Workers Compensation for Temporary Workers
Can Temporary Workers Get Workers Comp?
Leased, loaned and temporary workers – just like any employee – are entitled to Workers Compensation under California Law. But if a temporary employee is injured on the job, it can be confusing for the temp worker to determine WHO is responsible for the Workers Comp: the Temp (Leasing) Agency OR the company where the temporary employee performed services.
On September 28, 2014, Governor Brown signed a very progressive law that requires companies (of 25 employees or more) who use workers provided by staffing agencies to “share with a labor contractor all civil legal responsibility and civil liability the provision of workers’ compensation insurance.”
In other words, in California, temporary employees leased to an employer (of 25 employees or more) through a temp agency are covered by BOTH the employer AND the temp agency. This is a big improvement over most other states where EITHER the company you did the work for, OR the agency has to provide workers’ compensation coverage – but not both.
While this is good news for Temporary Employees, having two parties responsible for workers comp can lead to some complicated issues in determining who has primary liability for paying any Workers’ Compensation benefits.
Which Temporary Workers Can Get Workers Comp? Santa Ana Lawyers
As with any workers comp claim, an employer-employee relationship must exist in order to bring the Workers’ Compensation coverage into effect. An “employee” is defined as a “person in the service of an employer under any appointment or contract of hire or apprenticeship, express or implied, oral or written.” And the Courts have determined that any person who renders service to another is presumed to be an “employee” –including temporary workers.
Whether an employment relationship exists is determined by factors such as whether the employer had “direction and control” over the activity of the employee, whether the employer provided the place to work, whether the employer could hire and/or fire the employee, and whether the employee was on the employer’s payroll.
When an employee is leased or loaned from an agency to an employer, most of the criteria above would be resolved in favor of finding an employment relationship between the “temp” and the company where the individual is assigned to work. But this still doesn’t answer who is PRIMARILY responsible for the Workers Comp benefits!
Which Employer Pays for Temporary Workers Comp? Santa Ana Lawyers
California law considers both the placement agency and the actual company providing daily work to be employers. But the placement agency is normally considered the “general employer” and the company where the work is performed is considered the “special employer.” This is because the temporary placement agency generally keeps the employee on its payroll and handles tax accounting, etc.
The general employer (temporary agency) is liable for the entire cost of workers compensation payable on account of injury occurring in the course of employment. The only exception would be if the special employer (company where the work was performed) had the employee on his or her payroll at the time of injury. And, often there is an express written agreement between the temporary agency (general employer) and the company using the employee (special employer) that the temporary agency will secure and be responsible for Workers’ Compensation.
So, the Temporary Agency is primarily responsible for a temp worker’s Workers Compensation. But happens when the insurance carrier for the general employer (the temporary placement agency) becomes insolvent, or the temp agency’s policy has been cancelled or lapsed?
At this point the “special employer” (company where work was done) would then become liable for the Workers Comp claim by an injured temporary employee. This is because the new California law is very clear that BOTH employers have “joint and several liability”.
In other words, if the general employer fails to secure workers compensation coverage – or if the carrier for the general employer becomes insolvent – the special employer is still typically liable under the law.
And, remember that employers with less than 25 employees (counting any temporary workers) – and employers who use five or fewer temporary workers at any one time – are exempt from the new law.
If all of this sounds a little complicated – it is. That is why it is essential for temporary employees who were injured on the job to discuss their case with an experienced Workers Compensation lawyer. It is important that you file your claim against the right party – and that you know your rights if one party or the other tries to deflect your claim to the other employer.