Workers for Staffing Agency Held to be Joint Employees of Business Staffing Agency Sends them to Work at.

The Missouri Supreme Court issued an opinion on August 19, 2014 in the case ofTolentino v. Starwood Hotels & Resorts Worldwide, which technically dealt with Missouri’s minimum wage law but might also eventually be applied to workers’ compensation law on the issue of just who is a worker’s employer: the staffing agency, the business the staffing agency contracts with for “labor” to be performed at, or both. The staffing agency paid “its” workers to clean rooms at a hotel owned by the Starwood hotel chain which is part of Sheraton Hotels.

Though this case is about when a company that uses a staffing agency can legally be considered a person’s joint employer for minimum wage enforcement purposes along with the staffing service that contracted out their labor to other companies, the tests that the Missouri Supreme Court used to determine joint employers may in some cases be just as applicable to workers compensation cases in the state of Missouri. This case came out of the Kansas City area. However, its rulings on joint employer liability for minimum wage and overtime payment enforcement could just as well apply to St. Louis workers compensation injuries, St. Charles workers’ compensation injuries, Jefferson County, Lincoln County or Franklin county workmen’s compensation injuries, or for work injuries suffered on the job anywhere else in the greater St. Louis area of eastern Missouri.

Starwood Hotels paid staffing agency Giant Labor Services a $5.00 fee per room cleaned, and then Giant Labor paid its employees $3.50 per room to clean the hotel rooms, illegally deducting from their (mostly non-citizen) workers’ pay for visa fees. A class action lawsuit was filed for Tolentino and other housekeepers against both Giant Labor and Starwood Hotels for minimum wage and failure to pay overtime violations and to pay back the amounts illegally deducted from their paychecks for visa fees.

Starwood Hotels tried to get the suit against them thrown out, claiming that they were not Tolentino’s or the other housekeepers’ joint employer so they were not responsible or liable to either be forced to pay them at minimum wage or to repay the amounts illegally deducted by Giant Labor from their pay. The circuit court threw out both claims against Starwood Hotels, agreeing with Starwood that they could not be held liable for any laws Giant Labor violated in not paying its workers at the Missouri state minimum wage and taking illegal deductions from their pay and failing to pay them for overtime hours worked.

The Missouri Supreme Court reversed the lower court’s decision to throw out workers’ claims for payment of back-owed minimum and overtime wages against Starwood Hotels. It ordered Giant Labor to pay its housekeepers back pay to satisfy minimum wage plus overtime pay requirements. However, Giant Labor was so cash-poor that this money could not be recovered against them after applying certain minimum collection tests, so the only source of funds sufficient to pay back the underpaid wages and overtime would be Starwood Hotels. Staffing service Giant Labor was indicted for criminal violations as well.

The Supreme Court considered a series of factors to determine whether the workers it found had been denied the minimum wage and overtime pay by Giant Labor staffing service could recover the money owed them from Starwood Hotels as their joint employer with Giant Labor. These factors all went to how much direction and control Starwood Hotels exercised over them as joint employees.

The factors were 1.) who had the power to hire and fire the housekeepers? 2.) who supervised and controlled their work schedule and working conditions? 3.) who determined their pay rate and method of payment? and 4.) who maintained their work records? The Court found that Starwood Hotels 1.) had effective power to hire and fire the housekeepers after interviewing them for the job and telling Giant whether they would have them back; 2.) gave them their daily assignments, inspected their housekeeping work, and could make them redo work not properly performed; 3.) made the initial decision to pay housekeepers on a per-room basis and later raised their pay in response to an increase in the minimum wage; and 4.) kept regular records on their performance. The Court held that if Starwood Hotels can be held to be a joint employer of its housekeepers along with Giant Labor staffing service which underpaid their wages, Starwood could be held liable as their joint employer for those underpayments equally with Giant Labor, regardless of whether it was Giant rather than Starwood that committed the wage and hour violations in the first place.

There is no reason why the Missouri Supreme Court’s decision in Tolentino could not be applied where the Missouri state statutory law being enforced is the Missouri Workers Compensation Law rather than the Missouri state minimum wage law. Missouri workers’ compensation law has a special Section 287.040 on work done under contract by contractors or subcontractors, making most employers/hirers of labor done by subcontractors as equally responsible and liable as their subcontractors to pay workers’ compensation benefits to their workers injured on the job.

The recent Tolentino case would hopefully provide yet another way for a workers’ compensation judge or a court to hold a subcontracting company liable as a joint employer for workers’ compensation benefits to workers paid their wages by subcontractor companies such as staffing services. Most of the time staffing services will be fully insured to pay workers compensation benefits to their employees injured on the job, but their insurance rates would be high because of all the extra workers they run through their staffing company’s payroll as their employees so the companies such workers are sent to work at would not have to themselves.

Some such staffing services might come on hard times and decide to drop their workman’s compensation insurance coverage. The only way for the worker injured on the job to get their workers’ compensation benefits paid would be to claim the company they were sent to work at as their joint employer with the staffing service who pays their wages. Often workers hurt on the job with perfectly valid work injuries have nobody to pay their workers compensation benefits because their direct employer had dropped their workmen’s compensation insurance coverage or never got coverage to begin with.

That is why once you have been hurt at the workplace or elsewhere on the job it is important that you stand up for your rights and demand your rights to workers compensation benefits. Tom Hyatt of St. Louis Workers Compensation Center would help you enforce your rights to workmans compensation benefits against the subcontractor who hired you to work for another company at a different location that had contracted with them for your labor. Workers compensation attorney Tom Hyatt would listen to your story and file your claim, demanding and fighting for your denied Missouri workers compensation benefits: medical treatment, temporary lost wage benefits, and eventually permanent disability benefits.

If the company who hired the staffing service decided to retaliate against you by harassing you, demoting you, cutting your hours or pay only after you filed a claim against them, if you could prove they were your joint employer the Tolentino case would give you a better legal argument to sue them for discrimination. Never passively sit by without ever sticking up for your rights. Let Lawyer Tom Hyatt demand they give you all your workers compensation benefits and use the law to enforce your rights to workmen’s comp benefits.

St. Louis Workers Compensation Center can demand your rights to workers compensation benefits for you. Then they can proceed to enforce them. Please call us for advice and assistance on any work-related injury suffered on the job St. Charles County, in St. Louis County, Lincoln County, Warren County, Jefferson County, Franklin County, or any counties in eastern Missouri within 100 miles of the greater St. Louis area. All our consultations are absolutely free. Tom Hyatt will talk to you about your case right away. Our attorney’s fee would be a modest percentage of the Missouri workmen’s comp disability benefits we fight to get for you.

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