Test every important contract term three ways. What exactly is included, who is responsible for it, and what happens if it does not go to plan. An agency that can answer all three for each term in writing is describing a working arrangement rather than a sales promise.
The questions to ask a staffing agency before signing are not really about price. They are about working out what you are buying and what you will actually pay. They are also about who carries which obligations, and what happens when a placement or the relationship itself does not work out.
Most of the difficulty comes from one structural fact. Staffing agreements often cover several hiring models at once, and temporary staffing and permanent recruitment are different arrangements with different commercial and employment consequences. A clause written for one can read as though it applies to the other. This guide covers the questions that separate them and what sits inside a bill rate. It then looks at how conversion clauses work, who the employer of record is, and how the agreement ends.
Confirm Which Hiring Models The Agreement Actually Covers
The first of the questions to ask a staffing agency is which models the document in front of you actually covers. Agencies frequently present one master agreement spanning temporary, contract, permanent and seasonal hiring. That is efficient to administer and easy to misread.
Hiring model | Who employs the worker | How you pay |
Temporary staffing | The agency | An hourly bill rate for hours worked |
Contract staffing | Usually the agency, for a fixed term | An hourly or daily rate for the term |
Permanent placement | Your organisation | A one-time placement fee |
Executive search | Your organisation | Fee structure that may differ from standard placement |
Ask the agency to identify, clause by clause, which terms apply to which model. The fee schedule, guarantee, conversion rules and termination provisions frequently differ, and a document using the word placement throughout without distinguishing them is worth having reviewed.
Info: Ask whether a separate schedule exists for each hiring model. Agencies that work across several models usually have them, and a master agreement with model-specific schedules is easier to read than one document trying to cover everything in general language.
Ask What Is Inside The Bill Rate, Not Just The Number
Among the questions to ask a staffing agency about money, this one does most of the work. For temporary and contract staffing, the hourly figure quoted is not the worker’s wage. It contains the wage, the statutory employment costs the agency carries as employer, and the agency’s margin.
Two agencies quoting different rates may be dividing those three parts very differently, which means the lower quote can cost more over an assignment.
Questions That Make Two Quotes Comparable
- What hourly wage will the worker actually receive for this role?
- Which statutory employment costs are included in the quoted rate?
- How are overtime hours billed, and at what multiple?
- How are statutory holidays handled?
- Are premium rates applied to evening, overnight or weekend shifts?
- Is there a minimum billable period per shift or per assignment?
- What is invoiced if a worker is sent home early or an assignment is cancelled late?
The last two produce more invoice disputes than the headline rate does. An agency billing a four-hour minimum when you expected two is not overcharging if the agreement says so.
Conversion Clauses Decide What Happens When A Temp Works Out
The best outcome of a temporary assignment is often that you want to keep the person, which is why the questions to ask a staffing agency should include this one early. The conversion clause decides what that costs, and it is the clause employers read least carefully.
Establish four things in writing.
- How many hours or weeks must a worker complete before conversion carries no fee
- What the fee is if you convert earlier, and how it is calculated
- Whether the clause survives the assignment, and for how long after it ends
- Whether it applies if the person later applies independently to a public posting
That last point is the one that surprises people. A broadly drafted clause can capture a candidate who approached you months later through your own careers page. The time to narrow it is before signing rather than when the invoice arrives.
Note: Ask how the conversion fee changes with assignment length. Many agreements reduce it as the worker completes more hours with you, reflecting that the agency has already earned margin on the assignment.
Establish Who Is The Employer And What That Leaves With You
In temporary staffing, the agency is generally the employer of record, handling payroll, source deductions and statutory employment obligations. That does not transfer everything away from you, which makes this one of the questions to ask a staffing agency worth asking in writing.
Obligations Check
As the business controlling the workplace, you retain health and safety responsibilities for the people working in it, including orientation, hazard information, supervision and incident reporting. Ask the agency which obligations they carry, which remain with you, and get that split in writing rather than inferred.
Insurance Check
Ask what insurance the agency holds and request current certificates. Ask also about licensing, since requirements differ by province. Ontario operates a licensing regime for temporary help agencies and recruiters, with obligations that reach the employers engaging them. This is a major check when choosing a GTA recruitment agency.
Note: Confirm the current position for your province before relying on any of it, since these rules have changed in several jurisdictions in recent years.
Agree The Exit Terms Before You Need Them
Termination clauses attract the fewest questions to ask a staffing agency and matter most when a relationship is already strained.
- Settle the notice period each party must give, and what happens to workers on assignment when notice is served.
- Establish whether you can end the agreement without ending active assignments, and what final invoicing then applies.
- Ask what happens to the records. Timesheets, assignment history and placement documentation may be needed long after the relationship ends, and knowing what you receive on exit is easier to agree while everyone is still enthusiastic.
- Also ask what the guarantee period is for permanent placements, what triggers it, and whether it provides a replacement, a credit or a refund.
Final Thoughts
The questions to ask a staffing agency before signing come down to four things. What you are buying, what you will pay, who is responsible, and what happens when something goes wrong.
Start by establishing which hiring models the agreement covers and which clauses apply to each, because temporary staffing and permanent placement are different relationships and one document often covers both. For hourly work, ask what sits inside the bill rate rather than comparing quoted numbers, and settle overtime, statutory holidays, shift premiums and minimum billing before the first invoice. Read the conversion clause properly, including how long it survives an assignment. Then get the employer of record split in writing and agree the exit terms while the relationship is new.
Next Employment provides temporary, contract, permanent and seasonal staffing for Ontario employers. Get in touch to discuss your hiring requirements and how our agreements are structured.
Frequently Asked Questions
What Are The Most Important Questions To Ask A Staffing Agency?
Which hiring models the agreement covers, and what sits inside the bill rate. How conversion from temporary to permanent is charged, who is the employer of record and which obligations remain with you, and what notice and final invoicing apply when the agreement ends.
Why Can Two Staffing Agencies Quote Very Different Hourly Rates?
This is one of the questions to ask a staffing agency that saves the most money. A bill rate combines the worker’s wage, the statutory employment costs the agency carries and its margin, and those three divide differently between agencies. A lower quoted rate can cost more across an assignment once overtime, premiums and minimum billing are applied.
What Should A Temp-To-Perm Conversion Clause Specify?
How many hours or weeks the worker must complete before conversion is free of charge, and the fee if you convert earlier. It should also state how long the clause survives after an assignment ends, and whether it applies to someone who later applies independently through your own job posting.
Who Is The Employer Of A Temporary Worker?
In temporary staffing the agency is generally the employer of record, handling payroll, source deductions and statutory employment obligations. The business controlling the workplace retains health and safety responsibilities including orientation, hazard information, supervision and incident reporting, so confirm that split in writing.
