Navigating Contingent Labor: Employer of Record or Staffing Agency?

Are you feeling the effects of the ever-changing world and economy in your workforce? So are others, in fact, we’ve found the need for contingent labor is only increasing for organizations. In a recent survey by SIA, from those surveyed, 65% said they would “increase their reliance on contingent workers in the next two years”. Even more shocking, of the respondents, 92% said “workforce challenges such as employee attraction, engagement, and retention – in addition, compliance complexities – are creating risks to organizations in terms of their ability to achieve their goals in the next year”.

These are huge numbers to pay attention to and tell us a few things. First, you’re not alone. We have all been impacted by the chaos that we call the last 4 years, and we are all together navigating this new normal. Second, partnering with contingent labor experts to support your business operations is a tremendous way to transform your organization.

That all being said, it’s crucial to find the right services you need to fill the gaps your company is facing. Two that we want to discuss today are employer of record and staffing agency. While they both impact contingent workers their functions are very distinct from each other.

what is an employer of record?

An employer of record (EoR) is a company that legally employs workers on behalf of another business. An EoR takes full responsibility for all aspects of employment including compliance, onboarding, payroll, taxes, and & other HR functions like benefits.

An EoR is key for companies who may be looking to alleviate administrative burdens so you can focus on the strategic growth of your organization, while often reducing costs. When it comes to engaging with contractors, it’s important that you are completely looped into all the unique laws and regulations that come with temporary workers to avoid being penalized and fined.

what’s the difference between EoR and a staffing agency?

A staffing agency can oftentimes be used synonymously with any organization that provides contingent labor services. However, a staffing agency’s primary focus is being the recruiting power.

A staffing agency helps you find talent that fits the needs of your business. They discover qualified candidates, run interviews, and then hand them over to your organization. Staffing agencies are helpful when you have large projects or reoccurring assignment needs. They’ll work to understand your business values as well as tactical job-specific skill sets to ensure you’re getting the right people in the right positions.

let’s wrap it all up

Understanding what options are available to you when it comes to your temporary staff is extremely important in developing an effective and scalable program. What’s even better? Populus Group can help you with both being an employer of record & supplementing or completely supporting your recruiting needs. Not to mention we can also support Independent Contractor/1099 classifications or engage with foreign nationals.

Reach out to us if you would like to discuss what areas your organization might benefit from contingent labor services. Fill out the form below, and let’s connect and grow together!