Three Potential Liabilities Staffing Firms Face When Working with Independent Contractors

Three Potential Liabilities Staffing Firms Face When Working with Independent Contractors

Many businesses are relying more and more on independent contractors to perform necessary job duties or complete short-term projects. Staffing companies work with independent contractors to meet their client’s needs. However, the staffing firm may need to help limit independent contractor liability.

Vicarious Liability

An independent contractor may inadvertently bring vicarious liability to the staffing firm. The client may deem the staffing firm liable when the independent contractor doesn’t complete a job, becomes ill or steals something. The client may go after the firm rather than the contractor to receive financial compensation.

Dangerous Activities

Most independent contractors do not work in dangerous fields, but some of them do and can put the staffing firm at risk. Making sure there is a workers’ compensation plan in place for an independent contractor when working with inherently dangerous materials or projects can help cover costs in the event of an injury or illness.

Contract Provisions

The Affordable Care Act states that companies must provide health insurance when the number of full-time employees exceeds 50. According to worldwide specialty programs, clearly outlining the relationship between the contractor and the staffing firm can help protect the agency from having to pay for an independent agent’s insurance.

Independent contractor liability doesn’t have to negatively affect a staffing agency. Proper documentation and contracts can help mitigate risk.

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