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Compliance and Legal

EEOC Holds Both Staffing Firms and Staffing Clients Responsible Under EEO Laws

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Recently, the EEOC filed a lawsuit against Hire Dynamics, a staffing firm (click here for the EEOC press release).  According to the complaint, after a Hire Dynamics employee filed a charge of discrimination against one of its clients, the staffing firm retaliated by failing to give the employee any further job assignments or opportunities.

As this case highlights, it is important that staffing companies and their clients work together to comply with applicable fair employment practice laws.

Staffing is a vibrant and growing industry, employing more than 2 million workers per day.  Effective use of temporary labor helps the 90% of U.S. companies that use staffing agencies to ramp up and down, as production needs fluctuate, without incurring the costs associated with managing employment processes.

Staffing agencies lease employees to their clients to perform work that is part of the routine operations of the client’s business, typically side-by-side with and doing the same work as the client’s employees.  Notwithstanding the interrelatedness of staffing agencies’ and clients’ workforces, it is common for client companies to assume that they have no EEO obligations towards staffing firm employees assigned to their work site.  It is also common for staffing firms to assume that they are not responsible for any discrimination, retaliation or harassment that their employees face at their clients' work sites.  Both assumptions are often wrong.

According to EEOC guidance and applicable case law, staffing agencies are responsible for discrimination, retaliation, and harassment that their employees confront at clients’ work sites.  Further, to the extent that the working conditions of staffing firms’ employees are controlled in whole or in part by the clients to whom the employees are assigned, clients are responsible, too.  As the EEOC guidance makes clear, staffing firms must hire and make job assignments in a non-discriminatory manner and client companies must treat staffing firm workers assigned to them in a non-discriminatory manner.  Further, staffing firms must take immediate and appropriate corrective action if it learns that a client has discriminated against one of its workers. 

The nature of the staffing firm/client company relationship makes dealing with EEO issues and employment laws even more difficult than is typically the case.  When in doubt about how to handle a particular situation, consult your employment counsel.

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Biography

Martha J. Zackin is Of Counsel in the Mintz Levin's Boston office, practicing in the Employment, Labor & Benefits Section. She has more than 20 years of experience advising and representing clients on a broad range of employment law issues and in adversarial proceedings. In her role as an advisor to employers, boards of directors, and executives, Martha regularly provides practical advice and counsel on a wide range of employment-related issues, including employee relations and policy matters, violations of noncompetition, nonsolicitation and nondisclosure agreements, employee training, employment and separation agreements, affirmative action, mergers and acquisitions, and internal investigations. Martha has represented clients before administrative agencies, courts, arbitrators, and mediators.

Before joining Mintz Levin, Martha was corporate counsel for Keane, Inc., a billion-dollar multinational corporation with, at its peak, approximately 12,000 employees. Beyond her responsibilities as the sole employment lawyer for Keane, Martha assisted the company with Sarbanes-Oxley compliance, corporate governance, M&A due diligence, SEC matters, and risk assessment. Prior to joining Keane in 1994, Martha was with another major Boston law firm.

Representative Matters

  • Secured a $7.8 million judgment on breach of contract and civil conspiracy claims, following a five-day arbitration hearing before a three-member, neutral panel. 
  • Successfully resolved an EEOC class action lawsuit, on highly favorable terms. 
  • Helped the governance committee of the board of directors of a publicly traded company successfully navigate through a high-profile CEO departure, following the public airing of sexual harassment allegations against the executive.
  • Successfully resolved OFCCP and DOL audits.
  • Successfully represented employers and individual executives in numerous proceedings alleging violations of state and federal antidiscrimination laws.


Recognized for excellence, Martha was selected as a 2007 “In-House Leader in the Law” by Massachusetts Lawyers Weekly. She is frequently asked to provide expert commentary on various employment issues, having appeared on The Emily Rooney Show and been quoted in MSNBC.com, Boston Business Journal, Business Insurance, and Workforce Management.

Contact Info -  Tel (617) 348-4415 * Email MJZackin@mintz.com *

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