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Trends & Impact #4: Workers Compensation And Temporary Staffing

Welcome to the fourth in the series of Staffing Industry Trends and Impact blogs from Barton Staffing Solutions. Today’s topic is Workers Compensation and Temporary Staffing. These topics are the result of many RFP renewal requests we receive this time of year. As industry thought leaders, we share our observations to elevate the entire industry.

More often than should be the case, we encounter a senior manager or human resources leader and are surprised. Some don’t know that just like any company, staffing firms must carry workers compensation insurance, and are subject to the same laws and regulations for workers as it pertains to claims made in the case of injury or accident involving a worker.

Government regulations pertain to all workers, regardless of the type of employee they are, the direct or indirect employer they take work assignment from. Employers, either companies with direct hires, or temporary staffing firms providing a temporary workforce, must treat workers with similar consistency in terms of workers compensation.

In many ways, a staffing firm must be even more diligent in driving safety and training initiatives in the workplace than other companies – merely because they provide a workforce to perform duties in the workplace environment of another company in which the staffing has limited, if not distant, management influence. It’s not good or bad, just the nature of the service that staffing firms provide.

This arrangement is a pivotal factor in a staffing firm’s workers compensation insurance rates. Over the past few years, this trend to manage workers compensation claims risk has driven insurers to become close partners to staffing firms in assessing the safety in the workplace at client companies.

Few companies know that these insurers keep track of risk ratings of staffing firm companies, examine NCCI codes, and in some cases limit the support that a staffing firm can provide some companies. NCCI is the National Council on Compensation Insurance. Based on these ratings, insurers can limit which clients can be served, under the current policy and insurance rates.

Insurance rates can increase for staffing firms that serve high-risk, low safety, and high-claims-rate clients, but that translates to higher temporary labor rates as a cost to the staffing firm’s business model. Or, some lesser staffing firms may be under-covered in terms of workers compensation insurance, or have no coverage at all. Partnering with a firm that operates under-insured is risky, and certainly not an approach to build a growing business upon.

Barton Staffing Solutions works closely with its insurer, and from time to time, based on claims rate, risk valuation, and workplace safety concerns, will choose not to provide workers that pose a risk. The most important risk, of course, is the risk of injury and accident that would hurt a Barton Staffing Solutions employee. Avoiding that risk, helps reduce risk to business, creates collaborative connections with clients to improve the workplace environment, and overall, benefits the cost model of clients that choose Barton Staffing Solutions over other higher-risk temporary staffing suppliers.

Call Barton Staffing Solutions today. We’re ready to have a discussion with you about this trend and the impact that workers compensation and temporary staffing can have on your business. We’re here to help.