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Hiring via a Staffing Company? 3 Legal Reminders

By Jenny Tsay, Esq. on March 31, 2014 10:54 AM

Need to hire new workers? A staffing agency may be able to help get the job done -- but there are a few legal issues you'll want to consider first.

Some staffing agencies can place the right candidate at your firm without you having to sift through a high volume of job applications. Others will allow you to select and interview candidates, but will handle the hiring and other HR tasks so your small business doesn't have to.

However, before you sign up with a staffing company, here are three legal tips to keep in mind:

1. Read Your Contract Carefully.

Staffing agencies enter into contracts with employing businesses that can cover issues like the amount to be paid, the minimum qualifications for the job, and when the worker's assignment will end. But your business may want to include additional clauses such as a non-disclosure agreement.

It's a good idea to have a business lawyer review your contract to make sure everything is in order. A lawyer will also be able to advise you about potential breach of contract situations and what your business may be liable for in a worst-case scenario.

2. Staffing Company Workers Are Not Your "Employees."

Workers hired via staffing agencies are typically not independent contractors, nor are they employees of your small business. Rather, they generally are employees of the staffing company, which should be their point of contact for questions about issues such as pay and overtime, and even issues such as discipline and termination.

So if one of your staffing-agency hires fails to follow your rules or is giving you attitude about a particular assignment, it may be best to ask his actual employer (i.e., the staffing agency) to address the problem. Not having to deal with HR-type issues is one potential advantage of hiring through a staffing company.

3. Employment Laws Are Still in Effect.

Even with a staffing company effectively serving as your human resources department, your small business must still comply with employment discrimination laws. Neither your business nor a staffing agency can discriminate based on factors like race, gender, age, or disability.

Another common issue involving staffing-agency workers is whether they are paid for all hours worked, so make sure you're keeping an eye on their work schedules. It's also wise for business owners to make sure that staffing companies are checking for work visas or other documents that legally entitle a foreign national to work in the United States. Failure to do so can potentially land your business in hot water.

These are just a few general legal tips to remember when hiring via a staffing company. For guidance on more specific concerns, consult an experienced employment lawyer near you.

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