Published in Ohio Lawyers Weekly, November 17, 2003

Consistency, paper trail help prevent negligent hire claims
By Dean Boerger

Your company can be held legally liable for negligent hiring if you fail to investigate and determine a job applicant's incompetence or unfitness by checking their references, criminal records, or general background. You can be sued for negligent hiring for failing to become aware of an employee's unfitness for a particular position, or for failing to take any subsequent corrective action, such as training, reassignment, or discharge, to remedy the problem once you discovered the disqualifying factor of incompetence.

You will want to insure compliance with the following guidelines if you have employees who have or will have significant contact with the public, customers, patients, or children:

What is Negligent Hiring?
In general, the following must be shown in order for a customer, employee, or other third party to prevail in a negligent hiring suit against an employer:

-The existence of an employment relationship between the employer and the worker.

- The employee's unfitness.

- The employer's actual or constructive knowledge of the employee's unfitness (failure to investigate can lead to a finding of constructive knowledge).

- The employee's act or omission causing the third party's injuries.

- The employer's negligence in hiring the employee as the most likely cause of the plaintiff's injuries.

As with any issuance of notice of a pending lawsuit, you should consult your legal counsel immediately. Normally, you will have time constraints with which to respond to the charge. As long as you can show proof of reasonable investigation, the chances are greater that you as the employer will not be held responsible for the actions of the employee outside of his scope of responsibility.

Defending Negligent Hiring Claims
The Duty of Reasonable Investigation. You have a duty to make a reasonable investigation of an applicant's fitness before hiring. The extent of the investigation will vary with the circumstances.

You can be held liable if:

You did not conduct a background check. You hired an employee you should have known (through reasonable investigation) was incompetent or unfit.

How Do You Conduct a Background Check?
Once you have collected the necessary information regarding the applicant and have conducted interviews of potential job applicant’s, you are ready to begin your background check.

Since approximately 33 percent of job applicants misrepresent themselves on employment applications, it is necessary to verify the information provided. Because of the limited availability of qualified applicants, some companies do not conduct any type of background check and regret this decision when they discover the applicant was unqualified for the job, had an unfavorable criminal history or personality traits not conducive to the position.

Moreover, if your applicant will have contact with other employees or with customers, an important reason to do that checking is to avoid negligent hiring claims. If you have an employee who turns violent and harms either a customer or another employee, you could be slapped with a lawsuit if a background check would have kept you from hiring that person.

If you have employees who have or will have significant contact with the public, customers, patients, or children, you will want to be particularly careful about doing a thorough background check, including a check of criminal records to the extent permitted by law.

Screening Job Applicants
Hopefully, when you advertise a job opening you should expect to receive phone calls, personal visits, and resumes in the mail. How do you handle the inquiries?

-First, you must determine if the person is a qualified job applicant. In most cases, you can eliminate applicants based on the qualifications of the position. NOTE: If you have 15 or more employees, the EEOC requires that you keep all records of all applicants for a full year. You will also have to insure compliance with the requirements under several federal and state laws to include FLSA, OSHA, FICA, FUTA, ERISA, Equal Pay Act, Title VII of the Civil Rights Act, ADEA, ADA.

- Determine the method that you will utilize to communicate with the all job applicants regarding their application.

- Determine how you are going to gather the information needed to conduct an adequate background check. By having the applicant complete an application or rely solely on a resume, which in most cases does not provide the necessary contact information.

- When you wrote your job description, you should have determined whether any type of testing would be necessary to qualify for the job opening. This can be drug testing, psychological testing, aptitude testing or whatever is needed to determine competency for the job.

Guidelines for Reference Checking
The following will guide you through the screening process and determination of competence or fitness for the job opening:

-Inform the applicant that no offer of employment will be made until a satisfactory background check is completed.

-Contact each reference provided by mail or telephone.

- In fear of being sued for giving a bad reference, some companies will only provide dates of employment and position. A telephone call to the supervisor with a faxed release from the applicant will sometimes bear more information than from the mailed form.

- A copy of a release statement signed by the applicant should accompany all information requests from references to include personal references.

- Keep records of all conversations and documents received with the application.

- Document all unsuccessful attempts to obtain information from references.

- Do not hire an applicant whose former supervisors will not provide any information.

- Ask the applicant to assist in obtaining the desired reference information.

- Do not make an offer of employment until a thorough background check is completed.

Criminal Records Check
In most cases, the law only allows for utilization of criminal convictions within the past seven years in determining employment eligibility. It is unlawful to disqualify an applicant, based on an arrest without a conviction. An important and sometimes overlooked aspect of criminal records checks is a check of all counties and/or states based on the provided residential history. This is time consuming and delays the process but you may be surprised at the high percentage of applicants that have a conviction from a former city or state of residence.

Consistency and documentation is the key to employer success when you are responsible for applicants and employees. This information is in no way to be regarded as legal advice. Consult an employment law attorney on any aspect of your hiring process.

Dean Boerger is the President of Boerger Investigative Services, LLC, a private investigative agency specializing in background investigations, insurance claim and workers’ compensation fraud investigations, and criminal investigations. He can be contacted at 614-481-0777 or email: dean@boergerpi.com. For more information visit www.boergerpi.com.