Is Your Business Exposed to Liability for Your Company’s Leased Employees/Temporary Workers?

In recent years, employee leasing and hiring through temporary staffing agencies has become more popular among businesses who want to outsource many of the daily tasks and responsibilities associated with hiring and managing employees, in order to achieve greater efficiency in the operation of their business. Employee leasing or temporary staffing agencies take on many of the daily responsibilities businesses would otherwise have to undertake relative to their employees, including, for example, recruiting, hiring, discipline and termination, conducting performance reviews, payroll, employment-related tax filings, and so forth.

Businesses that utilize leased employees through temporary staffing agencies should be aware that although it outsources many of these daily tasks and responsibilities to the agency, who is the primary employer, the business will still likely be considered a “joint employer” of those employees under certain federal, state, and local labor and employment laws. This means that the business is subject to the same legal obligations as if it were the leased employee’s direct employer. For example, a business that uses leased employees is subject to the prohibitions against discrimination and harassment of those employees under Title VII of the Civil Rights Act of 1964, as if those employees were direct or regular employees of that business.

This joint employer relationship can expose businesses to significant risk when those leased or temporary employees do not follow the company’s basic and fundamental rules and policies regarding things like discrimination or harassment, safety, and timekeeping, to name just a few. Often leased or temporary employees are simply never made aware of the Company’s rules or policies governing employee conduct or the policies they are aware of are unclear as to the procedures that should be followed in the event the employee has questions or issues.

While the staffing or leasing agency is considered the employee’s primary employer and should provide its employees guidance regarding these basic rules and policies, businesses who are hosting the employees should also consider developing and providing the employees with a Temporary/Leased Employee Handbook. This handbook would be a condensed version of the company’s regular Employee Handbook, and should include the company’s policies regarding equal employment opportunity, timekeeping procedures, safety rules and procedures, rules prohibiting harassment and discrimination and the procedures for reporting such conduct by others along with who the employee should report any issues to.

By informing temporary or leased employees of the company’s rules and policies regarding these basic concepts, the company may avoid potential wage and hour issues, discrimination and harassment complaints, and workplace injuries that can be extremely costly for the company. If you would like to explore having an employee handbook for your leased employees or if you need assistance in drafting a temporary employee handbook, please feel free to contact us.