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April 2018

Fix Your Service Agreements

Recent litigation involving situations where worksite employees of certain Florida based PEOs have allegedly caused grievous injury to third parties in vehicular accident situations has shown the critical importance of making sure that all service agreements in Florida contain the Florida tort reform language. In 1999, with the assistance of then Senator “Skip” Campbell, Mike Miller was able to work with the trial bar and pass Florida Statute 768.098, which grants tort immunity to PEOs, even in joint employment situations, where certain conditions are met and the service agreement with the client contains the requisite language of the statute. The crucial portions of Section 768.098, Florida Statutes that must be contained in every Florida service agreement in order to argue that tort immunity is applicable are as follows:

(d) The employer seeking to avoid liability pursuant to this section is expressly absolved in the written contract forming the joint employment relationship of control over the day-to-day job duties of the jointly employed employee who has committed a tortious act, and actual control over the portion of the job site at which or from which the tortious conduct arose or at which and from which the jointly employed employee worked, and that said control was assigned to the other employer under the contract; and

(e) Complaints, allegations, or incidents of any tortious misconduct or workplace safety violations, regardless of the source, are required to be reported to the employer seeking to avoid liability pursuant to this section by all other joint employers under the written contract forming the joint employment relationship, and that the employer seeking to avoid liability pursuant to this section did not fail to take appropriate action as a result of receiving any such report related to a jointly employed employee who has committed a tortious act.

In one recent vehicular accident case where the required language was not contained in the service agreement, the PEO and its client were deemed jointly liable for the grievous injuries incurred by passengers in another vehicle struck by the vehicle driven by a worksite employee. It is crucial that PEOs review all of their service agreements, particularly those that pre-date the enactment of Section 768.098, Florida Statutes to make sure that an addendum is entered into between the PEO and the client to place the required tort reform language in the service agreement. In most cases this should be able to be easily accomplished by a letter from the PEO to the client explaining that the PEO has no desire whatsoever to try to run a client’s business and that the addendum will make it clear that the client and not the PEO will control the client’s worksite.

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