Delaware Employment Law Blog

Good documentation practices during the hiring process can help employers avoid a failure-to-hire claim.  And that's a good thing, considering that failure-to-hire claims are costly. Just ask Perdue.  The poultry company has agreed to a pay out of more than $800k to settle a claim of disparate impact arising from what the DOL concluded to be systematic discrimination against non-Hispanic job applicants. 

Disparate Impact Claim

A Labor Department news release states an evaluation in 2005 and 2006 by the Office of Federal Contract Compliance Programs (OFCCP) found the Salisbury-based company failed to comply with federal employment laws at its poultry processing plants in Rockingham, N.C., Dillon, S.C., and Monterey, Tenn. (The OFCCP has jurisdiction because Perdue supplies poultry under a federal contract to the U.S. Department of Agriculture.)

The settlement agreement will require Perdue to pay $800,000 in back wages and interest to 750 women and minorities who were not hired during the relevant time period.  The company also will make employment offers to some of those who were not hired but who are still interested in employment with Perdue.  In those cases, the employees will receive retroactive company service dates for purposes of benefits and promotion rights. 

Documentation Regrets

Perdue officials denied the allegations on the basis that many applicants were unqualified for employment or withdrew from consideration for employment.  They stated that the company agreed to a settlement only to avoid protracted litigation, according to the company. The VP of HR said in a company statement:

Perdue is committed to treating all job applicants fairly. We regret we did not more carefully document our hiring process for production associates, which led to these concerns by the OFCCP and, ultimately, to this settlement.

Perdue has implemented new procedures to ensure it retains all relevant documentation of its selection processes and is also conducting training of its human resources staff to assure appropriate implementation of Perdue's hiring and employment practices, according to the company statement.

Interviewing Best Practices

Interviewing is one of the most neglected areas in employment law.  When I teach seminars on lawful interviewing, I will inevitably see faces filled with shock and despair as they realize just how many of the best practices have not been implemented in their organization. 

Documentation is key in hiring.  If you keep notes and records only on the people you hired, you will have nothing to refer to in a failure-to-hire claim.  And let's be honest, the ones you didn't hire are likely the ones who were the least memorable.  Can you remember candidates you interviewed and rejected in 2005 and 2006? 

Without an established and consistent documentation and record-retention policy for the hiring policy, a failure-to-hire claim can be nearly impossible to defend.  Just ask Perdue.

Source:  Delaware News Journal, Gwenn Garland

Every time we undertake the defense of a discrimination charge or lawsuit filed by a current or former employee, one of the first things we do is ask our client for a copy of every piece of paper, e-mail message and computer file they can find that has to do with their relationship with the employee. What makes us the happiest is when our client sends us documents that we can use to demonstrate to the government, the court, or the jury that the company has adopted basic employment policies, has been conscientious in the hiring process, has monitored the employee’s performance, and, if there were conduct issues, has taken steps to correct them.

Employers, no matter how small, that do not keep basic employment records will face a greater challenge in defending claims by employees than those who do. In Delaware, employers who have as few as four employees can be sued in state court for discrimination!

Even if you don’t have a Human Resources Department and feel that you are too busy to fool around with what you might think of as useless and time-consuming paperwork, you will do yourself a big favor if you use, at the very minimum, the following:

1. An employment application

2. An employee handbook

3. Performance evaluations

4. Disciplinary action forms

You should also keep in mind that certain documents are legally mandated, including I-9 forms, state and federal employment law posters, and tax documents such as W-4 forms. I would also recommend that you make a photocopy of each employee’s social security number card to avoid problems with mismatched social security numbers. Using these basic documents will help you avoid liability for discrimination, hiring illegal aliens, and hiring employees who harm others, and may help you reduce the number of successful claims for unemployment compensation benefits.