Hourly pay for temps could create ’employees’ — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

Hourly pay for temps could create ’employees’

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in Employment Law,Human Resources

The 3rd Circuit Court of Appeals, which has jurisdiction over Penn­­sylvania employers, has ruled that paying an hourly rate for temporary employees coming from an outside agency may mean those workers are your “employees” under anti-­discrimination laws.

Recent case: Matthew, who is black, worked for Labor Ready, a staffing firm that provided temporary workers for a number of clients, including discount retailer Tuesday Morning. The retailer was opening a store in Pennsylvania and needed temps to unload merchandise, set up display shelves and stock merchandise on shelves in preparation for the store’s grand opening.

Matthew worked at the store for a total of 10 days, generally with about eight other Labor Ready workers.

Soon, Matthew started complaining that he and several black co-workers were being racially harassed. For example, he claimed that the Tuesday Morning store manager accused him of stealing two eye-liner pencils, and assigned him to work in the back near the trash containers. Matthew also complained that a white Tuesday Morning employee blocked his way and called him a racial slur.

Soon after, Matthew alleged, the black temps were all told not to come back.

Matthew sued Tuesday Morn­­ing and his case was dismissed on the premise that he was not a Tuesday Morning employee.

But he appealed, and the 3rd Circuit Court of Appeals reinstated his lawsuit. It looked at some of the specific arrangements between Labor Ready and Tuesday Morning. It found, for example, that Tuesday Morn­­ing paid a set fee for each hour the Labor Ready employees worked, not a flat fee for services. That was an indication that they were employees of both Labor Ready and Tuesday Morning, making the retailer responsible for any employment discrimination the black temps might have experienced. The case was sent back for trial. (Faush v. Tuesday Morning, No. 14-1452, 3rd Cir., 2015)

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