Background of employment and staffing agency business licensing
Businesses that procure, or attempt to procure, employment for individuals are often required to obtain a state employment agency license. A general manger of the agency may be subject to a state examination and an individual professional license. A surety bond in the name of the entity may be required with each application. Other common requirements include examples of proposed contracts and schedules of fees, financial statements, and supporting corporate documents. Licenses are valid for a certain period of time (1-3 years) and must be renewed.
Unlicensed employment or staffing agencies face considerable penalties with fines ranging from $1,000 - $25,000 depending on the state. Unlicensed employment agencies may be ordered to restore any money that was paid to them by a client while they were operating as an unlicensed agency. In addition, the state can prohibit the agency from operating in that state in the future.
Business license considerations
State and local authorities require businesses to obtain specific licenses and permits based on their industry. In some cases, regulations mandate specialized education and unique credentials.
Operating without the appropriate license typically results in penalties, which vary according to the size of the business and the severity of the violation.