Tag Archives: Temps

05.22.23
by

Today’s Riddle: Should I Cap a Temp’s Service at 6 months? 12 months?

I like riddles. How could you not? Here are two. Answers are at the bottom of the post:

1. What has to be broken before you can use it?
2. I’m tall when I’m young, and I’m short when I’m old. What am I?

Getting back to business, here’s a question I have been asked many times. It seems a bit like a riddle, with no clear answer and requiring careful thought. But I’m going to declare No Riddle. That’s because I think there’s a straightforward answer, and it might not be what you were thinking.

Here’s the question (in case you are among the 0% of today’s readers who skipped this post’s headline):

Should we cap a temp’s assignment at 6 months? 12 months?

To answer today’s question, I’m going to have to ask you two questions. (Sorry, that’s how we play this game.)

Question 1: As temps, my assumption is that they are intermingled with the company’s employee workforce, doing the same thing as employees, working side by side with employees, and reporting to the company’s supervisors. Is that accurate?

Question 2: Are they employed by a staffing agency and treated by that staffing agency as its W2 employees?

If you answered yes to both, then the amount of time temps are assigned to the company will almost certainly have no bearing on their status. They will be employees of the agency and probably also joint employees of the company. There are various joint employment tests, and we can go through them (fun!) but it would be largely an academic exercise.

From a practical business standpoint, we should assume that any time the answer to my two questions are yes, these two conclusions will follow:

First, The entity receiving the services is likely to be a joint employer under the FLSA, NLRA, anti-discrimination law, and state laws, regardless of whether the temp is assigned for five months or five years. When temps are intermingled with employees in a staff aug situation, there is very likely joint employment, regardless of which test is applied. Arguments could be made under some tests that there is no joint employment, but for purposes of trying to answer the question above in a practical business-oriented way, I would assume there’s going to be joint employment.

Second, joint employment in this scenario is a risk inherent in working with temp staffing agencies. But that’s not necessarily a problem. Joint employment is not unlawful and, with one exception, joint employment only becomes a problem if the staffing agency/primary employer fails to do something it is legally required to do, such as pay overtime or minimum wage. In that event, both companies would be jointly liable if there is a joint employment relationship.

The one exception is the NLRA. If the company is a joint employer, then the various protections of the NLRA start to cross over the temp employee and direct employee populations, such that if the agency workers were to organize, the company might have to bargain with them; or there could be a mixed unit; or if agency workers picketed the company, it would not be illegal secondary picketing.

So, if the answer to both of my questions is yes, then I would not be concerned with the duration of assignment. The company is very likely a joint employer already.

Some companies have a practice of not engaging temps for more than six months or year before deciding either they don’t fit or they should be hired directly. But there is no rule of thumb, and this sort of practice is often implemented based on the misunderstanding that capping a temp’s service time would reduce the risk of joint employment in a staff aug situation.

In reality, it’s unlikely to make any difference. In a staff aug situation, once you’re in the swimming pool of joint employment, you’re wet. It doesn’t matter if you’re on the top step or in the deep end. And once you’re a joint employer, you might as well exercise as much control as you want. You can embrace it at that point.

The best way to protect the company against the risks and consequences of joint employment is in the contract with the staffing agency. Here are Ten Things That Should Be in Your Staffing Agency Agreement But Probably Aren’t.

On the other hand, if you would answer no to either of my two questions, then limiting the duration of the assignment could be helpful in reducing the risk of independent contractor misclassification, especially if the workers are 1099 contractors.

If the answer to either of the questions is no, then we’d have to dive deeper into the facts to be able to say whether limiting the duration of the assignment would make any difference at all.

So, did you get the answer to the two riddles? Scroll down to see the answers.

.

.

.

.

.

.

1. An egg
2. A candle

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

© 2023 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

2018_Web100Badge
 
03.13.23
by

Ten Things That Should Be In Your Staffing Agency Agreements But Probably Aren’t

As promised during the Master Class session last week, here are Ten Things That Should Be in Your Staffing Agency Agreements But Probably Aren’t.

