Using a Temp Agency to Hire Hourly Employees?

Author Sean Behr Date May 31 2019

Companies may consider using hourly employees to deal with additional tasks so their business can run efficiently. Due to issues with finance and fluctuations in workloads, hiring a full-time employee may not be the best option.

In these cases, companies can choose hiring through a temp agency to find hourly employees. Hiring temporary employees is especially beneficial for companies that have seasonal jobs or need to fill short-term vacancies.

Using  temp agency to hire employees may be suitable for your company. However, you should weigh up the pros and cons of finding hourly employees through a temp agency.

Hiring managers need to consider different recruiting methods when taking on new employees. Hiring someone unsuitable can have a negative impact on the business. This goes for different types of worker classifications i.e. contract workers and employees.

There are different ways that you can hire through a temp agency. Hourly workers are normally used to deal with changes in the demand for a company’s goods or services.

Most companies use hourly workers to save money and to keep the workload of full-time workers at an acceptable level. For example, a retailer may take on extra hourly workers to deal with fluctuations in workflow during seasonal sales or holidays.

Hourly workers can be part of the growing contingent workforce that are used to fill positions that are currently being recruited for. Using this strategy helps the company to function without overwhelming existing employees with extra work.

Using a temp agency to hire employees for different types of hourly positions

Hiring through a temp agency for hourly work is now done in many different industries. However, the largest portion of all temp jobs are in the clerical and administrative fields.

Clerical and office positions make up around 40% of all temporary positions. These clerical positions include:

  • Receptionist
  • Typist
  • Data entry clerks
  • General office clerks

Technical workers make up around 15% of all temporary workers. These industries include: 

  • Analysts
  • Engineers
  • Computer programmers

You will find temp workers in an increasing number of industries, including: 

  • Legal
  • Marketing
  • Sales
  • Accounting

The variety of roles and industries that temps work in shows that hourly workers continue to be a great resource for many different types of companies, regardless of size or industry.

If you are asking yourself, “Should I use a temp agency to find hourly workers?” here are some advantages and disadvantages of this approach.

The advantages of using a temp agency to hire employees:

1. Reduce the time to hire by using a temp agency  

Traditionally, recruiting employees was a long and tedious process. You had to design an advert, write good sample job descriptions, collect resumes and cover letters, sort out the candidates and then arrange to interview potential hires. The list of things to do when hiring can lead businesses without a dedicated H.R or recruitment function to feel overwhelmed.

If you have a small business or if no one in your business has hiring experience, you could save time by hiring through a temp agency. Using a temp agency for hiring employees benefits you by providing dedicated team for sourcing and recruiting candidates quickly.

Generally, hiring through a temp agency streamlines the process because they have a list of “go to” sites and resources to get the word out about a job opening.They also have software like, an applicant tracking systems (ATS) to sort candidates. This helps them to stay organized and cut down on time in the hiring process.

Using a temp agency to hire employees helps because they have the right tools and resources on hand that can save your business time, reduce paperwork, and reduce hiring steps.

The cost and time savings of hiring through a temp agency can only be realized if they are making use of the best hiring software. For example, the Turas Group is a staffing agency that’s dedicated to improving the candidate experience and providing the best service for businesses.

To meet the needs of their recruiters, candidates and clients (which include more than 20 Chick-fil-A franchise locations), The Turas Group partnered with Fountain to provide a better hiring process.

As a result of partnering with Fountain, The Turas Group reduced their time to hire from two weeks to three days and empowered each recruiter to handle nearly 2,000 applicants.

Read The Turas Group case study to find out more amazing results even though implementing Fountain only took two weeks.

2. Using temp agencies to hire employees means they will be responsible for paying your hourly employees.

This means that when you hire through temp agencies they will take care of tax issues as they handle payroll. So, you do not have to concern yourself about preparing taxes and contributions or making submissions to the Social Security Department.

Your company will be responsible for paying the temp agencies invoices. That’s about it when it comes to payroll for temporary hourly workers.

3.  Using temp agencies for hiring employees means they carry out pre-employment screening services

As temp agencies have already developed their processes for sourcing, hiring and screening workers, they will have access to background checking services which could include:

  • Credit checks
  • Criminal record checks
  • Verifying references

Because of the extensive repercussions of false or incomplete background checks or inadequate employment screening, you have to make sure that when hiring through temp agencies they have an excellent vetting process.

Before hiring through a temp agency, ask them for information about the background service checks that they conduct. Do your research to ensure that these background checks are complete and reliable.

4.  Using a temp agency to hire employees can decrease your stress

Using a temp agency to hire hourly workers can take a load off the shoulders of your current employees. If it takes a long time to recruit, you will end up with overworked, exhausted employees who are burnt-out. This could result in a negative workplace culture and a loss of productivity.

