and your business growing.

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The wrong funding option, on the other hand, could be costing you money, in addition to causing other problems within the business. Here’s how.

The Wrong Funding Adds to Your Bills

If you opt to take out a bank loan, you could actually end up adding to your bills without giving your business the liquidity it truly needs. A loan may seem like a great idea at first, but it deposits a lump sum into your account. Once the money is used, you’re on the hook for paying it back with interest.

This isn’t a long-term solution for a business trying to improve cash flow. Instead, the loan injects cash into your business on a one-time basis and then becomes yet another financial burden for you to manage month to month.

Interest and Debt Pile Up

It should be obvious how a loan can add strain to your finances, particularly if your cash flow is upside down. In the staffing industry, this scenario is all too common.

Once the cash is gone, you have a debt to pay, coupled with mounting interest payments. If your cash flow is uneven, you may find yourself torn between paying the interest on the debt or funding payroll. You might even be tempted to take on more debt to meet all of your financial obligations.

This could mean the financial situation within your business becomes worse instead of getting better, even with the additional funding.

There Are Other Funding Options

Many business owners choose bank loans because they believe this is the only option for them. This isn’t true.

You have plenty of options as a staffing agency owner. A bank loan might be just one of many options available to you, and in many cases, it may not be the right option for your business.

Explore other options to find the right funding for your business.

Are You Getting the Right Funding?

If you’re not sure you’ve picked the right funding option for your staffing agency, you can talk to the experts. They’ve helped many other businesses like yours, and they know what options are available.


Topics: Staffing Agency

5 Signs You Need to Update Your Staffing Agency Software

Posted by Chelsea Henry


Dec 19, 2018 9:00:00 AM

5_Signs_You_Need_to_Update_Your_Staffing_Agency_SoftwareTechnology is one of the main drivers of change in the workplace today. Initially, new technologies may be adopted to make certain tasks faster and easier. Over time, however, technological innovations can completely revolutionize the way you do things.

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Take a look at staffing agency software, like applicant tracking systems. Initially, these software tools were brought into staffing firms to make the task of sorting applications and selecting the right candidates easier. Now they’re an indispensable part of the hiring process, even guiding screening, interviewing, and the writing of job descriptions.

The problem with software, of course, is that rapid innovation means it quickly becomes outdated. Most staffing agencies can’t afford to update their software every year or two, so they try to manage with what they have as long as possible. This strategy can make sense, but it can also leave you using outdated software long after it’s stopped being useful.

If you notice any of these five signs, it’s time to update your software.

1. The Staffing Agency Software You Use Is Obsolete

This is probably the best indication you need to update your software. The company that made it has since sunsetted the product, or they may not even exist any longer.

While your software may continue working for now, it’s only a matter of time before it ceases to be functional. Whether it’s an operating system update or the new hardware of the future, this relic of a program won’t be able to keep up.

Save yourself some headaches and make a switch now.

2. The Software Is No Longer Meeting Your Needs

When you purchased it, this program did everything you needed it to do. This isn’t the case any longer.

This can happen for a few reasons. It may be the software is old and outdated. It could also mean your firm has outgrown it and you require a more robust platform to keep up with your demands.

3. You’re Having Trouble Integrating with Other Systems

Perhaps one of the best signs you need to update the software you’re using in your staffing firm is incompatibility. Your program just won’t connect with the systems your clients and suppliers are using.

This is cause for concern. Part of the reason you use software is to ease tasks like the transfer of data. If the program isn’t meeting these expectations or it’s causing more headaches than it’s solving, it is most definitely time for an upgrade.

4. Newer Software Has More Features You Need and Want

New software incorporates new tools and features. As technology progresses, older tools are updated, tweaked, improved, and even adapted into new features and tools.

While this isn’t a reason to update on its own, it will eventually mean your program no longer has features considered essential to running a staffing firm efficiently. Take the applicant tracking system. A decade ago, these programs were considered state of the art. Today, the software you were using in 2008 would hardly perform all the functions you need.

You don’t need to spring for every bell and whistle on a top-of-the-line program. Just make sure you have what you need.

