Category: Labor & Employment

Picture This: The National Labor Relations Board’s Division of Advice Wants to Sue Employer for Issuing Social Media Policy with Photo/Video Ban

Michael Best Logohe National Labor Relations Board’s Division of Advice (the Division) recently recommended that the Board issue a complaint against Giant Foods for implementing its social media policy without first bargaining with two unions, and for maintaining a social media policy that included unlawful provisions. Although the Division analyzed several social media policy provisions, its criticism of two provisions in particular—a ban on using photo and video of company premises, and restrictions on employees’ use of company logos and trademarks—makes it very difficult for employers to protect their brands while at the same time complying with federal labor laws.

Giant Foods’ social media policy forbade employees from using company logos, trademarks, or graphics without prior approval from the company. The policy also prohibited employees from using photographs or video of the “Company’s premises, processes, operations, or products” without prior approval as well.

The Division concluded that these provisions were unlawful under the National Labor Relations Act (NLRA) and that the National Labor Relations Board (the Board) should issue a complaint against Giant Foods for implementing them. As employers are becoming keenly aware, the NLRA safeguards employees’ right to engage in protected concerted activity. Such activity includes group discussions and some comments by individual employees that relate to their wages, hours, and other terms conditions of employment.

The Division concluded that banning employees from using company logos or trademarks was unlawful because: (1) employees should be allowed to use logos and trademarks in online communications, including electronic leaflets or pictures of picket signs with the employer’s logo; and (2) those labor-related interests did not raise the concerns that intellectual property laws were passed to protect, such as a business’ interest in guarding its trademarks from being used by competitors selling inferior products.

Additionally the Division concluded that restricting employees from using photo and video of company premises unlawfully prevented them from sharing information about participation in protected concerted activities, such as snapping a picture of a picket line.

Unfortunately, the Board’s expansive view will likely hamper companies’ ability to prevent damage to their brand and reputation.  Not allowing employers to ban the taking of videos and photos on their premises, or restricting the use of company logos/trademarks could lead to public relations nightmares such as the one Subway Foods recently endured after it was revealed that an employee posted a graphic picture on Instagram of his genitalia on a sub, with the tag line “I will be your sandwich artist today.”

Given the prevalence of cell phones with photo and video capabilities, and the ease of uploading photos and videos to the internet, a company that cannot control its employees’ use of those devices on their premises will be one bad employee decision away from public embarrassment.

What else can be gleaned from the Giant Foods Advice Memorandum? That the Board’s General Counsel will continue to prod employers to eliminate blanket bans on certain kinds of employee conduct from their social media policies and replace those bans with provisions that include specific examples of what employee conduct the policy prohibits. The Board and its General Counsel have previously found social media policies that restricted employee use of confidential information and complaints about an employer’s labor practices as unlawful; Giant Foods makes clear that the agency is also scrutinizing other kinds of policy provisions that potentially could infringe on an employee’s right to engage in protected concerted activities.

Accordingly, employers should review their policies with counsel so that they can tailor them to restrict employee conduct that will damage the company and its brand, but not be “reasonably” read to restrict employees’ rights to engage in protected concerted activities.

It’s Official: Top Union Lawyer To Be National Labor Relations Board (NLRB) General Counsel

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And you thought Lafe Solomon was anti-employer? Buckle your seat belts folks because the employer community is in for a rough ride.

The White House has confirmed Board member Richard Griffin has been nominated to be the new General Counsel for the NLRB.  Before joining the Board as a “recess” appointee, Griffin served as General Counsel for the International Union of Operating Engineers. Griffin has served on the board of directors for the AFL-CIO Lawyers Coordinating Committee and has held various legal jobs with the IUOE. Griffin holds a B.A. from Yale University and a J.D. from Northeastern University School of Law. With Griffin’s nomination, the President also withdrew the nomination of Lafe Solomon Jr. to be General Counsel.  Solomon had been named Acting General Counsel on June 21, 2010.  His nomination for that job went to the U.S. Senate on January 5, 2011 and again in May of this year, but the nomination was never voted upon.

As we previously reported here and here, Griffin’s nomination for the GC job comes on the heels of the deal crafted in the Senate to allow the President’s nominations for the Board to come to the floor for an up or down vote.  Republicans insisted that the President withdraw the nomination of Griffin and Sharon Block.  He agreed and replaced their nominations with those of Kent Hirozawa and Nancy Schiffer, both reportedly hand-picked by AFL-CIO President Richard Trumka. With the recent confirmation of all five of the nominations, the Board is at its full five-member complement for the first time in more than a decade.  However, with a solid 3 member pro-Union majority and Griffin in the General Counsel’s slot, it will be full speed ahead on President Obama’s pro-Union agenda.

