CHAPTER 11 —
INNOVATIVE HIRING STRATEGIES:
BUILDING A WINNING TEAM

§ 11.1

I. THE NEW HEART & SOUL OF THE AMERICAN WORKFORCE

§ 11.1.1

A. INTRODUCTION

Hiring has become a central focus of employment litigation. Claims ranging from negligent hiring lawsuits of customers and coworkers, to invasion-of-privacy claims of applicants, to discrimination, disparate treatment and disparate-impact litigation, are on the rise. Each type of claim raises different and potentially conflicting obligations. Employees and third parties can and do bring claims for negligent hiring if an employer fails to adequately screen applicants. Applicants can bring invasion-of-privacy claims if the pre-employment screening crosses appropriate boundaries. The federal Fair Credit Reporting Act (FCRA), as well as similar state laws, further limits the employer's ability to conduct the thorough background checks that the law of negligent hiring seems to require. Applicants can sue for all types of discrimination if they are denied a job, and the Americans with Disabilities Act (ADA) requires employers to accommodate both physical and mental conditions. Furthermore, many public and private entities are expanding the use of applicant "testers" to seek out discrimination in hiring.

Even with the downturn in the economy, America's employers are faced with a skilled-labor shortage. Experts predict that the much less numerous Recent reports show that"Generation X" will not be able to fill all of the positions vacated by the retirement of the baby boomers. Furthermore, the face of the workforce is changing as more women and minorities enter the labor market and older workers remain in the workforce longer or reenter the workforce after retirement. So, employers tackling the problem of finding and keeping qualified employees must reevaluate their corporate cultures. They must accomplish this in the context of long-term changes in the economy.

The Hudson Institute's publication, Workforce 2020: Work And Workers In The 21^st Century (hereinafter "Workforce 2020"), describes five forces that will move the American economy over the next twenty-five years. These include rapid technological change; further global integration of the U.S. economy; rapid economic growth in certain developing nations; deregulation and liberalization, both nationally and globally; and demographic change, especially the aging of baby boomers.¹ These factors will combine to affect the American economy to: (1) increase the markets for products, services, and capital; (2) increase competition; (3) expand local markets for goods and services; and (4) shift the focus from goods production to service production. These predictions have proved accurate, and the changes involved necessarily affect the labor market.

Recent reports show that, despite the struggling economy and accelerated layoffs, businesses are still desperate to hire entry-level workers.² Experts say that entry-level openings are the last positions to go during an economic downturn.

Faced with unprecedented hiring needs and difficult and confusing legal obligations, many employers have turned to specialized service providers, such as employment agencies, temporary agencies, and consultants that take over complete responsibility for screening and hiring. While these agencies seem to be an ideal solution to a growing problem, employers must use caution, as they may be held liable for the wrongs of such third parties. Employers are also using innovative strategies to attract and retain employees, such as signing bonuses, rewards for referrals, and enhanced and unusual employee benefits. This chapter will explore the challenge of hiring in the 21st century, and will offer some breakthrough solutions for building a winning team.

The latest forecasts regarding the labor market show that there will be significant changes over the next decade. The U.S. population is expected to increase by 24 million over the 2002-2012 period.³ The Department of Labor's 2002-2003 Occupational Outlook Handbook (hereinafter "Occupational Outlook") predicts the following workforce trends:⁴

The civilian labor force is projected to increase by 17.4 million, or 12%, to 162.3 million for the 2002-12 period.
The labor force will become increasingly diverse.
The youth labor force, ages 16 to 24, is expected to slightly decrease its share of the labor force to 15% by 2012.
Professional and related occupations will grow the fastest and add more new jobs than any occupational group.
Professional specialty occupations such as computer and mathematical occupations, health care practitioners, and education, training and library occupations will provide nearly three-fourths of total wage and salary growth.
A college degree or higher is the most significant source of education or training in the vast majority of the highest paying occupations.

The changing workforce presents both legal and practical implications for employers. For example, as the workforce ages, layoffs requiring ADEA, OWBPA, and WARN compliance will necessitate advanced planning. Similarly, a more diverse workforce will require employers to carefully examine their EEO policies to prevent any impropriety. Additionally, according to recent studies by the Labor Department's Bureau of Labor Statistics, total employment is expected to increase 14.8% over the 2002-2012 period."⁵

§ 11.1.2

B. THE RETENTION BATTLE

Retention of current employees will continue to be a vital issue for employers. According to a recent report cited by Careerbuilder.com, "nearly one-in-four workers say they are currently dissatisfied with their jobs," a 20% increase over 2001.⁶ Further, most of those job hunters represent that they plan to leave their jobs for other pursuits in the next two years.

According to "At Work 2003: Past, Present, and Future," less than half of all workers say they are satisfied with their career progress. Forty-eight percent of workers say they are under a great deal of stress. In 2003, 53% of men say they are dissatisfied with their pay. Women have stayed relatively consistent in their perspective with one-in-two expressing dissatisfaction.⁷

Because it has previously been estimated that 60% of approximately 56 million job openings between 2002 and 2012 will be due to replacement needs, it will be important for employers not only to hire good employees, but also to keep them.⁸ While attracting and keeping good employees makes "good business sense" from a human resources perspective, it also makes good sense from a strictly economic perspective. A survey by William H. Mercer Cos. Found that while the monetary cost of employee turnovers varied among respondents, they could be significant:

Fifty-five percent of the respondents said turnovers cost them $10,000 or less on a per-person basis. Another 16% pegged the cost at between $10,000 and $20,000, while eight percent said the cost is between $20,000 and $30,000.⁹

The survey found that U.S. employers overall had a mean turnover rate of over 18%, with turnover in the service industry slightly higher than in manufacturing by approximately 20% to 15%. Within the organizations surveyed, technological and administrative staff had the highest turnover rates, while management and professional workers had lower rates.¹⁰

§ 11.1.3

C. THE TALENT & SKILLS CRUNCH

The jobs of the future will call for "knowledge workers" with basic skills in areas such as problem solving, mathematics, and reading. According to the Bureau of Labor Statistics, by the year 2010, approximately 42% of projected job growth will require a college degree or other postsecondary certification, which would be an increase from only 29% in 2000. Even those potential employees who possess the minimum educational requirements do not always have the required skills. "CEOs have found deficiencies in problem-solving skills (cited by 31%), computer and technology skills (21%), basic reading skills (12%) and mathematics (12%). Another 25% of CEOs mentioned a wide array of other missing skills, while only 7% felt that no important skills are typically lacking."¹¹Much of this is due to the expansion of the IT sector, as well as the increased use of computers in the workplace.

There is every indication that entry-level jobs will require greater skills over time. Education is essential in obtaining and retaining a higher paying job. For example, for all but one of the 50 highest paying occupations a college degree or higher is the most significant source of education or training. Air traffic controllers is the only occupation of the 50 highest paying for which this is not the case.¹² A general trend in the American economy is that technology creates and destroys jobs at the same time; "[b]ut the jobs that [are] lost require … comparatively few skills, whereas the jobs that [are] created are both better-paying and higher skilled."¹³ Although science, engineering and technology jobs are fueling the nation's economic growth, women, minorities and persons with disabilities will continue to represent more of the workforce.¹⁴ Although these three groups remain underrepresented in the science, engineering and technology fields, by the year 2020 women will comprise nearly half of the U.S. workforce. However, in July 2000, they represented only 9% of engineers and computer programmers. At the same time, minorities filled only 3% of the careers in those high-tech fields, but are estimated to occupy one-third of the workforce by 2020. Skill levels for these individuals will have to increase accordingly.

§ 11.1.4

D. THE NEW FACE OF OUR WORKFORCE: CHANGED DEMOGRAPHICS

The face of the future workforce is much more diverse. As the demographics change, employers will need to consider changing their work environment to attract, and keep, women and minorities in their workforces. Larger numbers of female professionals is only one of many changes the workforce faces demographically. The population is growing at a slower rate, and different ethnic groups are gaining a larger share of the population.

The U.S. workforce will become more diverse by 2012. White, non-Hispanic persons will continue to make up a decreasing share of the labor force, falling from 71.3% in 2002 to 65.5% in 2012. However, despite relatively slow growth, White, non-Hispanics will remain the largest group in the labor force in 2012.. Hispanics are projected to account for an increasing share of the labor force by 2012, growing from 12.4 to 14.7%. Indeed, by 2012, Hispanics will constitute a greater share of the labor force than African-Americans whose share will grow from 11.4% to 12.2%. Asians will continue to be the fastest growing of the labor force groups.¹⁵

There will be significant changes in the age of the labor force, as well. The baby boomer generation will continue to represent a large percentage of the workforce, followed by the lower population of the "Generation X'ers." According to The Boss's Survival Guide, published in 2001, 76 million baby boomers are beginning to retire with only 44 million Generation X'ers to fill the workforce. This leaves approximately 32 million fewer workers to fill America's current jobs. This situation will not improve until 2010 when the generation following Generation X (children of the boomers) enters the workforce.¹⁶ Thus, the workforce will age with the baby boomers, but "[t]he youth labor force (aged sixteen to twenty-four) is expected to grow more rapidly than the overall labor force for the first time in twenty-five years. At the same time, the number of persons in the labor force ages twenty-five to fortyfour is projected to decrease."¹⁷ The retirement age is getting, and will continue to get, higher.¹⁸ As the workforce ages, employers will have to aim their hiring efforts and benefits programs at older workers.

With a changing workforce and greater competition to fill openings, hiring managers in all industries will be challenged to find legal, resourceful ways to meet their companies' personnel needs. In the rush to find qualified employees, many employers may stumble by failing to expand their applicant pools so as to ensure adequate opportunities for minorities or women, or by making inappropriate assumptions about older applicants.

