Define: Coemployment

Coemployment refers to a situation where two or more employers share the responsibility and liability for a group of employees. It typically occurs when a staffing agency or professional employer organisation (PEO) is involved.

In a co-employment arrangement, one employer (the client company) maintains control over the day-to-day activities and management of the employees, while the other employer (the staffing agency or PEO) handles administrative tasks such as payroll, benefits, and compliance.

Co-employment can provide benefits to both the client company and the employees. The client company can access a larger pool of talent, reduce administrative burdens, and gain expertise in HR and compliance. Employees may receive better benefits, training, and career development opportunities.

Yes, both the client company and the staffing agency, or PEO have legal obligations towards the coemployed employees. They must comply with employment laws, provide a safe working environment, pay wages and benefits, and handle any legal disputes that may arise.

The responsibility for workers’ compensation can vary depending on the specific co-employment agreement. In some cases, the staffing agency or PEO may provide workers’ compensation coverage, while in others, the client company may be responsible. It is important to clarify this in the co-employment contract.

Yes, both the client company and the staffing agency, or PEO, have the right to terminate a co-employed employee, subject to applicable employment laws and the terms of the co-employment agreement. It is crucial to follow proper procedures and avoid any discriminatory practices.

Yes, a co-employed employee can file a lawsuit against both the client company and the staffing agency, or PEO, if they believe their rights have been violated. It is important for both employers to have proper legal protections and insurance coverage in place.

To avoid or resolve conflicts, it is essential to have a clear and comprehensive co-employment agreement that outlines the roles, responsibilities, and expectations of both employers. Regular communication, collaboration, and a mutual understanding of each party’s obligations can also help prevent conflicts.

While coemployment is not specifically regulated by federal law, various employment laws, such as the Fair Labor Standards Act (FLSA) and the Family and Medical Leave Act (FMLA), still apply to coemployed employees. It is crucial for both employers to ensure compliance with all relevant laws and regulations.