There are still four Master Class sessions to go. The next one will be Tuesday at 2pm ET, covering the NLRB and the Uncertain State of Labor Law. There is no charge to participate. CLE and HR credits are available. You can register here.

ten-things-that-should-be-in-your-staffing-agency-agreements-3.2023Download

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

© 2023 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

2018_Web100Badge
 
02.27.23
by

Airbag Jeans? Why You Should Address Disability Accommodations in Your Staffing Agency Agreements

Photo: Mo’cycle

A Swedish company has constructed airbag jeans for motorcyclists, designed to inflate for protection in the event of a crash. The denim-like fabric is water-repellent and abrasion-resistant. You can learn more here.

When riding a motorcycle, it’s smart to anticipate the possibility of injury. The same is true when engaging temps from a staffing agency.

Here’s what I mean. At some point, you’ll have a temp who requires reasonable accommodations for disabilities. The expense to accommodate might be small. But it might not be. Who pays for it, you or the staffing agency?

Last week, the EEOC announced a $119,000 settlement with a staffing company that rejected an applicant because of disabilities. The applicant, who is deaf, had been placed at a client. Before the applicant was to appear for work, a manager at the staffing agency cancelled the assignment, informing the applicant that the client did not have sign language interpreters available. The client, incidentally, was ready and willing to employ the applicant.

The EEOC’s news release doesn’t say whether the applicant actually needed an ASL interpreter or whether the client was planning to pay for one. But providing an ASL interpreter can be a reasonable accommodation. In a staffing agency relationship, who pays for reasonable accommodations needed by temps?

The best advice here is to plan ahead and put on those airbag jeans. Your contract with the staffing agency can address who pays for reasonable accommodations. All it takes is a short clause in the agreement. If the agency is paying, make sure there’s no markup on those expenses. Few staffing agency agreements address who pays for reasonable accommodations. But they should.

If you add a clause, differentiate between Title I and Title III obligations. Title I of the Americans with Disabilities Act (ADA) prohibits disability discrimination in employment. That’s the one you want to focus on. Title III of the ADA addresses public accessibility. You’ll pay for the wheelchair ramps and accessible doorways at your facility (Title III), but you may be able to shift the expenses of Title I compliance to the agency.

It’s also a good idea to make sure managers know to involve HR if disability or accommodation issues arise. You don’t want a manager saying “we can’t accommodate that” and ending a temp’s assignment.

Airbag jeans will be sold for $499 a pair. Reasonable accommodations may cost more. Either way, it’s smart to plan ahead and build protections in to your staffing agency agreement.

On March 7, I’ll be speaking at the 10th Annual Labor Relations and Employment Law Master Class Series, addressing recent developments in the contingent workforce area. I’ll be addressing joint employment and staffing agency relationships, and I plan to offer a list of ten items that should be in your staffing agency agreements but probably aren’t

Sign up here to learn more. There is no charge to attend the webinar.

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

© 2023 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

2018_Web100Badge
 
02.20.23
by

Lost Your Bill of Rights? Here’s a New One for New Jersey Temp Workers

What Companies Using Temps In New Jersey Need to Know

According to the National Constitution Center, there were 14 original copies of the Bill of Rights, with one sent to each of the 13 states and another kept by the federal government. The Center also reports, however, that four of the states — Georgia, Maryland, New York, and Pennsylvania — lost their copies. North Carolina’s was stolen by a Union soldier during the Civil War but recovered in 2002 through an FBI sting. (“Hey buddy, I’m lookin’ to buy a Bill of Rights. Ya know anyone?”)

New Jersey kept its copy, but also just added some new stuff. Sort of.

This month, New Jersey passed the Temporary Workers Bill of Rights. It’s less sweeping than the original 1791 Bill of Rights, but it co-opts the important sounding name to get everyone’s attention and to show constituents that the lawmakers are doing really important things that warrant re-election, financial support, the undying love of chatbots, etc.

New Jersey lawmakers love the “Bill of Rights” tag, by the way, having also recently passed a Siblings’ Bill of Rights, a Property Taxpayers’ Bill of Rights, and a Nursing Home Residents’ Bill of Rights.

The Temporary Workers’ Bill of Rights imposes new burdens on staffing agencies and the companies using temp workers. This post will focus on the obligations imposed by the companies using the temp workers.