§ 11.1.5

E. EEOC INVOLVEMENT IN HIRING DISCRIMINATION CLAIMS

Another recently emerging trend is the Equal Employment Opportunity Commission's (EEOC) increasing participation in hiring discrimination cases. For example, a new fact sheet from the EEOC explains the hiring rights of job applicants under the American with Disabilities Act (ADA). The fact sheet explains ADA rules on when employers may seek medical information from job applicants, reasonable accommodation requirements during the hiring process, and on prohibited questions during the pre-offer job application process.¹⁹

The EEOC also has initiated an increasing number of hiring discrimination class actions. Because of the potential scope of class action litigation, most of these cases have settled before trial, but their impact on the affected employers can be severe.²⁰ The potential cost of hiring discrimination class actions is illustrated by a settlement of an EEOC-initiated class action against Rent-A-Center awarding $47 million to a class of over 5,000 women who claimed sex discrimination in hiring and employment decisions.²¹ Obviously, it is critical for employers to properly train managers and other employees involved in recruiting, interviewing and hiring and to be cognizant of possible hiring trends that could indicate patterns of discrimination.

§ 11.2

II. OVERVIEW OF THE LAW OF HIRING

§ 11.2.1

A. THE LAW OF PRE-EMPLOYMENT SCREENING

Obviously, employers can be held liable for discriminatory hiring practices.²² Additionally, in most states, employers can be liable for their employees' actions if they fail to conduct a reasonable investigation into prospective employees' backgrounds. In fact, at least fortyseven states now recognize negligent hiring and retention as a viable cause of action.²³ The common law tort of negligent hiring has been applied where employees have committed crimes or intentional torts against coworkers and third parties. In order to prevent liability, employers must carefully screen applicants to insulate themselves from liability for their employees' future actions. Employee privacy concerns related to such screening presents both an obstacle and a trap for the unwary in this regard. Additionally, the use of employment "testers" to seek out discrimination in hiring is a relatively new trend that also threatens to increase hiring litigation. This section addresses some potential liabilities involving the hiring process.

§ 11.2.1(a)

Negligent Hiring

Negligent hiring is typically defined as follows: "A person conducting an activity through servants or other agents is subject to liability for harm resulting from his conduct if he is negligent or reckless . . . in the employment of improper persons or instrumentalities in work involving risk of harm to others."²⁴ Unlike vicarious liability, where an employer is liable for the acts of its employees who commit torts while at work, the law of negligent hiring places responsibility directly on the employer for the failure of hiring managers to conduct reasonable background investigations.

Most often, negligent hiring cases involve a failure to act. For example, employers are most frequently sued for hiring employees without looking into their criminal background or failing to check references that may signal a problem.²⁵

To establish a prima facie case of negligent hiring, a plaintiff must demonstrate the following: (1) that he or she suffered a compensable injury; (2) the employer had a duty to the plaintiff to exercise due care in hiring; (3) that the employer breached this duty; and (4) causation between the employer's breach and harm suffered by plaintiff.²⁶

Moreover, "[n]egligent hiring is a doctrine of primary liability; the employer is principally liable for negligently placing an unfit person in an employment situation involving an unreasonable risk of harm to others."²⁷ Further, the plaintiff's injuries must result directly from the employee's "unfit or incompetent performance of work."²⁸ "In negligent hiring . . . cases, the ultimate question of liability to be decided is 'whether it was reasonable for an employer to permit an employee to perform his job in light of information about the employee which employer [sic] should have known.'"²⁹ This liability extends to an employee's intentional torts and crimes, which are usually excluded from the traditional doctrine of respondeat superior. For example, an employer who hires negligently can be liable for assaults committed by employees against customers.³⁰ Employers may also be liable for placing a dangerous employee (whose dangerous propensities were not investigated in the hiring process) in a position where he might cause harm to other employees.³¹

Of course, employers may be insulated from liability if they perform adequate background checks.³² A number of legal issues arise in formulating and implementing adequate background investigations, as outlined below.

Investigation Standards for Background Checks

The world in which we live and work today demands that employers design and implement available means for safeguarding their employees and their workplaces. Background check policies and practices should no longer be viewed as a luxury, especially in light of the events of September 11, 2001. Conducting background checks assists employers in preventing potentially troublesome individuals from joining their workforces. Employers are well advised to perform thorough pre-employment background checks, including a requirement that applicants fully respond to all questions posed in the job application or otherwise. Cases across the country suggest that employers who thoroughly investigate applicants can escape liability for negligent hiring.

For example, in Burnett v. C.B.A. Security Service, the court noted that "[t]he tort of negligent hiring imposes a general duty on the employer to conduct a reasonable background check on a potential employee to ensure that the employee is fit for the position."³³ In Burnett, the employer was not liable for a security guard's auto theft and careless driving because the employer did an adequate background check. The background check involved verifying the information on the employee's application and requiring the employee to obtain a sheriff's card, which subjected the applicant to additional screening.³⁴ Similarly, in Gay v. United States, the court found that the employer was not liable for an indecent assault on a patient at a federal healthcare facility by a healthcare worker.³⁵ There, the court noted that "there was a thorough background investigation by the Navy before [the employee] was enlisted."³⁶ The ultimate question is clear: what standards should an employer follow when conducting a pre-employment background investigation?

The Cotran Decision

Although the case did not deal with pre-employment investigations, in Cotran v. Rollins Hudig Hall Int'l., Inc., the California Supreme Court articulated a proper general standard for employer investigations, which provides helpful guidance for investigations of prospective employees.³⁷ In that case, Ralph Cotran, a high-level employee, was accused of sexual harassment by two of his subordinates. During the course of a two-week harassment investigation, the employer interviewed witnesses, including five witnesses identified by Cotran himself.³⁸ The employer determined that it was more likely than not that Cotran harassed his subordinates, and decided to terminate his employment. Cotran sued for breach of contract and wrongful termination. During trial, Cotran presented evidence that he had consensual sexual relationships with both of his accusers, and that one of them attempted to get a pay increase at the same time she complained of sexual harassment. The jury found the employer liable, because it found Cotran did not actually harass his subordinates and had, thus, been wrongfully terminated.

The California Supreme Court overturned the jury's decision. In a landmark ruling, it held that an employer need not prove that allegations of misconduct leading to the employment decision are true. Rather, it must simply conduct a proper investigation and act in good faith on the information obtained when making employment decisions:

[T]he term "good cause" in the context of implied employment contracts [is defined] as fair and honest reasons, regulated by good faith on the part of the employer, that are not trivial, arbitrary or capricious, unrelated to business needs or goals, or pretextual. A reasoned conclusion, in short, supported by substantial evidence gathered through an adequate investigation that includes notice of the claimed misconduct and a chance for the employee to respond.³⁹

Therefore, when a claim of wrongful discharge in violation of an implied or express contract is brought, "[t]he proper inquiry for the jury . . . is not, 'Did the employee in fact commit the act leading to dismissal?' It is 'Was the factual basis on which the employer concluded a dischargeable act had been committed reached honestly, after an appropriate investigation and for reasons that are not arbitrary or pretextual?'"⁴⁰

The California Supreme Court in Cotran provided guidelines for what constitutes an appropriate investigation. Citing earlier cases, the court stated:

[An employer] must act in good faith and fairly listen to both sides, for that is a duty lying upon everyone who decides anything. But I do not think they are bound to treat such a question as though it were a trial. . . . They can obtain information in any way they think best, always giving a fair opportunity to those who are parties in the controversy for correcting or contradicting any relevant statement prejudicial to their view.⁴¹

Although it is a California decision relating to wrongful discharge, the standards of reasonableness articulated in Cotran for wrongful discharge may readily be applied to pre-employment investigations.

§ 11.2.1(b)

Effective Job Applications & Conducting Lawful Job Interviews

§ 11.2.1(b)(i)

Effective Job Applications

Effective job applications must be drafted so that the objective qualifications for the job may be garnered from information provided by the applicant. To acquire this information, applications should require the full names of the applicant, addresses for the past 10 years (in order to accomplish the appropriate background check), emergency contact information, social security number, detailed employment history, position for which the applicant is applying (it is most appropriate to require designation of one position per application in order to avoid increased risk of class action claims and claims of "continuing" applications), availability to work (schedule, attendance issues, whether the individual can perform the necessary functions of the job "with or without a reasonable accommodation"), a criminal conviction inquiry,⁴² a driving record if appropriate for the job, educational information (however, it is recommended that the application not request dates of high school graduation in order to avoid age-related claims), and references (both personal and employment-related).

Applications should not be processed unless they are fully completed. All gaps (for example, in employment history) should be explained and all information fully provided before the applicant is interviewed or during the first interview. Further, as new information is submitted regarding an applicant, a written record with proper documentation should be made in order to render the file complete. See a sample job application in the Essential Tools section below.

§ 11.2.1(b)(ii)

Conducting Lawful Job Interviews, Reference Checks & Background Investigations

There are other limits on what an interviewer can and cannot ask prospective employees and current employees in considering them for employment, retention, promotion or other important employment decisions. Likewise, employers conducting reference checks or background investigations must be careful not to trespass these limits. Some of these restrictions protect individual privacy, while others are meant to prevent discrimination in the hiring process. These limits apply not only to executives making the final hiring decisions, but to each person interviewing a job candidate or contacting references or other information sources concerning applicants or employees.⁴³ As a general rule of thumb, interview questions should concentrate on the applicant's ability to successfully perform the job duties fundamental to the position being filled.⁴⁴ Below are several areas of inquiry that employers should keep in mind when interviewing prospective employees or conducting reference checks or background investigations.

