Research conducted by ResumeLab found that 36 percent of U.S. workers lie on their resumes. That’s almost four out of every 10 job candidates. The same survey also found 93 percent of people knew someone who knowingly lied about their skills or qualifications. Even more shockingly, when employers knew about the bluffing, only 65 percent eliminated those who fibbed. This leaves a huge margin of error for the possibility of negligent hiring.
When an improperly vetted hire causes damages, the responsibility for amending these mistakes or injuries can land on their employer. This is an avoidable problem that companies should evade at all costs. Negligent hiring claims often lead to lawsuits. According to a study titled “Criminal Background Checks for Prospective and Current Employees,” the average settlement of negligent hiring cases is 1.6 million dollars. Negligent hiring cases make the claim that an employer knew or should have made the effort to know if an employee would be a danger. It’s vital leaders create a fully developed, standardized hiring process. Otherwise, your organization could face serious consequences like bankruptcy and closure.
In this article, learn more about negligent hiring, how it is defined by the law, real-life examples of negligent hiring, and what company owners need to do to dodge it.
What is Negligent Hiring?
Negligent hiring happens when business owners don’t follow a well-formed hiring process that thoroughly evaluates who they’re bringing onto their team. Any person harmed or damaged by an employee who was not properly assessed can file a negligent hiring claim against the company. This is because employers must ascertain whether their hires could potentially put their customers or employees in harm’s way. If they do not, they can be held accountable for remedying the negative impact of their team member’s words, actions, behaviors, and crimes.
Defining Negligent Hiring in Legal Terms
Individual states handle negligent hiring claims. While cases involving negligent hiring can be brought forth in any state, the laws and regulations for each state are different, which affect rulings. For this reason, leaders in charge of hiring employees should always know and abide by their state’s hiring and employment laws. For reference, visit the American Bar Association’s (ABA) list of negligent hiring laws in each state.
According to Negligence in Employment Law, the grounds for a negligent hiring lawsuit are:
- The defendant had a legal obligation to not act in a way that potentially causes harm.
- They did not perform their “duty of care.”
- Because of this breach of responsibility, the plaintiff suffered injury or harm.
- The damage would’ve been a foreseeable consequence of not fulfilling their duty of care.
While employers should adhere to their duty of care, they should not discriminate against any person during the hiring process. This includes people who have a criminal background. When developing a formal hiring process, keep in mind federal laws administered by the U.S. Equal Employment Opportunity Commission (EEOC). Additionally, stay up-to-date with your state’s labor laws such as “ban-the-box” laws that prevent employers from creating job application forms that identify people as criminals. This stops organizations from violating laws that protect U.S. citizens’ rights for equal and fair employment opportunities.
What Causes Negligent Hiring
Considering how potential employees will impact customers, coworkers, and other people they encounter as a representative of the business is an employer’s responsibility. When business leaders fail to do this, they fail to effectively lead their organizations and team members. As leadership expert and best-selling author Simon Sinek says, “We become leaders when we accept the responsibility to protect those in our care.”
For this reason, a hiring manager should always evaluate whether or not a candidate for a job would be a positive contribution to customers and existing employees on the team. Asking job interview questions that evaluate how a person thinks, acts, interacts, and behaves at work is important, but so is doing your research. While an applicant might interview well, their background check and work references might tell another story. It’s up to leaders to gather all the facts and make a decision that serves the business and its people.
The following actions puts employers at risk of negligent hiring:
- Skipping a formal job interview process because a candidate comes highly recommended from someone you trust.
- Not conducting a background check.
- Not requiring references from previous jobs.
- Disregarding red flags like not listing their past employer as a reference.
- Not validating credentials or certifications.
- Knowingly hiring someone who is not legally qualified to do their job.
- Not checking driving records when the position requires driving.
Examples of Negligent Hiring Cases
A negligent hire can lead to serious damages with high costs. For example, in 2019, a jury awarded 54 million dollars to the plaintiffs of an Illinois lawsuit involving negligent hiring. In this case, an employee with a suspended license struck a vehicle that severely injured the other driver. The victim of the accident could no longer work due to the bodily harm he suffered. If the trucking company would’ve done a little research on the driver they hired, they would’ve realized he was not suitable for the job. Furthermore, his driving record and lack of qualifications demonstrated that being employed as a truck driver would’ve likely resulted in an accident. This caused the court to rule in the plaintiffs’ favor.
