Are Your Employee Hiring Practices Putting Your Business at Risk?

You could be putting your business at risk if you're unintentionally discriminating during the hiring process. Here's what you need to know.

By Rieva Lesonsky,

Few small business owners relish the process of hiring employees. It takes time away from their business, it’s stressful, and most entrepreneurs don’t enjoy interviewing job candidates.  What’s more, the hiring process could be opening your small business to legal risks even without your knowing it.

Reading a recent survey by QuickBooks Payroll about small-business hiring, I was shocked by some of the reasons business owners give for not hiring job candidates. Specifically:

3% of business owners in the survey have rejected a job candidate due to nationality or race. 3% have rejected a job candidate for being too old. 13% have rejected a candidate because of their social media history.

Discrimination at work is in the news frequently, but the stories usually focus on discrimination against people who have already been hired. Equally important are the laws that apply to discrimination in hiring. If a person isn’t hired and suspects they were rejected for a reason that has nothing to do with their ability do the job, they could sue your company for discrimination.

Apparently, some small business owners need a refresher course on hiring laws. Here are some areas where you might be making serious mistakes in hiring employees without even knowing it.

Social media activity

Can you use social media to help you make a decision when hiring employees? Well, yes—but this area is full of potential landmines. Here are some rules to follow:

If you plan to review a job candidate’s social media history as part of the hiring process, make that clear in the job posting and reiterate it during the interview. Be sure to conduct the same type of social media review for every job candidate. When reviewing social media usage, look at the aspects of the candidate’s social media presence that relate to their ability to do the job—not to their status as a protected class of employee, such as religion, gender, race, or age.

Suppose you’re hiring a salesperson. Looking at how active they are on LinkedIn and how many contacts they have is relevant to the job you’re hiring for. If you want to hire someone who’s very active and effective on social media, examining that aspect of their activity is a reasonable part of the hiring decision.

However, if you see the person posts on LinkedIn about their activities with their church, and you don’t approve of their religion so you decide not to interview or hire them, that is discriminatory.

Race or national origin

National origin and citizenship status are not the same thing. All employers are required by federal law to verify new hires’ citizenship status using Form I-9, Employment Eligibility Verification. Some 13.75% of employers in the survey I read say they rejected a job candidate because the candidate could not legally work in the United States.

Rejecting a job candidate based on race or national origin, however, is different. For instance, perhaps a job candidate appears to be equally qualified as all of the other candidates based on his resume. However, he appears to be Hispanic, so you decide not to interview him because you assume he might not have the legal right to work in this country. That’s discriminatory.

Age discrimination in hiring employees

In some situations, a job candidate’s age is a legitimate consideration in their job qualifications. Under the Fair Labor Standards Act (FLSA), 14 is the minimum age for hiring. The FLSA also regulates the number of hours minors under age 16 can work and restricts them from certain hazardous work such as driving motor vehicles and operating heavy equipment. If you want an employee to serve alcohol or work in a bar setting, job candidates will need to meet your state’s requirement for the legal drinking age.

Generally, though, the age of a job candidate is not relevant in hiring. This is especially important to remember when it comes to older candidates: The Age Discrimination in Employment Act (ADEA) prohibits workplace or hiring discrimination against people age 40 and up.

Protect your business from accusations of age discrimination. Don’t ask for a candidate’s age on job applications unless it is directly relevant to the job (as in hiring a bartender). During the interview, don’t ask how old they are.

Unintentional discrimination when hiring employees

Making assumptions about job candidates can lead to unintentional discrimination. For instance, suppose a job requires working on Sundays. If you assume a job candidate who mentions her active role in her church during the interview wouldn’t be interested, that could be discriminatory. Don’t jump to conclusions: Just ask her if she is willing to work on Sundays.

Your employee recruitment policies may also unintentionally be discriminatory. Want ads that ask “recent college graduates” to apply could be seen as discriminating against older candidates. Using language such as “entry-level position” will show that you’re looking for candidates with limited experience, without being discriminatory.

Protected employee categories under the Equal Employment Opportunities Commission (EEOC) include race, color, religion, sex (including gender identity, sexual orientation, and pregnancy), national origin, age (40 or older), disability, and genetic information.

Still not sure if your hiring practices are exposing you to risk? You can learn more at the Department of Labor website, the EEOC website, or by working with an HR consultant or attorney with experience in employment law.


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Finance Magazine: Are Your Employee Hiring Practices Putting Your Business at Risk?
Are Your Employee Hiring Practices Putting Your Business at Risk?
You could be putting your business at risk if you're unintentionally discriminating during the hiring process. Here's what you need to know.
Finance Magazine
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