Does the Bill apply to your industry?

The Bill applies to temp workers assigned by a temp staffing firm to work in any of the following industries, using Bureau of Labor Statistics (BLS) designations:

  • 33-90000 Other Protective Service Workers
  • 35-0000 Food Preparation and Serving Related Occupations
  • 37-0000 Building and Grounds Cleaning and Maintenance Occupations
  • 39-0000 Personal Care and Service Occupations
  • 47-2060 Construction Laborers
  • 47-30000 Helpers, Construction Trades
  • 49-0000 Installation, Maintenance, and Repair Occupations
  • 51-0000 Production Occupations
  • 53-0000 Transportation and Material Moving Occupations

If you’re not in one of these industries, stop reading and get on with your day.

What obligations does the Bill impose on the users of temp labor?

1. Equal Pay. This sounds fair but may be problematic in practice. Temp workers must be paid “not less than the average rate of pay and average cost of benefits, or the cash equivalent thereof” of the user’s similarly situated employees.

I see two immediate problems here.

First, one of the benefits of using a staffing agency is the ability to pay the temps less until they prove themselves and earn an offer of direct hire. No longer. Now you’ll have to pay the same amount as you pay your regular workers, plus the markup.

Second, how is the staffing agency going to know the wages paid to your similarly situated regular workers and the value of the benefits package you provide them? Presumably you’ll have to tell the staffing agency.

But the staffing agency is not your confidant or fiduciary. It has multiple clients, probably including your competitors. Do you really want the staffing agency to know what your cost of insurance is, or what you pay your regular workers, or the full suite of benefits you offer? The staffing agency will have to adjust what it charges you — and your competitors — based on what each of its clients pay their similarly situated worker. That sounds like a pretty useful set of data for anyone wanting to know what competitors are doing.

You can (and should) designate this information as confidential when disclosing it to a staffing agency, and you should make sure your staffing agency agreement includes an obligation to protect confidential information. But is the information really that safe from prying eyes? If a competitor or temp worker is involved in litigation, couldn’t this information be subject to subpoena? Once you reveal this information, you lose a good bit of control over it.

2. Freedom to direct hire. Under the new law, temp workers must be free to accept offers of direct hire. Staffing agencies cannot restrict the workers’ ability to accept offers of direct hire. The agency can impose a “placement fee” on its client (you), but the amount is limited by statute.

The amount of the placement fee cannot exceed “the equivalent of the total daily commission rate the temporary help service firm would have received over a 60-day period, reduced by the equivalent of the daily commission rate the temporary help service firm would have received for each day the temporary laborer has performed work for the temporary help service firm in the preceding 12 months.”

For purposes of contracting, any provisions prohibiting direct hire for limited periods of time need to be removed. Instead, staffing contracts (in NJ, for these job classifications) should permit direct hire but may charge a permitted placement fee.

3. Reimbursement of tax obligations. The user of services is required to reimburse the temp agency for wages and “related payroll taxes.” Presumably this is already basked into the markup, but now it’s required.

4. Joint and several liability. The law imposes joint liability for any violations of the equal pay or direct hire provisions. Consider what that means for equal pay. You might have to disclose to the temp agency what you pay your similarly situated employees, but you don’t control the temp agency’s payroll practices. If they mess up and pay the temp worker less than the law requires, the law says you’ll be jointly liable.

Who said anything about fair?

Be sure your staffing agency agreement includes robust indemnity provisions. The agreement should also create a contractual obligation for the temp agency to pay workers all amounts they are due under the law so that, if the agency fails to do so, you can point to a breach of contract when seeking indemnity. Indemnity claims based purely on the law could be subject to challenge since the law also says there is joint liability.

Conclusions

This Temporary Workers’ Bill of Rights applies only to certain industries in New Jersey but, for users of temps in these industries, the law creates important new obligations.

For violations, the law allows for a private right of action and carries a six-year statute of limitations.

If you use temp labor in New Jersey in one of the covered industries, be sure you understand the new requirements. This would be a good time to go back and revisit your staffing agency agreements. They may need some tidying up.