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Continuing the Conversation Around Working Women

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Anne-Marie Slaughter’s July 2012 Atlantic article, “Why Women Still Cant Have it All” stirred up the coals in the ever-simmering firestorm regarding working women. Further fueled by the March 2013 publication of Sheryl Sandberg’s book Lean In: Women, Work, and the Will to Lead, it seemed everyone had a word of criticism to offer.

The abundant criticism often missed the larger point – the conversation is important, and these two women should be applauded for spurring it.

Lean In contains illustrative stories about what holds women back in career and life, and offers encouragement for overcoming them. Sandberg, a Harvard graduate, mom of two, and wife to David Goldberg, CEO of SurveyMonkey, has had a storied career. The current COO of Facebook, she began her career as a research assistant to Lawrence Summers at the World Bank and later she served as a management consultant at McKinsey. She then became the chief of staff to Summers at the Treasury Department and spent six and a half years at Google, where she rose to the post of vice president of global online sales and operations. She also made it to the top of the notoriously male-dominated world of Silicon Valley, where the paucity of women among engineers, inventors andcomputer scientists is still clearly visible.

There is no doubt that Lean In offers a glimpse into the lives of the rich and famous that Sandberg affords (after all, Forbes lists her as the sixth most powerful woman). But, net worth and fame notwithstanding, there is valuable insight for women in the legal industry, where men still dominate at management and executive levels.

Take a chance

When Sandberg first received a job offer at Google in 2001, she questioned the title: Business Unit General Manager. There were no business units to manage and the company had less than 1000 employees at the time. Google CEO Eric Schmidt said, “If you’re offered a seat on a rocket ship, you don’t ask what seat. You just get on.” Sandberg went on to become Google’s vice president of Global Online Sales and Operations. Today, Google has over 30,000 employees.

Similarly, lawyers, and non-lawyer professionals in the industry, are often advised to decline a job opportunity if it means a step-down in title. These people may miss an opportunity to catapult their career by joining a growth organization simply because of a few words on a business card.

Don’t be afraid to negotiate

In 1970, American women made 59 cents for every dollar men earned. In 2010, women earned just 77 cents for every dollar men made. Sandberg’s solution: negotiate like a man. When she was talking to Mark Zuckerberg about joining Facebook, Sandberg says she was inclined to accept the first offer he made because she really wanted to work for Facebook. Both her husband and brother-in-law encouraged her to make a counter-offer, saying, “Damn it, Sheryl! Why are you going to make less than any man would make to do the same job?” Sandberg counter-offered.

She told Zuckerberg that he was hiring her to run his deal teams and this would be the only time they would ever be on opposite sides of the table. She laid out what she wanted, and got a more lucrative offer the next day.

Stop trying to please everyone

Herein lies an important female personality issue in the workplace. Most of us place significant value on being liked. During her first performance review, Sandberg notes Zuckerberg told her, “Your biggest problem is you worry way too much about everyone liking you all the time.” He said she would never make an impact unless she said something that at least one person disagreed with. “It’s going to hold you back,” he warned her.

Employees who concentrate on results and impact are more valuable than those who focus on fitting in and pleasing everyone.

View child care costs as an investment

Sandberg notes that over the past decade, child care costs have risen twice as fast as the median income of families with children. The cost for two children (an infant and a four-year-old) to go to a day care center is greater than the annual median rent payment in every state in the country. Rigid work schedules, lack of paid family leave, and expensive or undependable child care derail women’s best work efforts. Sandberg encourages women to compare child care costs to their future salary instead of their current one. Initial child care costs are an investment in a working mother’s career.

Include men in the conversation

Sandberg believes that the single most important career decision a woman makes is whether she will have a life partner and who that partner will be. A partner’s lack of participation in child care and domestic tasks are significant factors in some women’s decisions to leave the workforce or reduce their hours.

Because there are still significantly more men at the top of every industry, the proverbial good-old-boy network continues to flourish. And because there are already a reduced number of women in leadership roles, it is not possible for junior women to get enough support unless senior men mentor them.

The simple conclusion Sandberg strove for, clearly communicated and ultimately obtained, is that by turning the focus of the feminist movement toward personal choices, society has failed to encourage women to aspire to leadership. Thus the conversation needs to continue.

