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Avoid Issues of Co-employment

August 1, 1996
Related Topics: Contingent Staffing, Featured Article
When temporary employees become more attached to their contracting companies than their agencies, you have a problem of misplaced loyalty. The temps look to their contracting companies to fulfill their needs, and are almost sure to be disappointed.

The issue of allegiance becomes more problematic if it leads to a co-employment situation. Co-employment occurs when a company's relationship with the temporary employee takes on the characteristics typically associated with the traditional employee/employer relationship: salary and benefit review, counseling, discipline and termination. When co-employment exists, each company is liable for the employment decisions made by the other. If a contingent employee files a legal complaint and wins, both the agency and the client company could be responsible for any damages awarded.

The preceding explanation of the co-employment issue is included in New York City-based Olsten Corporation's handbook for client companies. It also provides a list of do's and don'ts your company should follow to avoid potential liability:



  • Train the new assignment employee to perform job tasks
  • Take immediate corrective action if an assignment employee is violating safety rules
  • Report any absences, tardiness or unacceptable behavior to the agency
  • Refer all questions relative to pay, benefits, duration of position or opportunity for employment to the agency
  • Inform the agency about any changes in an employee's work schedule
  • Assist the agency in evaluating employees.
  • Inform an assignment employee that he or she is terminated or suspended
  • Discuss pay rates, increases, incentives or bonuses
  • Discuss opportunities for regular full-time employment
  • Extend an offer for employment
  • Request that an assignment employee complete timecards or forms with your company's name on them
  • Counsel assignment employees concerning: tardiness, punctuality, attendance, dress code, child-or elder-care arrangements or other personal matters.

Because issues of co-employment are directly related to the client company's own actions with regard to temporary employees, the above guidelines can provide companies with a solid foundation for dealing with temporary staffing issues.

SOURCE: Olsten Corporation

Personnel Journal, August 1996, Vol. 75, No. 8, p 46.

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