Lets look at triangular employment arrangements and why like its Bermuda counterpart it’s easy to be set adrift in the off site staff management maze.

Most people work at their employers premises, on a site and with duties controlled by their employer.  In the last few years however we have seen an increase in staff being sent to work at premises belonging to a third party.  In the government and educational sector secondments have been common for some time but as competition for business has increased, companies have needed to find alternative approaches to improved service delivery in order to gain competitive advantage.

Freight companies now commonly place a staff member on their client’s premises to co-ordinate transport from the customer end.  Stationery and print companies dealing with large accounts have for some years placed a person or team of people within the clients business to act as an in-house print management team and even in recruitment, master vendor agreements have seen a team of recruiters working within the clients business for ease of access.

These arrangements can be very successful providing both economic and efficiency savings, but what happens when the relationship turns sour for some reason.  The “Triangular Employment Arrangement” can be a source of real difficulties when it comes to defining the rights of the individuals and companies concerned.

Your customer, the third party will want to retain control over who they have working in their business and the conduct of that person while on their premises.  It is possible therefore that a complaint against your employee could come from your customer.  What do you do if your customer no longer wants your staff member on their site or as the third party you have issues relating to the performance or conduct of a suppliers staff member on your site?

While there is case law and determination surrounding this subject, many areas have yet to be tested.  I would advise you tread carefully when considering this kind of arrangement.  However whether you are the third party or the employer you need to be seen as fair in your dealings with the employee. 

As a third party make sure that any person coming to work on your premises reads and signs your company policies and procedures particularly those that relate to conduct and health and safety.  This removes any element of doubt should there be issues further down the line.  Although you have the right to decide who works on your premises, any issues of performance, conduct or complaint should be dealt with in conjunction with the employer and fairly investigated by both the third party and the employer before any decisions to dismiss are made.

If your client requests removal of your employee from their site, make sure you investigate the issues thoroughly and have the safety net of alternative employment for that staff member.  Companies have in the past got into difficulty when there has been no job for the employee to come back to.  In this instance it is advisable to include a provision in the contract stating that the employee’s employment is subject to the third parties approval.  In Ward v Spotless Services (NZ) Ltd 6/08/03 the existence of this clause along with the fact that no alternative employment was accepted by the employee was enough for the ERA to dismiss the case.

Although there is no law to say how a third party deals with these issues other than to be fair, employees can make a claim to the ERA against a third Party in a triangular relationship if they feel that the third party has incited, instigated aided or abetted any breach of an employment agreement.