The importance of maintaining staff insurance for temporary staffing companies is evident because of the types of risks and exposures these businesses face on a regular business. They have to concern themselves with their legal liabilities in placing temporary workers, many of whom they may have little or no history with, in positions with clients that depend on them to put competent, honest individuals to work performing the duties of full-time employees currently not available to fill their positions.
In today’s litigation-driven world, the consequences can be extremely costly. Owners and supervisors of temp staffing firms need to be very detailed when both, interviewing and doing background checks to ensure that they are not hiring someone that may cause them issues down the road.
In addition, they need to be aware that they could face charges of discrimination if this process is mishandled in any way, or could be victimized by candidates that are merely looking for an “easy pay day” by filing a false claim of harassment, invasion of privacy, deprivation of a career opportunity, or other wrongful acts.
An employment practices liability insurance policy will cover costs for defense in any resulting litigation, but proper interviewing techniques and procedures can reduce the risks associated with these types of claims.
Other concerns requiring staff insurance
There is also the concern that, once placed, the temp worker may cause costly mistakes on the job, become involved in violent acts, steal from their employer, or involve themselves in acts of cyber crime or accidental cyber breaches. This problem is two-fold, since the staffing company can be blamed and held responsible for the acts of their temporary staff member, and they can also lose a valuable client, as well as suffer reputational loss.
These are real concerns that every owner must address and have training procedures that can help determine if they are sending the right person to do the job required of them. They value the relationship of the host clients and depend on them to keep their own businesses running smoothly. The bottom line is, staff insurance for the untold number of exposures in running a temp agency is the only secure way to operate a company of this kind.