Temp Employment Agencies

Before looking for temp employment agencies, you need to understand your companies needs and understand the reason you would want to use a temp staffing service. Some of this is covered previously on our page on finding the best temp agencies. To help understand how best to work with temp employment agencies you need to look at 3 things, costs, benefits and how to use one successfully.

Costs of Temp Services

Before tackling this issue, let's get a definition of a temp service. A temporary employment agency provides people to a company for a fee. Those people are hired and employed by the temp agency but work at the client site and are directed in their day to day work by the client. There is in effect a co-employment relationship.

Temp Employment Agencies

Now moving on to the cost. Temp agencies are paid to find and place people at a client's work site. They are responsible for payroll and HR administration. Therefore, the client hiring that employee pays fees for these different services. The fee is rolled up onto one fee and you are billed for each hour the employee works. This fee paid over and above the hourly rate is called a markup rate or when it is an all inclusive rate including the hourly rate it is called a bill rate.

Benefits of Using Temp Employment Agencies

There are a number of benefits to using temp employment agencies and here are a few;

  • No Payroll Fees or Payroll Taxes
  • No HR Administration or benefits administration
  • No dealing with wage garnishments, unemployment claims and dealing with employee related paperwork issues
  • Try before you buy - called a Temp to Hire where the employee works for you for a short time and is converted over if they prove to be good employees
  • Easily handle short term or seasonal increases/decreases in work
  • Cover for employees out for periods on disability or other temporary leave.

These are just some of the benefits of using a temp agency.

How to Use a Temp Service Successfully

There are 2 ways to go with temp services, you can hire one that is a local generalist and can fill a variety of positions or you can find a specialty agency that can find you a lot of type of person. To be successful you need to know what you need in a temp service.

Using a Local or Regional firm

Local or regional agencies are often more generalists and are usually smaller agencies, with more flexibility and are locally focused. They know the local markets and are keyed in on employment trends of the local market. Here's a summary of the benefits of using a generalist temporary staffing agency;

  • Higher Cost - competitive but not the lowest.
  • More time - Time to fill a position is not as fast
  • More Personalized - Likely have access to the owner or general manager of the agency.
  • Better Local Knowledge - They often know more about the general local employment environment
  • Better Communications - They are also far more likely to get to know your business and really understand the culture in your company to give you better matches for your positions.
  • More Flexible - Having access to decision makers can result in 'outside-the-box' solutions, even if you have specialized needs in your business.

Using a Specialist

Specialists are more likely to be larger companies with separate divisions. For instance many national chains now have a division that does clerical, legal, technical, light industrial and so on. This means each of those divisions has people who specialize in finding just that type of talent. Here are some of the benefits of using a specialized service;

  • Quicker Placement - Set up to put people to work very quickly.
  • Lower Cost - Though the savings are not a great deal, if there are large numbers of employees, the savings can be real.
  • Volume Placement - Designed to deliver more bodies faster to a job.
  • Multiple Agencies - If you have a wide variety of positions to fill, you will be dealing with multiple agencies or divisions

Summary

If you need lots of bodies to put to work and cost or time is your biggest driving factor, the larger specialized firms are the way to go. If you need personalized service and 'fit' is important to your company as well as function, the stick with the smaller local temp employment agencies.

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