Staffing Agreement

Written by the NextCrew team

What it means in practice

Most disputes between an agency and a client trace back to a clause that was missing or vague. A staffing agency agreement usually covers:

• Services and scope. What roles the agency supplies and how orders are placed.
• Rates and billing. Bill rates or markup, overtime and holiday multipliers, invoicing cycle and payment terms.
• Responsibilities. Who recruits, pays, supervises, trains and approves hours; the core of managing co-employment.
• Insurance and indemnity. Required policies and limits, and who pays when something goes wrong. See staffing agency insurance.
• Fees. Conversion fees for hiring a Crew Member directly, and late-cancellation or minimum-hour charges.
• Non-solicitation and term. Limits on hiring each other's staff, contract length and how either side can end it.

Example

A client cancels a 20-person shift an hour before start, after Crew Members have arrived. The agency owes reporting time pay in some states either way. With a cancellation clause, the client is billed a minimum number of hours per person; without one, the agency absorbs the cost. The same logic applies to overtime billing, conversions and program fees: if it is not in the agreement, it is a negotiation after the fact.

What is a supplier agreement on an MSP program?

On a managed program, the contract is usually called a supplier agreement. The agency signs it with the MSP or the client, and it replaces much of the negotiation above with the program's standard terms. It typically sets:

• The program fee. The percentage deducted from what the agency is paid. See program fee.
• Rates. The rate card or markup limits for each role.
• Payment terms. When the agency is paid, including whether it is paid only after the client pays the MSP.
• Performance. The supplier scorecard measures and the tier rules.
• Compliance and exit. Required checks, insurance limits and how either side can end the arrangement.

Read it before the first order: the fee and the payment terms change your real gross margin on every hour you bill.

How NextCrew fits

NextCrew does not draft contracts. Once the terms are agreed, rate configuration sets pay rate, markup and bill rate per position for each client and applies them to every future order, and the client record holds billing information and contract details.

Related terms

• Bill rate: the hourly rate the agreement sets for the client.
• Conversion fee: what the client pays to hire a Crew Member directly.
• Rate card: the list of bill rates by role attached to many agreements.
• Co-employment: why the responsibilities section matters.
• SOW staffing: buying a deliverable instead of hours.
• Employer of record vs PEO vs staffing agency: which model the agreement should name.

Go deeper

See how client records and rates are managed on the staffing CRM page, and how agreed rates reach invoices on staffing invoicing software.

General information, not legal advice. Have an attorney review your staffing agreement.