 

Kathryn Whitaker is Business Development Specialist at K&L Gates in Charleston, SC.

 

Ioana Good manages communications at Lowndes, Drosdick, Doster, Kantor & Reed, P.A. in Orlando, FL.

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Complete Your Non-Compete Agreement: Helpful Drafting Tips

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Perhaps you consider your non-compete agreement just one form in a stack of many? When it is time to use it there is not much to the process: you retrieve it from the HR office, briefly discuss it with the employee, and he willingly signs it. But such a practice is a perilous one because non-compete agreements are not meant to be “one-size-fits-all.” Rather, they should be thoughtfully tweaked to each specific employee and situation. By relying on boilerplate language and fill-in-the-blank forms, you are risking the chance that a court will find your agreement unenforceable.

Unfortunately, there are no bright-line rules that employers can abide by to ensure the legality of agreements, but there are some factors that you should consider when drafting these agreements that should assist employers in enforcing their agreements when the time comes to do so, including:

1) The nature of the industry

The higher the competition in the industry, the more likely a non-compete will be upheld. If the industry is such where an individual may gain sensitive or secretive data, strategies, or business models, then a strict non-compete makes much more sense. On the other hand, if succeeding in the industry primarily results from people relying on their own strengths (good service, knowledge, etc.), then there is less of a reason to restrict them from competing against their former employer because they will not be relying on what was gained at their previous employment. Compare the industry of a Silicon Valley technology start-up versus that of a general family physician; a non-compete agreement makes much more sense in the former rather than the latter. Lesson – explain clearly the reason why the agreement is necessary. 

2) The relevant characteristics of the employer

Is the business local or global? Are there a handful of employees or thousands? Does the employer dominate the industry or is competition fierce? As a general rule, the larger the employer’s geographical reach, the larger the geographical restriction can be. Yet, the geographic reach of the employer is just one of many considerations and must be viewed in light of the entire non-compete. For example, a court may uphold a one-year restriction of competing nationally, if the business is global. On the other hand, if the business is unique to one state (say, breeding racing thoroughbreds) then a five-year, state-wide restriction could be held unenforceable. Take time to understand your business and catalogue its characteristics. Lesson –limit the geographic and durational scope of the restriction as much as is reasonable – and explain the reasons for each.

There are some additional tips worth sharing; check back on Wednesday and I’ll discuss what else you can do to improve your non-compete agreements.

Unpaid Internships – Opportunity or Liability for Businesses?

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Unpaid internships have long been viewed by students, recent graduates and industry newcomers as a chance to gain experience that might help them select or launch a career, and to some, a chance to eventually land a paying job.  Employers can capitalize on this to teach their trade or profession and find new talent; but, they should not use interns just to cut labor costs.

The United States Department of Labor and many states use six criteria to determine whether internships in for-profit company operations can lawfully be unpaid: 1) the internship must be similar to training given in an educational institution; 2) regular paid workers are not displaced; 3) the intern works under close observation; 4) the employer derives no immediate advantage from intern activities; 5) there is no guaranty of employment upon internship completion; and 6) it is clear up front that there is no expectation of payment.  The overarching theme is that unpaid internships must be educational and predominantly for the benefit of the intern, not the employer.

Some employers have no idea the criteria exist and unwittingly expose themselves to expensive single-plaintiff, class action and regulator’s claims to reclassify interns as employees and to recover unpaid minimum wages, overtime pay, interest, multiple penalties and attorneys fees.  [For more on this see our post on Unpaid Interns Deemed Employees Under the FLSA].  Add to that, there are potential employer and decision maker risks for failure to withhold income and employment taxes.

“Warning bell” examples of internship programs that may be subject to reclassification include, use of unpaid internships to simply minimize labor costs or merely as an extended job interview to see if interns can make the cut later for a paid job; no real, supervised education and training, beyond what the intern might happen to observe; and a predominance of work assigned to interns that paid employees would normally do to generate or support the business.  Likewise, interns whose work is primarily running errands, answering phones, filing, organizing documents, data entry, scanning or coping images, or cleaning – even though they arguably have good exposure to work going on around them – tend to look like they are merely doing what paid support staff employees ought to be doing.

