Who is legally responsible as the employer of the Placed Employees providing services for Degree Wellness?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
The services shall be performed by persons in the employ of Staffer and Staffer assumes legal responsibility as the employer of said persons, including payment of wages, benefits and other compensation due to said persons, procurement of insurance, including, without limitation, workers' compensation insurance, and Staffer's compliance with all applicable federal, state, local laws and other requirements, including payment of all taxes withheld from or due on the Placed Employees. Staffer will comply with all laws governing the employer-employee relationship, except those responsibilities that are expressly delegated to Group in this Agreement. Group will not permit Placed Employees assigned hereunder to work hours in excess of the hours reported to Staffer for payment and will comply with all legally required rest and meal periods for such employees.
All services by Staffer's Placed Employees shall be performed in an acceptable workmanlike manner, by Placed Employees who are appropriately licensed and fully qualified.
No Joint Employment Relationship. Staffer acknowledges and agrees that its relationship with Group is that of an independent contractor and nothing in this Agreement or related to Staffer's performance of any service shall be construed to create an employment or agency relationship between Group and Staffer or Group and any of Staffer's employees. Except in instances where the clinical quality of the work performed is in question, Staffer retains the sole and exclusive right and obligation to determine hiring and firing; conduct pre-employment screening and testing; maintain personnel records and files; track employee hours and pay wages and benefits; direct, control and supervise Staffer's employees; conduct performance management; impose discipline; and establish all other terms and conditions of employment of Staffer's employees. Staffer shall at all times remain the sole employer of persons employed by Staffer and, to this end, Staffer and Group agree that no act or omission of Staffer or Group shall be construed to make or render them joint employer, co-employer or alter ego of each other. Nothing in this Agreement shall be construed to create a partnership or joint venture relationship between the parties. Placed Employees provided to Group by Staffer shall not be eligible to participate in any of the benefits or benefit plans offered or provided by Group to regular employees on Group's payroll.
Indemnity as to Staffing. Staffer shall, to the fullest extent permitted by law, indemnify, defend and save harmless Group, its affiliates, and their respective managers, directors, officers, employees, insurers, and agents, (collectively, the "Indemnified Parties") from and against any and all claims, demands, actions, causes of action, damages, losses, fines, penalties and expenses (including reasonable attorneys' fees), which may be made or asserted against the Indemnified Parties, arising from or related to a Placed Employee and the services provided by Staffer pursuant to this Agreement, including, but not limited to, damage, bodily injury or the death of any person. Staffer also agrees to indemnify, defend and save harmless the Indemnified Parties from and against any liability arising out of or related to a breach of the terms of this Agreement, or any federal, state or local statute, law, ordinance or regulation.
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 63–66)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, the Staffer is legally responsible as the employer of the Placed Employees. This means that Staffer assumes all employer responsibilities, including paying wages, benefits, and other compensation. Staffer is also responsible for procuring insurance, such as workers' compensation, and complying with all applicable federal, state, and local laws, including tax withholdings and payments for the Placed Employees.
This arrangement means that the Degree Wellness franchisee (referred to as 'Group' in this context) does not have the typical employer responsibilities for the Placed Employees. However, Degree Wellness retains control over the clinical work performed by registered nurses and must not interfere with the Staffer's responsibilities as the employer, except for specific responsibilities expressly delegated to Degree Wellness in the agreement. Degree Wellness must also ensure that Placed Employees do not work excess hours and comply with legally required rest and meal periods.
This division of responsibilities is further reinforced by the agreement stating that the relationship between Staffer and Group is that of an independent contractor, explicitly disavowing any employment or agency relationship. Staffer retains the exclusive right to manage the employment terms of its employees, including hiring, firing, screening, record keeping, and performance management. This ensures that Staffer remains the sole employer of the Placed Employees, and neither party can be construed as a joint employer.
Staffer is also obligated to indemnify Degree Wellness (Group) against any claims, losses, or expenses arising from the services provided by Staffer's Placed Employees. This includes claims related to damage, bodily injury, death, or any breach of the agreement or applicable laws. This indemnification clause protects Degree Wellness from potential liabilities associated with the Placed Employees' actions and services.