Staffing agencies play an increasingly important role in the workforce today, enabling companies to maintain a flexible labor pool and fill employee shortages as needed. However, this field comes with an unusual degree of exposure to risk with respect to both clients and workers, which makes it especially important that staffing agencies have adequate employee liability coverage.
In contrast to the traditional company structure, the agency does not oversee its employees directly. Rather, they are under the supervision of the client, yet the staffing agency remains responsible for the work temporary employees do. They also are expected to screen workers, match them properly with jobs and accurately represent clients to temporary workers.
This means that the staffing agency may be liable not only for workers’ errors but also for the working conditions in the client company. Mistakes in the workplace, particularly in high-risk settings such as medicine, can be costly for all involved, particularly for the staffing agency.
Furthermore, an employee who feels that the placement company was misrepresented or that he or she has been wrongfully disciplined, terminated or discriminated against may file a claim against both the client company and the staffing agency. Full employee liability coverage can protect staffing agencies against severe financial damage from a liability claim stemming from either client companies or workers.