By Judy Collins  |    Wednesday June 1, 2017

Category: Contracting, Expert Advice


When an existing or new client calls to fill a temp or contract position, what questions do you need to ask before accepting the assignment? These questions will determine the mark-up of the payrate to ensure your profit margin. You need the answers to these questions before you start the search:

First, ask the Job Title and Description of the work to be performed. From this information, you can determine the Workers’ Compensation Class Code. Check with your insurance carrier to make sure that you can cover this position. The rates can vary significantly by Class Code, which will impact your mark-up.

Second, ask in what state the work will be performed. Are you or your back-office provider set up to withhold taxes in this state? Are there any special requirements or regulations which ap-ply? Certain cities and states have special laws which govern workers in these venues. In certain cities and states, for example, there are special regulations which must be followed. These reg-ulations have a significant cost impact. There are employer mandates to contribute a portion of medical benefits after a certain number of hours worked. The employee must be covered under Workers’ Comp in the state in which they are working.

Third, is the position overtime-exempt or will you be invoicing your client time-and-a-half for any overtime? In some states overtime is considered any hours over eight worked in one day, while most states define overtime as any hours starting at over forty worked in a week. Let your client know that you will be in compliance with all state and local hour and wage requirements.

Fourth, what is the payment schedule? Are your invoices due upon receipt or on a 30, 60 or 90-day receivable schedule? Sometimes, if bank financing is involved, lenders will not fund if the receivable schedule is too long. Are you prepared to assume this financial burden?

Fifth, what are the insurance requirements in addition to General Liability? Does your client have any special endorsements? Some of these endorsements could include: being named as Additional Insured, Waiver of Subrogation, Errors & Omissions, and/or Crime/Theft coverage. Does your client need a copy of your certificate of insurance with proof of coverage before the position starts?

Sixth, will you be working with a vendor management company? You need to be aware of the service fees vendor management companies will charge. These fees typically may range from 2 to 6% of the pay amount. You will want to take this into consideration before proceeding. Care-fully read over their contract to understand special provisions which will affect your profits.

Summarizing, this may seem daunting at first, but once you are familiar with the process, plac-ing people through contract staffing can be a smooth and orderly…and profitable opportunity. Work with a third-party back-office provider to help you navigate through the necessary ques-tions to ensure a successful contract staffing placement. Know the QUESTIONS TO ASK…ABOUT CONTRACT STAFFING and increase your success!


Judy Collins

Evergreen Contract Resources

713-297-5808 – Office

713-858-2677 – Cell

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