Blind faith in legal terms equals significant risks for your agency
An agency received that invoice after their worker filled the new company van with the wrong fuel. The engine was wrecked. The client pointed to the agency.
The signed Terms? They left the agency exposed.
Temporary staffing is a business model that may not always make sense to clients and can lead to misunderstandings, and at worst, carry serious hidden risks.
Here are three things every agency should understand to avoid costly mistakes and work smarter in the temp space:
🚩Temp work brings hidden liability
Fast-paced assignments. Quick client approvals. But when things go wrong, who's actually responsible?
Watch out for:
Clients pushing the risks in their business onto you
Small margin killers costing thousands like fixed rates, aggressive conversion fees and payment terms that blow out your cashflow
Onerous Insurance requirements that will lead to rejected claims
What helps:
Define your service: What you do is not what the worker does for the client
Remember: The temp works under the client's supervision
Review PSAs carefully
🛑Insurance won't save you from bad terms
Insurance is a risk management tool, not a liability cap.
Why it matters:
Claims can hike up your premiums or worse, leave you uninsurable
Valuable clients may desert you or decline your tender responses
PSA and client terms often include insurance requirements that aren't automatically part of your insurance cover
What helps:
Know what you're covered for exactly
Always cross-check insurance liability clauses with your broker (and lawyer)
Linking the value of the contract to the risk you are willing to accept
☑️Clear understanding helps you say "no"
Clients often assume temp recruitment is like 'consulting'. If terms aren't aligned to the three-way staffing relationship, you could be stuck footing bills you didn't see coming.
What helps:
Don't negotiate 'commercials' and 'legals' separately
Train up on how to spot and negotiate adverse terms
Know that the person you're dealing with likely isn't a legal expert either
Too many agencies only find out about these issues after something goes wrong.
Get ahead of the risk. Talk to us, so you can grow without hidden liabilities.