By contrast, if the intern is closely supervised and taught learning objectives that can be applied to multiple different employers, with occasional support staff type work incidental to the learning, with no guaranty of employment, and a writing that specifies a limited duration of an internship without pay, odds are better that intern can lawfully be unpaid.  As a practical matter, if a school or college will give the intern course credit, the odds of legal compliance increase.

A safe path to avoid classification risks is to pay interns at least minimum wage and for any overtime worked, afford meal and rest breaks, and manage their work assignments to reduce overtime needed.   Depending on employer policies and applicable laws, an intern who is part-time or a short-term temporary employee may not be eligible for certain employee benefits.

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Centers for Medicare and Medicaid Services (CMS) Spells Out Requirements in New Rule for Consumer Helpers in Insurance Exchanges

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Amid ongoing political debate about implementation of the Affordable Care Act and the ability of average Americans to understand the complexities of the health reform law, the Centers for Medicare and Medicaid Services on July 12, 2013 released a final rule that sets forth requirements for different types of entities and individuals who will aide consumers in learning about and enrolling in health coverage plans on insurance marketplaces created by the law, called exchanges.

The rule distinguishes between three categories of consumer helpers: “navigators,” “non-navigator assistance personnel,” and “certified application counselors.” All three types, which may include community nonprofit organizations and their staffs, and other entities and individuals, will perform similar functions, such as helping consumers establish their eligibility for coverage on an exchange and enrolling them where eligible. The primary differences lie in how they are funded and in the exchanges in which they will provide assistance. Navigators will provide assistance in all exchanges—federal exchanges, state exchanges, and federal-state partnership exchanges—and will be funded by federal and state grants. Non-navigator assistance personnel will provide assistance in federal-state partnership exchanges and optionally in state exchanges, and will be funded through separate state-administered grants or contracts. Certified application counselors will provide assistance in all exchanges and will not receive exchange-related funds (although they may receive funds from other federal programs).

The rule lays out standards with which navigators and non-navigator assistance personnel must comply. These standards include conflict-of-interest standards that limit affiliations with insurance companies and standards governing certification, recertification, and training in particular subjects. The rule establishes additional standards to ensure that the services of navigators and non-navigator assistance personnel are culturally and linguistically appropriate and also accessible to the disabled.

As to certified application counselors, the rule authorizes exchanges to designate an organization to certify its staff members or volunteers as application counselors, or to directly certify these individuals, who in both cases must comply with certification standards similar to those applicable to navigators and non-navigator assistance personnel. Correspondingly, the rule requires withdrawal of an organization’s designation or a counselor’s certification in the event of noncompliance with the rule. Finally, the rule requires that certain information about certified application counselors be available to health coverage applicants, and it prohibits the imposition of any charge on applicants for application or other exchange-related assistance.

The rule takes effect on August 12, 2013.

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Starting an Online Business: Licensing Requirements

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Individuals interested in starting an online business are often confused or uninformed as to the licensing requirements for such businesses.  In many ways, an online business is like any “brick and mortar” store and the owner will probably be required to obtain certain licenses or permits to operate.

Federal Requirements

Business Licenses.  Most businesses do not require a federal business license or permit.  However, a business engaged in one of the following activities should contact the responsible federal agency to determine the requirements for doing business:  Investment Advising, Drug Manufacturing, Preparation of Meat Products, Broadcasting, Ground Transportation, Selling Alcohol, Tobacco, or Firearms.

Tax Identification Number.  A federal tax identification number, also known as an Employer Identification Number (EIN), is a federal identification number issued by the Internal Revenue Service to identify a business entity.  Nearly all businesses are required to have a tax identification number.

If a business is operated as a sole proprietorship, the owner may use his or her social security number in place of an EIN on all governmental forms and other official documents.  However, most small business advisors recommend using a federal tax identification number instead.

To obtain a federal tax identification number, a business owner should contact the nearest Local IRS Field Office or call the IRS Business and Specialty Tax Hotline at 800-829-4933.  The necessary form, IRS Form SS-4, can be downloaded directly from the Small Business Administration website.

State Requirements

Many states and local jurisdictions require a person to obtain a business license or permit before beginning business operations.  A business that operates without the required license or permit may be subjected to fines or may be barred from further business activity.  In some localities, a business operating out of a residence may require an additional permit.

