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WESTAFF REPORTS FIRST QUARTER RESULTS

WALNUT CREEK, CA, Wednesday, March 6, 2002
Westaff, Inc. (NASDAQ: WSTF), a leading provider of temporary office and light industrial staff, today reported financial results for the first quarter, which ended January 26, 2002.

Sales of services and license fees for the first quarter decreased from $137.1 million in the fiscal 2001 quarter to $107.0 million in fiscal 2002, a decline of 21.9%. The decline primarily reflects the impact of the current economic recession.

Westaff also had an operating loss of $4.3 million for the first quarter of fiscal 2002 as compared to operating income of $1.7 million for the fiscal 2001 quarter.

The fiscal 2002 operating loss includes restructuring charges of $1.9 million associated with the abandonment of certain management information systems, which were under development, as well as severance, lease termination and other costs related to the Company's announced layoffs and office closures.

Westaff's management currently estimates that the restructuring will reduce operating expenses by approximately $4.5 million on an annualized basis.

"In the second quarter, we are continuing a program of cost containment," said Dwight S. Pedersen, Westaff's President and Chief Executive Officer. "We are reevaluating the profitability of our branches, and we will make additional branch closures where warranted. We are also initiating a multi-faceted program to increase sales and to improve the productivity of our sales force. We believe that we will begin to see the benefits from all of this in the third quarter."

Westaff remains out of compliance with certain of its senior secured note financial covenants and revolving credit agreement covenants. The Company's management is continuing to work with its bank group and senior note holders to amend and restructure its credit facility, reset financial covenants or obtain covenant waivers as needed. The Company's management is also working with its worker's compensation insurance carrier and its surety bond holder on financing issues. Westaff's Board of Directors has authorized management to hire an investment advisor to evaluate the Company's financial and strategic alternatives.

Westaff provides staffing services and employment opportunities for businesses in global markets. Westaff annually employs approximately 175,000 people and services more than 20,000 clients from more than 330 offices located throughout the U.S., the United Kingdom, Australia, New Zealand, Norway and Denmark. Westaff achieved fiscal 2001 system revenues of more than $580 million. For more information, please visit our website at www.westaff.com.

This press release contains forward-looking statements as defined in the Securities Exchange Act of 1934, and is subject to the safe harbors created by law. These forward-looking statements involve a number of assumptions, risks and uncertainties. Actual results of future events could differ materially from estimates. Among the factors affecting future operating results are: financing risks, a going concern opinion issued by the Company's accountants, possible adverse effects of fluctuations in the general economy, reliance on executive management, uncertain ability to continue and manage growth, control by a significant shareholder, reliance on management information systems, risks related to international operations, variability of employee-related costs, risks related to customers, variability of operating results and the seasonality of the business cycle, ability to attract and retain the services of qualified temporary personnel, a highly competitive market, reliance on field management, employer liability risks, risks related to franchise agent and licensed operations, the risk of Nasdaq de-listing and risks related to acquisitions.

Forward-looking statements are based on the beliefs and assumptions of the Company's management and on currently available information. The Company undertakes no responsibility to publicly update or revise any forward-looking statement. Additional information concerning the risks and uncertainties listed above, and other factors you may wish to consider, is contained in the Company's filings with the Securities and Exchange Commission, including Form 10-K, Form 10-Q, Form 8-K and other filings.