CSP Contract Staffing & Billing Practices 3

Question 1

Which contract clause protects a staffing firm from damages claims that far exceed the fees earned on an assignment?

Accepted Answer

Limitation of liability clause

Answer

Indemnification clause

Answer

Force majeure clause

Answer

Non-solicitation clause

Question 2

A 'pay-when-paid' clause in a staffing subcontract arrangement means:

Accepted Answer

The subcontracting staffing firm is paid only after the prime contractor receives client payment

Answer

The staffing firm pays workers only after the client approves timesheets

Answer

Workers receive pay in advance before their assignment begins

Answer

Payment terms are tied to worker performance metrics

Question 3

A staffing agency charges $32/hr and pays workers $22/hr with an employer burden rate of 18% of pay rate. What is the approximate gross profit per hour?

Accepted Answer

$6.04

Answer

$10.00

Answer

$13.96

Answer

$5.44

Question 4

Which of the following is a common contractual requirement a staffing firm must fulfill before a temporary worker begins an assignment?

Accepted Answer

Providing certificates of insurance to the client

Answer

Filing a business license application with the client's state

Answer

Registering the temporary worker as a client company employee

Answer

Obtaining the client's approval of the staffing firm's payroll schedule

Question 5

What is the typical purpose of an 'exclusivity' clause in a staffing services contract?

Accepted Answer

It requires the client to use only one staffing firm for specified job categories

Answer

It prevents the staffing firm from placing workers at competing clients

Answer

It restricts workers from accepting permanent employment after their assignment

Answer

It limits the staffing firm's ability to poach its own placed workers

Question 6

Under a Vendor Management System (VMS) arrangement, the staffing firm's effective margin is most directly reduced by:

Accepted Answer

The VMS platform's transaction or program management fees

Answer

The number of workers the client employs directly

Answer

The client's internal HR department size

Answer

State unemployment tax rates for the client's industry

Question 7

Which of the following best describes 'co-employment risk' in the context of staffing contracts?

Accepted Answer

The legal risk arising when a client exercises so much control over temporary workers that it may be deemed a joint employer

Answer

The risk that a temporary worker will simultaneously work for two competing staffing firms

Answer

The financial risk of paying workers across two different states simultaneously

Answer

The compliance risk of misclassifying independent contractors as temporary employees