While business licensing requirements vary from state-to-state, the most common types include:

·    Basic Business Operation License – a legal document issued by a local governmental authority that authorizes a person to conduct business within the boundaries of the municipality.  Many states have established small business assistance agencies to help small businesses comply with state requirements;

  • Fictitious Name Certificate – a document, usually filed with a state agency, which is required to operate a business using an assumed name or trade name (essentially, any name other than the full, formal name of the individual or company);
  • Home Occupation Permit – a permit which may be required to conduct business from a residence;
  • Tax Registration – if the state has a state income tax, a business owner must usually register and obtain an employer identification number from the state Department of Revenue or Treasury Department.  If the business engages in retail sales, the owner must usually obtain a sales tax license;
  • Special State-Issued Business Licenses or Permits – these permits may be required for a business that sell highly-regulated products like firearms, gasoline, liquor, or lottery tickets;
  • Zoning and Land Use Permits – may be required to develop a site or property for specific purposes
  • Employer Registrations – if the business has employees, the owner must usually make unemployment insurance contributions;

Additional state licenses may be required for regulated occupations such as building contractors, physicians, appraisers, accountants, barbers, real estate agents, auctioneers, private investigators, private security guards, funeral directors, bill collectors, and cosmetologists.

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New Requirements for Illinois Businesses under Concealed Carry Act

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Illinois employers may be surprised to learn what action items may be necessary for their businesses following enactment of Illinois’ new Concealed Carry Act.

Facing a deadline imposed by the Seventh Circuit’s 2012 ruling that the state’s concealed carry ban was unconstitutional, on July 9 the Illinois state legislature overrode Governor Quinn’s amendatory veto to enact Public Act 98-0063, which includes the new Firearm Concealed Carry Act (“Act”) and related laws and amendatory legislation. The Act makes Illinois the 50th state to enact legislation allowing concealed carry, and permits Illinois residents and non-residents who meet specified qualifications to apply for a license to carry a “concealed firearm” — defined as a concealed loaded or unloaded handgun carried on or about a person or within a vehicle — in the state. Among other provisions, the Act specifies qualifications, procedures and content of applications for licenses and areas where those holding licenses will be prohibited from carrying firearms. Individuals cannot apply for a concealed carry license in Illinois until the Department of State Police issues the applications (the Department has up to 180 days to do so).

Required Postings for “Prohibited Areas”

The Act prohibits authorized licensees from carrying a firearm into “prohibited areas” and further mandates clear notices at entrances of such venues that firearms are prohibited. (Required signage and accompanying rules will be issued by the Department of State Police and are not yet available.) Among others, the following are types of establishments subject to these requirements that must post clear notices prohibiting the carrying of firearms:

  • Areas controlled by public or private hospitals or their affiliates, mental health facilities, nursing homes, public or private elementary or secondary schools, pre-schools, and child care facilities.
  • Areas under the control of an establishment serving alcohol on its premises, if more than 50% of the establishment’s gross receipts within the prior 3 months is from the sale of alcohol. (The Act further provides that owners of such establishments who fail to prohibit concealed firearms are subject to penalties up to $5000.)
  • Buildings, classrooms, laboratories, clinics, hospitals, artistic, athletic or entertainment venues and other areas under the control of a public or private community college, college, or university.
  • Events authorized by Special Event Retailer’s license during the time alcohol will be sold.
  • Areas under the control of a gaming facility licensed under the Riverboat Gambling Act or the Illinois Horse Racing Act of 1975.
  • Public gatherings or special events conducted on property open to the public that requires the issuance of a government permit.
  • Any stadium, arena, or the property or areas under the control of a stadium, arena, or any collegiate or professional sporting event.
  • Areas under the control of a museum, amusement park, zoo, or airport.
  • Any areas owned, leased, controlled or used by a nuclear energy storage, weapons, or development site.
  • Buses, trains, or other forms of transportation paid in whole or in part with public funds, and any areas controlled by a public transportation facility.
  • Areas where firearms are prohibited under federal law.

Prohibition by Other Owners Desiring to Maintain Gun-Free Facilities

Employers and other property owners can still prohibit the carrying of concealed firearms on property under their control that is not among the enumerated “prohibited areas” provided they post the state-approved sign indicating that firearms are prohibited. (Owners of private residences desiring to prohibit firearms need not post the sign.) Because this provision of the Act applies to owners of “private real property” however, it raises questions for businesses operating on leased premises who desire to ban firearms. At a minimum, such businesses should ensure that their landlord’s concealed carry policy is consistent with their own.