5. No One Knows How to Use It

Software is improving all the time. Remember when people had to know MS-DOS or another programming language to even use a computer?

An updated program may be easier and more intuitive for your staff to use than older programs. If the one person who knew how to use the program has left, it’s definitely time to upgrade.

Staffing agency software plays an integral role in your agency’s operations. Make sure you keep operations running smoothly by keeping software up to date.


Topics: Staffing Agency

5 Reasons Staffing Agencies Need to Adjust to Fit a Millennial Workforce

Posted by Chelsea Henry


Dec 17, 2018 9:00:00 AM

5_Reasons_Staffing_Agencies_Need_to_Adjust_to_Fit_a_Millennial_WorkforceIn recent years, much has been made about how the millennial workforce is changing traditional ideas about work. This generation appeared to many as one that was rewriting what work meant and how it was conducted. While many saw negative aspects of this shift, others saw quite a few positive trends.

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At the core, millennials want many of the same things their predecessors wanted from work. Their ideas about how to achieve them and even about what makes a good workplace, however, can seem quite different.

Millennials now make up a large portion of the workforce, and as more boomers and Gen Xers retire, millennials will continue to move into more senior roles and occupy a larger percentage of the workforce. Staffing agencies would do well to take note of these five changes and adjust their operations to fit this new workforce reality.

1. Staffing Agencies Can Help Millennials Find Flexible Opportunities

One of the greatest strengths staffing agencies have is their alignment with flexible work opportunities.

Millennials have a very different attitude to work than earlier generations. They value flexibility, which allows them to work when it suits them. For some people, this means they prefer to work at certain times of the day. For others, it might mean working at one job opportunity for a few weeks or months, then taking some time off.

Staffing agencies align well with this desire for more flexible working arrangements.

If you haven’t started offering contract roles yet, this may be the best time to start.

2. Millennials Want Meaningful Work

One way staffing agencies will have to adjust to the millennial workforce is by shifting the focus to meaningful work. Millennials put emphasis on the need to have a job that means something to them and a job that aligns with their values. They want to feel like what they do matters. If the agency cannot offer these kinds of jobs, they may go elsewhere.

By focusing on cultural fit, agencies can help millennial workers find not only the right jobs, but jobs that mean something to them.

3. Satisfying a Craving for Stability

Many people believe millennials are very different from earlier generations. In some ways, they are. In other ways, however, they’re very similar to boomers and Gen Xers.

One similarity is the desire for stability. Workers want to be assured their job will be there in the morning.

As the gig economy grows, partnering with a staffing agency could give millennial workers the sense of security they crave. Agencies may be able to provide contracts and opportunities on a more regular basis.

4. Can Agencies Answer the Call for Benefits?

Another thing millennial workers want is good employee benefits. This is very similar to earlier generations. At the end of the day, workers want many of the same things, no matter which generation they’re from.

Employers have been rolling back benefits, and the age of temporary and contract work has seen the number of workers with employer-sponsored benefits shrinking. Could staffing agencies be the answer?

Offering benefits could be one way to attract more candidates to your agency and convince them to stay with you.

5. Millennials Seek Opportunities to Learn and Grow

Agencies are also in a prime position to help millennial workers continue learning and growing in their careers. Many millennials want job opportunities that also function as learning opportunities.

By shifting your focus to emphasize the learning opportunities available with different positions, you could create more appeal for millennial workers pondering a staffing agency partnership.

In short, millennials will soon be the driving force of labour. Staffing agencies will need to adjust their approach to meet the expectations and demands of the workforce as the world of work continues to be transformed.


Topics: Staffing Agencies

Is Your Staffing Agency Compliant?

Posted by Chelsea Henry


Nov 21, 2018 9:00:00 AM


Is_Your_Staffing_Agency_CompliantAs a staffing agency owner, there are many tasks you need to look after. The administrative work of the agency is often a full-time job. If you’re busy enough, it may even be enough to keep two or three people occupied on a full-time basis.

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One of the most time-intensive tasks you need to look after is compliance within the agency. Staffing firms need to remain compliant with all of the rules and regulations around employment, including safety laws, legislation regarding vacations and leaves, and so much more.

