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How Payroll and HR Software Can Benefit the Staffing Industry

Jerika Holton
Sep 1, 2022

The staffing industry employed 14.1 million temporary and contract employees in 2021. That is 14.1 million employees with different pay rates, hours, pay schedules, and working in various industries, sometimes across various locations. So how do you manage to pay every employee accurately and on time?  

Utilizing a payroll provider can automate the most complex payroll scenarios for the staffing industry. We will explore the staffing industry's challenges to how your payroll software provider can help service your organization.  

  1. Speed Matters

In the staffing industry, speed matters. The ability to place employees quickly is a competitive edge that can set you apart from the competition. With the lack of skilled workers, it is important to stray away from the traditional methods of finding top talent and move towards modern approaches to attract the limited pool of talent quickly.  

You can quickly attract talent with social media outlets, such as LinkedIn, and online job boards like Monster and Indeed. However, this use of technology can also mean hundreds to thousands of applicants. Applicant tracking software through your payroll and HR provider filters through the applicants to find the best suited for the job opening. Once hired, you can allow employees to upload important i9 documents and review their information virtually. So, from start to finish, you can have an employee placed into their position faster than ever.  

Speed also refers to the process of calculating payroll. Trying to do calculations for each employee can be time-consuming and presents a higher opportunity for manual errors. Utilizing a payroll provider, you can automate this process by spending less time on back-office activities and focusing on what matters most, placing top talent promptly. Using "error detections," you can quickly identify areas that need attention, and once you have finished your corrections, you can review your payroll before submission.

  1. Compliance

If you think maintaining compliance is expensive, try non-compliance.  

Maintaining compliance can be a headache. On top of the standard compliance needs every company faces, the staffing industry employs workers across several tax jurisdictions and industries, making maintaining compliance increasingly difficult for staffing agencies.  

Correct Classification and Documentation

The staffing industry employs not only many part-time and full-time workers but also a rise in contract workers. Misclassifying contract workers as regular employees or vice versa can lead to incorrect tax withholdings that can cause significant financial penalties or even lawsuits.  

Turnover is a term the staffing industry is familiar with since many jobs are temporary. The EEOC requires employers to keep employment records for one year, the FLSA requires employers to keep payroll records for at least three years, and the FLSA requires you to keep all records (wage rates, seniority, job evaluations, etc.) for two years. Housing employee documents in cloud-based software can help you to hold onto employment documentation.

Payroll Compliance

When calculating payroll taxes, you must ensure that the proper deductions are taken out for federal, state, and local taxes. Failure to do accurate calculations can lead to incorrect pay, fine, or penalties for your organization. Since staffing agencies manage employees across different jurisdictions, it is beneficial to have your software automate the correct deductions and have a tax expert by your side to help you navigate complex payroll tax scenarios. Other withholdings, such as garnishments like child support, are prioritized and applied automatically to payroll.

Overtime Compliance

Timekeeping software allows employees to keep track of their own time, which can be scary for management. The good thing is that you do not have to fear staying compliant with overtime calculations. Your timekeeping software can do proper overtime calculations depending on what state regulations you must abide by.

Year-End Forms

You know that feeling when it's the end of the year when you can feel the overwhelming sense of stress through your HR department? Well, you don't have to worry about that feeling anymore. Your software can automatically populate information into your year-end forms, so you do not have to worry about manual entries. You will not have to worry about missing any deadlines with alerts and notifications.  

Your payroll and HR provider will also support your distribution of year-end forms. You can distribute year-end forms electronically, or they can be printed and mailed to your employees.

  1. Economic Uncertainty

Many employees are living paycheck to paycheck, or they must use multiple streams of income to afford everyday life. Paycheck accuracy has always been critical, but now with inflation at 9.1%, employees are looking for ways their employer can provide financial relief.  

  • Providing a variety of options for accessing funds. Earned wage access, or instant pay, has gained popularity as inflation rises. 56% of Americans cannot cover unexpected expenses of $1000; with earned wage access, you can have access to your pay when an emergency arises. When evaluating payroll providers, check to see what banking and payment options they provide.  
  • Benefits can provide financial relief. Suppose a medical emergency arises for yourself, your family member, or even your furry friend. In that case, many options are available to keep the medical bill from breaking the bank.  
  • Performance management is an overlooked way to provide financial relief. Sometimes, you just need to make more money. Employees look for ways to grow their skill set and to perform well enough to receive a raise or to be promoted to a higher-level role.
  1. Workforce Changes

The workforce has changed dramatically following Covid-19, and staffing agencies are still tasked with navigating through their changes to attract talent.  

The Great Resignation

Most organizations are exploring ways to retain employees as we are during the great resignation. Staffing agencies are faced with the task of managing turnover as employees leave their job earlier than usual. It can be challenging to keep track of employees who are hired and rehired dozens of times. Cloud-based technology can help keep track of employee records. Flexible payroll providers, like Greenshades, are beneficial because you can run payroll as you see fit, so you have the freedom to provide trouble-free termination pay or do special pay runs in unique situations.  

Remote Workplace

During the Covid-19 lockdowns, many employers closed their offices to protect their employees' health. With the increase in remote work, there is an increased need for cloud-based software. Administrators can process payroll and handle essential HR functions from any location through their desktop or mobile application. With the office closed, communication between the HR department and employees can suffer. Thanks to employee self-service, communication does not have to suffer, and employees are empowered to take control of the HR functions that directly impact them. Staffing agencies can save time by utilizing self-onboarding, self-enrollment, and the employee self-service portal helps limit outreach to the HR and payroll staff.  

Increase in Contract "Gig" Workers

Staffing agencies already employ many contract or "gig" workers, and by 2023 52% of the workforce will have participated in the gig economy. "Think about your workforce strategy. How many W-2 employees do you need? How many gig workers? And what tools do you need to support each segment? Thinking about this process forces examination of a lot of your systems, especially payroll and accounting." McGuire says. To support your gig workers, classify them correctly, provide various payment options, and ensure correct information for year-end form processing.  

Wrapping Up

The workforce has evolved, and with increasing economic pressures, it is more difficult to find and retain top talent. Staffing agencies are on the front line of the workforce evolution. Although payroll and HR functions are not a glamorous part of an organization, it is essential to help you navigate these changes.  

To learn more about Greenshades Payroll & HR Platform, contact or visit  

Register for our Payroll for Staffing Firms and Bullhorn ATS Webinar on September 14th, 2022 at 12:00PM EST.

Visit the Greenshades Blog for future posts and insightful industry-specific articles.

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