Temp staffing gives businesses flexibility, but compliance isn’t optional. Whether hiring for short-term projects or long-term contracts, companies need to follow labor laws that protect temporary workers. Mistakes lead to fines, lawsuits, and serious disruptions, and no business wants to deal with that.

The legal landscape isn’t the same everywhere. Employers in the United States and Canada operate under different compliance rules, and failing to understand those differences is a risk. From wages to safety to liability, businesses need to know the law and follow it to the letter.

Ignoring compliance doesn’t just cost money—it damages reputation. Getting this right keeps everything running smoothly, protects workers, and ensures temp staffing remains a smart business move, not a legal nightmare.

The Legal Responsibilities of Businesses Hiring Temp Staff

Temporary workers aren’t exempt from labor laws. Just because they’re not full-time doesn’t mean you can cut corners. Whether you’re hiring in the U.S. or Canada, businesses are still on the hook for wages, workplace safety, and fair treatment. The key is knowing where the lines are—because those lines do exist, and crossing them can lead to serious liability.

United States: Compliance Laws for Temp Workers

Fair Labor Standards Act (FLSA)
Temp workers are covered under federal wage and hour laws. That means they must be paid at least the federal minimum wage and receive overtime (time-and-a-half) if they work more than 40 hours a week. Even if the staffing agency handles payroll, the company using the workers still needs to make sure the pay is lawful.

Occupational Safety and Health Administration (OSHA)
OSHA makes it clear: staffing agencies and host employers share responsibility for temp worker safety. That includes proper training, PPE, and a safe environment. You can’t outsource your duty to protect workers on your site—even if they’re technically not on your payroll.

Joint Employer Liability
Companies using temp labor can be considered joint employers under various laws. The National Labor Relations Board (NLRB) enforces joint employer status for union-related matters, while other agencies like the Department of Labor (DOL) and Equal Employment Opportunity Commission (EEOC) can hold companies accountable for wage or discrimination violations. If a staffing agency drops the ball, the business using the workers may still be liable.

Workers’ Compensation
Who covers a temp worker if they’re injured on the job? That depends on your agreement with the staffing agency and the state you’re in. Some states require the staffing agency to carry the policy, while others may expect the host company to assume coverage. If no one’s clear, the liability could land on your lap.

Canada: Compliance Laws for Temp Workers

Employment Standards Acts (Provincial Laws)
Each province sets its own employment rules for things like minimum wage, vacation pay, and overtime. Whether you’re in BC, Alberta, or Ontario, you need to follow your province’s Employment Standards Act. And that applies to temp workers—no exceptions.

Workers’ Compensation Boards (WCBs) / WSIB in Ontario
Workplace injury insurance is provincially regulated in Canada. That means businesses must confirm with the staffing agency who’s responsible for reporting injuries and covering claims. Assuming it’s “their problem” isn’t enough—get it in writing.

Equal Pay for Equal Work (Ontario)
Ontario temp workers are entitled to equal pay if they’re doing the same job as permanent staff. The law says they must be paid the same hourly rate unless there’s a clear difference in seniority, merit, or other factors allowed by the legislation. This isn’t true in all provinces—but if you’re in Ontario, it’s non-negotiable.

Human Rights and Anti-Discrimination Laws
Canada enforces strong human rights protections, federally and provincially. You can’t treat temp workers differently based on race, gender, age, disability, or any other protected category. That applies across the board—from job assignments to discipline to termination.

Best Practices for Staying Compliant

Labor laws change, and the worst time to learn about them is during an audit or lawsuit. If you’re using temporary labor, here’s how to protect your business:

1. Clarify Worker Classification

Not all temp labor risks are about staffing agencies. Problems happen when businesses try to bypass agencies and classify workers as “independent contractors” to cut costs. That’s a red flag. If someone’s taking direction, using your equipment, and working scheduled hours—they probably qualify as an employee, not a contractor. Misclassifying them opens you up to fines and back pay claims.

2. Confirm Liability for Wages and Benefits

Who’s issuing paychecks? Who’s responsible for vacation pay, sick leave, or workers’ comp? These details need to be spelled out clearly in your agreement with the staffing agency. Don’t assume it’s covered—double check. If the agency fails to pay up, you could be next in line.

3. Ensure Compliance with Workplace Safety Standards

Temporary workers must be given the same level of training and protection as your regular employees. That means clear safety protocols, site orientations, access to PPE, and proper supervision. A staffing agency can help, but the host employer always shares responsibility under OSHA or provincial WCB laws.

4. Follow Anti-Discrimination and Equal Pay Laws

Hiring and promotion decisions must be based on skills and job performance—not background, age, or appearance. In Ontario, if a temp worker is doing the same work as your full-time staff, they need to be paid the same, unless a lawful exception applies. Even outside Ontario, equal pay is still a best practice if you want to avoid resentment and retention problems.

5. Work with a Reputable Staffing Agency

The right staffing agency does more than fill shifts. They make sure workers are classified correctly, trained properly, and paid fairly. They carry the right insurance and know what compliance actually looks like. A bad agency, on the other hand, can drag your business into a legal mess. So vet your partners like you would any vendor that touches your operations.

MGR Workforce Helps Businesses Stay Compliant with Temp Staffing

Temporary staffing should solve problems—not create them. MGR Workforce connects businesses with reliable, pre-screened workers while handling compliance on both sides of the border.

Request Temp Workers Today—Without the Compliance Headaches

Hiring temp workers should be simple. MGR Workforce handles the legal side, so businesses can focus on productivity. Request temp workers today and get a workforce that’s skilled, reliable, and fully compliant with labor laws.