Risk management services

What to Ask Before Choosing a Labor Hire Company

12 August 2015

Alma Fuller

A labor hire company is a type of company that will recruit and then hire out short-term and long-term workers, who remain on the labor company's payroll during their employment. Since you may not pay for sick time, vacation time, and health benefits, it can actually be more cost-effective to use a labor hire company in the long run.

Before you choose a labor hire company or have any of their workers on your jobsite, note a few questions you want to consider and subjects to cover with the company's agent:

1. Are there restrictions as to the work environment or jobs their workers can perform?

Don't assume that hiring someone from a labor company means that they are now able to handle any type of work that needs to be done, and you need to ensure you ask this question when hiring for construction sites, working with hazardous materials, and other potentially dangerous situations. Very often working at heights, with chemicals, or other such circumstances will require workers to have special training and certification. 

Note that the labor company's insurance may not cover any injuries suffered when their workers are in unsafe conditions, and you may face liability if they were to be injured. Discuss any restrictions as to the work environment, hours an employee can work, materials they can work with, and so on before you hire someone from a labor hire company. 

2. Will they handle disciplinary actions, dismissals, and the like?

One of the more unpleasant tasks of owning or managing a company is having to discipline employees and also dismiss them. A labor hire company may be the ones to do this with anyone they send to their jobsite, and they may actually prefer that you notify them of any disciplinary needs rather than dealing with their employee.

In some cases, they may prefer to actually dismiss an employee rather than take disciplinary measures, if the employee has faced disciplinary measures before. 

A labor hire company may also want to handle dismissals themselves, as some of their employees may have a long work history with the company. The labor hire company may want to ensure that this employee is provided work at another jobsite immediately, or that the dismissal is handled professionally so they maintain a good relationship with this employee.

Have other questions? Try contacting a company such as Labour Options with any questions you have.

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