Many people may not realize how risky the staffing industry can be. Staff insurance covers the unique needs and exposure staffing services face that are not covered under standard insurance policies.
The high risk stems from the fact that the staffing agency is liable for the actions of its employees who have been staffed at off-site locations and are being supervised by the agency’s clients. It’s important to acquire staff insurance to manage the three primary types of exposure that staffing companies face.
1. Work Performed
This exposure involves the mistakes of a qualified contract worker that result in a financial loss for the client. Anyone can make a mistake, but a contract worker is the responsibility of the staffing agency, therefore they staffing agency may be liable for the loss.
2. Serviced Provided
Staffing firms may also provide services beyond simply staffing. This can include managing such things as payroll, employee benefits or recruiting. Any mistakes made in the performance of these services puts the staffing agency at risk.
One of the primary goals of a staffing agency is to provide staff to their clients. If the agency can’t provide the staff, provides unqualified staff, or does not perform the proper screening or testing, the staffing agency is at risk. Less common, but still possible, is the risk of a worker bringing a lawsuit against the staffing agency for misrepresenting the work opportunity.
Needless to say, navigating the pitfalls of the staffing industry can be difficult, so it is important that maintain the correct staff insurance to protect yourself against these three common types of exposure.