Hiring Practice Issues

Michael D. Fitzgerald
June 16, 2006 — 4,128 views  
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The hiring and firing processes utilized by an employer are two of the most fertile areas for potential litigation. Because an employer must keep in mind all of the statutory schemes governing employment when looking for and hiring a new employee and when firing an unsatisfactory one, employers can easily overlook a crucial and potentially devastating matter. With the current trend of increasing employment-related litigation, including tort claims fordefamation and emotional distress, it is very important for the employer to be aware of the potential legal consequences of its actions and methods by which those negative consequences can be avoided. This article endeavors to outline some of the most important aspects of hiring and firing as well as some new trends in employment litigation. By paying close attention to the areas discussed, you may head off expensive litigation while maintaining the best work force for your company.

A. The Application

The first step in the hiring process, once a job opening has been identified, is usually to take applications from those interested in the job. The most important thing to remember about a job application is that it must elicit only relevant information about the applicant and ask questions that are job-related. Specifically, an application should:

(1) avoid language implying any promise of continued employment;
(2) contain a disclaimer announcing that employment is terminable at will by either party at any time;
(3) contain an authorization, signed by the applicant, for the exchange of information during the reference-checking process;
(4) refrain from inquiries that are not job-related (see Section II.B. on The Interview);
(5) contain a standard equal employment opportunity statement; and
(6) contain a statement alerting applicants if the employer maintains a drug-free workplace.

B. Background Investigations

Background investigations conducted by potential employers can be beneficial to determine an applicant’s “fitness” for a particular job; however, potential problems can arise with respect to investigations into credit or criminal records. In some instances, these investigations can even be violative of Title VII of the Civil Rights Act of 1964. A Title VII claim may arise when the investigation procedure results in the disqualification from employment of a disproportionate number of minority employees and there is no showing by the employer that the criteria used are job-related or necessary to the employer's business.

1. Checking Credit References

A good illustration of the dangerous nature of credit checks is found in EEOC Decision No. 72-0427 (Aug. 31, 1971). In that case, the Equal Employment Opportunity Commission (EEOC). decided that a bank\'s policy of excluding applicants from employment on the basis of their credit reports would result in a foreseeably disproportionate impact upon minority applicants. The Court noted that, according to 1 967 Census Bureau statistics, 35.4 percent of the total number of nonwhite persons in the United States were below the poverty level, as compared with 10.3 percent of the total number of whites, On the other hand, in Bailey v DeBard, 10 CCH EPD ¶ 10389 (D.C. Ind. 1975), the court held that a state police department\'s use of a background investigation of trooper applicants, including a check into the applicant's credit history, was not violative of Title VII. The court found a close relationship between the information and job performance. Simply, this is a murky area, and employers should be very careful if they decide that such investigations are warranted in their particular industries.

Additionally, the Fair Credit Reporting Act (FCRA) provides strict guidelines for the use of credit reports in hiring. Clear and conspicuous disclosure stating that the employer may conduct such an investigation must be made to the applicant in writing in a document that consists solely of the disclosure, and the applicant must authorize the procurement and use of the report in writing prior to a prospective employer obtaining the report. 15 U.S.C. § 1681b(b)(2). The employer must also certify to the reporting agency that it has complied with the disclosure requirements and that any information obtained will not be used in violation of state or federal equal employment opportunity laws or regulations. 15 U.S.C. § l681b(b)(1).

2. Criminal Histories

In Youngblood v. Dalzell, 925 F.2d 954 (6th Cir, 1991), an employee's Title VII action based on the use of criminal histories in hiring was successful. Because the screening of applicants on the basis of their criminal histories resulted in a disproportionate impact on African-Americans, the employer's process was held discriminatory. However, to be successful, a Title VII claimant alleging discrimination through the use of criminal histories must typically show that the screening process actually caused a racially imbalanced workforce. Matthews v. Runyon, 860 F. Supp. 1347 (E.D. Wis. 1994). Employers should note that if a criminal record is used to automatically disqualify applicants rather than as merely one factor taken into consideration, a plaintiff will have an even stronger Title VII claim. See Wright v. Runyon, 1995 WL 97597 (EEOC 1995). An employer must also remember that anything learned as a result of a criminal background investigation can be used in a future negligent hiring action to show that the employer should have known that the applicant was reckless, dangerous, etc.

Even given the risks associated with them, background investigations can be very helpful if carefully planned. The key is to make sure that the criteria used in the investigation are job related. It is also important to make sure that the use of such techniques does not disproportionately impact any protected class. If an employer has reason to believe that such an investigation will reveal a disqualifying attribute of any applicant that might subject the company to future liability, they can proceed, but only with caution.

C. The Interview

The interview is a very important exercise for both the employer and the potential employee. The interviewer's job is to obtain information about the applicant that will enable him or her to determine if the applicant is suitable for the job. The applicant is, at the same time, learning about and evaluating the potential employer. Employers should make certain that interviewers are aware of what they can and can not legally ask, Assuming that supervisors know what is and is not appropriate is a potentially costly mistake.

Generally, employers can ask questions about the applicant's knowledge and experience in the area in which he or she will be working should they get the job, any other qualifications for the job, strengths and weaknesses associated with the tasks required by the job, and the ability to work with others. Question areas specifically prohibited include, but are not limited to, the following:

(1) Age – including date of birth and even, arguably, dates graduated from high school or college;
(2) Marital status – including questions like “Would your husband object to relocation? ”;
(3) Children – including questions like “Are you planning to start a family?” or “In the event you get this job, would you need to obtain child care?”;
(4) Medical history – including questions about past injuries, illnesses and workers’ compensation claims;
(5) Religious affiliations – including questions like “Do you have a problem working Sundays?”;
(6) Bank accounts and other personal financial information – rarely relevant to the job;
(7) Union or club memberships – blanket inquiries may reveal information employers are not entitled to, such as religious affiliation, national origin, or disability;
(8) Transportation – unless vehicle ownership or the ability to get to off-site projects is required for the job;
(9) Arrests – (see Section II.C.2. on Criminal Histories);
(10) National origin – including questions about an applicant’s native language and where the applicant is originally from.

