Protecting your company in a co-employment arrangement

On Behalf of | Apr 21, 2019 | Employment Law -- Employer |

Employees are a core part of many businesses. In some cases, it is more feasible to hire temporary workers on a long-term basis.

In such cases, many companies turn to staffing agencies. In order to ensure the protection and proper order of such co-employment relationships, business owners should consider a few important things.

Agreements with agencies

Before engaging with an agency, it is important for business owners to ensure that the agency is legitimate. One way is to make sure that the agency is in full compliance with the law, both locally and federally. In addition, the agreement between the business and agency should not only clearly dictate the relationship between the two but also explain the contractor relationship between the business and the worker. It may also be beneficial to detail the aspects the agency is responsible for, such as the hours of the worker.


Along with the contract with the agencies, businesses should instill a clear, detailed contract with the worker. One important aspect of the contract must be the contractor’s status as a non-employee. This is critical to preventing claims of employee misclassification. It can be quite helpful to work with an employment law attorney to ensure the proper wording and stipulations are in place with the contract.


Another important element to include within the contract is a statement about benefits. If the business does not offer benefits to non-employees, the contract should clearly state that the worker does not receive benefits from the business. Some business owners may choose to provide nonqualified plan options for contractors. For those who choose this option, it is still important to note that the worker does not qualify for employee benefits.

When all parties have a clear understanding and documentation of the nature of a relationship, it helps to deter possible issues. Take some time to determine what elements are needed to safeguard your company and maintain healthy co-employment relationships.