§ 11.2.1(b)(iii)

Permissible Interview Questions

	You May Ask:	You Should Not Ask:
ADDRESS/RESIDENCE	"Can you be reached at this address? If not, would you care to leave another?" "Can you be reached at these telephone numbers? If not, would you care to leave another?"	"Do you own your home or rent?" "Do you live with your spouse?" "With whom do you live?"
AGE	Only questions that verify non-minor status; i.e., "Are you over 18?" "If hired can you show proof of age?" "If under 18, can you after employment, submit a work permit?"	"How old are you?" "What is your date of birth?" "What is your age?" "When were you born?" Dates of attendance or completion of elementary or high school. Any questions which imply a preference for persons under forty years of age.
AIDS/HIV	"Are you able to perform the essential functions of the job applied for?"	Any questions to inquire whether an applicant (or current employee) has AIDS/ HIV.
ARRESTS AND CONVICTIONS (see also "Court Records" below)	Employers may ask applicants about arrests, but must include inquiries concerning whether charges are still pending, have been dismissed, or led to conviction of a crime involving behavior which would adversely affect job performance, and whether the arrest occurred within the last ten years. Law enforcement and certain state agencies, school districts, businesses and other organizations that have a direct responsibility of the supervision, care, or treatment of children, mentally ill or disabled persons, or other vulnerable adults, may have more latitude to ask questions regarding arrests. Employers should check state law with respect to any questions concerning arrest records. Generally, it is safer just to ask about criminal convictions.	Any questions about arrests that did not occur in the last ten years.
CITIZENSHIP/ BIRTHPLACE	"Are you authorized to work in the U.S.?" "Can you, after employment, submit verification of your legal right to work in the United States?" (or a statement that such proof may be required after employment.) BUT do not ask only foreignlooking or foreign-sounding applicants.	"Are you a United States citizen?" "Where were you born?" Or any questions regarding birthplace or citizenship status of applicant, applicant's spouse or other relatives.
COLOR OR RACE	Statement that photograph may be required after employment.	Any questions concerning race or color of skin, eyes, hair, etc. Should not require applicant to affix a photograph to application nor should applicant be given the option of attaching a photograph.
COURT RECORDS	"Have you ever been convicted of any crime?" (In California, exclude marijuana violations more than 2 years old.) "Has a court, jury or government agency ever made a finding you committed unlawful harassment or discrimination?"	"Have you ever had a bankruptcy?" "Have you ever sued or filed claims or complaints against your employer?" "Have you ever been a plaintiff in a lawsuit?"
DISABILITY	"Can you, with or without reasonable accommodation, perform the essential duties of the job(s) for which you are applying (see attached job description)?" "Are you currently able to perform the essential duties of the job(s) for which you are applying?" If the disability is obvious, or disclosed, you may ask about accommodations.	"Are you disabled?" An employer MAY NOT make any medical inquiry or conduct any medical examination prior to making a conditional offer of employment. "Have you ever filed for or received workers' compensation?"⁴⁵ What medical problems the applicant may have. The amount of sick time or medical leave taken at last job.
DRUG USE	Current use of illegal drugs. Recent use of illegal drugs	Questions about past addictions Use of lawful drugs Frequency of alcohol use
EDUCATION	"Are you presently enrolled or do you intend to enroll in school?" "What subjects did you excel in at school?" "Did you participate in extracurricular activities?" "What did you select as your major?" "Did you work an outside job while attending school? Doing what? What did you like/ dislike about your part-time job during school?" "Are you interested in continuing your education? Why? When? Where?" "Did your education prepare you for the job you are seeking with us? In what ways?"	"Did you graduate from high school or college?" (unless the employer can demonstrate that successful performance on this job requires a specific level of education). "Who paid for your educational expenses while you were in school?" "Did you go to school on a scholarship?" "Do you still owe on student loans taken out during school?"
EXPERIENCE, SKILLS & ACTIVITIES	"Do you have any special skills or knowledge?" "Are your skills recent?" "When did you last use a calculator (or any other machine or skill)?" "Do you enjoy being active in community affairs?" "Are there any activities which have provided you with experience, training, or skills which you feel would be helpful to a position with us?" "How will your involvement in [activity] affect your work here?"	"Does your physical condition make you less skilled?"
FAMILY	"Do you have any commitments which would prevent you from working regular hours?" "Can you work overtime, if needed?" "Are you now or do you expect to be engaged in any other business or employment? If 'yes,' what kind of business or employment is it? How much time does it require?"	"How many children do you have?" "Who takes care of your children while you are working?" "Do your children go to day care?" "What does your husband think about your working outside the home?" "What does your husband (or wife) do?" "What is your husband's (or wife's) salary?" Name of spouse or children of applicant.
MARITAL STATUS	"Please state the name(s) of any relatives already employed by this company or a competitor." "Whom should we contact in case of an emergency?"	"Is it Mrs. or Miss?" "Are you single? Married? Divorced? Separated? Engaged? Widowed?" "What is your maiden name?" Identity of applicant's spouse.
MILITARY SERVICE	"Have you served in the U.S. military?" "Did your military service and training provide you with skills you could put to use in this job? "How did you feel about your stay in the Army (Navy, etc.)?"	"Have you served in the army of a foreign country?" "What type of discharge did you receive from the U.S. military service?" "Can you provide discharge papers?"
NAME	"Have you ever used another name?" or, "Is any additional information relative to change of name, use of an assumed name, or nickname necessary to enable a check on your work and educational record? If yes, please explain."	"What is your maiden name?"
NATIONAL ORIGIN	In order to comply with the Federal Immigration Reform and Control Act of 1986, you can ask: "Are you prevented from being employed in the United States because of your visa or immigration status?"	"What is your national origin?" "Where were you born?" "What is the origin of your name?" "What is your native language?" "What country do your ancestors come from?" "Do you read, write, or speak Korean (or another foreign language, unless based on job requirements)?" How applicant acquired the ability to read, write or speak a foreign language. Or any other questions as to nationality, lineage, ancestry, national origin, descent or parentage of applicant, applicant's parents or spouse.
NOTICE IN CASE OF EMERGENCY	Name and address of person to be notified in case of accident or emergency.	Name and address of relative to be notified in case of accident or emergency.
ORGANIZATIONS	About any organization memberships, excluding any organization of which the name or character indicates the race, color, creed, sex, marital status, religion, national origin, or ancestry of its members: "Do you enjoy being active in community affairs?"	For a list of all organizations, clubs, societies, and lodges to which the applicant belongs.
PHOTOGRAPHS	For a photograph after hiring for identification purposes.	Any applicant to submit a photograph whether mandatory or optional before hiring.
PHYSICAL OR MENTAL CONDITION, DISABILITY	Statement by employer that offer may be made contingent on applicant's passing a job-related physical examination.	"Do you have any physical disabilities or handicaps?" Questions regarding applicant's general medical condition, state of health, or illnesses. Questions regarding receipt of workers' compensation.
PREGNANCY	"How long do you plan to stay on the job?" "Are you currently able to perform the essential duties of the job(s) for which you are applying?"	"Are you pregnant?" "When was your most recent pregnancy terminated?" "Do you plan to become pregnant?" Any questions about medical history concerning pregnancy and related matters.
PRIOR EMPLOYMENT	"How did you overcome problems you faced there?" "Which problems frustrated you the most?" "Of the jobs indicated on your application, which did you enjoy the most, and why?" "What were your reasons for leaving your last job?" "Have you ever been discharged from any position? If so, for what reason?" "Can you meet the attendance requirements of the job?"	"How many sick days did you take at your old job?" "Did you file any claims against your former employer?" "Have you sustained any work-related injury?"
REFERENCES	"By whom were you referred for a position here?" Names of persons willing to provide professional and/or character references for applicant.	Questions put to applicant's former employers or acquaintances that elicit information specifying the applicant's race, color, religion, national origin, disability, age or sex.
RELIGION OR CREED	Statement by employer of regular days, hours or shifts to be worked. "Are you available to work on weekends?" (if this is a legitimate questions)	"What is your religion?" "What church do you go to?" "What are your religious holidays?" "Does your religion prevent you from working weekends or holidays?"
SEXUAL ORIENTATION OR PREFERENCE		"Are you a homosexual?" "What is your view regarding same-sex partner benefits."

§ 11.2.1(c)

Beware of EEOC Testing

Another risk inherent in the hiring process is discrimination claims made by applicants. Some private organizations, in attempts to discover discriminatory hiring practices, have used employment discrimination testers. Testers are sent by civil rights organizations such as the EEOC, the NAACP, or the Fair Employment Council of Greater Washington, D.C., to apply for jobs with a particular employer or employment agency. Testers are matched pairs of individuals sent to apply for jobs that they do not intend to accept. The sponsoring group ensures that testers differ from one another only in race or in some other characteristic, such as age, gender, religion, or national origin, and that their applications show them to be virtually equal in such areas as employment history, educational backgrounds, and licenses. However, sometimes credentials offered by a member of a protected class are slightly better than those given to the non-minority tester.

After the job application process is completed, the company's or employment agency's treatment of the testers is compared. If a difference in treatment is detected, a discrimination complaint may be filed. Since testers do not actually want the positions for which they apply, many critics question whether testers are truly victims of discrimination, that is, whether they have standing.

In May 1996, the EEOC published new enforcement guidelines reaffirming its long-held position that testers and the agencies that deploy testers have the right to pursue employment discrimination claims when it appears that the testers have been discriminated against in the process of searching for a job.

The landmark case addressing employment testing is Kyles v. J.K. Guardian Security Services.⁴⁶ In Kyles, a federal court held for the first time that employment testers have standing to sue under Title VII.⁴⁷ Two African-American women, Kyles and Pierce, worked as employment testers on a project directed by the Legal Assistance Foundation of Chicago (LAFC).⁴⁸ The women applied for employment with J.K. Guardian Security Services. After being rejected for employment, the two women filed suit against the company, alleging violations of Title VII. The district court ruled that the plaintiffs did not have standing to bring suit against the company because they admitted that they had no interest in the employment they sought and would have rejected such employment if offered.⁴⁹ On appeal, however, the Seventh Circuit concluded that Congress had statutorily created standing for housing testers under the Fair Housing Act (FHA), and then analogized Title VII to the FHA.⁵⁰ The court cited three reasons for finding tester standing under Title VII: (1) Title VII's broad authority over discrimination; (2) the strong public interest to eliminate discrimination from the workplace; and (3) the EEOC's formal opinion supporting tester standing.⁵¹

Until the Seventh Circuit's opinion in Kyles, no federal court had recognized the standing of employment testers.⁵² However, such standing is now clearly recognized under Title VII.

