Blog

The Joint Employment Relationship

on April 12, 2021 in ABR Blog, HR and Workforce Tips

 

In most staffing arrangements, a staffing agency and the client companies they serve share employer obligations in what is often referred to as a co-employment relationship, otherwise known as joint employment.

Joint Employment Relationship: Who Does What

Responsibilities in this type of joint employment arrangement are as follows.

Staffing firms

  • Verify employee work status under immigration laws
  • Are the employer of record for wages and benefits
  • Withhold and remit all payroll taxes (e.g., Social Security and Medicare)
  • Provide workers’ compensation insurance coverage
  • Have the right to hire and fire
  • Hear and act on complaints from employees on working conditions and other work-related matters

Clients

  • Generally supervise and direct employees’ day-to-day work
  • Control working conditions at the work site
  • Determine the length of employees’ assignments

Staffing Agency Advantages

One of the many advantages of using a staffing firm is that you don’t have to worry about workers’ compensation, unemployment insurance, liability coverage, and payroll taxes and withholdings for the temporary workers assigned to you. That’s because staffing firms generally are the employers of such individuals and handle those obligations.

However, in some situations, you may be deemed a “joint employer” of temporary workers assigned to you, and thus you may share liability with staffing firms for some employment obligations.

Joint Employment: Not A New Concept

While there has been recent news about joint employment coming from federal agencies such as the U.S. Department of Labor and U.S. National Labor Relations Board, the fact is that joint employment is nothing new in traditional staffing arrangements. For decades, these agencies, as well as most other federal agencies and courts, have taken the position that staffing clients often are joint employers.

So what has changed? For some industries, perhaps a lot. But for the staffing industry, not much. The flexibility and efficiencies that staffing affords outweigh any potential joint employment concerns and, in some contexts such as a staffing firm’s workers’ compensation coverage, joint employment can actually protect staffing clients from liability.

Hiring A New Staffing Provider? Ask These Things

Joint employment issues can be addressed by working with a knowledgeable and compliant staffing firm. Therefore, when choosing a staffing provider, ask the company how it trains and keeps its internal staff up-to-date on employment laws. Explore how the firm remains compliant and how it can help you manage joint employment issues. And ask whether the firm is a member of the American Staffing Association, which offers comprehensive education programs on workplace law compliance.

We want you to use staffing services with confidence. We hope this information will help you choose your service provider wisely.

This information in this blog was provided by the American Staffing Association and published with permission.