Special Provisions for Parking Areas

Note that while the carrying of concealed firearms may be prohibited in buildings, facilities and properties — including parking areas — authorized licensees can still drive with concealed firearms into the parking areas, and can store the firearms and ammunition in a case in their locked vehicle or in a locked container out of plain view. Thus while licensed employees and visitors may be prohibited from bringing a firearm into a business or venue, they cannot be prohibited from keeping the firearm in their car. Employers must be sure that any policies or procedures governing handguns in the workplace do not infringe on the rights of employees to keep authorized handguns locked in their cars, even if in employer-owned parking lots.

An Evolving Area of Law

This area of the law continues to evolve. On July 16, Chicago’s City Council unanimously voted to strengthen the City’s assault weapons ban with measures that prohibit more weapons, add stricter penalties for violations, and outline student safety zones in order to meet a 10-day deadline imposed by companion amendments within Public Act 98-0063.

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White House Highlights the Need For Educated Immigrant Entrepreneurs and Employees

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The Office of Science and Technology Policy (“OSTP”) highlighted the need for immigration reform in a recently published blog post. Over 40 percent of Fortune 500 companies, including GE, Ford, Yahoo and Google, were founded by immigrants or children of immigrants. According to the OSTP, the recently passed bipartisan Senate bill would enact some of the President’s key priorities for retaining the skilled workers.

Specifically, the bill would remove visa caps for immigrants with a PhD or Master’s degree in Science, Technology, Engineering and Math (“STEM”). A recent article from Forbes.com highlighted the continuing need for STEM graduates. The median pay for STEM graduates with less than three years of work experience was $88,700. However, STEM jobs remain unfilled because of the lack of qualified candidates.

The Senate bill would also create a new startup visa for Immigrant Entrepreneurs. Qualified Entrepreneurs would have to invest no less than $100,000 in a U.S. business, create no fewer than three jobs and generate at least $250,000 in annual revenue from business conducted in the United States. A “Qualified Entrepreneur” would be an individual who has a significant ownership interest in a U.S. business entity, is employed in a senior executive position of that U.S. business entity, submits a business plan to USCIS and has a substantial role in the founding or early stage development of such entity.

Additionally, the bill would eliminate the existing backlogs for employment-based visas. This change would permanently expand the availability of visa numbers for high-skilled workers by exempting relatives of these skilled workers from the annual cap. These are important, necessary and critical changes to our broken immigration system. All eyes are now focused on the House to see if these important immigration reform steps will be passed into law and how the new bill would impact the EB-5 program.

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A Checklist for Employee Reference Checks

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Thorough research during an employer’s hiring phase can prevent undesirable employees from becoming part of a workforce. There is no better way to get an accurate assessment of job applicants than by speaking with people who have actually worked with them. Before picking up the phone, however, potential employers should keep a few things in mind:

Who should inquire?

Someone in HR may typically perform reference checks, but the supervisor or manager who will be interacting with and interviewing the applicant should consider making the calls.  A supervisor or manager will not only benefit from getting the information directly, but they may also have an easier time getting high-level references to speak candidly about the applicant.

Consider obtaining consent

Getting the applicant’s consent before obtaining potentially sensitive information can help insulate you from liability. Further, former employers may be more at ease discussing the applicant if they know the applicant has approved of the contact.

What should be discussed?

Keep it at a professional level; not personal. Anything you ask should be relevant to the position with the goal being to find out about the applicant’s ability and how they will interact with others. Obviously, avoid any questions that could inadvertently lead to a discrimination or unfair hiring practices claim, such as inquiring about the person’s age or religion.

Know what you want to find out beforehand. People provide references whom they believe will say positive things, but this is not always the case. In the event a reference thinks poorly of the applicant, try to find out if their negative opinion is based on articulable, business-related reasons. While comments like, “she just was not a good fit at our company” can be appreciated, it is better to hear comments such as, “she was not a good fit at our company because she was repeatedly absent and needed constant oversight.”

Take notes

Information obtained during a reference check can be valuable evidence if a negligent hiring claim is later made by a third-party. For example, if the applicant is hired and subsequently is violent towards a customer, having records to show that none of the employee’s references offered any indication of violent behavior will support your defense that the hiring was not negligent.

Get necessary releases before going further

An applicant’s express permission is necessary before accessing some records, such as a credit report or criminal background check. Some records may be completely inaccessible, such as workers’ compensation information or medical records. If you have conducted the reference checks and are ready to take your interview process to the next level, make sure that you know what kind of releases are required.

 Maegan Pirtle and Shawn Beloin, Law Clerks for McBrayer, contributed to this article.