Over the past several years, employers have increasingly turned to staffing firms such as temporary agencies and employee leasing companies to supply workers. And according to the federal Equal Employment Opportunity Commission (EEOC), many of these so-called ‘contingent’ workers are female and/or minorities. Employers often mistakenly assume that because temps or other contract workers aren’t on their payroll, they’re not the person’s employer and therefore won’t be responsible for harassment or bias problems. But the EEOC has just released new guidelines making it clear that if you have 15 or more employees, both you and the staffing agency can sometimes be considered joint employers and liable for these workplace disputes.
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Who’s Responsible For Temps’ Claims Of Discrimination Or Harassment?
According to the EEOC, the most important factor in determining who is the worker’s employer is whether you or the agency have the right to exercise control over the person.
In the most common case, the temporary agency pays the worker’s wages, takes care of tax withholding and provides workers’ comp coverage. The agency can also fire the person if their services are unsatisfactory. But the individual’s job duties and working conditions are controlled by you, the client of the agency. In this situation, both you and the agency will be considered the joint employer of the temporary worker.
However, the result can be different depending on how the relationship is structured. For example, you put your workers on an employee leasing firm’s payroll. But the leasing firm is only responsible for paying wages and handling insurance benefits. You have the sole right to hire and fire, and you exercise complete control over the workers. According to the EEOC, only you, not the leasing company, are the employer and are responsible for workplace discrimination.
You’re Responsible Even If They Are Not Your Workers
Although you may not be a contingent worker’s employer, you can still get sued. Suppose you’ve contracted with a computer vendor to provide periodic on-site maintenance of your equipment. The firm sends the same technician each time, and he brings his own tools and works without your supervision. After a few visits, you ask the vendor to replace the technician with someone else because you are unhappy with his work. However, the worker believes the true reason for your complaint is that he is black.
Even though the worker isn’t your employee, if your request to replace the technician was motivated by racial bias, you could be liable for interfering with his employment opportunities.
The EEOC points out that staffing firms can be on the hook for their clients’ misdeeds if the agency fails to take immediate and appropriate corrective action once it learns that there may be illegal discrimination. Here’s an example: A temporary receptionist complains to the agency that she is being sexually harassed at her worksite. To avoid liability, the agency must notify the client and insist that it thoroughly investigate and take appropriate action. If the client doesn’t investigate, the EEOC says the agency should refuse to send any more employees to that client.
What You Can Do
Here are some measures you can take to protect yourself from temporary workers’ claims:
- Review your policies. Check to be certain your written sexual harassment and anti-discrimination policies clearly cover temporary or contract workers. Be sure the policies are strictly enforced and your employees know that the rules against harassment and discrimination extend to temps.
- Investigate all problems. If a temporary worker claims that either your organization or the staffing agency has discriminated against or harassed them, investigate immediately. If the complaint is valid, take prompt measures to remedy the situation.
- Treat temporary workers the same. It’s critical to treat contingent workers just as you would any regular employee with respect to discrimination and harassment matters. And the same is true for people you consider to be independent contractors. The general rule is that to qualify for protection under the anti-discrimination laws, a worker must be an employee. Nevertheless, you are still vulnerable to lawsuits by those you think are independent contractors because a court may find that you have misclassified a worker and that the person is legally your employee.
For More Information
For a free copy of ‘Enforcement Guidance: Application of EEO Laws to Contingent Workers Placed by Temporary Employment Agencies and Other Staffing Firms,’ call (800) 669-3362. The publication is also available on theEEOC’s web site.