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Considering Legal Exposure When Engaging a Staffing Firm

Liability exposure and costs associated with workers’ compensation claims are major factors for most healthcare companies. Many view nurse-staffing partnerships as a way to help mitigate risks. To some extent that’s true. However, relying on an outside recruiting firm to hire healthcare workers does not completely absolve a company from legal responsibilities.

Fact & Fiction

  • A staffing partnership reduces liability exposure for the healthcare company, but it does not indemnify the client altogether.
  • A thorough service agreement that outlines the recruiting agency’s obligations with regards to background screenings, verifying worker authorization, workers’ compensation insurance coverage, etc. DOES mitigate the client’s legal risk.
  • Placing contingencies on a worker’s term of employment does NOT reduce the client’s liability whatsoever. The length of employment is irrelevant, legally speaking.

Employment Claims

  • Pertaining to EEO claims (discrimination, harassment, etc.), BOTH the staffing agency AND the client may be held responsible, depending on the circumstances.
  • The legal standard for determining who is considered an “employer” with regards to EEO claims is very detailed. But, the simple way to look at it is that anybody or any organization that directly controls or dictates a worker’s duties is considered their “employer.”
  • Companies can be liable for personal injury claims, even if the worker is employed through a staffing agency.

Other Important Takeaways 

  • Both healthcare companies and staffing firms are legally-obligated to conform to EEO laws and will be held responsible for violations.
  • Clients should ensure that their employment agency exercises due diligence and legal compliance in recruiting and hiring practices.
  • Healthcare companies cannot transfer legal exposure entirely to their staffing partner and must also take steps to avoid claims.
  • An employment agency’s workers’ compensation insurance does cover temporary staff. The client may still be exposed to other personal injury lawsuits.

The co-employment legal landscape is very complex. A staffing agency partnership may be helpful, but it is not a “get out of jail free card” for healthcare companies. With that said, vetted relationships with trustworthy workforce firms can mitigate legal risks.

Healthcare companies that hire nurses and other medical professionals should also seek to mitigate risk by implementing top-notch staffing and VMS technology!

BlueSky Medical Staffing Software Manages Your Contingent Healthcare Providers