Legal Trends: Hiring Days Are (Almost) Here Again!

By Jonathan A. Segal Jun 1, 2002
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HR Magazine, June 2002Before rushing out to add scads of new staff members, take a moment to review your hiring practices

As the economy begins to improve, many employers are—for the first time in months—seriously considering the prospect of hiring new employees. What a relief to be adding staff, rather than conducting layoffs!

Of course, we’re not fully out of the woods yet as the economy does not appear to have completely rebounded. But that can be good news: It means employers have the time to review their hiring policies and make sure they are in full legal compliance—before the next big hiring spree takes place.

This article focuses on seven common hiring mistakes and offers tips on how to rectify or avoid them.

Job Descriptions

Job descriptions often focus heavily, if not exclusively, on minimum objective requirements—such as education and job experience. However, these documents often pay little or no attention to the more subjective behavioral competencies essential to a job, such as flexibility, agility and strategic insight.

Failure to spell out these behavioral competencies can cause trouble for at least three reasons:

  1. Employers often base final hiring decisions on subjective competencies. We tend to screen on the objective and decide on the subjective. If the job description does not clearly state what these subjective behavioral criteria are, then the foundation for relying on them is conspicuously absent.

  2. Under the Americans with Disabilities Act (ADA), employees increasingly are seeking accommodations for emotional conditions that, they argue, interfere with their ability to meet certain necessary behavioral competencies.

    “I can fulfill all of the requirements of the job, but I need to focus on one thing at a time,” an applicant might say. In such a situation, if the ability to multi-task under pressure is not listed in the job description as an essential requirement, the employer may have more difficulty denying an accommodation.

  3. In my experience, managerial and professional employees are more likely to be discharged (or selected for layoffs) because of deficiencies in behavioral competencies than because of technical skill deficits. If you let go of a manager with good numbers because he is not a team player, being a team player should be listed on the job description. (It also should be a basis for evaluation.)

Employers also should remember that a job description is the first place the courts will look when determining exempt or non-exempt status under the Fair Labor Standards Act (FLSA).

The fact that a job description may not support the decision to classify a position as exempt is particularly troubling given that, in frightening numbers, employers are defending class actions challenging the exempt status of entire groups of employees.

Employers should pay particular attention to job descriptions for administrative positions that are classified as exempt. The exempt status of administrative positions often is a target for attack.

The FLSA does allow administrative employees to be classified as exempt, generally if the position holds adequate independent discretion in making business decisions. To the extent employers wish to rely on this exception, they should grant their administrative employees the necessary independent judgment and discretion—and make sure their job descriptions reflect this.

Recruiting

As the applicant pool becomes more diverse, so does the pool of stellar candidates. Employers who fail to increase the diversity of their applicant pool will exclude whole communities of talent—and may find the quality of their hires suffering as a result.

However, employers need to be careful how they increase diversity. Generally speaking, employers cannot specifically reserve a position for a woman, a minority, etc. Nor can employers hire third parties and ask them to refer only women, minorities, etc. Doing so likely will leave a business open to a viable claim of reverse discrimination.

The way to increase diversity without ending up on the wrong side of a claim is to increase the diversity of the pool of qualified applicants from which you select your candidate. If your applicant pool is diverse, the odds increase that your hires will be diverse as well.

One legally prudent way to increase the diversity of your applicant pool is to supplement (not replace) your general recruiting with efforts aimed at diverse associations, publications, web sites, etc. There are two primary benefits to such efforts.

First, targeted recruiting sends a positive message that your organization is serious about diversity.

Second, targeted recruiting can be a strong legal defense. If you hire an applicant as a result of an ad you posted on a web site geared to minorities, that applicant will have a harder time suing for racial or ethnic bias later on if things don’t work out.

Application for Employment

Virtually all employers have employment applications. However, many applicants aren’t required to complete the application, particularly if they are applying for senior- level positions. Another problem: Some applicants are allowed simply to attach their resumes, without filling out or signing the application.

I hate unnecessary process, but employment applications are hardly unnecessary. In fact, a solid application provides the following benefits:

  • Sound applications include certifications that can provide substantial legal value in the event of a claim. For example, most applications include a statement such as: “I understand that, if I am hired, my employment will be at-will, which means that either the company or I can terminate my employment at any time, for any or no reason, with or without prior notice.”

Have you ever seen applicants include this kind of language on their resumes?

  • Some applicants lie on their resumes. If you require applicants to complete an application, their answers may not be consistent with their resumes–which may help you screen out at least the careless liars.

  • Illiteracy is one of the biggest problems business will face—and is facing already. If applicants can’t read or write, you won’t know this from their resumes because someone else may have prepared them. The problem may become apparent, however, by the amount of time it takes applicants to fill out the application or by virtue of how they have answered it.

  • Often the best predictor of how applicants will perform on the job is what they do (as opposed to what they say) in the application process. If you ask applicants to fill out the application in full and they don’t, you have meaningful data to consider in the decision-making process.

Whom to Interview

Generally speaking, employers should interview only those applicants who meet the minimum job requirements listed on the job description. If the job requirements are reasonably related to the job, then refusing to interview those who don’t meet the requirements is a legally strong decision.

However, if an employer interviews one applicant who does not meet the minimum job requirements, then denies an interview to a second, similarly “unqualified” applicant, the second applicant might have the basis for a discrimination claim.

