# Staffing Agency

> A staffing agency is a firm that recruits workers and places them with client companies on a temporary or contract basis, acting as their legal employer for the placement, but usually operating within a single country and focused on sourcing people rather than global compliance.

A staffing agency recruits workers and places them with client businesses that need people quickly or temporarily. The agency sources and screens candidates, then puts them to work on assignments, often for seasonal peaks, project work, or roles a company wants to trial before hiring permanently.

For the length of the placement, the agency is usually the legal employer. It runs payroll for the worker, withholds tax, and handles the basic employment administration, while the client directs the day-to-day work. This is why staffing is sometimes confused with an Employer of Record.

The difference is one of purpose and reach. A staffing agency finds the worker for you and tends to operate in a single national market. An Employer of Record employs a worker you have already chosen, and is built to handle payroll, tax and labour-law compliance across many countries. The two models can work together rather than replace each other.

## How is a staffing agency different from an Employer of Record?

A staffing agency sources the worker: it finds, screens and supplies people you do not yet have. An Employer of Record employs a worker you have already selected, taking on the legal employment, payroll and compliance so you can hire compliantly in a country where you have no entity. One recruits; the other employs.

Because they solve different problems, a business can use a staffing agency to find someone and an EOR to employ them.

## Who is the legal employer when I use a staffing agency?

During the placement, the staffing agency is normally the legal employer of the worker. It holds the employment contract, pays the worker, and withholds the required taxes and contributions, while your business directs and supervises the work itself. When the assignment ends, the employment relationship with the agency usually ends too.

## Key facts

- **Scale of US staffing employment:** US staffing companies employed nearly 2.2 million temporary and contract workers in an average week of 2024, and hired 12.7 million over the course of 2023. (Source: American Staffing Association, verified 2026-07-28)

## Staffing agency vs EOR

|  | Staffing agency | EOR |
| --- | --- | --- |
| Main job | Finds and supplies workers | Employs a worker you have chosen |
| Typical reach | Usually one country | Many countries |
| Legal employer | The agency, for the placement | The EOR, for the employment |
| Best for | Temporary, seasonal or trial hires | Compliant hiring where you have no entity |

## Frequently asked questions

### Is a staffing agency the same as an Employer of Record?

No. A staffing agency recruits and supplies workers, usually within one country and often for temporary or seasonal roles. An Employer of Record employs a specific worker you have already chosen and handles payroll, tax and compliance, commonly across several countries. They solve different problems and can be used together.

### Does a staffing agency handle international compliance?

Most staffing agencies operate within a single country and are built around recruitment, not cross-border compliance. If you need to employ someone in a country where you have no legal entity, an Employer of Record is designed for that, taking on local employment law, payroll and tax obligations on your behalf.

### Can I use a staffing agency and an EOR together?

Yes. A staffing agency can help you find the right person, and an Employer of Record can then employ that person compliantly in the country where they are based. Because one focuses on sourcing and the other on legal employment, the two models complement each other rather than compete.

## Sources

- [Staffing Industry Statistics](https://americanstaffing.net/research/fact-sheets-analysis-staffing-industry-trends/staffing-industry-statistics/), American Staffing Association

_Last updated 2026-07-28. Reviewed by Teamed's in-house employment-law team. Source: https://www.teamed.global/glossary/staffing-agency_