What are the top EPLI claims in staffing agencies, and how to prevent them? Staffing firms serve as the employer of record while their employees work inside a client’s facility under the client’s daily supervision. This arrangement creates employment practice exposures unlike those most employers face. Employment practices liability insurance (EPLI) addresses allegations related to hiring, workplace treatment, and termination, and it works alongside other coverage within a broader employment agency insurance program designed for staffing firms.
Understanding which claims surface in this industry, along with the operational factors behind them, helps insurance agents evaluate staffing liability exposures before recommending coverage.
Top EPLI Claims Facing Staffing Firms
EPLI claims against staffing firms typically involve discrimination, sexual harassment, and wrongful termination. The Equal Employment Opportunity Commission’s enforcement guidance on staffing arrangements explains that a staffing firm and its client company both qualify as joint employers when each holds the right to control a placed worker’s job, regardless of whether either company exercises that control every day. That shared standard means either party may answer for a claim tied to the same worker.
Applicants who go through a staffing firm’s screening process, in-house staff at the firm’s own office, and employees placed at a client’s worksite can each bring a claim, and a client company may share responsibility alongside the staffing firm in any of these situations. Recognizing who may bring these claims helps insurance agents identify employment practice exposures before recommending employment agency insurance built to address them.
Understand Staffing Risk Factors
Staffing firms carry employer-of-record duties, yet a client company often controls the placed worker’s daily assignments, supervision, and worksite conditions. That split creates joint-employer exposure, and it now plays out under more than one legal framework.
A final rule from the National Labor Relations Board, effective February 2026, restored the board’s narrower standard for joint-employer status under the National Labor Relations Act. Under that standard, a company qualifies as a joint employer of another employer’s workers only if it holds and actually exercises substantial, direct, and immediate control over wages, benefits, hours, hiring, discharge, discipline, supervision, or direction.
Reserved contract authority that a client never exercises, or influence that only shows up indirectly, does not meet that bar on its own. This standard governs a different set of legal questions than the Title VII discrimination claims covered above. Still, it shows how closely regulators are scrutinizing the staffing firm-client relationship, and it gives agents one more reason to review how a client’s role in daily supervision is spelled out in the staffing agreement.
Evolving employment relationships add another layer to this picture. As staffing arrangements grow more complex, with multiple parties sharing hiring, scheduling, and supervisory duties, agents can ask staffing clients how a client’s role in daily supervision might change who could be named in a future claim. This kind of question does not replace legal guidance, but it opens a fuller risk conversation with staffing clients navigating staffing liability exposures.
Strengthen Employment Practices
Consistent hiring procedures reduce the chance that a hiring decision looks arbitrary or discriminatory after the fact. A structured onboarding process, paired with a clear channel for workplace complaints, gives employees a documented path to raise concerns before those concerns turn into claims.
Written anti-harassment policies, thorough documentation of performance issues and disciplinary decisions, and a client service agreement that spells out which party handles supervision, scheduling, and discipline all strengthen a staffing firm’s employment practices record. Agents can use these operational touchpoints to guide a more specific conversation about employment agency insurance with staffing clients.
Turning Risk Reviews Into Action
A review of common EPLI claim scenarios gives agents a practical way to open conversations with staffing clients about their hiring practices, client relationships, and overall risk profile. Walking through real claim patterns, rather than a general policy checklist, tends to surface gaps a client might not otherwise mention.
Connecting these operational practices to the right coverage helps agents address staffing liability exposures before an employment-related claim arises. Call us today to talk through employment agency insurance options for your staffing clients.
About World Wide Specialty Programs
For the last 50 years, World Wide Specialty Programs has dedicated itself to providing the optimal products and solutions for the staffing industry. As the only insurance firm to be an ASA commercial liability partner, we are committed to that partnership and are committed to using our knowledge of the industry to provide staffing firms with the best possible coverage. For more information about Staffing Professional Liability Insurance or any other coverage we have available to protect your staffing business, give us a call at (877) 256-0468 to speak with one of our representatives.