§ 11.2.1(d)

Background & Reference Checks

A background investigation before hiring any applicant is necessary, given the risks to safety, potential of lawsuits from co-employees and third parties who may otherwise be harmed, and the risk to the employer of hiring a dishonest, unreliable, unqualified or even dangerous individual. At a minimum, the work history and references of any prospective employee should be confirmed to the greatest possible extent by contacting the appropriate parties.

In fact, the Court of Appeals of Indiana denied summary judgment to an employer based on the employer's failure to contact an employee's immediate former employer and the employee's supervisors from the three previous employers listed on her application for employment.⁵³ In that case, the defendant employer's Vice President of Operations submitted an affidavit stating that the employer had, in fact, contacted the previous employers; however, the court held that since there was no record of the previous employers' assessment of the employee, a genuine issue of material fact remained, and the employee's claims survived summary judgment. The minority astutely pointed out in the concurring opinion that if the majority opinion were interpreted literally, negligent hiring claims would survive summary judgment "whenever a defendant failed to show that it spoke to an employee's former employers."⁵⁴ In any event, employers are advised to contact all former employers, supervisors and references of prospective employees, and to fully document such contact. Good faith, documented efforts in this regard should generally suffice to overcome allegations of negligence, even where former employers or other references refuse to provide information.

An employer need not perform exactly the same investigation on every applicant, provided that any differentiation is based upon legitimate business interests and an investigation policy reasonably calculated to further those interests.⁵⁵ For instance, an employer may wish to investigate more stringently the backgrounds of prospective employees who have applied for positions involving confidential information such as financial data, trade secrets, or other sensitive material. Likewise, an employer may reasonably desire to conduct extra investigation of persons who may have access to corporate or customer funds or to other valuable property, or who will be in a special position of trust, such as healthcare workers or workers who have access to customers' homes as part of their job duties. An employer may also determine that applicants for managerial, supervisory, or policy-making positions will undergo a more rigorous background investigation due to their anticipated value to the employer and the greater potential for damage arising from their wrongful conduct.

Privacy issues aside, employers must avoid any disparate treatment that may violate discrimination laws. An employer may be held liable for unlawful discrimination, regardless of whether the discrimination is intentional, if its investigation policy results in unequal treatment or impact as to protected categories such as race, national origin, sex, pregnancy, sexual orientation, marital status, physical or mental disabilities, age, political activities, bankruptcy, or other legally protected categories or activities.

Employers also should request every applicant's written consent to their investigation of employment, educational, reference, licensing and public records information, as well as to the release of such information to the employer by third parties.

Individual states have varying laws and regulations concerning access to an employee's or prospective employee's criminal record. Some states have both statutes and agency guidelines; some states are silent on the issue. Thus, while employers are urged to inquire into the criminal history of job applicants, they must do so within the appropriate state law constraints.

§ 11.2.1(e)

Outsourcing Background Checks & the FCRA

§ 11.2.1(e)(i)

Overview of FCRA Application to Outsourced Background Checks

Some employers choose to hire third party investigators to perform background investigations, which can provide several benefits. First, there may be more legal protection to the company, as the FCRA provides limited legal immunity to employers that hire third party investigators.⁵⁶ This legal immunity covers defamation suits, invasion of privacy claims, and allegations of negligence in connection with the investigation. Second, in-house HR representatives may simply not have the time to perform background checks adequately, especially when such checks require jaunts to locate old legal documents, etc. In those cases, hiring a third party to conduct the investigation may be significantly more economical. Finally, many employers profess that using a third party investigator makes an applicant more comfortable, in that the applicant views the investigator as more objective and less bound by office politics.⁵⁷

As stated above, employers must be aware that there are specific FCRA rules that apply to background checks conducted by third parties. The employer must present the applicant with a clear, written disclosure that the employer may obtain a consumer report and use it to make future employment determinations. The disclosure must be in a separate document. The employer must further secure the applicant's written authorization to obtain such a report. This authorization should be prospective so that it covers both the application process and the entire term of the individual's employment. If the results of the consumer report convince the employer to take any type of adverse action, such as refusing to hire the applicant, the employer must provide the applicant a copy of the consumer report and written notice of the applicant's rights under the FCRA. Any adverse action by an employer as a result of information gleaned from a consumer report requires the following employer action:

notify the applicant of the adverse action;
give the applicant the name and contact information of the consumer reporting agency used;
inform the applicant that the consumer reporting agency did not make the decision to take the adverse action against the applicant;
notify the applicant that they have a right to dispute with the consumer reporting agency the accuracy or completeness of information contained in the report; and
notify the applicant that they may obtain a free report from the consumer reporting agency if such request is made within 60 days.⁵⁸

Employers should communicate negative results of a report to the applicant before making a decision not to hire. Since the investigation comes later in the hiring process, at a time when an employer has already invested time and money in the applicant, the employer typically has little to lose. For all practical purposes, if the negative information is true, applicants are likely to concede and withdraw their names from consideration.⁵⁹

Finally, if results of a background investigation uncover negative information, employers need to remember to be consistent in their hiring decisions. For example, if one applicant for a particular job is hired despite a criminal conviction, past or future applicants for similar positions could allege unlawful discrimination if their applications were rejected based on the same type of conviction.

§ 11.2.1(e)(ii)

The FCRA's Specific Requirements

The FCRA, which governs the retrieval and use of consumer information from consumer reporting agencies, was extensively amended in 1996 by the Consumer Credit Reporting Reform Act of 1996, in November of 1998 by the Consumer Reporting Employment Clarification Act of 1998, and again in December of 2003 by the Fair and Accurate Credit Transactions Act of 2003. The amendments impose reporting and disclosure requirements for consumer report users (including specific requirements for employment-related users) and consumer reporting agencies. Requirements applicable to consumer reporting agencies are numerous and beyond the scope of this discussion. However, much of the FCRA applies to employment background checks. Pre-employment reports such as credit reports, criminal record reports, and department of motor vehicle reports are covered. Although it is legal for employers to obtain and use background information on applicants and employees, they must follow several requirements when obtaining and using these materials.

Even prior to the 1996 amendments, the FCRA imposed certain notification requirements and restrictions on the use of consumer and credit information in the hiring process. Any consumer report used for employment purposes was, and continues to be, subject to the provisions of the FCRA.

What Is a "Consumer Report?"

The federal FCRA is far reaching and broadly defines consumer reports as "any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living," where such information is "used or expected to be used or collected in whole or in part for the purpose of serving as a factor in establishing . . . eligibility for . . . employment purposes."⁶⁰ In the employment setting, the two most important elements of this definition are: (1) the report must be for employment purposes; and (2) it must be by a consumer reporting agency. A report is prepared for employment purposes when it is to be used for the purpose of evaluating an applicant for employment or a current employee for promotion, reassignment, or retention.⁶¹ Notably, the Federal Trade Commission – the governmental agency that enforces the FCRA – has opined that the Act's employment provisions apply to independent contractors, as well as employees.

A "consumer reporting agency" is any person (or entity) that for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing reports to third parties.⁶² An investigative consumer report is:

[A] consumer report or portion thereof in which information or a consumer's character, general reputation, personal characteristics, or mode of living is obtained through personal interviews with neighbors, friends, or associates of the consumer reported on or with others with whom he is acquainted or who may have knowledge concerning any such items of information. However, such information shall not include specific factual information on a consumer's credit record obtained directly from a creditor of the consumer or from a consumer reporting agency when such information was obtained directly from a creditor of the consumer or from the consumer.⁶³

Investigative consumer reports in the employment context would typically consist of reference checks performed by an agency, rather than by the employer itself.

Thus, many reports in addition to traditional credit reports fall within the scope of the FCRA, and must comply with provisions regulating permissible purposes, procedures for ensuring compliance and accuracy of report information, disclosure requirements, and conditions of disclosure. In other words, almost any communication of information concerning an applicant or employee from a consumer reporting agency to an employer would potentially be a "consumer report." Common examples of consumer reports include department of motor vehicle records checks, criminal background checks, and credit history checks, when this information is obtained from an outside agency. At least one federal court has held that "virtually any information" communicated by a consumer reporting agency would be defined as a "consumer report" under the FCRA.⁶⁴ To be on the safe side, employers must assume that any pre-employment report prepared by a third party agency or investigator is generally covered by the FCRA.

Federal law additionally prohibits the reporting of obsolete information as defined by applicable provisions. Any appropriately licensed consumer reporting agency should be well informed and prepared to answer an employer's questions concerning these restrictions, as well as all certification, notice, and disclosure requirements of both federal and state laws. For instance, the FCRA generally prohibits the reporting of any adverse item of information that antedates the report by more than seven years. This prohibition does not, however, apply where a consumer report is to be used in connection with the employment of an individual whose annual salary is reasonably expected to equal $75,000 or more. Consequently, employers utilizing consumer reporting agencies for background checks should be aware that most adverse information antedating the report by more than seven years should not be disclosed in the consumer report requested. Fortunately for employers, however, the recent amendments to the Act provide that consumer reporting agencies may now report criminal convictions to employers regardless of the date of conviction.⁶⁵ Some states, including California, continue to limit the disclosure of information regarding an individual's criminal conviction history based on the age of the record, however.

Who Is Covered?

