Nicole A. Gross

With tough economic times has come an increase in hiring-related lawsuits against employers.  How employers handle the hiring and interviewing process can either protect them from, or expose them to significant liability.  For example, Cracker Barrel was hit with a nationwide class action lawsuit alleging Cracker Barrel’s requests for job applicants’ ages on the company’s application forms led to age discrimination in hiring.  This update will discuss what companies should do when hiring employees to recruit a better workforce and protect against hiring-related lawsuits, as well as ensuring its hiring and interviewing practices comply with employment laws such as Title VII, the Americans with Disabilities Act and the Age Discrimination in Employment Act. 

Preparation is the Name of the Game

Before beginning the hiring process, the company should establish clear objectives for any open positions.  This should include preparing written job descriptions that list the qualifications and/or experience the successful candidate must possess, what skills are necessary and desired for the positions and any physical, mental or emotional capabilities (i.e., the ability to handle stress, work well with others, etc.) that the position requires.  Creating written objectives can protect the employer against claims of discrimination in the hiring process.  To ensure that the right candidates are interviewed, a company should identify the position’s essential (and desired non-essential) job functions and qualifications.  Doing so also helps ensure that the company creates accurate job descriptions that match the job functions that the successful candidates will actually perform.  Importantly, employers should periodically review their written job descriptions, as out-of-date and inaccurate job descriptions can hamper the defense of hiring claims. 

It is important for the company to create (and review with an attorney) an employment application form.  This important but often overlooked form serves several functions.  First, it allows the company to obtain relevant information about the job applicant (i.e., years of experience in a particular field, education, any technical competencies, etc.).  Additionally, it serves as written support for a decision to hire (or not hire) the job candidate based on the information provided in the application. The application form can also be used to obtain the applicant’s consent to background checks, drug testing, arbitration, and other employer actions to improve hiring and resolve disputes.  The application form also must comply with federal and state employment laws, and therefore should not request information related to an applicant’s age, sexual orientation, race, religion, arrests, worker’s compensation claim history, and other private topics that can cause potential legal problems.

 Interview Dos and Don’ts

While the interview is an opportunity to find out more about a job applicant, it is also the point in the hiring process that gives rise to many lawsuits.  It is important to always stay within the bounds of discrimination laws, and to stay away from certain lines of questioning.  A structured, well-planned and well-documented interview process is integral to building successful defenses to potential hiring discrimination claims.  Essentially, the interviewer should restrict his inquiries to those related to the applicant’s skill, ability and relevant experience.

It is also important to match the candidates’ skill sets to the job requirements during the interview process.  For example, one recent study found that 20% of those surveyed said the job they accepted did not match the job they were told they would perform during the interview.

Here are some questions or categories of questions that interviewers should not ask an applicant:

·        Do not ask the applicant how old he or she is, although it is permissible to ask whether an applicant has reached the age of majority.

·        Do not ask the applicant questions that may reveal the applicant’s religion such as what church he or she attends or the name of his or her priest, rabbi or minister, unless your organization has a religious purpose.

·        Do not ask the applicant whether he or she is married, divorced, separated, widowed, or whether he or she has any children.  Note that Illinois law prohibits discrimination based upon marital status.

·        Do not ask the applicant whether he or she has ever been arrested.  The Illinois Human Rights Act makes it a “civil rights violation for any employer … to inquire into or use arrest information or criminal history record information… as a basis to refuse to hire …”  775 ILCS § 5/2-103.  However, the Illinois Human Rights Act “does not prohibit a … private organization from utilizing conviction information … in evaluating the qualifications and character of … a prospective employee.”  Id.

·        Do not ask about an applicant’s alcohol use during an interview, although it is permissible to point out any company policies on alcohol/drug use and ask if the candidate can comply with them.  Importantly, while the Americans with Disabilities Act (“ADA”) does not protect current users of illegal drugs (and questions regarding use of illegal drugs are therefore acceptable), it does consider alcoholism as a protected disability.

·        Employers should avoid questions regarding the mental health and/or physical condition of the applicant, but it is permissible to condition a job offer on satisfactory results of a medical exam or inquiry after a contingent job offer is made, or to ask applicants with an obvious disability to explain or demonstrate how they can perform the essential functions of the position with or without reasonable accommodation.

Asking impermissible questions during an interview can prove costly: Abbott Labs was hit with a $6 million verdict because of the improper questions it asked of an older applicant during an interview.