If you hire through a temp agency to find hourly workers, the burden of extra work for prolonged periods is removed from your full-time employees.

5.  Using a temp agency to hire employees increases flexibility

Companies who employ temps can reduce or extend the period of employment.

Technically, the temp works for the agency, not for the company. If that person is not working out because they are not a good fit for the role or the team, the company can ask for a replacement immediately. Companies also have the freedom to provide the temp with full-time work if they are an asset to the business.

6.  Using a temp agency to hire employees increase hiring possibilities

Hiring through  a staffing specialist or temp agency to secure an hourly employee, you should evaluate the hourly employees’ performance at regular intervals, throughout their time working at your company. This will help you to decide whether you will still need to hire another full-time person to do the job.

When your hourly employee performs to a satisfactory level, you can reduce the time and cost to hire a full-time employee by offering them the job. This means that you will no longer need to continue to spend time sourcing for a full-time employee using different platforms, like free job boards.

When thinking about hiring hourly employees, you should research all of your options. One viable choice is to use modern hiring software.With Fountain, you can experience the benefits of using a temp agency while remaining in full control of your hiring process.

For example, our Boost feature reduces your time to hire. With Boost, you let us know how many hourly employees you need and your budget to advertise. We then target free and paid job platforms so that you can attract the best candidates, quickly. You also save time managing candidates because we provide all of the information you need in one simple dashboard.

In terms of reducing paperwork, our hiring software is mobile-first. This means that your candidates and applicants can apply via a mobile device. You can also manage your candidates with your mobile device anywhere, anytime.

Concerning pre-employment screening services, Fountain works with leading screening and background checking services, like Checkr to make sure that your company receives a full end-to-end recruitment service.

You also enjoy more flexibility with Fountain. As you hire your candidates quicker and the temporary workers turn into valuable hourly employees, you can choose to offert hem a permanent position with your business, without negotiating fees with the temp agency.

Now that you are aware of the advantages of hiring a temp agency to find hourly employees, here are some of the disadvantages.

Hiring through a temp agency can go wrong if you hire an inefficient temp agency.

Not all temp agencies are created equal. It is possible that your temp agency will not understand the needs of your business and therefore provide you with unqualified hourly employees.

This can be a detriment to your business, especially if you are in urgent need of workers to fill the open positions.

Unqualified hourly employees could end up providing bad customer service, which will have a negative impact on your customer and client relationships.

1.  Using a temp agency for hiring employees has a high cost

Hourly employees can be cheaper to employ than full-time employees because you do not have to provide incentives, like benefits and health insurance. However, hiring through a temp agency means you still need to pay the fees and costs of the temp agency.

The fees that temp agencies charge differ according to the agency. But, it typically works out to an initial finder’s fee and a percentage of the hourly rate of your worker. You may also need to pay for pre-hiring services and background checks.

Be sure to try to negotiate cost and fees with your temp agency.

2.  Increased training resources are needed when hiring through a temp agency

When you use a temp agency to hire hourly employees, you will need to train these employees to do the job successfully. If the temp agency sends hourly employees who are unsuitable, you must repeat this training over and over again for new hires.

Continuous training could negate the time that you have already saved hiring employees through the temp agency. If you want to train your employees more quickly and efficiently, your modern hiring software should have onboarding capabilities which cut down on the time it takes to train an employee.

With Fountain, onboarding features help to induct new hourly employees into your business quickly and efficiently.

3. Legal issues of using a temp agency for hiring employees

Even though hourly employees are not technically your employees when you use a temp agency, you still need to take employment laws into account.

For example, you need to be mindful of legislation in terms of issues such as, discrimination and sexual harassment that hourly employees could face while working at your company. Be sure to brush up on your employment law to ensure that you are complying with the relevant federal and state laws.

Conclusion: Using a temp agency for hiring employees

When hiring hourly employees or independent contractors through a temp agency, you can avoid all of the issues associated with temp agencies by using hiring modern software.

Fountain can be used in your company, irrespective of the size. If you already have a recruitment system, that’s no problem as Fountain complements most recruitment systems.

Find out how you can use modern hiring techniques to cut out the potential issues associated with using a temp agency. Fountain has been designed to source, manage and onboard hourly employees in the most efficient way.


Enter a new era of frontline workforce management.

Learn more about how Fountain Hire can help you transform frontline recruiting, onboarding, and retention for improved workforce management.

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About the Author

Chief Executive Offier

Sean Behr

Sean Behr is the CEO at Fountain and has served in leadership roles at STRATIM (acquired by KAR), (acquired by AOL), and (acquired by Ebay). Behr also advises, mentors, and invests in entrepreneurs and early-stage companies.