Any employer who wishes to use a consumer report for employment purposes is covered by the FCRA. In construing the FCRA, courts are cognizant of its broad remedial purpose; thus, even independent contractors may be considered "employees" for purposes of the Act, subjecting their consumer reports to investigation prior to hire.⁶⁶

The FCRA contains special notification procedures applicable to consumer reports on applicants for commercial driving purposes. In essence, these special procedures only apply if the following two conditions are met: (1) the position for which the applicant is applying is a commercial driving position (including jobs involving (a) the transportation of persons, or (b) the transportation of goods) or a position subject to safety regulation by a state transportation agency; and (2) the interaction between the applicant and the employer in connection with the employment application is solely by mail, telephone, computer, or other similar means. Thus, if the employer has personal contact with the applicant at or before the time the employer requests the consumer report, these special provisions would not apply.

§ 11.2.1(f)

State Law & Privacy

Some states have enacted laws that impose similar or additional restrictions on how employers obtain and use credit or consumer reports for background checks on prospective employees. In any state, the employer who obtains such information should take caution not to use it in any manner that would subject the employer to liability for invasion of privacy. Employer policies governing how such information is obtained, used, and maintained is vital.⁶⁷

§ 11.2.2

B. THE LAW OF PRE-EMPLOYMENT TESTING: FOUR GENERAL AREAS OF CONCERN

Pre-employment testing includes physical or mental examinations; pencil and paper or physical aptitude or skills tests; or written, oral, or polygraphic honesty tests. Pre-employment testing can be useful to screen applicants for necessary skills. However, there are a number of areas where pre-employment testing may have legal implications. Often, it can run afoul of employee privacy rights. There are three areas of federal law of which employers must take note when implementing pre-employment tests: the Americans with Disabilities Act (ADA), the Employee Polygraph Protection Act, and Title VII of the Civil Rights Act of 1964.

§ 11.2.2(a)

The Americans with Disabilities Act

The ADA prohibits employers from requiring medical examinations prior to offering employment, with the exception of examinations to establish illegal drug use.⁶⁸ However, offers of employment may be conditioned upon the results of a medical examination prior to the commencement of employment duties.⁶⁹ All prospective employees must undergo the same examination, regardless of disability, except that the employer may limit examinations to appropriate categories of employees based on legitimate business reasons.⁷⁰

The ADA prohibits discrimination based on "qualification standards, employment tests, or other selection criteria."⁷¹ Therefore, many pre-employment tests may have ADA implications. For example, a pencil and paper "personality test" that asks questions about whether the applicants feel happy or sad, satisfied with their life or their work, or even if they feel tired or under stress, may indicate physical or psychological disorders. The EEOC interpretive guidelines indicate that the definition of "disability" does not include "common personality traits such as poor judgment or a quick temper where these are not symptoms of a mental or psychological disorder."⁷²

§ 11.2.2(b)

Drug & Alcohol Testing

Private employers generally are able to conduct nondiscriminatory pre-employment drug tests, although in some states employers are required first to give a conditional offer of employment. Employers who wish to screen applicants for illegal drug use should implement a standard program for all applicants to avoid any implication of discrimination. Currently, the EEOC is of the opinion that employers are not allowed to screen applicants for alcohol abuse and may run afoul of the ADA for questioning prospective employees about alcohol use or abuse.⁷³

§ 11.2.2(c)

Employee Polygraph Protection Act

Federal law generally prohibits employers from using lie-detector tests for pre-employment screening.⁷⁴ Most states have acts that mirror the federal law. Some of these states place greater restrictions on testing by prohibiting lie detector "or similar" tests. These similar tests may include pencil-and-paper honesty tests. The states of Rhode Island and Massachusetts specifically prohibit written honesty examinations.⁷⁵ For more information regarding the use of polygraphs in the employment context see Chapter 18 of THE NATIONAL EMPLOYER®.

§ 11.2.2(d)

Title VII of the 1964 Civil Rights Act

As with all employment policies, pre-employment testing may have an adverse impact on a protected class. Therefore, employers must be extremely cautious when implementing any testing procedure. A test that has an adverse impact on the employment opportunities of individuals of a particular race, color, religion, sex, or national origin, and thus disproportionately screens them out, is unlawfully discriminatory unless the test or its component procedures have been validated in accordance with the Uniform Guidelines of Employee Selection Procedures.⁷⁶

§ 11.2.3

C. OUTSOURCING YOUR HIRING NEEDS

There are a number of companies who are willing to do your hiring for you. Unlike traditional "temp" services, companies today are designing programs and software to help do your initial applicant screening. These companies and products can save valuable time and resources. There are also particular jobs, like those in the IT industry, that significantly benefit from outsourcing. When a job's requirements change frequently, hiring temporary or "contingent" workers ensures that the employees have the most up-to-date knowledge required for the job.

There are, however, risks involved with using temporary agencies.⁷⁷ According to the EEOC's guidelines on contingent workers, an employer who gets its staff from a temporary agency may be liable for the agency's discriminatory practices.⁷⁸

An entity that has enough employees to qualify as an employer under the applicable EEO statute can be held liable for discriminating against an individual who is not its employee. The antidiscrimination statutes not only prohibit an employer from discriminating against its own employees, but also prohibit an employer from interfering with an individual's employment opportunities with another employer. Thus, a staffing firm that discriminates against its client's employee or a client that discriminates against a staffing firm's employee is liable for unlawfully interfering in the individual's employment opportunities.⁷⁹

Therefore, any employer that considers using a staffing firm should carefully review the firm's hiring policies and procedures. Check to be sure the firm follows all of the guidelines described in this chapter. Review interview scripts to be sure that the firm does not ask prohibited questions. Also, ask the firm if they can tailor their hiring process to fit your needs. Many standardized services are not adequate for specialized industries, such as healthcare, child care, and transportation. One size does not fit all when it comes to hiring.

When employers want to maintain control over hiring, but still streamline the process, many turn to software for help. Computer-assisted interviewing is becoming more popular among employers, especially when a large number of employees need to be screened. "While automated hiring technologies are still in their infancy, recruiters envision a world in which they can reduce the hiring cycle time by ninety percent, anticipate what skills will be in demand before they can be articulated, and call up information about a potential hire on their computer screens."⁸⁰ For example, Proctor and Gamble requires that all applicants apply online; no paper resumes are permitted. This includes an on-line application form that is automatically evaluated.⁸¹

Marriott has used an automated telephone system to screen prospective applicants. The applicants are asked a series of basic questions regarding skills and salary requirement, and respond through the touchtone keypad. If the applicant qualifies, he/she is asked to schedule an interview, also through the telephone keypad.⁸²

Like the problems with temporary agencies, however, employers may run into problems with automated staffing software. While the makers of such software claim that their software is race and gender neutral, and that only the people using it have biases,⁸³ employers should be extremely cautious when delegating hiring functions to a computer. After all, a computer cannot see, think, hear or care. Only a human can adequately evaluate any given candidate.

§ 11.3

III. PRACTICAL RECOMMENDATIONS FOR THE HR PROFESSIONAL

§ 11.3.1

A. ATTRACTING, KEEPING & DEVELOPING NEW EMPLOYEES

§ 11.3.1(a)

Employee Retention as Job No. 1

There are things that you, as an employer, can do to keep your best people. Here are ten important things to remember:⁸⁴

10. "Hone your listening skills." Employees want to be heard. If employees believe you're a good listener, their feelings toward you will likely be positive. If employees feel you don't listen, they may very well stop talking. You need them to talk! You need information from them to do your job appropriately.⁸⁵

9. "Respect cultural values." Focus less on external characteristics and more on underlying values.⁸⁶

8. "Manage to get the best results."

Expect the best.
Put work in context.
Be clear.
Give employees the resources they need.
Let employees do the work.
Remove obstacles.
Don't give employees the answers.
Vary your style.
Don't stereotype.
Let employees fail, then help them learn from their mistakes.
Don't play favorites.
Think "we."⁸⁷

7. "Recognize the value of emotional intelligence." You can help your employees improve their ability to monitor their own and other's feelings and emotions, using that information to guide their thinking and action.⁸⁸

6. "Don't underestimate the value of informal recognition." Employees often feel their work goes unrecognized: find reasons to recognize people, not reasons not to.⁸⁹

5. "Keep employees in the loop." Employees want to know what's going on. When they are unaware, morale sags.⁹⁰

4. "Vary your leadership style." Good leaders look for options. When one doesn't work, they create others. This requires some risk-taking.⁹¹

3. "Manage within the context of your organization's culture." Know your company. Know what works and what doesn't. Every company is different.⁹²

2. "Share your expectations for employee behavior." Tell your employees what the job demands. Tell your employees how to perform well.⁹³

1. "Walk the talk." "Do as I say, not as I do" is poor managing. Follow your own rules. Make decisions based on core values, not efficiency or popularity. Admit your mistakes.⁹⁴

§ 11.3.1(b)

Finding Those Elusive Skilled Workers

Despite the current increase in available workers, the problem employers will continue to face is finding qualified candidates. With competition in the labor market projected to increase over the next decade, employers must implement innovative strategies to attract potential employees.

The Internet is still an excellent way for companies to find new employees and its use for this purpose has been skyrocketing. In recent years, the number of human resource professionals who use the Internet for recruiting has skyrocketed.⁹⁵ Companies of all sizes and budgets can now utilize the Internet for recruiting. While many employers post job openings on their own company Web sites, those companies too small to have their own Web site can now take advantage of an exploding market of centralized online recruiting sites. These sites can offer high traffic leading to more responses and are often much cheaper than traditional newspaper advertising.⁹⁶ While offering all of these advantages, the Internet should not be the only recruiting method used. Not everyone who could fill that job opening will have Internet access. "[T]he Internet has the potential to cause problems if employers who post jobs there fail to use a multifaceted search strategy, including more traditional means of recruiting."⁹⁷

Another concern is that reliance on Internet recruiting could result in race, age, or gender bias.