Also consider requiring temp workers to sign individual arbitration agreements as a condition of being placed at your worksite. This strategy can help insulate you from a class action filed against both the temp agency and your company. Class actions against both entities are a particular concern, given the joint liability section of the new law.

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

© 2023 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

2018_Web100Badge
 
04.06.20
by

When 500 Isn’t Necessarily 500: How to Count Employees Under the Families First Law

As you know by now, the Emergency FMLA and Emergency Paid Sick Leave provisions in the Families First Coronavirus Relief Act apply only to employers with fewer than 500 employees. But lots of questions have arisen about how to count.

For those who need help counting, here’s a helpful resource:

But for those of you counting employees instead of bats, let’s try this instead.

Question #1:  Do temps count? 

Answer:  Are we talking about feelings here? Because if we are, then everyone counts. You’re a winner! And you’re a winner! And you’re a winner!

Ah, but do they count toward the 500-employee threshold under Families First? Well that depends on whether they are joint employees of your business and the staffing firm.

As of last year, the answer for staffing agency temps was most often yes. But in January 2020, the DOL changed the test for how to determine whether someone is a joint employee under the Fair Labor Standards Act (FLSA). While there are different tests for determining joint employment, the one that matters for the Families First law is the FLSA test.

You can read more about the new DOL test here.

Question #2: Do part-timers count?

Answer: Yes. Count all part-time and full-time employees. Part-timers are people too. See, Feelings, Morris Albert (1975). Skip to 0:45 if you want to skip the instrumental intro.

Fun fact: In the late 80s, when you were arguing with your friends over which is the best Duran Duran song (answer: none), French songwriter Loulou Gaste successfully sued Albert for plagiarism, persuading a jury that Albert based the song on Gaste’s 1957 chart-topper “Pour Toi.”

Question #3: Do you aggregate employees across multiple subsidiaries?

Answer: Generally no. The default is that each subsidiary is its own employer. Divisions of a single subsidiary are aggregated.

But there are some situations when subsidiaries are aggregated. A conglomerate consisting of several different subsidiaries can a “single integrated employer,” in which case, you add the numbers together. We determine “single integrated employer” status by looking at four main factors:

  • Common management;
  • Common ownership;
  • Centralized control over labor relations and personnel; and
  • Interrelation of operations.

The more there exists common control, there more likely there is a single employer. There are many subfactors that also go into the analysis, and the most important factor tends to be centralized control over labor relations and personnel.

This is a difficult analysis, and there can be consequences to being a single integrated employer that go beyond Families First. If you think this applies to your company, proceed cautiously and seek legal advice.

Question#4: If I’m stuck home because of coronavirus, where can I find more helpful videos featuring The Count?

Answer: Ummm … this is where I sign off.

2018_Web100Badge

© 2020 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

 

12.20.18
by

Disco Meets “Permanent Temps”: NLRB Decides a New Joint Employment Issue

disco-297670__480On New Year’s Eve, Sister Sledge will be playing at the Seminole Casino in Coconut Creek, Florida. (You can buy tickets here.  You’re welcome.) The sisters will, of course, play the 1979 single, “We Are Family,” which is a disco song that it’s ok to admit you like. I don’t know what else they’ll play though.  It could be a long night.

“We Are Family” is also what happens when a company retains staffing agency temps for so long that they become, in that company’s words, “permanent temps.” It’s joint employment deluxe.

A recent decision by the NLRB examines what happens when a joint employer fails to apply a collective bargaining agreement to those “permanent temps.”

Orchid Paper Products Company in Pryor, Oklahoma, produces — wait for it — paper products. Their workforce is unionized and they make frequent use of staffing agency temps. The temps frequently remain on-site for long periods of time, at which point they acquire the status of “permanent temps.”

These workers are supervised and controlled by Orchid Paper, even though they are paid by their staffing firm. The Board found that under any test — Browning-Ferris or otherwise — they are joint employees.

One consequence of being a joint employee in a union environment is that the joint employer, Orchid Paper, has to follow the requirements of the collective bargaining agreement (CBA) as to those workers, even though they’re staffing agency workers. When Orchid Paper failed to follow the CBA as to those workers, it engaged in an unfair labor practice. So far, no big surprise.