Compliance is more important than ever before, partially because of an overhaul of provincial employment legislation. Several provinces have made major updates to their legislation in the past 12 months, and it seems likely more changes are coming.

As these changes come into play, it’s a good time to take stock of compliance in your organization.

Is Your Staffing Agency Insured?

One of the first things you’ll want to look at is your insurance needs. Most agencies require general liability insurance, which protects you if something goes wrong at the worksite, or if a client suffers damages or losses and decides to sue.

You might also want to look into specific types of business insurance, which can help you protect your agency in a number of different scenarios. One example might be commercial auto insurance if employees drive company vehicles.

You should also be working with the workers’ compensation board in your province or provinces of operation. You’ll want to be sure you’re making applicable contributions from payroll to cover insurance in the case of a worker accident or injury. This is all the more important in light of new rules about your legal liability in these situations.

Are You in Line with All Pay Requirements?

There have been many changes to things like minimum wage, vacation pay, and holiday pay in some provinces recently. Now is a great time to check and ensure your staffing agency is still complying with all the of the rules.

Ontario, for example, introduced a new holiday pay scheme in early 2018. This was rolled back in May 2018. The new provincial government is supposed to study the issue and make recommendations, so the formula for calculating holiday pay in Ontario may be changing again.

If you’ve recently expanded to a new province, you’ll want to be sure you’re in line with their regulations about calculating various types of pay.

Are You Offering Training?

Most provinces have requirements for you to provide some forms of training to employees, and training requirements may vary from job site to job site. You should be providing all candidates with information about their rights, safety measures they should be taking, and how to deal with an accident or injury.

This kind of information is especially important for young and vulnerable workers who may need additional support.

Compliance is clearly an important part of running a successful staffing agency. Keep an eye on it, and you’ll be in a better position.


Topics: Compliance and Legislation

Independent Recruiters: 4 Smart Reasons to Offer Contract Staffing Services

Posted by Chelsea Henry


Sep 26, 2018 9:00:00 AM

Independent_Recruiters_4_Smart_Reasons_to_offer_Contract_Staffing_ServicesThe need for temporary staffing services has been growing exponentially in Canada. More and more employers are shifting away from permanent positions to more flexible arrangements. With the gig economy now in full swing, employers and workers alike are thinking short term.

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Independent recruiters are likely aware of this shift, since it affects their business. As more of your clients look to temporary and flexible staffing solutions, you may have found many of them leaving you for larger agencies. Those who remain may have fewer positions for you to fill, and new customers may be few and far between.

It might be time to start offering contract staffing services to your clients. Here are a few smart reasons to offer this service.

1. Your Clients Want This Service

Perhaps the best reason you should offer contract staffing services is that your clients are asking for it. Their staffing needs are changing, and they’re moving away from permanent placements to more flexible solutions.

If you don’t offer contract staffing solutions, your clients may start looking elsewhere. They might be going to your competition or working with large agencies. They may eventually turn to these agencies for all of their staffing needs, including any permanent positions they have.

Offering contract staffing solutions gives your clients the flexibility they need.

2. It Represents a Growing Opportunity

Another good reason to offer temporary staffing services is that it represents a growth opportunity for your business. If you don’t offer contract staffing already, you’d be adding to the services you can offer your clients.

This is a growing area. Many businesses are looking for contract staffing services. Not only will your existing clients be happy to hear you can now fulfill these needs, in addition to their permanent staffing requirements, but you may find some new clients as well.

As the gig economy continues to grow, the demand for contract staffing services will likely continue to grow apace. If you want to grow your business, adding contract staffing services is a great idea.

3. You Can Compete More Effectively

Most independent recruiters offer permanent staffing solutions for their clients. While you may think this keeps you from competing directly with large agencies offering contract staffing services, you are still competing with them at the end of the day.

This is because most large staffing agencies also offer permanent placement services. Your clients may eventually go to the larger agency with all their hiring needs.

If you want to grow your business and keep your clients, you’ll need to go toe to toe with these large agencies. While independent recruiters have several advantages for clients, offering the same or similar services as your competitors can make your business more appealing to prospective clients.

