How Does a Temp Agency Pay its Workers?

One challenge that companies face is making sure that they are paying their employees properly. One advantage to using a temp staffing agency is that they will look after the payment process for your temporary staff working at your company.

So how does a temp agency pay its workers? Understanding the process will help you find a temp staffing agency which is properly paying their workers. This will ensure that you avoid legal issues. Also, by knowing that the agency offers competitive wages is an assurance of quality.

Temp Staff Are Employees of the Agency

It is good to remember that all individuals who are placed in a position by your temp staffing agency are considered employees of the agency. As employees of the temp agency they will receive their payment in a similar way that you would pay your permanent staff.

Just like you would with your permanent staff, your temp staffing agency will make sure all workers receive at least minimum wage. Also, just like you would with your employees, they will also make sure the following payments and deductions are properly cared for:


  • Workers compensation (WSIB)
  • Unemployment insurance (EI)
  • Canada Pension Plan (CPP)
  • Employer’s Health Tax (EHT)
  • Public Holiday Pay (PHP) for the mandated statutory holidays during the calendar year
  • Vacation pay
  • All governmental tax deductions
  • Termination Pay (Bill 139, Ontario Employment Standards Act)


It is good to be aware that a temp staffing agency is required to care for these mandatory deductions. If they are properly looking after paying their workers, then this would be reflected in the fees they charge you. If the agency charges you too low a fee this can be a red flag that they may not be properly paying their workers.

Reduce the Hassle

Since the temp workers that you are using are employees of the temp staffing agency, all of the paperwork and documentation will be handled for you. It is the agency that will deal with the temporary staff. Once they walk through your doors your only concern is putting them to work.

Another advantage to partnering with a temp staffing agency is when you no longer require the services of a temporary worker; you can send them back to the temp agency. There is no need to worry about having to make termination payments or to fill out any paperwork. By making sure your agency is properly following all payroll procedures it can give you piece of mind, knowing that all legal procedures are properly cared for. It gives you one last thing to worry about, so you can focus on the success of your business. Working with a temp staffing agency really is the most cost effective way to find qualified short-term workers.

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1 thought on “How Does a Temp Agency Pay its Workers?”

  1. If the temp agency is providing only health care professionals such as Registered Nurses. Are they allowed to charge tax(gst/hst) to the company?

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