In a different negligent hiring case, a jury awarded the plaintiff over 1 million dollars. While the employer said they vetted all their employees and provided a safe work environment, evidence showed they did not. They hired someone who had an active case involving a terroristic threat made with an illegal weapon at a job site. In addition to this, multiple workers reported violent encounters with the employee in question, yet the company did nothing to remedy the issue. In 2015, the man brought a gun to the office and murdered his coworker. With this evidence, the jury found the employer guilty of negligent hiring.
How to Avoid Negligent Hiring Claims
As demonstrated above, negligent hiring can result in serious consequences that leave a trail of destruction. Leaders in charge of making hiring decisions must carefully create guidelines and processes that safeguard those impacted by their organizations. When this happens, negligent hiring is an avoidable problem. Use the tips below to protect your organization and its people.
1. Create a Uniform Hiring Process
Above all, the top way to avoid the liability of negligent hiring is having a thorough hiring process all candidates go through. Even if the business owner has known this person for 15 years, they still need to be vetted the same way other applicants are. While you might know and trust someone, it is always best to have a record on file showing you did your due diligence as an employer. In the event an accident does happen, you’ll have proof that you were not guilty of negligent hiring.
Before hiring someone:
- Conduct multiple interviews.
- Do a criminal background check.
- Get their driving records (if needed for the job).
- Call the person’s references.
- Verify their credentials.
Get more information on developing a strong hiring process.
2. Find Ideal Team Players
Leaders must consider the qualities they’re seeking in employees. Each worker will influence the business’s team culture. Before the interview process, think about the values the right person for the job needs. Best-selling author Patrick Lencioni says organizations should focus on hiring people who demonstrate being humble, hungry, and smart. Candidates who show all three are more likely to be ideal team players who can be developed into organizational leaders.
To gauge a person’s humility, hunger, and intelligence during an interview:
- Ask them about their greatest achievement in a work setting. Humble people will recognize others who helped them with this accomplishment.
- Discuss what contributions they would hope to make within the next 30 days if hired. This determines their hunger. Hungry people already have a plan they’re ready to execute—and they can’t wait to get started.
- Finally, briefly outline one of the business’s greatest problems and allow candidates to solve it. With this question, a person can show off their intelligence by being inquisitive, analytical, or creative. However, those flustered by the question will show the inability to think on their feet. This is a sign the person has the fixed mindset of a perfectionist who doesn’t want to give a “wrong” answer.
Learn more about finding ideal team players.
3. Implement a Trial Period for Full-Time Hires
90-day probationary periods for new hires are a great way to observe a person’s behavior, actions, and work abilities. This gives employers a chance to see how the team member will enmesh themselves into the company’s existing work culture. This can significantly cut down the amount of negligent hires an organization makes. In many negligent hiring cases, employers could’ve seen the red flags during this monitoring period if they were looking for them. This is why it is important to evaluate employees during a three-month probationary period. Otherwise, their negative impact could go unaddressed, causing damage to the business and those who interact with it.
During a 90-day probationary period:
- Establish clear expectations and boundaries for the job.
- Create key performance indicators (KPIs) alongside the employee. Before the end of their job evaluation, review their success rate. How low or high was their performance? What, if anything, needs to change?
- Never ignore complaints about an employee. Always address the problem with the person and enforce necessary disciplinary actions such as termination or a week of leave with no pay.
- Don’t extend a full-time job offer if the person continuously negatively impacts the business. Find another person who will be the right fit for the organization and those it serves.
Grow and Develop Leaders from Within
A team can only be as good as the leader guiding them. Leaders are responsible for selecting the right people for each job that contributes to the collective goals of the organization. When executives don’t put thought into who they’re hiring or the necessary processes needed to evaluate job candidates, negligent hiring and its costly consequences occur. However, when they do assess the values, qualifications, skills, personality type, and missing qualities the team needs, they set themselves up to build a team that accomplishes even the most challenging of missions.
It’s important to add people to the team who you can grow and develop into leaders. Multiplying leaders throughout the company help businesses run more effectively. For instance, leaders at every level please more customers, make a real difference in accomplishing the business’s top goals, and create a work environment people love being a part of. This is why it’s always best to carefully consider who you’re hiring, what you’re hiring them to do, whether or not they’re qualified to do this, and why the person you’ve selected is the best choice for the job.
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