Most HR departments and recruiters are familiar with the terms negligent hiring or negligence in employment. They are part of the reason why companies utilize lengthy background checks and interviews as part of their hiring process. Understanding what negligent hiring constitutes and how it can negatively affect your business is key to its prevention.

Negligent hiring is the act of hiring, supervising, or retaining an employee or contingent worker who if you know they may pose a risk. If these employees subsequently perform negligent or reckless acts which may harm others, the employer can be held accountable. In this sense, the employee definition may cover full-time employees and contingent workers such as temporary workers, independent contractors, and consultants.

A severe example of negligent hiring would be employing and/or retaining an individual with a known criminal history, who ends up assaulting a customer. Negligent hiring can also apply to general employee negligence, such as knowingly hiring an underqualified applicant to perform a dangerous or high-risk job, which may put other workers in danger.

In many US states and Canadian provinces, negligent hiring places the liability directly on the employer. As an example, California recognizes that employers can be held liable for the actions of unfit employees under their supervision if they were to cause harm. According to previous cases, for an employer to be legally considered liable, the individual must have known or reasonably should have known that the employee was incompetent or unfit to fulfill the duties of their position. This negligence in hiring must have then contributed to the harming another individual by the incompetent party.

How to Avoid Negligent Hiring

Avoiding the legal liability of negligent hiring requires due diligence. Here are four ways to avoid introducing risk into your organization:

1. Conduct Thorough Background Checks

   By knowing an applicant’s criminal and employment history, hiring managers can accurately assess potential risks. Following up on references is a critical part of uncovering red flags.
   
   

2. Assess Job-Relevant Competencies
   

   Prior to hiring a new employee, it is crucial to assess their capabilities. For example, if you intend to hire a food handling employee, make sure they understand food hygiene, how to prepare surfaces, and know what foods to not cross-contaminate.
   
   

3. Take Complaints Seriously
   

   If a complaint or grievance is communicated about a specific employee, take it seriously. If you are made aware of an issue and fail to investigate further, you may be held liable.
   
   

4. Remain Observant

   Observe how employees behave and/or interact with others. This can help Identify potential high-risk individuals early and intervene before it is too late.

Work With an Expert Third Party

These mitigation strategies can only protect the liability of an employer to a certain extent. Third party workforce specialists such as HCMWorks can provide much needed expertise to help minimize employer risk. We understand the legal aspects of hiring across North America and establishes appropriate workforce management processes to meet them. HCMWorks is a leading provider of contingent workforce solutions, including risk mitigation, talent acquisition, Managed Service Provider programs, Vendor Management System VMS advisory, and more. To learn more about how HCMWorks can minimize your hiring risk, talk to one of our experts.