Builders and Contractors Exchange
Weekly Bulletin: 13 July 2007
"Borrowed Servant Doctrine" May Make You Liable For Temporary Laborer Conduct
Contractors often use temporary agencies to staff unskilled laborers on construction projects. Generally speaking, when you hire a temporary laborer, you do not think of this person has an employee for whom you are legally responsible. Often it is the assumption that that temporary employee’s agency is the employer and the person hiring the agency should not have any responsibility for the temporary laborer’s actions. However, just because the temporary day laborer is not technically your employee, a legal fiction called the “borrowed servant doctrine” can make the you liable for the temporary laborer’s conduct while he is on the job, including the his or her negligent conduct or injuries he or she may have caused at work. At times, taking on this extra liability is unavoidable: as a function of the job, the temporary laborer is usually under the direct control and supervision of the contractor managing the job site, the temporary laborer is usually starting and stopping work at the contractor’s direction, and the temporary laborer can usually be discharged from the work at the contractor’s request. When you are using a temporary agency to help staff jobs on a site, keep in mind that even though these temporary employees may be technically employed by someone else, you may be responsible for their on-the-job conduct.
One way you can help protect yourself in this arena is by including an indemnification provision in your contract with the temporary agency. An indemnification provision is not a guarantee that you will escape paying damages for the acts of the temporary employee. But, if legally enforceable, an indemnification provision can cover the amount you are held liable for the temporary employee’s acts and can also cover your attorney’s fees and costs. In addition, always make sure that the temporary agency has adequate insurance coverage and that the agency’s coverage also complies with the requirements of your construction contract.
Questions?
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This article is meant to bring awareness to this topic and is not intended to be used as legal advice.