There are pros and cons of Internet recruiting, as set out in The Boss's Survival Guide.⁹⁸ These include:

PROS:

CONS:

Time savings

Shortens hiring time

Money savings

Extends the scope of your search

Extends scope of search

Increases responses to an opening

Greater control

Not always current

Better searches of your applicant pool

Not an effective way to reach passive job seekers

Makes the hiring process virtually paperless

Not an effective way to recruit for entry-level jobs or jobs requiring minimal experience or skills

Assists candidates to know more

May increase quantity of vendors you're managing

Overemphasizes skills

§ 11.3.1(c)

Providing Benefits for the 21st Century

It is well established that benefits that allow employees to spend more time with family actually increase morale and productivity. These programs may include flexible work schedules,⁹⁹ elder care assistance, child care assistance, and training programs (discussed more below). As larger numbers of women continue to enter the workforce, including women who are mothers, the "mix of desired benefits and work conditions will change: flexible hours, telecommuting, and family leave will become increasingly attractive to both men and women who are parents of young children."¹⁰⁰ Popular retention strategies used by companies include sending employees to external conferences and seminars, tuition reimbursement, managerial training, company support for degree programs, pay for performance, flex time, and interpersonal skills training.

Similarly, the growing number of older workers in the workforce will affect the types of benefits employers will need to offer in order to retain them for their skills and experience. "In response, health insurance might provide expanded coverage for the afflictions of the elderly, such as hearing loss and arthritis. Insurance providing for long-term care will be in demand. Because many workers past age sixty-five will have living parents in the over-eighty-five . . . category, elder-care programs will become more prominent."¹⁰¹

Work-life programs can be very beneficial to employers in terms of both employee relations as well as financial considerations. One Washington, D.C. company, Fannie Mae, estimates that for every dollar it now spends on its elder care program it receives a return of $1.50 through higher productivity, employee retention, and reduced absenteeism and turnover.¹⁰²

The numbers of employees choosing to telecommute has increased in recent years. In fact, in 2001, the number of telecommuting employees in the United States increased almost 17% to 28.8 million (or 1 in 5 U.S. employees) from 2000.¹⁰³ Of these telecommuters, most work on the road (24.1%), or from home (21.7%), while some work at "telework centers" (7.5%) or satellite offices (4.2%). Significantly, more than two-thirds of telecommuters express greater job satisfaction, and almost 80% claim they feel more committed to the company and have plans to remain. Further, almost three-quarters of telecommuters claim a "major increase" in their productivity and work quality.¹⁰⁴

Another benefit employers can offer is a stock option or employee stock purchase plan that will not vest until the employer has amortized its training investment. Yet another option is to restrict the employee by contract. While some states have laws that forbid contracts that limit an employee's employment options,¹⁰⁵ noncompete clauses may save an employer from training its rivals' future employees. In general, however, creating and maintaining a pleasant work environment, with competitive wages and benefits, is any employer's best weapon against employee attrition.

§ 11.3.1(d)

Offer Training Opportunities

With an increasing need for skilled workers, many employers are using in-house training or tuition assistance to ensure that current workers have the skills necessary to do their jobs. More importantly, as noted in The Boss's Survival Guide: "If employees are really our greatest assets, it only makes sense to invest in them."¹⁰⁶ The Guide points out that training not only improves employee contributions and productivity, but also creates better teams. These views are premised on the idea that employees desire training and will be receptive to learning new skills and developing areas of expertise.¹⁰⁷

To get started, the Guide recommends the following:

Make an inventory. Find out what your employee already knows. What kind of skills does she have?
Identify training needs.
Look for cross-training opportunities. Have employees teach each other skills so that they reinforce what they've just learned.
Offer training before you have a problem.
Find out what training is readily available.
Investigate outside resources. Check with community colleges and professional training firms.
Choose a training package carefully. Ask for preview materials, check references and clarify costs.
Choose a training firm carefully. If off-the-shelf training isn't appropriate, a training firm may be in order. Review their material, ask for references and call them, request a preview, meet who you'll be working with, and clarify pricing.
Get outside the box. Training can be fun!
Put the training in context. Explain to employees why you've chosen it, and what you expect out of it.
Apply the training.
Evaluate the training.
Accept that training isn't always the answer. Before you offer training, talk to employees, and get their input.¹⁰⁸

While training may help you get the candidate you want, it will also make your employees more valuable to the competition.¹⁰⁹ Therefore, the importance of employee satisfaction and retention cannot be overlooked.

Below are some questions employers can ask themselves to ensure that an organization's "managing the law" training programs are complete. For more information about choosing employment law training programs, see chapter 15 of THE NATIONAL EMPLOYER®:

Whom to train? All managers who influence employment decisions should receive mandatory "managing the law" training. Training only those people who have final authority to make employment decisions such as hiring and terminations is probably not adequate. Courts have not hesitated under the right facts to find liability for discrimination by lower level supervisors who influence the employment decision.
What laws to cover? As discussed above, training as a defense to discrimination claims will likely be applied to all major discrimination laws. Make sure management training programs cover the following:
- Title VII
- ADEA
- ADA
- FMLA (which has a penalty provision similar to the ADEA).
What skills to teach? Managers should be trained in making hiring, discipline, and termination decisions that comply with EEO laws and that will survive legal challenge. Do managers know what questions they can and cannot ask during a hiring interview? Do managers know how to avoid stereotypes when making employment decisions? Do managers know what factors to consider to ensure that discipline and termination decisions are (and appear) fair? Can managers create documentation that shows the organization's legitimate business decisions? Managing the law programs that fail to teach these skills and others needed throughout the employment lifecycle are not adequate.
What level of skills and knowledge needs to be taught? Make sure the level of instruction is appropriate for the audience. For example, frontline managers and supervisors generally do not need to know all the technical aspects of the ADA and FMLA. Yet, if these managers fail to spot the early warning signs (and report them to HR) the organization could face liability. Thus, ADA/FMLA training for front-line managers can be a segment of a larger program. HR professionals and more senior managers, in contrast, need more comprehensive training on these subjects.
Will the training program stand up to legal scrutiny? Courts (and opposing counsel) are frequently scrutinizing training that employers use to try to avoid or limit damages.¹¹⁰ Employers must ensure that their training programs are designed and delivered by experts in the relevant fields. Proper instructional design techniques must also be followed to ensure that employees truly "get the message."

By implementing a complete and adequate series of "managing the law" training programs, employers will attract and retain workers who desire to advance their management skills. Additionally, through effective training, employers can help avoid an "extraordinary mistake" that leads to liability. Doing so will also help avoid many of the workplace problems that lead to litigation.

§ 11.3.2

B. RECOMMENDATIONS FOR EFFECTIVE & LAWFUL HIRING

Understand the New American Workforce

Even in a down economy, realize that retaining your best employees is vital to meeting your hiring needs.
Identify your talent and skills gaps.
Recruit using the best available means to suit your needs and meet legal obligations, while recognizing and planning for potential risks.
Train managers on how to get and keep talented workers lawfully.
Prepare for the new demographics.

Understand the Law of Pre-Employment Screening

Perform lawful interviews.
Conduct background and reference checks.
Adopt policies and practices to comply with the Fair Credit Reporting Act.
Maximize your information from applicants and background checks (through effective job applications, interviews, background checks).
Adopt objective standards for qualifications to the greatest extent possible (and be prepared for EEOC testers and Title VII challenges).
Ensure that any pre-employment testing is lawful under federal and state antidiscrimination and privacy laws.

Adopt Lawful & Reasonable Standards for Obtaining & Using Consumer Reports

Establish and enforce a company policy to control the acquisition and use of applicant consumer and investigative consumer reports.
Amend existing policies and practices to comply with the FCRA amendments outlined above.
Reasonably restrict the number and nature of positions for which a consumer report is required.
Verify the name and Social Security number contained in the consumer report to make sure that it corresponds to the name and Social Security number provided by the applicant. Any errors, inconsistencies, omissions, or other problems should be brought to the attention of the manager or supervisor responsible for implementation of the company's consumer report policy.
Make certain that all individuals reading and reviewing consumer reports have been fully trained to understand and properly utilize the information disclosed by the report.
Do not deny employment based solely on an applicant's bankruptcy. Such discrimination is prohibited by federal law.
You may want to obtain additional information about an applicant whose credit report indicates that a judgment has been filed against the applicant and has never been satisfied.
If an applicant's credit report reflects several collection items, offer the applicant an opportunity to explain. However, do not question the applicant about personal details, such as a divorce. Rather, focus on information necessary to evaluate the status of the collection actions.
Avoid imposing blanket rules concerning employment of individuals with criminal convictions. We, nevertheless, strongly recommend that criminal background checks be performed on all applicants to be offered employment and that a fact-specific analysis of job requirements be applied when convictions are discovered. With the unfortunate rise in workplace violence, such investigation and analysis are extremely important for every employer.
Ensure that anyone performing investigatory or consumer reporting work for you is properly licensed and, with permission of such persons, perform background checks on them before they perform the work. Do not assume that a license equals a clear criminal or credit background. Because such persons will have access to personal information regarding job applicants, they should be chosen with great care.
Require any consumer reporting agency or private investigator participating in your background checks process to confirm both an understanding and compliance with all applicable legal requirements, each of which should be clearly identified in the written confirmation.
Do not deny employment to an applicant who has a poor credit record if the applicant appears suitable for the position on the basis of other job-related criteria.
Consider the length of time since the last incident resulting in a poor credit history or other adverse item in a consumer report. Obviously, a lengthy, ongoing history of credit problems or other undesirable events is likely to be more of a risk than old or infrequent problems or incidents.
Before denying employment on the basis of a consumer report, provide the applicant an opportunity to explain the reasons for the report.
Be prepared to explain the job-related reasons why the applicant's consumer report history renders the applicant unsuitable for a particular position.

