Businesses often use employee staffing companies or temporary employment agencies to avoid many employment liability risks such as hiring, firing and wage decisions. A recent decision of the National Labor Relations Board may erode that protection.


In the case of Browning-Ferris Industries, the Board found that two or more entities may be joint employers of a single work force if they share control or reserve authority to control the terms and conditions of employment. The Board found that “reserved authority to control terms and conditions of employment, even if not exercised, is clearly relevant to the joint-employment inquiry.”

Businesses which retain the potential to exercise control over a worker’s wages and working conditions, regardless of whether that control is ultimately used, may remain liable to the workers for actions of its staffing company. These businesses should review their staffing contracts to ensure they include language specifying that the business is not a co-employer and consider eliminating provisions that reserve some control over the workers, such as retaining the right to terminate the worker.

This summary was taken from the November HSP Business Briefing.

Eric A. Parzianello