Rock the PHR Exam 2025 – Unleash Your HR Superpowers!

Payrolling involves the process where a staffing or payroll company takes on the responsibility of employing individuals, often those referred to them by another organization, typically for the purpose of temporary assignments. This arrangement allows businesses to manage workforce flexibility without directly hiring employees. By partnering with a staffing firm, businesses can refer specific individuals who may be seeking temporary work. These individuals are then officially employed by the staffing firm, which handles all aspects of payroll, including taxes and benefits, allowing the referring organization to focus on their core operations without the burdens of direct employment.

The process does not involve direct hiring of employees, as stated in the first option, nor does it focus on training employees through external agencies. Lastly, payrolling does not eliminate payroll taxes for temporary workers; rather, those taxes are still applicable and managed by the staffing firm handling the payroll. Therefore, the essence of payrolling lies in utilizing staffing firms to manage employee referrals and payroll responsibilities.