Commitments and Contingencies

6 Months Ended

Jun. 30, 2026

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

On March 23, 2015, Plaintiff Jessica Gentry, on her own behalf and on behalf of a putative class of allegedly similarly situated individuals, filed a complaint against the Company in the Superior Court of California, San Francisco County, which was subsequently amended on October 23, 2015. The complaint alleges that a putative class of current and former employees of the Company working in California since March 13, 2010, were denied compensation for the time they spent interviewing “for temporary and permanent employment opportunities” as well as performing activities related to the interview process. Gentry seeks recovery on her own behalf and on behalf of the putative class in an unspecified amount for this allegedly unpaid compensation. Gentry also seeks recovery of an unspecified amount for the alleged failure of the Company to provide her and the putative class with accurate wage statements. Gentry also seeks an unspecified amount of other damages, attorneys’ fees and statutory penalties, including penalties for allegedly not paying all wages due upon separation to former employees and statutory penalties on behalf of herself and other allegedly “aggrieved employees” as defined by California’s Labor Code Private Attorneys General Act (“PAGA”). On January 4, 2016, the Court denied a motion by the Company to compel all of Gentry’s claims, except the PAGA claim, to individual arbitration. On March 8, 2024, the Court issued an order certifying: (1) a class of California-based temporary employees who attended at least one uncompensated interview with a third-party client at any time since March 13, 2010; (2) a subclass of class members who held a prior temporary job assignment before interviewing for a subsequent assignment; and (3) a subclass of class members who are no longer employed by the Company (i.e., a “waiting time penalties” subclass). The first phase of the trial on the issue of liability commenced on November 3, 2025. Closing arguments were delivered on January 23, 2026, and final briefs submitted. On May 4, 2026, the court issued its statement of decision after court trial on phase one of the trial. This is a two-phase trial. The decision is an interim order covering the liability issues tried in phase one of the case. The second phase of the trial is the damages phase. The final ruling and judgment will not be issued until after the conclusion of trial on damages, which is currently set for May 2027. They will both be subject to appeal. In its May 4, 2026, ruling, the court found candidate interviews to be compensable and the Company liable for

unpaid wages, liquidated damages and some PAGA penalties. Due in part to conflicting legal decisions and the uncertainty of the law in this area, the court found the Company was not willful in its failure to pay for interviews so did not find the Company liable for waiting time penalties or non-compliant wage statements. The amount of damages for unpaid wages, liquidated damages and PAGA penalties will be determined in the damages phase of the trial set to begin on May 3, 2027. On June 11, 2026, Gentry Petitioned for Writ of Mandate (“Writ”) to the California Court of Appeal seeking a reversal of the Superior Court’s ruling that the Company was not liable for waiting time penalties or non-compliant wage statements. The Court of Appeal notified the parties on June 24, 2026, that it declined Gentry’s Writ. On June 18, 2026, Gentry filed a Motion for Determination of entitlement to Permanent Injunctive Relief seeking an order to require the Company to start the payment of interview time pay to all employees interviewing for temporary and permanent employment opportunities effective upon the close of the damages trial in May 2027. The hearing on the permanent injunction motion is set for September 24, 2026. The Company maintains its position that it has meritorious defenses to the allegations asserted by Gentry, and the Company intends to continue to vigorously defend against the litigation including an appeal of a final judgment. At this stage of the litigation, it is not feasible to predict the outcome of or a range of loss, should a loss occur, from this proceeding and, accordingly, no amounts have been provided in the Company’s Financial Statements.

On April 6, 2018, Plaintiff Shari Dorff, on her own behalf and on behalf of a putative class of allegedly similarly situated individuals, filed a complaint against the Company in the Superior Court of California, County of Los Angeles. In addition to certain claims individual to Plaintiff Dorff, the complaint alleges that salaried recruiters based in California have been misclassified as exempt employees and seeks an unspecified amount for: unpaid wages resulting from such alleged misclassification; alleged failure to provide a reasonable opportunity to take meal periods and rest breaks; alleged failure to pay wages on a timely basis both during employment and upon separation; alleged failure to comply with California requirements regarding wage statements and record-keeping; and alleged improper denial of expense reimbursement. Plaintiff Dorff also seeks an unspecified amount of other damages, attorneys’ fees and penalties, including but not limited to statutory penalties on behalf of herself and other allegedly “aggrieved employees” as defined by PAGA. On April 8, 2026, Dorff’s motion for certification of a class was heard by the Court. On April 20, 2026, the Court issued an order denying Dorff’s motion for certification of a class. On June 1, 2026, the Court severed Dorff’s individual employment discrimination related claims from her individual misclassification claim and her collective PAGA claims. Trial on Dorff’s individual misclassification claim is set for January 11, 2027. No trial date was set for Dorff’s other individual claims and no trial date was set for Dorff’s collective PAGA claims. At this stage of the litigation, it is not feasible to predict the outcome of or a range of loss, should a loss occur, from this proceeding and, accordingly, no amounts have been provided in the Company’s Financial Statements. The Company believes it has meritorious defenses to the allegations and the Company intends to continue to vigorously defend against the litigation.

The Company is involved in a number of other lawsuits arising in the ordinary course of business. While management does not expect any of these other matters to have a material adverse effect on the Company’s results of operations, financial position or cash flows, litigation is subject to certain inherent uncertainties.

Legal costs associated with the resolution of claims, lawsuits and other contingencies are expensed as incurred.

The Company has a $100.0 million credit agreement (the “2025 Credit Agreement”) which matures in May 2030. Borrowings under the 2025 Credit Agreement will bear interest in accordance with the terms of the borrowing, which typically will be calculated according to the adjusted term Secured Overnight Financing Rate (“SOFR”), plus an applicable margin. The 2025 Credit Agreement is subject to certain financial covenants, and the Company was in compliance with these covenants as of June 30, 2026. As of June 30, 2026, the Company had no cash borrowings under the 2025 Credit Agreement, and maintained $10.3 million in standby letters of credit to satisfy workers’ compensation insurers’ collateral requirements.