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Negligent
Hiring and Retention - Are You Prepared?
Employers
can and are being held liable for the wilful misconduct of
their employees, even if the employees' actions occur outside
the scope or place of employment. This form of liability is
defined by the legal theories of negligent hiring and retention.
While
these theories are not necessarily new, what is worthy of
notice is the increase in negligent hiring and retention claims.
Beginning in the 1980's, negligent hiring and retention claims
have been on a rapid rise. This rise could be perceived as
part of a larger trend as courts continue to show increasing
interest in not only determining guilt, but in compensating
the victim.
The interest
in compensation can lend itself to a search for "deep pockets,"
and the offender's employer is a likely candidate. According
to a study by Liability Consultant's, Inc., a consulting firm
specializing in premises liability, the average settlement
in these cases is now over 1.6 million dollars. Such sensational
monetary judgments are sure to attract attention among potential
plaintiffs and the lawyers eager to try their cases.
More than
ever, employers need to clearly understand what negligent
hiring is, what responsibilities employers have to create
a safe environment through employee selection, and what actions
are necessary to reduce the risk of liability and loss.
The first
step in prevention is a firm grasp on how negligence in hiring
and retention are defined. Negligent hiring is based on the
idea that employers have a duty to exercise care when selecting
employees. In other words, an employer must adequately screen
individuals by performing a "reasonable" investigation of
the applicant's background.
Negligence
occurs when an employer does not perform this "duty of care"
by failing to investigate, conducting an inadequate investigation,
or hiring an applicant whom is unfit based on information
uncovered during an investigation.
Demonstrating
that an employee was unfit for a particular job is one of
the key elements in claiming that the employer was negligent.
There are no clear guidelines or legislation in place to help
determine whether someone is considered unfit for certain
jobs. Common sense and the outcome of previous litigation
are the best sources available. The most common evidence used
to demonstrate an employee is unfit for a particular position
is evidence of past criminal or inappropriate behaviour.
The individuals
were considered improper choices since their jobs involved
contact with the public or sensitive access to people and
their property. Jobs that include this kind of exposure to
the public have been held to higher standards by the courts.
For instance, a fast food chain was sued for $200,000 when
a worker assaulted a three-year old child, and it was discovered
that the individual had a criminal record that included assault.
A suit
was filed for 5 million dollars against a property management
company when a manager used a pass key to gain access to an
apartment and sexually assaulted the tenant. The management
company settled out of court when it was discovered that the
manager had been convicted of apartment burglary several years
before.
One employer
was liable when he hired a truck driver who lied about his
experience, had several speeding tickets, and had no training
as a truck driver. Suits like these have been successful against
employers of hospital orderlies, janitors, drivers, security
guards, bartenders, property managers, and a broad assortment
of other positions in as many industries.
Employers
have also been barred from using ignorance of the employee's
past as a means of avoiding liability. Courts have held that
negligence not only occurs when the employer knew, but also
when he should have known the employee was unfit. Employers
have been accountable for what they did not know if it can
be shown that additional efforts to investigate would have
uncovered information that made subsequent misconduct foreseeable.
Employers are being held responsible for creating a safe environment
for employees, customers, and the public at large. The courts
have indicated that this duty must be performed by adequate
screening policies.
The question
for employers is how much screening is enough to satisfy this
duty and avoid possible crippling liability? This question
has no easy answer. The level of screening should be proportionate
to the risk created by a particular position. Jobs that involve
exposure to the public should be carefully considered. Positions
that give persons access to children, elderly persons, patients,
master keys, private homes, personal property, and dangerous
materials need to be handled with extra care. Whatever the
conditions of the employment are, the best defence against
this kind of liability is a well-crafted plan, consistently
followed and carefully documented.
The use
of a properly-drafted application, skilled interviewers, and
verification of all employment and education claims should
be a part of any screening program.
Whatever
combination of screening methods is used, the message to employers
is clear; be prepared to defend your hiring practices against
claims of negligence. If employers ignore the risk poor hiring
practices can create, then they may have to answer for the
misconduct of their employees. If failure to properly screen
an employee is connected to a victim's injury or loss, the
employers may find themselves reaching deep into their pockets
to compensate the victim.
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