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Stay on top of employment law compliance and personnel management the easy way -- through HR Matters E-Tips. Use the tips as a handy resource to answer your daily HR questions or as a training tool for your supervisors and managers. Each weekly issue includes practical insights into common HR issues, including:

 

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HR MATTERS E-TIPS
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THIS WEEK’S TIP: Limiting Negligent Hiring Claims

Most HR professionals know that reference checking and work history 
verification are fundamental steps in applicant screening. What many 
may not realize is that these simple steps not only weed out bad 
candidates but also may help protect the employer from negligent hiring 
exposure if there is an incident of workplace misconduct or violence 
later. Unfortunately, you may be tempted to skip these checks in order 
to make a quick hiring decision. However, the consequences of omitting 
them can be devastating and range from huge monetary settlements and 
bad publicity to, in the worst case scenarios, loss of life. You can help 
prevent these problems and limit your organization’s exposure by taking 
a few basic precautions in checking candidate backgrounds. 

What is Negligent Hiring?

The legal theory of negligent hiring is based on the premise that an 
employer can be liable for the violent acts or wrongdoing of its 
employees if it did not investigate adequately their backgrounds or 
qualifications. Negligent hiring claims often involve employees both who 
are in a position to pose a threat of injury to the public (such as a driver 
or deliveryperson) and who subsequently attack another employee or an 
outside third party (such as a client or customer). 

To establish negligent hiring, the harmed person generally must show:

1. That the employer did not exercise reasonable care in hiring the 
employee (for example, by talking to former employers); 

2. That the employee had dangerous tendencies which should have 
been apparent if the employer had exercised reasonable care (such as 
by conducting an adequate preemployment investigation); and 

3. That the employer placed the employee in a position where others 
could be injured. 

The employer’s legal liability typically depends on the circumstances 
leading up to the employee’s misconduct and on whether the employee 
was acting within the scope of his employment duties. For example, in 
Judith M. v. Sisters of Charity Hospital, 93 N.Y.2d 932 (N.Y. 1999), a 
hospital was not liable for the negligent hiring of an employee who was 
accused of sexually assaulting a patient. The New York Court of 
Appeals found that the hospital acted with reasonable care in hiring and 
supervising the employee and that its management did not authorize, 
participate in, consent to, or ratify the employee’s alleged conduct. 
Similarly, in Vinci v. Las Vegas Sands, Inc., 984 P.2d 750 (Nev. 1999), 
the Nevada Supreme Court determined that the employer could not be 
held liable for negligent hiring since there was no evidence that it failed 
to conduct a reasonable background check.

Simple Steps to Prevent Claims

Clearly, the best way to limit negligent hiring claims is to follow common 
sense procedures to get as much information from the candidate as you 
can and then to verify the information before offering a position. To 
accomplish these goals, consider taking the following eight steps:

1. Train your interviewers. Every interviewer should be familiar with 
your hiring policy and know what types of background checks are 
required.

2. Have each applicant fill out an application form which you carefully 
review. Pay particular attention to gaps in employment and 
inconsistencies, and require references.

3. Question the candidate about any gaps in work history. Make sure 
you have an accurate timeline of past employment dates and know what 
happened during any periods of unemployment.

4. Check references. At a minimum, confirm the applicant’s dates of 
employment and position. Try to get substantive information about past 
performance and disciplinary records.

5. Ask about criminal convictions. Remember, however, that asking 
about arrest information (as opposed to convictions) could violate state 
discrimination laws.

6. Perform additional background checks appropriate to the position 
being sought. For example, consider credit checks on candidates who 
will handle money and review the motor vehicle records of potential 
drivers. 

7. Conduct criminal conviction checks on candidates who will be in 
“positions of confidence.” For example, if you are filling a position in 
which the employee would work in a customer’s home, with impaired 
individuals, or in a daycare center or hospital, a criminal check is 
appropriate (and required by some state laws). Make sure these checks 
cover each jurisdiction where the candidate has lived.

8. Document the steps you take to investigate the candidate. Even if 
you can’t get in touch with a reference or if a background check does not 
produce any information, make sure you have a clear record of the steps 
you took. Remember, too, if you ask a consumer reporting agency to 
conduct any of your investigations, you must comply with the notice and 
disclosure requirements of the Fair Credit Reporting Act. 

Better Safe than Sorry

As a practical matter, most negligent hiring claims involve extreme but 
isolated incidents of employee violent conduct. However, the risks of 
having to defend against these claims, and the negative publicity 
surrounding them, far outweighs the time and cost of taking a few simple 
steps to prevent them. As a general rule, your first line of defense is to 
weed out high-risk applicants before making hiring decisions. Your last 
line is to have clear documentation showing you took the reasonable 
steps a prudent employer is expected to take to avoid a negligent hiring 
action.

Subscribers to the Personnel Policy Manual and HR Policy Answers on 
CD can find more information on negligent hiring in Hiring, Chapter 202, 
notes 11 and 21.

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