29 Jun

Temp-to-Hire in Knoxville: How Direct Hire Conversion Works

Try a worker on our payroll first, then bring them onto yours when the fit is right. Honestly, that is the whole idea.

Key takeaways

Quick answer: Temp-to-hire lets you bring a Labor Exchange worker onto your own payroll after a stretch on ours. Once a worker reaches about 720 hours, you can hire them with no conversion fee. Before that, the fee starts at $3,000 and is pro-rated by the hours already worked.

Labor Exchange is a family-owned staffing agency at 4408 Chapman Hwy in South Knoxville. Call (865) 247-4957 to start a temp-to-hire placement.
Every worker we send is a W-2 employee, pre-screened, and covered by our workers' comp the whole time they are on our payroll.
Temp-to-hire means you try a worker on our payroll first. After about 720 hours you can hire them with no conversion fee; before that, the $3,000 fee is pro-rated by the hours already worked.
One hourly rate covers pay, payroll taxes, workers' comp, and screening, and it lands on one simple invoice.

We talk to a lot of Knoxville employers who like someone they have working through us and want to make it permanent. That is a good problem to have, and it is exactly what temp-to-hire is built for. Honestly, the question we hear most is what it costs to bring that person onto your own payroll, so let me walk through how it works and what to expect.

What does temp-to-hire actually mean?

Temp-to-hire is the try-before-you-hire path. The worker starts on our payroll as a W-2 employee. They show up, do the job, and you see how they fit your crew before you commit to anything long term. We handle the pay, the payroll taxes, the workers' comp, and the screening while they are with us.

If the fit is right, you bring that person onto your own payroll as a direct hire. If it is not, you simply tell us and we keep looking. There is no pressure to convert and no penalty for deciding a role was not the match you hoped for. You only make the move when you are ready.

So how much does a staffing agency charge for direct hire?

Here is the part employers really want to know. In most of our placements, once a worker has put in about 720 hours with you, which is roughly eighteen full-time weeks, you can bring them onto your own payroll with no conversion fee at all. At that point they are yours, free and clear.

Before a worker reaches that 720-hour mark, there is a conversion fee. It is based on a $3,000 fee, pro-rated by the hours they have already worked, so the more hours they have logged with you, the smaller it gets, all the way down to zero at 720 hours. While the worker is still with us you pay one hourly rate, with no surprise line items, and we will tell you exactly where any worker stands when you call.

Why try-before-you-hire works for Knoxville employers

Hiring straight off a resume is a guess. A worker can interview well and still struggle once the real shift starts. Temp-to-hire lets you watch someone do the actual job, in your shop or on your site, before you put them on your payroll. For warehouses near Forks of the River, restaurants in Bearden, and job sites from Maryville to Sevierville, that early look saves a lot of costly mis-hires.

It is also kinder to the worker. They get to learn your pace and decide if your place is right for them too. We are in the people business, and a placement that sticks because both sides chose it beats a fast hire that falls apart in three weeks. That is the kind of match we are proud of.

What one rate covers while a worker is with us

The single hourly rate you pay during the temp period covers the worker's pay, the payroll taxes, the workers' comp coverage, and the background screening we run before anyone is dispatched. You get one invoice for it, not a stack of charges to reconcile. That keeps your bookkeeping simple while you decide on the hire.

Because the worker is our W-2 employee, not a 1099 contractor, the compliance load sits with us. We handle the I-9 with two forms of ID, the tax withholding, and the comp paperwork. You get a ready worker without taking on the legal exposure that comes with sorting all of that out yourself.

How to start a temp-to-hire placement in Knoxville

Tell us the role, the schedule, and where the work is. We pull from a pool of pre-screened, ready people across Knox County and the Smoky foothills, and we can often dispatch the same day. You try the worker, and if the fit is right, we walk you through bringing them onto your payroll.

You can call us at (865) 247-4957 or walk into our office at 4408 Chapman Hwy in South Knoxville. We placed hundreds of East Tennessee neighbors in jobs last year, and we would be glad to help you find your next good hire the same way. Honestly, it is the best job in the world.

Common questions

How much do staffing agencies charge for direct hire?

At Labor Exchange the conversion fee is $3,000, and it is pro-rated by the hours the worker has already put in, so it shrinks the longer they are on the job. Once they reach about 720 hours, you can hire them with no fee at all. Call (865) 247-4957 and we will tell you exactly where your worker stands.

Is there a fee to convert a temp worker to a permanent hire?

Usually yes, until the worker reaches about 720 hours, at which point you can hire them with no fee. Before that, the fee is based on $3,000, pro-rated by the hours they have already worked, so the more they have worked, the lower it is. There are no hidden line items, and we will walk through the numbers with you.

How long does someone work as a temp before I can hire them?

You can hire a worker directly at any point. In most of our agreements, once they reach about 720 hours of work, roughly eighteen full-time weeks, there is no conversion fee. You can also hire sooner and pay a fee that is pro-rated by the hours they have already put in.

Are temp-to-hire workers W-2 employees or 1099 contractors?

They are our W-2 employees the entire time they work through us. We cover their payroll taxes, workers' comp, and screening, and we handle the I-9 with two forms of ID. The compliance load stays with us until you hire them directly.

Do you offer temp-to-hire outside of Knoxville?

Yes. We staff across East Tennessee, including Maryville, Alcoa, Sevierville, Seymour, and Oak Ridge. Tell us where the work is and we will send pre-screened, ready people, often the same day you call.