Clients of staffing firms frequently include clauses in their contracts with the staffing firm that say the staffing firm is responsible for the payroll, payroll taxes, and all benefits for the temporary workers. The clients’ contracts will often say that the temporary workers are not employees of the clients and in some cases will go so far as to say that the temporary workers are not employees of the clients for any purpose.
This can work to the clients disadvantage. In a recent case in Arkansas, an employee of a temporary staffing firm was injured and sued the client of the staffing firm. The client moved to dismiss the lawsuit saying that the temporary worker was jointly employed by the staffing firm and the client and therefore, the temporary worker’s sole remedy was workers compensation.
The Arkansas Court of Appeals said tha that the client was not protected by workers’ compensation exclusive remedy because, in part, the contract between the client and the staffing firm said that the temporary staffing worekrs would be their employees for any purpose. The contract said
Labor Solutions, at its cost, shall provide personnel (the “Personnel”) to perform the Services. Labor Solutions shall be solely responsible for the full payment of all compensation due the Personnel, including, without limitation, all wages, benefits, withholdings, payroll taxes and contributions. No Personnel of Labor Solutions shall be deemed an employee of Customer for any purpose relating to this Agreement, including, without limitation, under any compensation or benefit plan of Customer. (Emphasis added.)
The court relied upon this clause is determining that the client was not a joint employer.
Of significance, we note that the contract FNA signed with Labor Solutions contained FNA’s agreement that none of Labor Solutions’ personnel would be deemed employees of FNA for any purpose relating to the agreement.
This case provides staffing firms with some basis for pushing back on the demands from clients for clauses that say that clients are not joint employers.
Source: Court allows temp’s negligence case against staffing buyer to proceed.See also Humphries v. FNA Group LLC, 2025 Ark App 304 (2025).
