Compliance with local, state, and federal employment laws is vital to any organization’s well-being.
Staffing agencies are a great resource for organizations, especially when it comes to navigating complex compliance requirements. Staffing agencies bring expertise in managing the intricacies of the administration of employment, including compliance with employment laws, tax obligations, provision of workers' compensation and unemployment insurance, and benefits administration. By handling these aspects, staffing agencies help reduce the risk of compliance errors and costly legal issues. Additionally, they stay up-to-date with evolving regulations, ensuring that businesses remain in line with changing laws. For many organizations, partnering with a staffing agency provides peace of mind, knowing that their workforce management is in capable hands.
For these reasons it’s important to understand how reputable staffing agencies operate and the key elements to look for when evaluating a staffing partner.
The Form I-9, or "Employment Eligibility Verification" form, is a document that ensures employers in the United States are hiring individuals who are legally authorized to work. It verifies both the identity and employment authorization of each new hire, regardless of their citizenship status. This step is required for every employee, making it an essential part of the hiring process for all U.S. employers. For companies looking to simplify and streamline this process, staffing agencies like Eastridge can be a game-changer. As the employer of record for temporary workers, Eastridge handles the entire I-9 verification process, taking the compliance burden off your shoulders and allowing you to focus on what you do best—running your business. This not only helps ensure you stay compliant but also saves time and reduces the risk of costly errors.
E-Verify is a web-based system used by employers to verify the employment eligibility of their employees. It compares information from an employee’s Form I-9 against records in the U.S. Department of Homeland Security (DHS) and Social Security Administration (SSA) databases to ensure employers are hiring individuals who are legally authorized to work in the United States. The program helps ensure that employers comply with federal employment eligibility requirements. Partnering with a staffing agency, like Eastridge, that uses E-Verify ensures compliance with high employment eligibility standards. Eastridge is an E-Verify employer for all its employees nationwide, regardless of state laws. This proactive approach helps protect the staffing agency and its clients by mitigating risks associated with unauthorized employment.
Compliance with worker classification laws is another key factor when evaluating a staffing partner. Staffing agencies should primarily classify workers as employees (W-2), rather than independent contractors (1099). The distinction is significant:
Misclassifying workers as independent contractors (1099) is a common issue, often due to a lack of understanding of the governing rules or, in some cases, an intentional attempt to avoid tax liabilities. Some staffing firms misclassify workers as 1099 independent contractors to reduce tax burdens and other obligations, a practice that can lead to IRS audits and hefty penalties. At Eastridge, we exclusively employ W-2 employees and handle the full scope of employment administration for our clients.
Staffing agencies typically charge a markup on an employee’s hourly wage, which covers additional costs beyond the worker’s pay. These costs may include:
These employer costs add as much as 35% to 40% to an employee’s hourly wage. An exceptionally low markup may indicate that corners are being cut—potentially in compliance, safety, or employee support. Reviewing a staffing agency’s markup structure provides valuable insight into its priorities and commitment to compliance. At Eastridge, we believe in transparency and fair pricing. Our markup structure ensures that we maintain high standards in compliance, safety, and employee welfare while delivering exceptional service to our clients. We invest in the resources necessary to fully support our employees and protect our clients from potential risks.
Turnover within a contingent workforce can significantly impact productivity, training costs, and workplace culture. High turnover rates may also signal compliance issues, such as late or inaccurate pay, inadequate safety measures, or violations of local, state, or federal laws.
Agencies should proactively address turnover by identifying root causes and implementing best practices. Eastridge works closely with clients to analyze turnover trends and develop strategies to improve retention. Compliance concerns may be at the root when turnover is ignored, and employers should examine the staffing agency's practices closely.
A long-standing reputation for compliance and safety is invaluable in the staffing industry. Unfortunately, some firms evade accountability by closing and reopening under new names to escape the consequences of employment violations. A staffing agency with decades of experience demonstrates a consistent commitment to compliance and ethical practices. Eastridge’s 50 years of operation reflect its dedication to maintaining high safety and compliance standards, ensuring clients’ trust and long-term success.
Compliance is a shared responsibility between companies and their staffing partners. Contingent staffing should enhance compliance, not bypass it. Eastridge employs a dedicated team of legal and safety professionals to navigate the ever-changing landscape of employment laws, ensuring adherence to regulations at every level. Failing to prioritize compliance can lead to severe consequences, including financial penalties and damage to brand reputation. Companies should partner with staffing firms, prioritizing compliance and maintaining rigorous standards to protect their operations and workforce.