So what’s the problem with having temporary employees?

Problem #1

If a temporary worker is hurt on your premises arising out of your negligence such as failure to maintain your parking lot or to provide safe equipment, the injured worker will be paid loss of wages and medical bills from the workers’ compensation insurance carrier of the temp agency. That insurance carrier could then sue you, also known as subrogation, to recover what it pays to the worker.

Solution:

Obtain an agreement from the temp agency that it will waive its rights to sue you to recover its losses and also the losses of its workers’ compensation insurance carrier in the event of injury to its employee, your temp worker.

This will also require an agreement by its workers’ compensation carrier as evidenced by a waiver of subrogation endorsement on its workers’ compensation policy.

Also make sure that the temp agency has added an alternate employer endorsement to its workers’ compensation policy.

Problem # 2:

The temp worker, or in the event of death, that worker’s estate can also sue you for injury. An agreement from the temp agency will not block this from happening.

Solution:

Obtain  from  any  temporary  workers  an  Acknowledgement of  Status  and  Hold  Harmless.

Problem # 3:

If I don’t follow these recommendations, won’t I still be covered by my commercial general liability insurance policy that covers injuries on my premises?

Solution:

Probably not. This policy excludes employee injury and a temporary worker qualifies as an employee unless the activities of that worker fall within the following exception of a “temporary worker.”

“Temporary worker means a person who is furnished to a party to substitute for a permanent employee on leave or to meet seasonal or short-term workload conditions.”

Do not rely on this exception. “Seasonal” and “Short Term” are not defined, and most temporary workers are more permanent than temporary, from a practical standpoint.

Long-term  leased  employees  which  are  part  of  a  co-employer  arrangement  from  a  PEO (professional employer organization) are different than the temporary worker contemplated by this Special Report.

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Please sign up for the digital downloads.  You will gain access to over a hundred special reports related to both personal and commercial insurance.

For any of your personal or commercial insurance needs, please contact us.

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