§ 11.3.3

C. FOUR STEPS TO BASIC COMPLIANCE WITH THE FCRA

§ 11.3.3(a)

Step One: Disclosure & Written Consent

Before requesting a consumer or investigative consumer report, an employer must:

Separately Disclose That You May Request A Report: Provide to the employee or applicant a clear and conspicuous disclosure that a report may be requested. This must be provided in a "separate document" that does not refer to other subjects; and
Obtain Written Consent: Obtain written consent from the employee or applicant.

Many consumer reporting agencies will provide agreements and forms to employers that misinterpret the FCRA and its amendments, and particularly employer obligations. Employers should carefully review such materials to ensure that they avoid agreeing to more than the law requires or procedures that may violate the law. Another concern about inaccurate forms provided by consumer reporting agencies is that statements or inquiries included in such forms may either offend applicants or employees unnecessarily or raise concerns regarding equal employment opportunity laws and privacy.

Common Questions Concerning Disclosure & Written Consent:

Is it sufficient to include the disclosure that a report may be requested in the job application? No. It must be provided to a job applicant in a separate document. Nevertheless, the employer may include such disclosure in the job application as an additional notice.
Is consent language in the job application sufficient, when the application is signed by the applicant? Yes. There is no requirement that the consent language be contained in a document separate from the job application. Employers must, however, make the consent language conspicuous.
Can the disclosure document include the consent language to be signed by the applicant or employee? Yes. If an employer wishes to combine these two requirements within a single document, this is permitted.
Does the consent requirement apply to investigative consumer reports, even though the special disclosure (see next question) can be issued as late as three days after the report is first requested? Yes. Because investigative consumer reports are a subset of "consumer reports" under the FCRA, the general requirement of written disclosure to the employee or applicant and written permission from the employee or applicant, "at any time before" the employer procures the report, applies.
Are there additional disclosure requirements applicable to investigative consumer reports?^¹¹¹ Yes. Where an employer seeks to obtain an investigative consumer report, the FCRA requires an additional disclosure. This disclosure, the required timing of which is different from that for consumer reports (see below), must specify:

that an investigative consumer report, which must be clearly defined, ay be made; and
that the employee or applicant may request additional information as to the complete and accurate nature and scope of the investigation.

This letter must be sent within three (3) days of requesting the investigative consumer report. A copy of the FTC's "A Summary of Your Rights Under The Fair Credit Reporting Act" must accompany this letter when it is sent to the applicant or employee.

If an individual writes back and requests information as to the nature and scope of an investigative consumer report, the Act requires that the employer supply this information within five (5) days of receiving the written request.

Are there any additional requirements applicable to reports containing medical information? Yes. The FCRA prohibits consumer reporting agencies from providing consumer reports that contain medical information for employment purposes, unless the applicant or employee has explicitly consented to the release of the medical information in addition to authorizing the obtaining of a consumer report generally. Because of concerns about disability discrimination under the Americans with Disabilities Act, as well as state privacy and disability discrimination laws, legal advice in this regard is, however, recommended.
May the employer phrase a consent such that it applies not only to consumer reports related to the job application, but also to any reports that might be obtained after commencement of the employment relationship? Yes. The Act provides that the disclosure may be made "at any time before the report is procured or caused to be procured." Also, an FTC staff opinion letter states:

[A]n employer may choose to provide a general disclosure in writing to all current employees and obtain their written authorizations at one time. Thus, should it become necessary to obtain a consumer report on any individual employee, the disclosure will have already been given and the authorization already obtained, and the employee would not have to be told that a consumer report had been procured until the employer was prepared to take adverse action based on information in the report.¹¹²

This form should be signed by all job applicants in anticipation that the employer may on occasion determine that a post-employment consumer report without further pre-report notice and consent is desirable. Employers should also include similar language in their employee handbooks and incorporate it into all notices and consents signed by current employees.

Can an employer simplify the difference in required disclosures for consumer reports and investigative consumer reports by including the special investigative consumer report notice in the initial, separate disclosure required for all consumer reports? Yes. Nevertheless, inconvenience and unnecessary administrative burdens may result from such an approach. The investigative consumer report notice triggers the employee's or applicant's immediate right to request additional disclosure from the employer as mentioned above. If the employer either does not intend to actually request investigative consumer reports, or intends to do so only in isolated circumstances, a separate investigative consumer report notice to be used only when such reports are procured is advisable for this reason. Alternatively, the employer who includes both types of disclosures in one document for all employees and applicants must be prepared to respond to resulting requests for additional disclosures concerning investigative consumer reports, including a standard statement (where applicable) that the employer has not requested such a report to date, that the employer will notify the applicant or employee further should such a report be requested, and that such notice will be provided not later than three days after the report is first requested. We recommend avoiding such duplication of disclosures and communications.

§ 11.3.3(b)

Step Two: Certification to the Consumer Reporting Agency

Before obtaining a consumer report, the employer must provide certification to the consumer reporting agency retained to produce the report. Most, if not all, consumer reporting agencies will request that the employer sign their certification agreement. Employers should carefully review these agreements to ensure minimum compliance with applicable law and that no undesirable, additional requirements are incorporated. The employer must certify that:

Disclosures and Consent Have Been Made and Obtained: The disclosures required for consumer reports have been made to, and written consent has been obtained from, the applicant or employee who is the subject of the requested report;
Pre-Adverse Action Disclosures Will Be Made If Required: The additional procedures required by the FCRA in the event of a potential adverse action (described below in Step Three) will be followed before any adverse action is taken;
No State Or Federal EEO Laws Or Regulations Will Be Violated: The information from the consumer report will not be used in violation of any applicable federal or state equal employment opportunity law or regulation;
Additional Investigative Consumer Report Disclosures Made If Applicable: The additional disclosures required concerning requests for investigative consumer reports have been issued as required by the Act. (The agency must receive this certification before it can prepare or furnish the investigative report); and
Further Disclosure Concerning Investigative Consumer Reports If Requested: The employer will comply with applicable requirements that additional disclosures be made upon request from individuals on whom investigative consumer reports have been requested.

Common Questions Concerning Certification:

Who prepares the required certification? The consumer reporting agency is required to prepare this form and ensure that it is completed by the employer before providing a report to an employer for employment purposes.
May the employer request an investigative consumer report before certifying that the special applicable disclosure has been made? Yes, because the required disclosure to the applicant or employee may be made as late as three days following the request. The consumer reporting agency, however, cannot prepare the report or provide the report to the employer until the certification has been made.

§ 11.3.3(c)

Step Three: Providing Documents Before "Adverse Action"

When an employer obtains a consumer report (including an investigative consumer report) that influences, in whole or in part, the decision not to hire an individual, the employer must provide the following two documents to the individual prior to making any final employment decisions based on the consumer or investigative consumer report:

Copy of Consumer Report: A copy of the consumer report or investigative consumer report that has been relied upon; and
Summary of Rights Prescribed By Federal Trade Commission: The summary of consumer rights prescribed by the Commission. (This summary should be provided to the employer by the consumer reporting agency when the employer requests a report for employment purposes.¹¹³

This procedure allows applicants or employees to see reports that might be used against them. Although not specifically required by the Act, it is a good idea to send the applicant or employee a letter explaining the materials that you are sending. Note that the federal Bankruptcy Act prohibits taking adverse employment actions based solely on an applicant's or employee's (1) status as a present or former debtor under the Bankruptcy Act, (2) insolvency before or during a case under the Bankruptcy Act, but before the grant or denial of a discharge, or (3) nonpayment of a debt dischargeable under the Bankruptcy Act or that was discharged under the Bankruptcy Act.

Common Questions Concerning Pre-Adverse Action Requirements:

How long must an employer wait before implementing an adverse action based on a consumer report, after complying with the requirement that copies of the consumer report and FTC summary of rights be provided to the applicant or employee? The law is silent on this point. A reasonable interpretation of this silence is that no particular timing is required by law. Some employers may wish to adopt reasonable procedures for allowing applicants and employees to respond before implementation of adverse actions based on consumer reports so as to avoid potential difficulties arising from inaccurate reports. Nevertheless, this will likely be impractical for many, if not most, employers. Also worth noting is that the accuracy of consumer reports is primarily the responsibility of consumer reporting agencies. The FTC, however, has issued three staff opinion letters indicating that an employer must wait a "reasonable" amount of time after supplying the pre-adverse action materials but before taking final adverse action.¹¹⁴ These opinion letters, while acknowledging that the statute is silent on this issue, opine that a reasonable period of time is required, because the purpose of the Act is to allow consumers (applicants or employees) to discuss the report with employers before adverse action is taken. One staff opinion letter states that a five-day waiting period between the pre-adverse action notice to the applicant or employee and final adverse action appears "reasonable," but also states that "the facts of any particular employment situation may require a different time."¹¹⁵
What if a consumer report contains negative information about an applicant or employee, but did not ultimately influence the adverse action or would not change the result even if it was revised to omit such information? Under these circumstances, the employer is not technically required to forward a copy of the report or the FTC summary of rights before taking adverse action. Employers in this situation must, however, be mindful that employees and applicants enjoy a private right of action under the FCRA and may allege that the report in fact influenced the decision to some degree. Such claims would be particularly troublesome where negative information contained in a report is inaccurate. For these reasons, and to avoid claims focusing on this technical aspect of the FCRA's requirements, an employer in this context should consider sending a copy of the report and the summary of rights along with a cover letter indicating that this is a courtesy and that the report has been determined to be irrelevant to the decision-making process. Employers may wish to review any contracts or agreements they have with consumer reporting agencies to ensure that the contract or agreement allows them to disclose to the applicant or employee a copy of the report.

