Jeff’s On Call!: Employer-Mandated PSAs

Oct 5, 2010

This week’s inquiry comes from Fran Pollack:

Hello Jeff,

I am an avid reader of the Fordyce Letter and I have a question for you. I am the owner of a permanent placement and staffing company. I know that the Fordyce Letter is geared toward permanent placement, but hopefully, you will be able to answer this question regarding staffing.

It appears that more and more of our clients, as well as new clients calling in, are sending us THEIR agreements to sign vs. signing our standard fee agreements. In these agreements of theirs, they want us to sign our life away. They way us to sign their Indemnity Agreements/hold harmless agreements leaving the staffing company to assume all the risks from sexual harassment, discrimination, and liability of their cargo and equipment.

I get on the phone with them and explain that they are the co-employer and that they also have to assume responsibility for the workers we send to them.

I am not signing them, therefore, they are turning to other agencies who will sign them. I am losing business.

I would appreciate any feedback that you can give me. Thank you.

Fran Pollack

Hi Fran,

You’re an avid reader of my mind, too!

I’ll be addressing this issue head-on for the first time anywhere in the November 2010 TFL. The lead article is entitled, “The Employer Lawyer’s Worst Nightmare: The 15 Contract Crushers.”

We took hundreds of PSA’s (placement service agreements), picked out the fifteen most frequently-mandated provisions, and combined them. Then I dissected each one, showing you how to get them changed or knocked out entirely.

The increase in employer-mandated PSA’s isn’t your imagination. Temp services across the country are now being deluged and devastated by PSA’s too. Clients have gone from using simple non-disclosure agreements or liability releases to incorporating the PSA provisions I covered. So exactly the same approach to negotiating them should be used.

If your time card or sheet (that the client signs to verify hours) doesn’t contain the provisions you need to protect your business, it should. Then the time card becomes your contract, and you should only agree to terms that are consistent with it. If you agree to PSA terms that are not, whether patent (apparent) or latent (oops!), you’re headed for the courthouse door held open by the employer lawyer. This is often an insurance problem, because inconsistencies often mean exclusions from coverage.

Since you’ve been a loyal subscriber for so long and need the help now, I’m sending you a copy. Of course, I could probably just think it and you’d get the message, but this is so much more . . . well . . . “electronic”!

Keeping you sharp is what we do. May it help you for many years to come.

Thanks for asking and subscribing!


If you have a legal question you’d like to have Jeff answer here on The Fordyce Letter, check out Jeff’s On Call! and submit your question.

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