Plain definitions of the staffing, payroll, and compliance terms contractors use when evaluating a labor partner
The terms below come up constantly when contractors evaluate a labor partner. These are the plain-English versions.
A worker employed directly by a company, with payroll taxes withheld and employment protections attached. In staffing, a W2 worker is an employee of the staffing agency, which carries payroll taxes, unemployment insurance, and workers' compensation for them.
A worker engaged as an independent contractor rather than an employee. Classification is determined by how the work is actually controlled and performed, not by what the paperwork calls it, and misclassification carries penalties for the party found to be the employer.
A weekly payroll report required on federally funded and many state-funded construction projects. It records each worker's hours, classification, wage rate, and deductions, and is signed as a statement of compliance. Federal projects use Form WH-347.
The federal law requiring that workers on federally funded construction contracts above a threshold be paid at least the locally prevailing wage and fringe benefits, as determined by the Department of Labor. It is the reason certified payroll exists on federal work.
The wage and fringe benefit rate set for a given trade in a given locality, which must be paid on covered public projects. Federal rates come from Davis-Bacon determinations; many states run their own prevailing wage programs with their own rates and reporting.
The published schedule listing the prevailing wage and fringe rate for each labor classification on a specific project, in a specific county.
A number reflecting a company's workers' compensation claims history against the industry average. 1.0 is average, below 1.0 is better than average. Many general contractors set a maximum EMR for anyone working on their sites, which is why it gets asked about during vetting.
A one-page summary proving active insurance coverage, including workers' compensation and general liability. Contractors routinely require a COI, sometimes naming them as an additional insured, before a crew mobilises.
A required test confirming a respirator seals properly on a specific worker's face. Mandatory before respirator use on abatement and many remediation scopes, and it must be current.
An arrangement where a worker is placed through the agency, works on the agency's payroll for an agreed period, and can then be hired directly by the client. It lets both sides evaluate fit on real work before committing.
A permanent placement made by the agency, where the worker goes onto the client's payroll from day one.
What the client pays the agency per hour worked. It covers the worker's wage plus the agency's burden (payroll taxes, workers' comp, insurance, administration) and margin.
What the worker receives per hour, before deductions. Always lower than the bill rate, because the bill rate carries the employer costs.
The employer costs layered on top of a wage: payroll taxes, unemployment insurance, workers' compensation premium, and any benefits. Burden is why a bill rate is meaningfully higher than a pay rate, and why comparing the two directly is misleading.
A planned period when an industrial facility stops production for maintenance, repair, or replacement work. Shutdowns compress a large amount of labor into a short window with a hard end date, which is why they drive surge staffing demand.
Getting a crew documented, cleared, and physically on site and productive. Mobilisation time, not headcount, is usually what determines whether a staffing partner solves the problem.
The controlled removal or containment of a hazardous material, most commonly asbestos, lead, or mold, performed under regulated work practices by certified workers.
The broader cleanup and restoration of a contaminated site or structure, which may include abatement as one phase.