What it means when your business uses workers from a staffing company or temp agency
Many business owners assume that, if a worker comes through a staffing company, the staffing company is the employer, and that is the end of it. Not necessarily. In some situations, your business also may be treated as an employer for legal purposes. That is where the concept of “joint employer” comes in — and it can affect your exposure under labor laws, leave laws, antidiscrimination laws, and workplace safety rules.
Under the National Labor Relations Board’s current rule, effective February 27, 2026, joint-employer status depends on whether a company possesses and exercises substantial direct and immediate control over the essential terms and conditions of employment, such as wages, benefits, hours, hiring, discharge, discipline, supervision, and direction.
Why business owners should care
This is not just a technical legal label. If your supervisors are directing the worker’s day-to-day activities, setting schedules, overseeing performance, or influencing whether that person stays on the job, your business may have responsibilities of its own. Importantly, the test is not identical across all laws. The federal labor-law standard is one piece of the puzzle, but wage-and-hour, antidiscrimination, leave, and safety laws may analyze the relationship differently.
What responsibilities may fall on your business?
Start with safety. The U.S. Occupational Safety and Health Administration states that staffing agencies and host employers are jointly responsible for maintaining a safe work environment for temporary workers, including training, hazard communication, and certain recordkeeping duties. So, if a temporary worker is injured at your site, your business should not assume safety compliance belongs only to the agency.
Discrimination and harassment are another area of risk. The Equal Employment Opportunity Commission’s guidance explains that contingent workers placed by staffing firms may be employees of the staffing firm, the client, or both. That means if a worker assigned to your company experiences harassment, discrimination, or an accommodation issue, your business may have legal obligations, even if you are not the entity issuing their paycheck.
Leave issues also can create surprises. The U.S. Department of Labor explains that joint employment commonly exists when a temporary placement or staffing agency supplies workers to another employer. In those situations, the staffing agency is often the primary employer for Family and Medical Leave Act (FMLA) purposes, but the client still may have obligations, including not interfering with FMLA rights and, in some circumstances, restoring the employee to work.
The practical takeaway
If your company uses staffing-agency workers, ask a few basic questions:
- Who supervises them?
- Who sets their hours?
- Who handles any complaints?
- Who tracks their time?
- Who provides safety training?
- Who decides whether the worker stays or goes?
If the answer is “we do” or even “we do some of that,” then it is worth taking a closer look at your policies, contracts, and day-to-day practices. Contracts matter, but they do not control the legal result by themselves. The real relationship usually matters more.
Using staffing-agency labor can be a smart operational decision. But it is not a legal shield. Before a complaint, leave request, wage claim, or workplace incident lands on your desk, make sure your business understands where its responsibilities lie.
If your business uses temporary, leased, or staffing-agency workers, and you are unsure where your responsibilities start and end, this is a good time to get clarity before a problem turns into a claim by speaking with us at 973.787.8442 or emailing us at legaladmin@alixrubin.com
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