Below are several examples of questions and categories of questions that are permissible during an interview:

·     Although employers can ask why a candidate left their former employer, be careful about asking too many “Why” questions.  In one recent case, an interviewer kept probing an applicant about why she left a good job with a prior employer until she blurted out that she left because her previous boss could not handle her sex change operation.  When she did not get the job, she sued claiming gender identity discrimination, which is prohibited by Illinois law.

·     What kind of references would you receive from your former employers?

·     What did your prior job duties consist of?

·     What hours, days are you available or unavailable to work?

·     Ask “Event, Result, Action (EAR)” questions, such as describe an instance when you had to work as a team, what was the result and what actions did you take?

·     Have you ever been fired from a job? If so, when and for what reason?

·     Discuss gaps in the applicant’s employment history.

Due Diligence:

Conduct a Thorough and Well-Documented Background Investigation

Conducting a background investigation not only helps weed out unacceptable employees, but it also protects the company from liability related to negligent hiring claims from third parties and can help prevent workplace violence.  A company can be liable to third parties, or even employees, if the company hires or retains an employee whose dangerous tendencies were known or should have been known to the employer based on its background check.

Before completing the hiring process, the company should obtain background information on a potential employee through a variety of sources.  First, checking a candidate’s past employer references not only serves to confirm the candidate’s skills, abilities and qualifications, but it can also reveal any attendance, violence or other behavioral problems.  Personal references are less reliable because the candidate likely disclosed only those persons who would give a favorable reference; nevertheless, personal references can provide an added layer of information about the candidate’s personality and behavior.   Additionally, conduct a criminal background check, but only inquire about actual criminal convictions, not arrest history or expunged convictions.  Be aware that the EEOC says that per se refusals to hire applicants with criminal records is illegal, so your policies and forms should say that a conviction will not automatically preclude a job offer.  Because background checks can take time, you can make any offer contingent on completion of the background check.  However, determining the scope of the criminal check is important: How far back in time will the check go?  What will be the geographic scope of the criminal check: just the counties where the applicant resided or all surrounding counties? 

Many employers are starting to use online social networks like Facebook, MySpace and others to recruit and check up on applicants.  There are a number of other avenues for obtaining additional information on a candidate, including social security number traces, DMV reports as well as obtaining information about a candidate’s financial history through credit score reports.  However, beware when declining to hire an applicant based on his or her credit history.  Radio Shack provides a perfect example:  it was the target of a class action lawsuit alleging that its use of credit information to evaluate applicants discriminated against minorities. 

Employers should also be familiar with the requirements set forth in the Fair Credit Reporting Act (FCRA) if the employer uses outside agencies to conduct background checks.  The FCRA requires that the employer provide certain notices and reports to the applicant before taking any adverse action based on their credit report.  Importantly, it is often the protocol and thoroughness of the background investigation that forms the backbone of defenses to negligent hiring, workplace violence and related suits against companies.

Selecting the Right Candidate and Communicating the Offer

Each candidate should be evaluated based on the objectives previously developed during the pre-interview phase.  Rank the candidates in an objective manner, taking into account the listed objectives for a given position.  When communicating the offer to the successful candidate, keep in mind that although there may not be a written contract of employment, certain representations made to a potential employee can give rise to an implied employment contract. Therefore, during an interview or when communicating a job offer, refrain from stating: “this job is permanent,” “you will have this job as long as you like,” or “the company will not terminate you without just cause.”  For example, if a company representative states to a potential employee, “If you do a good job, you won’t get fired,” this can create false expectations and even an implied employment contract if the employee can establish that he or she reasonably relied on the statement.  The company should also build in an added layer of protection from implied employment contract claims by including a disclaimer on the employment application that advises all candidates that employment with the company is at-will, meaning the employee or the company can terminate the employment relationship at any time, with or without cause and that no one connected with the company, other than in a writing by the company president, has the authority to make any binding promises or contracts contrary to at-will employment.

Conclusion

The need to hire the best possible employees in these tough economic times and recent onslaught of employment-related lawsuits provide the catalyst for a more refined, thorough and documented hiring process. By adequately preparing for the hiring process, knowing what questions to ask and not ask during interviews and conducting an appropriate background investigation on candidates, companies can reduce their potential liability and ensure a more productive workforce and a safer work environment.