ASA Compensation, Benefits & Payroll Management 3

Question 1

What is a 'temp-to-perm' conversion fee, and who typically pays it?

Accepted Answer

A fee paid by the client to the agency when hiring a temporary worker as a permanent employee

Answer

A penalty paid by the worker when leaving a placement early

Answer

A rebate the agency offers clients for extended contract terms

Answer

A payroll processing charge billed to the temporary worker

Question 2

Which federal law requires employers, including staffing agencies, to notify workers of their rights regarding health coverage continuation when they lose eligibility?

Accepted Answer

COBRA

Answer

ERISA

Answer

HIPAA

Answer

ACA

Question 3

When a staffing agency uses a Vendor Management System (VMS), what is the typical financial implication?

Accepted Answer

A VMS fee or rebate is deducted from the agency's bill rate, compressing margins

Answer

The agency receives a higher bill rate to offset technology costs

Answer

Workers receive direct payment through the VMS platform, bypassing agency payroll

Answer

The client assumes all payroll tax liability through the VMS

Question 4

Under the Equal Pay Act, what must a staffing agency ensure when placing workers at a client site?

Accepted Answer

Male and female workers performing substantially equal work receive equal compensation

Answer

All temporary workers earn the same wage regardless of skill level

Answer

Client employees and temporary workers performing similar tasks receive identical pay

Answer

Workers from different agencies performing the same role earn the same rate

Question 5

Which payroll practice helps staffing agencies manage cash flow when clients have 30-60 day payment terms but workers must be paid weekly?

Accepted Answer

Invoice factoring or accounts receivable financing

Answer

Deferred compensation agreements

Answer

Extended payroll cycles

Answer

Retainer-based billing

Question 6

What is the 'spread' in staffing agency economics?

Accepted Answer

The difference between the bill rate charged to the client and the pay rate given to the worker

Answer

The geographic distance between client locations served

Answer

The percentage of workers converted from temp to perm

Answer

The variance between forecasted and actual hours worked

Question 7

A staffing agency operating in multiple states must comply with varying minimum wage laws. When state and federal minimum wages differ, which applies?

Accepted Answer

Whichever rate is higher

Answer

Always the federal minimum wage

Answer

Always the state minimum wage

Answer

Whichever rate the client prefers