GVHR » Topics » As a result of our co-employment relationship with most of our clients and client

These excerpts taken from the GVHR 10-K filed Mar 16, 2009.
As a result of our co-employment
relationship with most of our clients and client
employees, we may be subject to
liabilities as a result of their acts or omissions.



 



We enter into a contractual relationship with each of
our clients, whereby the client transfers certain employment-related risks and
liabilities to us and retains other risks and liabilities. Many federal and
state laws that apply to the employer-employee relationship do not specifically
address the obligations and responsibilities of this “co-employment”
relationship. Consequently, we may be subject to liability for violations of
employment or discrimination laws, including violations of federal and state
wage and hour laws, by our clients despite the contractual division of
responsibilities between us, even if we do not participate in such violations.
This risk is increased with respect to clients serviced by our HR consultants
who are located on-site at our clients’ offices and who are designated service
representatives of one or two clients because of their greater presence on a
client’s premises and potential involvement in client employee relations. In
addition, our client employees may also be deemed to be acting as our agents,
subjecting us to further liability for the acts or omissions of such client
employees. Although our professional services agreement provides that the
client will indemnify us for any liability attributable to its own or its
employees’ conduct, we may not be able to effectively enforce or collect such
contractual indemnification. Any such liability imposed upon us could have a
material adverse impact on our results of operations, financial condition and
cash flows.



 



As a result of our co-employment
relationship with most of our clients and client
employees, we may be subject to
liabilities as a result of their acts or omissions.



 



We enter into a contractual relationship with each of
our clients, whereby the client transfers certain employment-related risks and
liabilities to us and retains other risks and liabilities. Many federal and
state laws that apply to the employer-employee relationship do not specifically
address the obligations and responsibilities of this “co-employment”
relationship. Consequently, we may be subject to liability for violations of
employment or discrimination laws, including violations of federal and state
wage and hour laws, by our clients despite the contractual division of
responsibilities between us, even if we do not participate in such violations.
This risk is increased with respect to clients serviced by our HR consultants
who are located on-site at our clients’ offices and who are designated service
representatives of one or two clients because of their greater presence on a
client’s premises and potential involvement in client employee relations. In
addition, our client employees may also be deemed to be acting as our agents,
subjecting us to further liability for the acts or omissions of such client
employees. Although our professional services agreement provides that the
client will indemnify us for any liability attributable to its own or its
employees’ conduct, we may not be able to effectively enforce or collect such
contractual indemnification. Any such liability imposed upon us could have a
material adverse impact on our results of operations, financial condition and
cash flows.



 



EXCERPTS ON THIS PAGE:

10-K (2 sections)
Mar 16, 2009
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