The issue to be decided here, though, was the scope of the remedy that could be imposed.

As a result of an unfair labor practice, could the Board order a a remedy that held Orchid Paper to the entire CBA for its temps?

The Board said no, ruling that only certain parts of the CBA can be applied. In other words, “We Are Family, but Maybe Only Like Third Cousins.”

The Board ruled that an order intended to remedy an unfair labor practice had to be limited. The Board could only order the joint employer to apply the CBA provisions to the joint employees that related to the working conditions that Orchid Paper controlled.

My research in preparing this blog revealed that Sister Sledge, in fact, had two other Top 20 hits in 1979 — “He’s the Greatest Dancer” and “Lost in Music.” Those of you who remember those two songs will thoroughly enjoy the New Year’s Eve Show. Bring your platform soles.

© 2018 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

2018_Web100Badge

 

12.06.18
by

Happy Birthday, Rudolph! (You’re Still Just a Temp.)

Temporary workers rudolph reindeer employment law

At age 79, Rudolph is the youngest of Santa’s reindeer, having been created in a promotion for the Montgomery Ward department store in 1939. While he reliably shows up every December, Rudolph is still just a seasonal hire, presumably grazing with his caribou cousins somewhere in Lappland or Siberia the rest of the year.

Seasonal hires, or temps, present special problems. There are different kind of temps.

Temps retained as W-2 employees are regular employees, even if only retained for a short period of time.  Regular employment rules apply.

Temps retained through staffing agencies are a little different, but not much. They are likely joint employees of both the worksite employer and the staffing firm.  They likely take direction and supervision from the worksite employer and work side-by-side with the worksite employer’s regular employees.  These characteristics are generally signs of joint employment.

What is the impact of joint employment? Potentially none, but if the staffing agency does not properly pay its employees, the worksite employer may be on the hook. It is critical to ensure that hours are properly recorded and the staffing firm is reputable and reliable in its pay practices.

The use of temps can be a tremendous help during the holiday season, like having a luminous red headlight for a nose when delivering toys via sleigh.  Just be sure to tighten all the reins before taking off.

© 2018 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

2018_Web100Badge

06.19.17
by

When an Employee Double-Dips On a Paycheck, Who Pays?

Remember this?

Suppose the chip is a check, and the employee tries to cash it twice? Who would you rather be, Costanza or Timmy?

Staffing agency clients are increasingly pointing to a fraud committed by disloyal short-term employees. They cash a paycheck on their mobile app, then deposit the paper check a second time for duplicate payment. The check clears twice. Who must pay?

While this problem can arise in many scenarios, including with regular W-2 employees, it seems to be occurring more frequently with staffing agency employees, PEOs, temps, and other short-term workers. So let’s take a look.

Continue reading →

06.12.17
by

Joint Employment Is Like Taking Steroids By Accident

athlete-joint employment - staffing agency - 1840437_1920It seems like every month another professional athlete is caught using a prohibited substance. The typical script (after getting caught) is to blame the maker of a supplement. “I should have more carefully checked the label,” or “I had no way of knowing what was in that synthetic elephant urine.”

Fair or unfair, every athlete knows that he/she is responsible for what goes into the athlete’s body, whether the juicing was intentional or not.

The same rule applies to companies who use staffing agencies.

Continue reading →

05.15.17
by

The Myth of “Temporary Employees”

IMG_1067What is a “temporary employee”? I have practiced employment law for 20 years (Note to self: Keep practicing; someday you’ll get good at it.) and I can’t tell you. It’s a state secret. All lawyers have been sworn to secrecy forever.

Either that or, if you really want to know and say “pretty please” (with or without sugar on top, but no artificial sweetener please), that term has no legal significance. Usually the term is used to mean one of two things:

  1. your employee, hired on a trial basis with some sort of probationary period; or
  2. a staffing agency worker, retained to augment staff levels on a temporary basis.

Under option 1, the “temp” is a regular W-2 employee of yours, probably employed at will like your other employees, but whether you call that person “temp” or “permanent” or “regular” or “irregular” (?), none of it matters. A temp worker who is your employee, paid subject to deductions, is your employee.  Temp time counts toward FMLA eligibility. Continue reading →