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Company sold, but the new company is hiring us through a temp agency for 90 days. What happens if I do not become a permanent employee of the new company?

by Jim

The company I work for has been sold. The new owner hired a temp agency to interview and hire us for 90 days. What happens if the temp agency decides not to keep me after 90 days, am I able to collect unemployment benefits from the prior company that was sold? I have worked for them for 2 years, last June they laid me off for a 1 month due to lack of work and I was able to collect unemployment then. I intend on working for the new owner, but want to make sure that I know what my rights are.

Thank you,

Hi Jim. We'll see how thankful you are when you get done reading my answer .. because temp agencies are a pet peeve of mine.

I changed your title because all unemployed people need to be on their guard against not being found eligible for unemployment if they work for a temp agency.

Temporary workers in this country are a huge group of people who do not even know that they can collect unemployment between assignments .. because it is essentially a "lack of work". And the size of the group is growing .. because it seems everyone is working temp jobs nowadays.

Many states have added "temporary worker provisions" to their statutes to undermine a temp workers ability to collect unemployment .. or be able to stop paying benefits if temp work becomes your subsequent work to a valid paying claim.

Jim, once you start working for the temp agency .. that IS your employer until you accept work for another company or the client company .. which would be the company that bought your old employer out.

Another factor for you to consider is that anyone who refuses to apply or accept offered suitable work through the temp agency can be denied for that reason. Because the new company will tell the state that you were offered work. I don't have it in me this morning to address a predecessor/successor relationship which causes this. We just need to know that these things exist and can screw us out of benefits.

Until the point that you are actually "hired" though, through the temp agency .. you can file a claim because when the company was sold, your former employment became a lack of work claim itself. If you are unemployed for any length in the transition from one job to the other .. file a claim.

So let's move on to the
90 days and what happens if this "assignment ends".

This is where a temporary worker provision comes into play and Michigan does have a provision now See Table 5-3

Last year many states, changed laws that are favorable to employees .. which will very likely have the effect of more people collecting for personally compelling reasons. States did this so they could get their hands of "stimulus money".

Many states, including MI, according to DOLETA also added temporary worker provisions .. I'm guessing, as a means to offset the favorable provisions they added.

In 2009 21 states had temporary worker provisions .. this year, 2010, 32 states and Puerto Rico have these provisions.

Very sneaky.

When you fill out all the paperwork to become an employee of the temp agency .. you should find that you will be signing a form that says if you do not contact the agency within a specified length of time after an assignment ends for another assignment, you will have been considered to have voluntarily quit .. and Jim, it would be without good cause.

So, keep this front and center in your mind if things don't work out after the 90 days.

This is just one way temp agencies AND A STATE UNEMPLOYMENT PROGRAM fight unemployment claims .. they have a whole bag of tricks for putting workers through the unemployment wringer.

For some reason, temp workers do not understand who it is they are actually working for and the fact that you are basically, a sub-leased employee .. an appeal can become a convoluted mess.

But since I too was in the exact same position you are now in .. I have it straight in my head .. and it honestly took my personal experience as a temp worker to get it that way .. even though I already knew a whole lot about unemployment.

I was only supposed to be a temp worker for 6 months .. it turned into nearly three years with no paid days off, no vacation, no health insurance .. no nothing but working 60 hours a week and getting paid for 40.

When it finally ended .. the temp agency not only appealed my benefits .. they then appealed to the board of review .. of course I won:)

If you have a question when something comes up .. just ask because this is important for so many people and everyone needs awareness of what it means to work for a temporary staffing agency.

Comments ANYONE??

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Jan 11, 2011
Did I make a mistake?
by: Jim

Hi Chris,

I am once again writing to you for your advise. My company is relocating for sure and it will 67 miles one way from my home. I wanted to be proactive and went looking for a new job. I found one and gave my 2 weeks notice and went to work for the new company. I have only worked for approximately 60 days and the owner has let me go telling me it just wasn't going to work out.

My question now is will I be able to file for unemployment while I look for something else? Or have I messed up my chances for unemployment?

