Contract Staffing & Billing Practices Flashcards
7 cards from real CSP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Contract Staffing & Billing Practices flashcards as text
Which of the following best describes a 'direct placement' fee structure commonly used by staffing firms?
Answer: A one-time fee, typically a percentage of the placed candidate's first-year salary
Direct placement fees are typically a one-time charge equal to a percentage (commonly 15-25%) of the hired candidate's first-year annual salary, paid upon successful placement.
A staffing agency charges clients $28/hr and pays workers $20/hr. What is the markup percentage?
Answer: 40%
Markup = (Bill Rate / Pay Rate) - 1 = ($28 / $20) - 1 = 1.40 - 1 = 0.40 = 40%.
Under the Fair Labor Standards Act (FLSA), who is responsible for ensuring that temporary workers receive at least the federal minimum wage?
Answer: Both the staffing agency and client company as joint employers
Under the FLSA joint employer doctrine, both the staffing agency and the client company can share responsibility for minimum wage compliance when both control aspects of the employment relationship.
What is the primary purpose of requiring client signatures on worker timesheets before invoicing?
Answer: To verify hours worked and create an agreed-upon basis for the invoice
Client-signed timesheets verify that hours billed were actually worked and approved, reducing billing disputes and providing documentation supporting the invoice.
A 'retained search' billing arrangement means the client pays:
Answer: An upfront fee or installments regardless of whether a placement is completed
In a retained search, the client pays upfront (often in thirds: at engagement, at candidate presentation, and at placement), committing the firm's exclusive focus to the search.
When a client contests a staffing agency's invoice, what is generally the most appropriate first step for the account manager?
Answer: Review the signed timesheets and contract terms to identify discrepancies
Reviewing signed timesheets and contract terms allows the account manager to identify the source of the discrepancy and resolve it based on documented facts.
A staffing firm's 'gross margin' is most accurately calculated as:
Answer: (Bill Rate - Pay Rate) / Bill Rate
Gross margin = (Bill Rate - Pay Rate) / Bill Rate, expressing the portion of the bill rate remaining after paying the worker, before employer burden and overhead.