Over the past six weeks, 44 staffing agencies have had to file for bankruptcy. And this at a time when temporary staffing is in extremely high demand among companies.
Turnover and dissatisfaction as warning signs
The reason for this is that some staffing agencies have not recovered from the pandemic. When temporary staffing agencies run into trouble, it initially leads to a certain amount of unrest among temporary workers. Dissatisfaction and turnover rise—much to the chagrin of the client company. In the event of insolvency, there is also the risk that the client company will have to pay any unpaid social security contributions and taxes on behalf of the staffing agency. This is when so-called subsidiary liability comes into play.
Be Aware of the Risk of Subsidiary Liability
To avoid the risks of subsidiary liability, you should take countermeasures early on. It’s worth talking to staffing agencies at the very first signs of trouble.