Of course, special circumstances may warrant an exception to an otherwise absolute requirement. For example: You demand five years experience, but an applicant with only four years experience has a strong relationship with one of your biggest customers or potential customers.

In these circumstances, there is a legal risk in making an exception. But there is a business risk in not making an exception. An employer can achieve its business goal and minimize its legal risk by documenting, contemporaneous with the interview decision, the legitimate non-discriminatory reason for making an exception to the job requirement.

Impermissible Interview Questions

We know that applicants should not be asked certain kinds of questions in an interview. But that’s not enough. We must ensure that everyone else involved in the interview process knows which questions to refrain from asking.

In many organizations, peers have become an integral part of the interview process. When peers are involved in the hiring process, they perform a quasi-management function. As a result, if they ask illegal questions, the employer may be liable.

Independent of the legal issues, personal questions may push away talent. Applicants who are asked questions they perceive to be invasive may elect to work somewhere else, where the interview boundaries are more respectful.

Employers should ensure that peers who participate in the interview process receive guidelines on the questions they can’t ask. In addition to obvious equal employment opportunity (EEO)- and ADA-related questions, employers should focus on the following types of queries:

  • Where’s your family from?
  • You look very familiar. What’s your maiden name?
  • Are you married?
  • Do you have any kids?

These kinds of questions may be appropriate when starting a personal friendship, but they are not appropriate when beginning an employment relationship.

Permissible Questions

While it is important to avoid impermissible questions, it also is important to ensure that interviewers know which questions they are allowed to ask. This is true for two reasons.

First, if interviewers know what they can ask, they are less likely to tread in legally dangerous areas.

Second, ensuring that permissible questions are asked consistently can be just as important, from a legal perspective, as avoiding impermissible questions. Even if a question is lawful in isolation, legal problems can result if the question is not asked of all applicants.

For example, if a job requires travel, it is appropriate to ask applicants about their ability to travel. But if the question is asked of young women but not of middle-aged men, trouble may ensue.

Sometimes selective questioning is the product of unconscious bias. Fortunately, we have a conscious that can protect us from our unconscious.

To ensure that core questions are asked consistently, each interviewer should develop a list of core questions that will be asked of all applicants for a particular position. Developing a uniform list of job-related questions ensures consistency both in questioning and in phraseology.

In addition, if all applicants are asked the same question, employers gain the following advantages:

  • Applicants are less likely to feel they are being discriminated against if they are informed that all applicants are asked the same questions.

  • Employers have an easier time comparing applicants.

  • In the event of a discrimination charge, the list of questions can be used as evidence of a non-discriminatory process.

Decision-Making Process

Consistent with the employment at-will principle, employers can reject an applicant for any reason, no reason, a good reason or a bad reason—just not an illegal reason. That’s the law.

Here’s the reality: Judges, juries and commissions assume that employers make decisions for a reason. So, denying an applicant a job for no reason won’t be sufficient to rebut an allegation of discrimination.

Resting your defense on a bad reason is equally risky. If you give a stupid reason for not hiring someone, you’ll need to demonstrate that your stupidity is not pretextual but is consistent with how you do business generally. In other words, you have to show that you are consistently stupid.

Which leaves only one truly viable defense—a good reason. Often, the real (and good) reason is the employer didn’t believe the applicant would be a good cultural fit.

If cultural fit means the applicant doesn’t have the behavioral competencies necessary to thrive in the organizational culture, that’s usually legitimate. If cultural fit means he or she is culturally different, that’s almost always illegitimate.

To make sure that cultural fit is based on legitimate factors and not conscious or unconscious EEO considerations, evaluate inherently subjective factors by measuring them in terms of more objective behaviors—what the applicant said or didn’t say, did or didn’t do.

Criminal and Credit Checks

Post-Sept. 11, more employers are conducting criminal, credit and other background checks. State laws vary on this point, so you’ll need to check all that apply.

However, you also should be aware of the potential application of the federal Fair Credit Reporting Act (FCRA). Generally speaking, whenever a third party conducts a criminal record check, performs a reference check or verifies educational credentials, those activities probably are covered by the FCRA—even though they are not credit reports.

In other words, if you use a consumer reporting agency (broadly defined), you are probably covered by the FCRA. And if you are covered by the FCRA, generally speaking:

  • You must provide applicants with notice of your intent to do a check—and must obtain their authorization.

  • If you intend to take adverse action based on a report, you must inform applicants of this in writing and provide them with a statement of their rights under the FCRA.

Again, however, consistency is important. To conduct criminal or other checks based on applicants’ national origin is not only discriminatory but also dangerous in terms of the security gaps such a practice would create.

Conclusion
A good hiring program requires thoughtful planning. However, the time invested is more than justified. Hiring the right people is critical to an organization’s achievement of its strategic plans; it also can avoid the emotional anguish and potential litigation costs of terminating someone who is a good person, but a bad fit.

Author’s note: This article should not be construed as legal advice or as pertaining to specific factual situations.

Jonathan A. Segal, Esq., is a partner in the Employment Services Group of Wolf, Block, Schorr and Solis-Cohen LLP, a Philadelphia-based law firm. His practice concentrates on counseling clients, developing policies and strategic plans, and training managers to avoid litigation and unionization.

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