Nurse gets second bite at lawsuit apple, hospital must swallow bitter pill

The California Supreme Court recently dealt a difficult blow to clients of staffing agencies when it ruled that a client-hospital could be sued by a temporary nurse who had been placed at the hospital by a staffing agency even though the nurse had already sued—and settled with—the staffing agency. California employers that work with staffing agencies should be aware of the risks posed by this ruling.

Background

Lynn Grande worked as a nurse at Eisenhower Medical Center for one week in 2012. She was employed by a staffing agency, FlexCare LLC, which placed her at the hospital as a temporary employee. The agency and the hospital had a staffing contract that provided the agency would retain “exclusive and total legal responsibility” as her employer. The contract specifically provided the agency would ensure “full compliance with and satisfaction of” the wage and hour laws.

First bite: Grande sues agency

A different nurse (who is unnamed in this action) filed suit against the agency, alleging wage and hour violations. Grande joined the suit as a named plaintiff, and the two nurses sought to represent a class of individuals who worked not only at the hospital but also at the agency’s other placement sites.

The two nurses settled the first lawsuit on behalf of a class that included “all persons who at any time from or after January 30, 2008 through April 8, 2014 were non-exempt nursing employees of [the agency] employed in California.” The settlement provided the agency would pay out no more than $750,000 to the class members.