On the other hand, the following are examples of similar questions that, when answered, will supply the employer with similar necessary information but without the risk of a discrimination claim:

(1) This job will require a number of weekend conferences you will need to attend. Does overnight or weekend travel present a problem for you?
(2) This job requires you to move 45 to 50 lb. boxes from one area to another. Are you able to do that with or without reasonable accommodation?
(3) This job requires fluency in Spanish. Are you fluent in that language?
(4) Will you be able to work the scheduled hours, with or without difficulty?
(5) Are you legally entitled to work in this country? (This question is also legally required).

Remember this simple rule: If a question is not truly job-related, do not ask it.

D. Post-offer Issues

1. Pre-Employment Testing

An employer's use of pre-employment testing is governed by several familiar statutory schemes including the ADEA, the ADA, and Title VII. Three testing areas that have received a lot of recent attention from employers, legislatures, and courts are drug testing, genetic testing, and polygraph testing.

(1) Drug Testing

In today's society, the need for drug testing is evident, and employers are conducting pre-employment drug tests more frequently in an effort to prevent abusers from ever entering their workplaces. A set of parameters for pre-employment drug testing for Mississippi employers is found in Mississippi’s statutes governing drug and alcohol testing of employees, Miss. Code Ann. § 71-7-1 et seq. Employers who elect to participate in the Act's program reap several benefits, including (1) a presumption that termination of an employee or refusal to hire an applicant who tests positive is "for cause" and (2) classification of termination as one for work-related misconduct if for a positive test performed in accordance with the state program.

The rules of the program (which are quite lengthy and detailed) generally require that, prior to testing for drugs or alcohol, an employer must give an applicant a one-time written policy statement which must contain, among other things, procedures for applicants to report confidentially to a medical review officer the use of prescription or non-prescription medications after the testing process has revealed a positive confirmed result and procedures for contesting a positive result. The statement must also include a list of all classes of drugs which the employer will test for, described by brand name or common name and chemical name, and a statement notifying applicants of their right to consult with a medical review officer for technical information regarding prescription and non-prescription medications, Applicants must also execute a consent and release form prior to testing. The program's requirements may be viewed as strenuous, but the benefits are indeed valuable.

(2) Genetic Testing

While performing pre-employment health testing, an employer should be careful not to cross the line and invade the privacy of an applicant. At least one Circuit Court of Appeals has decided that employers may not, in the course of mandatory employment entrance health examinations (conducted after a conditional offer of employment), test applicants without their knowledge for highly private medical and genetic information, Norman-Bloodsaw v. Lawrence Berkeley Lab, 135 F.3d 1260 (9th Cir. 1998). The Court reasoned in that case that few subjects are more personal and likely to implicate privacy interests than one's health and genetic makeup and, therefore, held that selectively testing for the sickle cell trait and pregnancy invaded the privacy of certain employees on the basis of race, sex, and pregnancy. While the use of preemployment health and genetic testing is not wholly prohibited by the ADA, a Title VII action may be successful if the facts are similar to Norman-Bloodsaw.

(3) Polygraph Testing

Another troublesome form of pre-employment testing is the polygraph examination or “lie detector test.” 29 U.S.C. § 2002 contain general prohibitions against making employment decisions strictly on the basis of a lie detector exam; and § 2002 et. seq. details the few instances in which a lie detector test can legally be used in an employment setting. Examinees are protected by Mississippi Code Annotated § 73-29-47 in that the statute limits the admissibility of polygraph results at trial.

2. Proper I-9 Documentation

All employers are required to verify that a new hire is authorized to work in the United States. There are three categories of documents that an employer can use to complete the required verification:

· Those that establish both the new hire’s identity and eligibility for employment.
· Those that establish the new hire’s identity only.
· Those that establish the new hire’s employment eligibility only.

The instructions to Form I-9 contain a complete list of the acceptable documents in each of these categories, and an I-9 Form with instructions is contained at the end of this section. Employers cannot tell a new hire which documents to produce or that it prefers a particular document. Once the employer receives the documentation it is required to review the documents to ensure that the documents are for the new hire and consistent with other information provided to the employer.

So how does an employer verify that the documents are accurate? The employer must certify that it has examined the documents provided by the new hire, that the documents appear genuine, that they relate to the new hire, and it is the employer's belief, based on the documents, that the new hire is authorized to work in the United States. If the employer suspects the documents may have been tampered with or forged, it should ask for additional documentation from the new hire. If an employer is unsure whether the document is a forgery, the employer should err on the side of caution and accept the documents rather than risk a potential claim of discrimination from the new hire. In order to assess whether the documents are genuine, the employer should first verify that the document is on the INS' list of acceptable documents. Second,. it should verify that the document relates to the new hire i.e. the photo matches the person or the names are the same. Third, it should determine if the document is an obvious forgery i.e. misspellings or obviously tampered with. Fourth, the employer should determine whether the document is in the correct form i.e. correct color and size. Last, the employer should determine if the document is consistent with other information provided by the new hire.

It is important for employers to have I-9 information for all of its employees and verify that the information is accurate.

Michael D. Fitzgerald