Employers rely on temporary employees to fill employment needs during times of increased demand or due to worker injuries or illnesses. Businesses often use staffing agencies to supply the necessary workers.
While staffing agencies employ short-term workers, both the contracting business and the agency are responsible for complying with the Fair Labor Standards Act. Reviewing these frequently asked questions might ensure all parties follow the wage guidelines.
Do FLSA standards apply to temporary workers?
Employers often need temporary workers in various professional, administrative, and executive positions. While these positions typically qualify as exempt according to the FLSA standards, temporary workers usually get paid hourly rates based on the contract signed between the staffing agencies and their clients. Due to this arrangement, hourly temporary employees must receive overtime pay if they work more than 40 hours a week.
How does FLSA enforcement work with co-employers?
Staffing agencies and the businesses they contract with may be co-employers of temporary employees. While the contracting companies determine the pay rates, the staffing agencies hire and pay employees. However, both businesses might be responsible when employees do not receive their rightful overtime pay. If the companies hiring from the agencies know that employees work more than 40 hours per week but do not receive overtime pay, the businesses may be liable for shorted wages even if the agencies process the payroll.
FLSA standards guarantee overtime pay rates for most temporary employees. Staffing agencies and their clients can work together to ensure that these employees receive all eligible overtime wages.