Department of Labor sends warning shot to clients of temp staffing agencies

[kpete]

Department of Labor sends warning shot to clients of temp staffing agencies
In an increasingly outsourced economy, the administration says more companies should take responsibility for the workers they hire indirectly.


The Department of Labor thinks more companies should take responsibility for their contracted workforces, and it’s just told them exactly how and when.

If there’s one trend that’s characterized the changing American workforce more than any other in recent decades, it’s been the fracturing of the employment relationship, as companies focus on their “core competencies” and pay other businesses to do everything else.

Subcontracting, outsourcing, and the use of staffing agencies allows businesses to inexpensively scale up and scale down their labor needs, without the extra hassle and liability of adding payroll. But it also adds another layer between workers and the bosses who call the shots, shielding managers from responsibility when the labor provider doesn’t follow the law.

Department of Labor’ Wage and Hour Division director David Weil, a former business school professor, calls this trend “fissuring.” He thinks lots of those client companies should really be considered “joint employers,” together with the contractors that sign the checks, making them liable for violations. And Wednesday, his department issued detailed guidance drawing the categories in black and white, sending a message to employers that they had better fall on the right side.



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https://www.washingtonpost.com/news/wonk/wp/2016/01/20/department-of-labor-sends-warning-shot-to-clients-of-temp-staffing-agencies/?postshare=5611453304700611&tid=ss_tw