By Judy Collins | Wednesday June 29, 2017
Enjoy your time off this summer and still make money with a temp and contract placement. Your initial effort making the placement is rewarded with a continuous income stream for the duration of the assignment. While not the big payout of a direct placement, temp and contract placements offer smaller payouts over a period of time. This can be useful for supplementing your income between direct placement payouts. Even though temp and contract placements provide smaller payouts than direct placements, they can add up to significant sums. This provides a cushion to carry you between direct hire payouts.
Most temp and contract placements are priced on an hourly pay rate and bill rate. Some things you must know include: how much does the employee have to make (the pay rate) and what is your payroll burden. Your payroll burden will include expenses to cover Workers’ Compensation and other required insurances, matching employer taxes, state and federal unemployment, and any other mandated fees and taxes, including healthcare and paid time off. Payroll burdens can vary between different cities and states. This will determine the percentage you must mark up the pay rate to determine the bill rate. It is important to know the above expenses before you quote an hourly bill rate to your client. Also determine whether the employee is eligible for overtime. If so, the bill rate will have to reflect the additional charges. If you use a third-party vendor they will help you calculate your hourly profit based on your mark-up. It is important to know how much profit you will make per hour worked by the employee.
A third-party vendor can also ensure that the time card is received, the employee is paid for all hours worked, and your client company is invoiced. This happens even while you are on vacation! If you choose to handle payroll in-house, make sure someone is there to over-see these responsibilities. It is imperative that payroll goes out on a timely basis.
One of the main advantages of temp and contract placements is that you still have an income while on your time off. Temp and contract placements also provide diversity of income to carry you between direct placement payouts. Knowing your expenses, you can predict your profits. Follow these guidelines and you can STILL MAKE MONEY WHILE ON VACATION…WITH TEMP AND CONTRACT PLACEMENTS!