Question 1

Do you need a license to start a staffing agency in the US?

Accepted Answer

There is no federal staffing licence in the US, but several states and cities require an employment agency licence or bond, and healthcare staffing is separately regulated in many states. Every agency, everywhere, needs an entity, an EIN, state unemployment insurance registration and workers' compensation cover.

Question 2

What do you need to start a nurse staffing agency?

Accepted Answer

A nurse staffing agency needs an entity and EIN, state healthcare staffing licensure or registration where required, professional and general liability plus workers' compensation, a credentialing process for licences and background checks, and enough working capital to pay clinicians weekly against 30 to 60 day facility terms.

Question 3

What insurance does a staffing agency need?

Accepted Answer

A US staffing agency needs workers' compensation in every placement state, general liability, professional liability (errors and omissions), and usually employment practices liability. Clients commonly also require auto liability, umbrella cover and a fidelity or crime bond, all evidenced on a certificate of insurance before the contract starts.

Question 4

What is co-employment in staffing?

Accepted Answer

Co-employment means the staffing agency and its client each have responsibilities connected to the same worker. The agency generally employs and pays the W-2 worker, while the client directs day-to-day work. Neither label removes legal duties: the agency handles payroll and employment administration, and both parties must manage safety, discrimination and wage compliance.

Question 5

Should staffing agencies use W-2 employees or 1099 contractors?

Accepted Answer

A staffing agency cannot decide worker status by printing a 1099. If the agency recruits, assigns, controls or pays a worker who performs the client's work, W-2 employment is often the safer starting position. Classification depends on the full facts and applicable federal and state tests; misclassification can create back taxes, wage claims and penalties.

Question 6

How do staffing agencies handle I-9 and right-to-work checks?

Accepted Answer

A US staffing agency must complete Form I-9 for each employee within the required timing, retain the form for the prescribed period and reverify time-limited work authorisation when required. Do not let a client treat a staffing agency's I-9 process as optional: a worker must not start until the agency has completed its employment eligibility workflow.

Question 7

Do staffing agencies need to run background checks?

Accepted Answer

There is no single federal rule requiring every staffing agency to run the same background check on every worker. Client contracts, state law, the role and the worksite determine the requirement. Use a consistent, job-related process, obtain required consent, follow adverse-action rules and never make a criminal record an automatic proxy for risk.

Question 8

How do you choose insurance limits for a staffing agency?

Accepted Answer

Start with the limits your target clients require, then test them against the roles and payroll you will place. Workers' compensation follows state and classification rules; general liability and professional liability are contract-driven. A new agency commonly needs at least $1m per occurrence liability, but the right limit is the one supported by your work and client contracts.

Question 9

How do you check staffing agency licensing by state?

Accepted Answer

Check the labour, business or employment-agency regulator in the state where the worker performs services, then check the worker's city and the specific occupation regulator. Search for licence, bond, registration and fee requirements before signing the client. Healthcare, domestic staffing and talent agencies can each trigger a different rule set.

Question 10

What is IR35 for a UK recruitment agency?

Accepted Answer

IR35 is the UK off-payroll working regime that asks whether a contractor would be an employee of the client if their intermediary were removed. Depending on the client's size and status, the client or intermediary assesses the engagement and the fee-payer may deduct PAYE and National Insurance. A recruitment agency cannot solve IR35 with a label alone.

Question 11

What rights do agency workers have in the UK?

Accepted Answer

UK agency workers receive day-one rights such as access to collective facilities and information about permanent vacancies, and after twelve weeks in the same role with the same hirer they generally receive equal treatment on basic working and employment conditions. The agency and hirer must share information and keep assignment records accurate.

Question 12

What is a staffing assignment agreement?

Accepted Answer

A staffing assignment agreement records the specific placement between the agency, worker and client: role, location, start date, expected hours, pay rate, overtime, supervisor, expenses, safety process, confidentiality, timesheets and how the assignment can end. It sits underneath the client master terms and prevents a verbal change becoming a payroll or compliance dispute.

Recruitment and staffing compliance

Start with the question closest to your desk