4. It’s Easy to Do

Another great reason to offer temporary staffing services to your clients is that it’s relatively easy to do. You’ll want to review the legal requirements and ensure you have all of the documentation in place before you begin offering this service, but you can do it effectively.

Some of the most time-consuming and intensive parts of shifting to contract staffing services can be the back-end tasks and administration. With contract staffing, you may be responsible for tasks you didn’t previously handle, such as payroll administration, employee classification, and more.

This is what holds most independent recruiters back from offering these services. With the right back-end office solution, however, you can easily look after these additional tasks. Take advantage of a service provider’s existing infrastructure, and begin offering your clients great contract staffing services today.

Offering contract staffing solutions is a smart move for so many reasons. With the right help and support from a back office services provider, you can begin competing more effectively and offer your clients better service than ever before.

Unlock a Lucrative Revenue  Stream With Contract Staffing

Topics: Independent Recruiters

What Staffing Firms Need to Know about the Pay Transparency Act

Posted by Chelsea Henry


Sep 12, 2018 9:00:00 AM

What_Staffing_Firms_Need_to_Know_about_the_Pay_Transparency_ActThe former Ontario government made many changes to labour laws before being voted out of office in June. One of the most talked-about pieces of legislation was 2017’s Bill 148. This legislation introduced many changes, including revisions to holiday pay. It also raised the minimum wage.

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In March 2018, the provincial government enacted another controversial piece of legislation designed to change labour laws. This bill passed in the House and became known as the Pay Transparency Act.

What is the Pay Transparency Act?

This Act is designed to create more transparency about how employers compensate their staff. The goal of the legislation is to give people more clear information about wages, which will then allow them to challenge unfair practices and cases of discrimination.

Like the changes in Bill 148, the Pay Transparency Act will also affect staffing agencies and how they operate. Here’s what you need to know.

What Does the Pay Transparency Act Do?

This Act, which will come into effect in January 2019, requires a few changes to the way employers and staffing firms advertise jobs. The first change is a new requirement to post a salary range on any job advertisement. The reason for this is to create a public record, which job candidates can then refer to. Employers must offer candidates salaries within the stated range.

Under the Act, employers will also be prohibited from asking candidates about their past salary history. The reasoning is that what someone has been paid in the past should not affect what a current employer is willing to pay for the position.

Workers have new rights under the Act as well. Employers will no longer be able to take action against staff who discuss or disclose their salary. In the past, many employers had non-disclosure agreements built into their employment terms, and they could take disciplinary action against employees who discussed wages.

How Does It Affect Staffing Agencies?

There are a few very obvious effects the Pay Transparency Act will have on the way you operate your staffing agency. The first is that you’ll need to revise any and all job postings to include a salary range. You’ll need to get this information from your clients.

The next change may be to questions you ask during screening interviews. You’ll no longer be able to ask about previous compensation. If you ask about salary history as part of your screening or interviews conducted on behalf of your clients, you’ll want to remove these questions now.

Finally, staffing firms will need to review employment contracts and remove any language about reprimanding staff who disclose or discuss salaries. Non-disclosure agreements will need to be removed or made non-applicable to salary information. If your clients supply the contract, you’ll need to review it.

More Changes on the Way

There is another requirement employers will want to pay attention to, and that’s the reporting requirement of the Pay Transparency Act. Beginning in May 2020, organizations with more than 100 employees will need to monitor pay gaps and report on them.

The reporting requirement is probably the most daunting task, since it requires employers to keep track of yet another payroll factor. Staffing firms, which often employ more than 100 people, will almost certainly be affected by this requirement.

Is the Pay Transparency Act Necessary?

Many people are unhappy about the Act, feeling it adds undue burden to employers’ already heavy workloads. People also point to equal pay laws and non-discrimination legislation on the books in Ontario.

Others feel the Pay Transparency Act, which is the first law of its kind in Canada, is necessary if pay gaps are to be eliminated.

For now, employers and staffing firms alike should be prepared to implement the changes required by the Act. The provincial government may decide to review and amend the law, but for now, you may want to get a helping hand with reporting and other tasks.

Everything You Need to Know about Starting a Successful Staffing Firm

Topics: Compliance and Legislation

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