Staffing firm sues rivals over contractor classification
Staffing firm sues rivals over contractor classification

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A hospitality staffing firm sued three online staffing platforms claiming unfair competition over their use of independent contractors. Two staffing buyers were also named as defendants.
The Party Staff, a Los Angeles-based hospitality staffing firm, filed the suit on Jan. 8. The firm’s attorney, Shannon Liss-Riordan, is known for representing drivers in legal challenges over misclassification against firms such as Uber.
Defendants in The Party Staff lawsuit include staffing platforms Qwick, Instawork and Tend Exchange (acquired last year by Nowsta).
The Party Staff pays workers as employees, including minimum wage, overtime and payroll taxes, according to the suit. It argues the staffing platforms undercut the company on cost by misclassifying their workers.
“In reality, Qwick, Instawork and Tend are hospitality staffing companies (just like plaintiff), and they have violated California law by classifying their workers as independent contractors,” according to the lawsuit. “In so doing, they have been able to offer lower prices than plaintiff, thereby gaining a significant competitive advantage.”
The Party Staff said it has been in business since 1989. It provides temps to hotels, catering companies, corporate dining facilities, special events and residential parties. The company said it has lost numerous clients as a result of its competitors’ misclassification.
“In many cases, plaintiff’s clients have explicitly informed plaintiff that they would be terminating plaintiff’s services because Qwick, Instawork or Tend could offer lower prices,” according to the lawsuit.
The Party Staff also named staffing buyers Aramark and ISS Guckenheimer as defendants.
Stands by Model
Qwick fought back against the claims in a note to SIA.
“We deny the allegations in this case and stand by our operating model,” the company said in a statement. “Business partners choose to work with Qwick over other providers for many reasons, including finding our innovative, tech-driven approach to staffing to be more efficient and superior overall. We are compliant with all California labor laws and exclusively staff W-2 personnel in the state.”
Instawork also responded.
“While Instawork does not comment on active litigation, we prioritize compliance with applicable regulations and understand that the growing community of partners and pros who use our platform choose Instawork because they trust the quality and reliability we bring to both businesses and workers looking to find and fill local staffing opportunities in a rapidly evolving modern economy,” Kira Caban, head of strategic communications, said in a statement.
First Case
Though the lawsuit was recently filed, Liss-Riordan said the issue isn’t new.
“This issue has been a serious one for a long time, and this company decided it needed to do something about the unfair and unlawful competition that is driving down labor standards and making it difficult for law-abiding businesses to compete,” she said in a note to SIA.
Liss-Riordan said this is the first case that she is aware of where a staffing firm is challenging competitors over misclassification.
The lawsuit says hospitality workers supplied as independent contractors aren’t able to satisfy prong B of the ABC test for independent contractor misclassification that workers perform work that is outside the usual course of the hiring entities’ business.
“The business model of defendants hinges exclusively on its employees — it provides no independent services beyond hiring, managing, and assigning employees to client shifts,” according to the lawsuit.
It also argues that the defendants would not meet prong A of the test that a worker is free from the control and direction of the hiring entity in the performance of work.
“They exercise this control by using a comprehensive system of ensuring standards, rules, qualifications and other requirements that workers must follow and restricting which workers have the access to and ability to perform particular jobs,” the lawsuit said.
Tend Exchange, Aramark and Guckenheimer have also been contacted for comment.
The lawsuit was filed in San Francisco, which has previously sued staffing platforms for classifying workers as independent contractors. Those lawsuits included Qwick and WorkWhile.
The Party Staff vs. Qwick et al; Superior Court of the state of California for the county of San Francisco; CGC-25-621259