My previous employer was a family owned staffing agency, I will call it the “Staffing Agency,” and we primarily staffed nurses in nursing homes and hospitals throughout Iowa and Nebraska. It was a start up business so I got to participate in many decisions about pricing and contract agreements. Shortly after starting, I learned how competitive the industry was and over the three years I worked with the Staffing Agency, I watch several other similar companies open and then shut down within only a few months.
The problem with the healthcare staffing industry in comparison to other staffing industries is that in order to be competitive you need to pay your employees well and keep your prices low to attract nursing facilities. It is standard within the healthcare staffing industry to provide creative incentives for nursing facilities to maintain your services without having to cut your prices. The basic concept was to increase volume, the more employees of the staffing agency the nursing facility used, the better the discount they got.
The ultimate goal of a healthcare staffing agency is to help nursing facilities deal with the fluctuations of staffing as their census increases or decreases. We also can create employment matches between the nursing facilities and our employees. This is a great situation for a staffing agency because it reaffirms to our clients that we take great pride in the employees we hire and that we are here to truly help them whenever possible. But as an agency we need to make sure that all the costs associated with hiring that particular employee are covered before we allow a nursing facility to employ them along with receiving some sort of recruiting fee for helping them fill that employment need. Our contract agreement with nursing facilities provides a clause to protect us in these types of situations while still allowing the firm to be competitive. Rather than charging the client a flat finder’s fee after an employee has performed a set number of hours under contract with the nursing facility the finder’s fee decreases, and at 540 hours they are able to hire that employee free of charge. The employment by the nursing facility also needs to be at the will of the employee.
After three years of business, I hadn’t yet come across a client who qualified for the hiring agreement or an employee who wanted to enter into an employment arrangement with one of our clients. It wasn’t until after I had a discussion with one
of our employees, I will call her LPN-Female, that I realized one of our clients had ignored our contract agreement and gone ahead and hired one of our employees. The client, I will call them “Nursing Home,” had been using us to help them staff an overnight LPN shift that they were having trouble filling. We had been sending them the same LPN for over a year. After that year we decided to send her to a closer facility and started sending a new LPN. The new nurse, I will call him “LPN-Male,” started going to this facility and it was when we heard about how great he was and about how much they enjoyed having him that the problem started.
Our relationship with the Nursing Home was a good one, they were very easy to do business with and we had to do little work because our LPN-Male at the time would schedule shifts with the facility rather than going through us. All we had to do was send him his paychecks and bill the facility. After six months or so, the shifts he was picking up dwindled to almost nothing until finally they were gone. We continued to try to schedule LPN-Male at other facilities but he turned down several of our shifts because he already had work. It is common in the healthcare staffing industry for employees to work for more than one staffing agency to help them secure steady work.
Several months later Nursing Home called again looking for help. We sent them LPN-Female because LPN-Male informed us that he was already working at another facility. After her shift LPN-Female called me to inform me that LPN-Male had been working for Nursing Home the past several months. She informed me that LPN Male had been working at Nursing Home the past several months through another agency and that he was no longer working for that agency but that he had been hired part-time at Nursing Home.
This information deeply upset and hurt me! LPN-Male had been a very good employee of ours and the Nursing Home had been a great client. I had enjoyed working with them very much and valued our relationship with both of them, so I was completely shocked by the dishonesty. Once I got over my personal reaction, I realized Nursing Home had broken their contract agreement with Staffing Agency by hiring LPN-Male without contacting us. It had become very clear to me that both Nursing Home and LPN Male were aware of the contract agreement and by having him pick up shifts through the other staffing agency they thought they could avoid paying the finder’s fee.
What do I do?
If I bring the situation to light I would not only jeopardize future business between Staffing Agency and Nursing Home, but I would have to let the Administrator know about the dishonesty that occurred between his Director of Nursing and LPN Male.