Staffing Firm Insurance: Identifying Your Liabilities

Staffing Firm Insurance Identifying Your Liabilities

Staffing Firm Insurance: Identifying Your Liabilities  

Staffing firms face increasing demand from their clients to absorb various types of liability involved with the staffing process. For example, many clients will expect staffing firms to assume responsibility for damages or losses brought to their business by a worker you placed.  Government officials have begun holding staffing agencies partially responsible for providing benefits to temporary or placed employees as well as ensuring that employees are not placed in situations which violate their employment or worker’s rights. The amount of responsibility placed upon staffing professionals today is tremendous, and only increasing as staffing services become more heavily utilized.  The truth is that staffing firms are often so busy resolving everyone else’s conflicts and assuming other responsibilities that they forget to prepare for their own.

According to the American Staffing Association (ASA) there are a few things that staffing agencies are inherently liable for.  In general, these risks are primarily those of any other business. These include proper employment practices of their own employees, including payment of wages and benefits, non-discrimination, accountability to fulfill contracts and business agreements, to maintain a safe work environment and so on. As a service provider, staffing firms are can also be liable for client losses or damages caused by the services they provide. For example, if a client suffers losses as a result of a staffing firm’s failure to properly screen or otherwise qualify an assigned employee for a position, the firm can be held legally responsible for those losses.

This is often where controversy arises, when clients attempt to suggest that a staffing firm is responsible when they are not. A staffing firm is unlikely to be held responsible for the actions of a placed employee. They are simply responsible for ensuring that all proper hiring, screening and qualification measures are taken when placing a worker. The ASA recommends that staffing professionals work with legal representatives to craft contract language that will explicitly detail the firm’s and the client’s responsibilities and liability limits. They provide examples of suggested language for a variety of staffing industry sectors and other resources on the website.

The staffing industry faces challenge and risks unique to their niche services and profession. At World Wide Specialty Programs we specialize in ensuring that staffing industry members receive the most complete coverage available. Our Staffing Firm Insurance portfolio includes a comprehensive array of insurance solutions, including general liability and a host of specialty liability coverage inclusions. To learn more about all of our offerings, we invite you to give us a call today at (877) 256-0468.