B. Leased and Temporary Employees

Leased and temporary employees work for the service firm supplying workers to the client company. Although they report directly to an employer, they receive their paychecks and benefits from the company leasing their services. Leased employees typically do not work at one job site for more than a fixed period (i.e., one year). Once a particular job is finished, they are then assigned to work at another company.

Counsel Comments:Although the Department of Labor reports that the use of temporary workers has surged 400% since 1982, statistics provided by USA Today reveal that temps earn an average 40% less per hour than full-time workers. Even though the vast majority (80%) work 35 hours a week, most do not have health benefits, pensions and life insurance and most temps are women. This has caused some commentators to point out that when you are a temp you are treated at a lower status despite the advantages of a flexible work schedule.

Although leased employees are obligated to conduct themselves in accordance with the work rules and regulations stipulated by the company for which services are being provided, they must ultimately answer to the leasing company hiring them. When a dispute arises, such as whether unemployment insurance is available after a layoff or firing, the issue may depend on the rights and remedies available against the leasing company and not the client.

Female applicants applying for work as leased employees should know the ramifications of their status before accepting employment. At a minimum, get answers to the following questions:

• Which company will pay me?
• Can I collect overtime for my efforts? If so, how do I go about this?
• To whom do I look for instructions about when, where, and how work is to be performed?
• Who controls my work schedule?
• Under what circumstances may I be dismissed?
• Who furnishes the tools and equipment used by me for the job?
• How do we resolve problems I may have with the client?
• Am I prohibited from working directly for the client company (such as being required to sign a restrictive covenant in an employment contract) if they like my skills and work performance?
• Do I have a say in my assignments?
• How often do I have to report back to the leasing company?
• What are my benefits and who pays for these benefits?

Although employee leasing is being used more these days, critics contend that employees suffer by not receiving commensurate benefits from the company leasing their services.

Tip:It is critical to negotiate a fair hourly rate or weekly salary as well as obtain equivalent benefits that would be available if you worked for a company as a regular employee.

The relationship of a leased or temporary worker to her employer has unique ramifications with respect to workers' compensation, unemployment insurance benefits, and tax matters. In some states, a person who is employed by a leasing company is also considered to be in the special employ of the client company despite the fact that the leasing employer is responsible for the payment of wages, has the power to hire and fire, has an interest in the work performed by the employee, maintains workers' compensation for the employee, and provides some of the employee's equipment. This means, for example, that if you are injured while working for the client company, you may be covered under workers' compensation and cannot institute a private negligence lawsuit.

However, if the client company approved your hiring and possessed the right of control, an employer/employee relationship might be found, making the client responsible for any discrimina-tory acts (including sexual harassment) perpetrated against you on the job site. The same is true if you desire to take time off to care for a newborn or an adopted child, an elderly parent, or a sick spouse under the federal Family and Medical Leave Act (FMLA).

Under what conditions will companies using temporary labor be required to comply with the FMLA? Generally, where two or more businesses exercise some control over the work or working conditions of the employee, a joint relationship may be found to exist. Once this occurs, the client as the secondary employer may have the obligation to comply with the FMLA and cannot discriminate against you if you seek to exercise your rights under this law. (Note: Discussion about your rights under the FMLA is part of the next chapter.)

Tip:If you are a leased or temporary employee, speak to a lawyer immediately if you believe your rights are being violated. This may include, for example, being a victim of sex, race, age, or disability discrimination, or being denied unemployment insurance benefits or workers' compensation coverage after an accident.