I'd appreciate any help you can give me.
Thank you
Jim from Michigan

Well, Hi again Jim:)

Let's see .. we should first find out what the VQ disqualification is in Michigan.

Click with me, everybody .. and follow me to table 5-4 on page 8. Which, tells us the voluntary quit disqualifications state by state.

The reason were checking this is because some states, unlike Michigan do not have a law that may provide good cause for a VQ for new work. (So, Jim, you'll want to check the Michigan precedents to find out what that law provides for because it might make all this checking a moot point for you.)

Michigan says you have to earn 12 times your weekly benefit amount in subsequent employment in order to requalify if the quit is without good cause.

So since I don't know what your WBA will be .. I can't tell you how much the amount is that you would need to purge through subsequent earnings if the VQ turns out to be without good cause.

If your last employer terminated your employment after only 60 days because "it's not working out" .. I would call that a piss poor reason to fire someone and use to establish misconduct. So, I don't see this as a possible problem.

By the way, if you don't know what your weekly benefit amount will be .. you can estimate it .. if you can figure out the formulas you'll need .. which can be found back in the monetary chartbook.

Anyone out of breath yet from all the clicking?

Jim, I'm just feeling a bit punchy tonight. If you need me to help you figure out how much .. email me, I'll be happy to help you figure out that VQ disqualification thingy.

Aug 06, 2010
Temp Agency
by: Jim

Hi Chris,

I wrote to you back in May regarding becoming an employee of the temp agency after the company I worked for was sold. I am at the 90 day mark and I have been approached by the owner with the following options.

1. I can become an employee of the new company which will relocate about 60 miles from where we are now.

2. I can stay an employee of the temp agency continue to work as until the company is relocated. They informed me if I refuse to become an employee of the new owner, it will be considered a voluntary quit--but if I stay as the temp and work until the company is moved, then the temp agency will lay us off and we can collect unemployment.

I feel something isn't right. I am confused and I am in the process of trying to research it out, but I have to make a decision by Monday, 8-9-10.

Any insight on this would be greatly appreciated.

Thank you,

Hi Jim,

Since the offer from the new company requires you to travel 60 miles further .. you should investigate decisions which are about quitting due to distance from work. Or refusal due to distance.

And Jim .. I have never heard of a temp agency willingly lay someone off without "recalling you to work for some other temp assignment .. watch out .. this is how they can end any benefits due to a layoff.

I'm certain MI will have decisions which involve both distance and ugh .. temp agencies.

Don't get me wrong .. temp agencies are great because they put people to work, but they are sneaky when it comes to unemployment claims and are notorious for fighting claims .. at least most of them.

May 14, 2010
Suitable work
by: Jim

Thank you for your response--it cleared alot up for me. Now my question is lets say new company does not keep me, will the temp agency find me another job? What constitutes suitable work? I am a machinest, could they place me taking orders at a fast food restaurant? Would I have to take it?

Thanks for all of your help, I really appreciate it.


Jim, you are a machinist. That is currently a partial definition of what suitable work is to you.

I don't think that flippin burgers will ever be suitable work for you .. unless the pay for flippin burgers comes close enough to match your income as a machinist.

You only have to understand what Michigan thinks is suitable work. The following is copy and pasted from a MI decision

The Court cited Sec. 29(6) factors on suitability before the 1980 amendment: "The Commission shall consider the degrees of risk involved to his health, safety, and morals, his physical fitness and prior training, his experience and prior earnings, his length of unemployment and prospects for securing local work in his customary occupation, and the distance of the available work from his residence." MCL 421.29(6);

You'll have to do a little research to find out what the 1980 amendment consisted of. The issue is addressed in unemployment statutes.

You might also try this pdf because it's much easier to search and is only the "employment security act" and much easier to search .. for language.

To get a better handle on how the statues are interpreted by MI, read some of the MI precedent decisions located right here at a logical location?? The Department of Energy, Labor and Economic Growth

I suggest Chapter 13 "Refusal of Work".

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