Staffing Agencies Must Protect Themselves Legally

Staffing Agencies Must Protect Themselves Legally

A recent trial in Pennsylvania has highlighted just one of the legal issues surrounding the hiring and employment of temporary workers. A staffing agency’s customer recently failed to make pension fund contributions for nearly 1,500 temporary employees and was taken to court by the pension fund’s lawyers. The attorneys for the fund argued that the rules of a recent collective bargaining agreement between the agency’s customer and the Teamsters Union required regular contributions.

Because the temporary employees were technically on the payroll of the staffing agency, and not directly on the customer’s payroll, the defendants argued that they were not responsible for the pension fund contributions. That argument fell on deaf ears at the trial court level, however, with the court finding in favor of the pension fund and interpreting the agreements in a manner that would place temporary employees on the payroll if a certain number of hours were worked and if the same work was performed as that of union members.

That decision was reversed by the appellate court, which held that the trial court misinterpreted the terms of the agreement and that the employees in question were truly non-payroll employees.