Staffing Firms Liable for Worker Injuries in California

By Roy Maurer Oct 2, 2014

The California Occupational Safety and Health Appeals Board recently issued two decisions expanding the responsibilities of primary employers in “dual employment” relationships. The decisions overturn a 30-year-old precedent that shielded staffing firms from liability if their temporary employees suffered injuries while under the client’s supervision.

Previous case law limited the responsibilities of primary employers in dual employment relationships to “training and monitoring employees” who worked under the supervision of the client employer.

The Aug. 28, 2014, rulings held that staffing providers may be charged with any and all safety violations under Title 8 of the California Code of Regulations.


In Staffchex, 10-2456, the board upheld the Division of Occupational Safety and Health’s (Cal/OSHA’s) citations against staffing agency Staffchex and Aware Products, the client employer, for a 2010 accident suffered by a temporary machine operator whose fingers were cut off while trying to clear jammed bottle caps from a filling and capping machine.

Staffchex attempted to use the defense created by the 1985 ruling in PEMCO II (Petroleum Maintenance Co.). In that decision, the appeals board created a specific defense for primary employers, such as staffing agencies that contracted away their ability to effectively supervise employees. Since then, staffing firms in California that could meet a four-part test were not considered liable for injuries.

The four-part test was satisfied if:

  • The contract employee carries out his work assignments wholly in the secondary employer’s establishment.
  • The contract employee is supervised solely by management personnel of the secondary employer.
  • The primary employer is barred by contract or policy from access to the worksite, except to maintain time records of contract employees or for purposes unrelated to the supervision of work activities of contract employees.
  • The primary employer maintains an accident prevention program, trains contracted employees and instructs them on the hazards of the contracted work.

The Staffchex decision effectively eliminates this test as a defense from responsibility for temporary workers’ safety.

“In considering this argument the Board turns to the Cal/OSH Act, which mandates that every employer has a duty to its employees to furnish a place of employment that is safe and healthful—that duty is nondelegable,” the appeals board said.

The appeals board noted in its decision that temporary employment has increased significantly since the PEMCO II decision.

“Nearly 30 years have passed since the board promulgated the rule found in PEMCO II … and this affirmative defense has led to complexity and confusion, when the intent of the Act is plain. The Board finds that PEMCO II is not consistent with achieving the goal of each employer furnishing a safe and healthful workplace in all circumstances, and so finding, declines to recognize the defense found therein,” the board said.

Labor Ready

In Labor Ready, 13-0164, the board similarly affirmed Cal/OSHA’s citations against staffing firm Labor Ready, for failure to ensure that its employees were covered under an effective injury and illness prevention program and heat illness prevention program while working on a client employer’s construction site. Labor Ready had an injury and illness program, but the parties agreed by contract that while Labor Ready’s employees were at the client’s worksite, they would be covered by the client’s safety program. The board found that Labor Ready then “took no steps to ensure that [the client’s program] was sufficient … did not ask to view [the written program], did not request a copy, nor … receive verification of training” on the program.

“An employer remains responsible for its employees’ exposure to a hazard, even where that hazard is created by a third party, and is responsible for the safety of its employees, even if it does not retain ultimate control at all times,” the board said.

Moreover, contractual language may not transfer safety responsibilities from the primary employer. “While [Labor Ready] may argue that it had arranged for [the client] to provide the heat illness prevention program, each employer ultimately remains responsible for the completion of its safety and health duties to its employees, and may not contract or otherwise delegate those duties away,” the board said.

The federal Occupational Safety and Health Administration is currently focused on the issue of temporary worker safety and launched an initiative in 2013 to help protect temporary workers from workplace hazards.

Roy Maurer is an online editor/manager for SHRM.

Follow him @SHRMRoy


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