The Question of the Week posted this week got me thinking about the classification of temporary employees. Temporary workers are workers that are employed by a staffing agency which supplies workers to the client company. Temporary workers report to the client, but receive pay and benefits from the staffing agency. Temporary workers, therefore, are considered to be the employee of the staffing agency rather than the client company.
The risk of having a temp become an employee of the client company arises when the client company retains a certain amount of control over the temp. If that happens, the client company may face liability for a wide variety of employment related issues including discrimination and wage and hour violations.
How can the client company reduce the risk of having a temp become classified as an employee? The suggestions listed below are taken from “Get Smart When Using Temporary Employees” and a 2004 Iowa case, Willms v. Associated Materials Inc.
- Allow the staffing agency to communicate the rate of pay and hours to the temp;
- Require the staffing agency to perform drug testing or background checks;
- Request the staffing agency perform periodic visits to the job site;
- Differentiate the temp uniforms, badges, parking spaces, break rooms, etc. from the permanent employees’;
- Allow the staffing agency to make hiring and firing decisions as well as take disciplinary action;
- Limit the time period a temp works at the site;
- Refer to the temp as a worker who is assigned rather than an employee who is hired;
- Always have your attorney review your agreement with the agency.
In short, treat temporary employees different than your permanent employees. A client company may not be able to completely eliminate the risks of having temporary workers classified as employees, but by using some of the suggestions above the risk will be reduced.