An agency of record (AOR) is a third-party entity providing compliant workforce administration for independent contractors. An AOR company assumes responsibility for ensuring your contractors are paid compliantly with all applicable regulatory and tax considerations, wherever they are assigned.
In today’s ever-evolving workforce, many leaders in business management are leveraging AORs to provide thorough, ongoing IC compliance and mitigate misclassification risks. Plus, an AOR also saves time for workforce management by managing IC invoicing and payment processes.
To learn more about AORs from our experts in workforce management, read on!
Determining if your organization can benefit from an AOR arrangement to manage contract staffing is pretty simple.
Particularly, if your organization intends to ramp up its employment of contract workers—particularly independent contractors, freelancers, or SOW project workers—but can’t adequately manage the following HR-related tasks for the influx of new contractors, the use of an AOR can help ensure compliance with all required regulatory compliance, worker classification, tax, and business, rules-based concerns. These things are crucially important to a successful contract worker program:
Adding to the HR headcount to manage a newly expanded contract workforce can add significant costs to an HR department. And if cost savings and efficiencies are among the reasons why you may be considering adding contract workers to your workforce mix, then it seems counterproductive to add full-time resources to HR. In these cases, the AOR is definitely worth consideration.
If your business could benefit from using an agency of record, our experts in workforce solutions at nextSource would love to tell you everything you need to know on how to get started and take advantage of its potential benefits. Contact us today to learn more.
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