§ 11.3.3(d)

Step Four: Notice After Adverse Action

After the employer has provided copies of the consumer report and the FTC summary of FCRA rights, and waited any "reasonable" time period it has decided to establish, the employer may take adverse action. After taking such action, the employer must provide an adverse action notice. This notice may be provided orally, in writing or electronically. Written notice is advisable, as it serves to show compliance with the Act. The adverse action notice must contain:

Consumer Reporting Agency Contact Information: The name, address, and telephone number of the consumer reporting agency (including a toll-free telephone number established by a national agency) that provided the report;
Statement that Agency Is Not the Decision Maker: A statement that the consumer reporting agency did not make the decision to take the adverse action and is unable to inform the consumer as to the specific reasons why the adverse action was taken;
Statement of Right to Obtain a Free Copy: A statement of the consumer's right to obtain a free copy of the consumer report from the consumer reporting agency by making a request within sixty days of receiving the adverse action notice. This statement may be somewhat confusing, as the applicant or employee has already obtained a copy of the report from the employer at this point. Thus, this statement may indicate that the individual is entitled to obtain an additional, free copy of the report from the agency; and
Statement of Right to Dispute Report: A statement of the consumer's right to dispute the accuracy or completeness of any information in the report.

Common Questions Concerning Post-Adverse Action

Does the Act now require that the employer provide an explanation to job applicants or employees about which part of a consumer report influenced the adverse decision? No. The employer is not required to provide a more detailed rationale for the decision and should not share such rationale with the consumer reporting agency.
What damages are recoverable where an employer takes adverse action based on a consumer report, but has failed to comply with the FCRA? Any person who willfully fails to comply with any requirement of the FCRA with respect to a consumer is liable to that consumer in an amount equal to the sum of any actual damages sustained by the consumer (not less than $100 and not more than $1,000), or if a natural person has obtained a consumer report under false pretenses or knowingly without a permissible purpose, the actual damages sustained by the consumer or $1,000, whichever is greater, punitive damages, and, if the action is successful, costs plus attorney's fees.¹¹⁶ The Act enables job applicants and employees to sue in federal or state court either for actual damages or fixed penalties (or both) for violations. Even if the employer has undisputed proof that the adverse decision was inevitable without the consumer report, penalties are recoverable.

§ 11.3.4

D. TRAIN YOUR MANAGERS TO EFFECTIVELY RECRUIT, SCREEN & RETAIN YOUR 21ST CENTURY WORKFORCE LAWFULLY

Perhaps the most logical, but overlooked response to retention problems and hiring challenges today is a change in management style. Many managers still cling to outdated management styles, which can drive away quality employees.¹¹⁷

The Boss's Survival Guide theorizes that employees in the 21st century need a new kind of management that emphasizes training, coaching, flexibility, honesty and the feeling that they belong.¹¹⁸ The authors developed the following "12 Steps to Better Bossing," which summarizes this new management style:

Treat employees as precious resources, and take it seriously if you lose one — investigate why the employee left, why she wasn't happy and what could have made her stay.
Recruiting has changed. Today, the company has to impress and sell to win over the employee. Think of recruiting as a time to sell the job, along with the challenges and opportunities that go with it.
Abusing employees results in their taking frustrations out on the customer. Happy employees are usually better with customers who, in turn, may very well buy more.
Take your time with employees. Give your employees the time they need, which will allow you the opportunity to realize their strengths and then utilize those strengths to your advantage. When it comes to taking time for your employees, "[s]ometimes inefficiency is more efficient in the long run."
Don't follow the Golden Rule — not everyone wants what you want. Instead, ask employees what they want and act accordingly.
Don't view employees as a threat to your own power. Employees who are given latitude by their bosses can accomplish a great deal when they work together and are able to make decisions without having to have every minor decision "approved."
See your employees as your customers: if they become unhappy, they will go elsewhere. Tailor a working environment well-suited to their individual needs.
Set goals and measure progress, not only for your employees, but for you as well. Allow your employees to provide feedback on your performance, listen carefully to their comments and act on the information.
Make sure your employees know the point at which a decision can have major ramifications for the company and that they get a manager involved when that time arrives. Allow your employees to make appropriate decisions for appropriate situations; however, save huge issues for management.
Ask your employees what it will take to keep them. You'll likely be surprised at the relatively minor requests that can easily be accommodated and which will vastly improve an employee's outlook, attitude and performance.
Create a vision. Recognize employees' efforts with appropriate pay scales, bonuses and raises. Encourage and praise your employees on a daily basis.
Show your employees that you believe in them. Be there for them at their low points to encourage them, inspire them, and "keep their fires going."¹¹⁹

§ 11.4

IV. ESSENTIAL TOOLS FOR LAWFUL HIRING

§ 11.4.1

A. SAMPLE EMPLOYMENT APPLICATION^¹²⁰

1 RICHARD W. JUDY & CAROL D'AMICO, WORKFORCE 2020: WORK AND WORKERS IN THE 21^ST CENTURY, 11 (1997).

2 Susan R. Hobbs, Trends, Daily Lab. Rep. (BNA), Sept. 6, 2001, at C1.

3 Department of Lab. Bureau of Lab. Stats., Occupational Outlook Handbook, available at http://www.bls.gov/oco/ print/oco2008.htm (hereinafter "Occupational Outlook").

4 Id.

5 Occupational Outlook, available at http://www.bls.gov/oco/print/oco2008.htm.

6 At Work 2003: Past, Present and Future, available at http://www.careerbuilder.com/share/about us.

7 Id.

8 Occupational Outlook, available at http://www.bls.gov/oco/print/oco2008.htm.

9 Michael Bologna, Mercer Survey Reveals Employers Must Look Within To Solve Turnover Problems, Daily Lab. Rep. (BNA) Apr. 22, 1998, at A11.

10 Id. at A10.

11 Angela Swinson, Employment Will Increase 15 Percent in Next 10 Years: College Degrees Critical, Daily Lab. Rep. (BNA) at D-7 (Dec. 4, 2001).

12 Occupational Outlook, available at http://www.bls.gov/oco/print/oco2008.htm.

13 RICHARD W. JUDY & CAROL D'AMICO, WORKFORCE 2020: WORK AND WORKERS IN THE 21^ST CENTURY, 11 (1997).

14 Commission Recommends Steps to Broaden Talent Pool in Science, Technology and Workforce, Daily Lab. Rep. (BNA), July 13, 2000, available at http://www.shrm.org/hrnews/articles.

15 Occupational Outlook, available at http://www.bls.gov/oco/print/oco2008.htm.

16 BOB ROSNER, ALLAN HALCROW & ALAN LEVINS, THE BOSS'S SURVIVAL GUIDE 4-5 (2001).

17 Workers ages 46-64 are predicted to account for most of the labor force over the next decade. Swinson, supra note 11.

18 Older workers appear to be inclined to continue working. Carolyn Hirschman, Exit Strategies, HR MAGAZINE, Dec. 2001. Last year, nearly one-third of the 56.3 million Americans aged 55 or older were working, according to the Bureau of Labor Statistics. According to a study in 2001 by the Employee Benefit Research Institute, 61% of employees expect to work for pay after retiring. Id.

19 EEOC Fact Sheet Explains Hiring Rights of Disabled, Daily Lab. Rep. (BNA) Oct. 9, 2003 available at http://www.eeoc.gov/facts/jobapplicant.htm.

20 See Osgood v. Harrah's Entertainment, Inc., No. 00-284 (D.N.J. Aug. 22, 2001) (judge certified a class consisting of Caucasian employees and job applicants who were denied employment opportunities based on Harrah's affirmative action policies).

21 See http://www.eeoc.gov/press/10-4-02.html.

22 A $65.1 million settlement was reached in Alabama for a race discrimination in hiring, promotions, compensation and other opportunities class action. See Reynolds v. Alabama Dep't of Transportation, No. CA-85-T-665-N (unpublished) (M.D. Ala. Mar. 11, 2001). The settlement included claims of approximately 2,400 employees and more than 100,000 applicants with $40 million for promotion and compensation claims, up to $15 million for hiring claims and at least $4.6 million for compensatory damage aspects of plaintiffs' claims. Wooten v. Dillards, No. 99-0990-CV-W-3-ECF (unpublished) (W.D. Mo. Dec. 7, 2001), wherein a federal judge approved a $5.6 million settlement of a race discrimination class action against Dillards, Inc. The settlement compensated plaintiffs who claimed they faced a hostile work environment and suffered discrimination in hiring, pay, promotion and terms and conditions of employment.

23 Michael Bologna, Defending Against Negligent Hiring Litigation Request Due Care in Hiring, Daily Lab. Rep. (BNA), Sept. 16, 2003.

24 AMERICAN LAW INSTITUTE RESTATEMENT OF AGENCY (SECOND) § 213 (1958) at 458.

25 Michael Bologna, Defending Against Negligent Hiring Litigation Requires Due Care in Hiring, Daily Lab. Rep. (BNA), Sept. 16, 2003.

26 Id

27 J. v. Victory Tabernacle Baptist Church, 372 S.E.2d 391, 394 (Va. 1988).

28 Shanks v. Calvin Walker & Doctor's Assocs., 116 F. Supp. 2d 311, 314 (D. Conn. 2000) (quoting Surowiec v. Security Forces, 1995 Conn. Super. LEXIS 1587 (Conn. Super. Ct. May 23, 1995).

29 Brown v. Zaveri, 164 F. Supp. 2d 1354, 1360 (S.D. Fla. 2001) (quoting Gillis v. Sports Auth., Inc., 123 F. Supp. 2d 611, 617 (S.D. Fla. 2000)).

30 Medina v. Graham's Cowboys, Inc., 7 I.E.R. Cases 399 (BNA) (N.M. Ct. App. 1992); 6 AM. JUR. 2D Assault and Battery section 134 (1963).

31 Stalbosky v. Belew, 205 F.3d 890, 896 (6th Cir. 2000); see also

CHAPTER 11 — INNOVATIVE HIRING STRATEGIES: BUILDING A WINNING TEAM

CHAPTER 11 —
INNOVATIVE HIRING STRATEGIES:
BUILDING A WINNING TEAM