Hiring a new employee can be an exciting and daunting task. An employer must comply with various laws related to hiring a new employee. In this article, you can find answers to some of the most frequently asked questions when it comes to hiring a new employee.
What general laws should I follow when hiring a new employee?
There are many potential hiring laws that an employer must consider when hiring a new employee. Here is a list and brief description of the most common hiring laws:
Title VII of the Civil Rights Act of 1964: prohibits discrimination in employment on the basis of race, color, religion, sex, or national origin.- The Equal Pay Act of 1963 (EPA): protects men and women doing substantially the same job in the same establishment from wage discrimination based on sex.
- The Age Discrimination in Employment Act of 1967 (ADEA): protects people who are 40 years of age or older.
- Title I and Title V of the Americans with Disabilities Act of 1990 (ADA): prohibits employment discrimination against qualified individuals with disabilities in the private sector and in state and local governments.
- The Civil Rights Act of 1991: provides monetary damages in cases of intentional employment discrimination.
- Title II of the Genetic Information Nondiscrimination Act of 2008 (GINA): prohibits discrimination in employment based on the genetic information of an applicant, employee, or former employee.
Under federal law, employers are required to verify an employee’s eligibility to work in the United States by completing a I-9, Employment Eligibility Verification within three days of the employee’s start date.
Should I have a new employee sign an employment contract?
Not necessarily. Employers are not required to have written contracts with their employees. However, a written contract can make sense for higher-level workers or employees with complex job agreements. Specifying the rights and obligations of each party can be helpful and restrictive, so balance the needs of each party before a new hire signs a written employment contract.
Are there special rules that I should keep in mind when hiring a foreign worker?
Yes. It is illegal to discriminate against applicants and employees based on their national origin or citizenship, so never ask a potential employee where they are from. Instead, ask if the potential employee is legally authorized to work in the United States full-time.
In addition, the United States Department of Labor (DOL) is responsible for certifying positions for temporary and permanent employment of foreign workers. Once the application is certified by the DOL, the employer must generally file a petition in the United States. Citizenship and Immigration Services (USCIS) for a visa on behalf of the foreign worker. The foreign worker must also show that they are admissible to the United States under the provisions of the Immigration and Nationality Act (INA). The USCIS website provides useful information for employers interested in hiring a foreign worker when a US citizen is not available.
Are there any special rules I need to keep in mind when hiring an independent contractor?
Yes. First of all, since the IRS treats employee and independent contractor taxes differently, it is important to make sure your future employee is truly a independent contractor. If you misclassify your worker as an independent contractor and the IRS believes the worker is an employee, you may be liable under the Fair Labor Standards Act and owe back taxes, worker’s compensation benefits, and employee benefits. If you are unsure, you can file a Form SS-8 with the IRS to obtain an official determination on the status of the prospective employee.
Are there special rules that I should keep in mind when hiring someone with a disability?
Yes. The Americans with Disabilities Act (ADA) has two important effects on hiring an employee with disabilities. First, the ADA prohibits discrimination against people with disabilities in the hiring process. Second, the ADA requires employers with 15 or more employees to provide reasonable accommodations for individuals with disabilities unless the employer has unnecessary hardship. A reasonable accommodation is any change in the work environment or the way work is performed that allows a person with a disability to enjoy the same employment opportunities.
Are there special rules that I should keep in mind when hiring minors?
Yes. In order to hire minors, you must comply with the federal Fair Labor Standards Act (FLSA) as well as state labor laws. Generally, the FLSA and state employment laws divide minors into two categories: children ages 14-15 and children ages 16-17.
Can I check the credit of a potential employee?
Under the Fair Credit Reporting Law (FCRA) employers must obtain the employee’s written consent before seeking an employee’s credit report. If you decide not to hire or promote someone based on the information in the credit report, you must provide a copy of the report and advise the applicant of their right to challenge the report under the FCRA. Some states have stricter rules that limit the use of credit reports.
Can I check the background of potential employees?
Yes, but you must be very careful. Here are some general types of background checks that employers often want to run:
- Criminal History: Many states only allow you to conduct a criminal background check if they are work related (i.e. hiring a security job) and since the ability to conduct a criminal background check varies from interstate, you should review the laws of your state before conducting a check.
- Lie Detector Tests: The Employee Polygraph Protection Act prohibits most private employers from using lie detector tests for pre-employment evaluation or during the course of employment.
- Medical records: Generally, you cannot obtain an employee’s medical records with the employee’s consent. It is also generally illegal to ask for medical records.
- Bankruptcies: Although bankruptcies are a matter of public records, Federal Bankruptcy Law prohibits employers from discriminating against applicants because they have filed for bankruptcy.
- Workers ‘Compensation Records: Workers’ compensation appeals are public records, however, employers can only use this information if they can show that the applicant’s injury could interfere with their ability to perform required job duties.
- School records: Under the Family Educational Rights and Privacy Act, as well as similar state laws, education records are confidential and may not be released without the consent of the applicant.
- Military Service Records: Military service records may be released under limited circumstances and generally require consent. However, the military may, without the person’s consent, reveal their name, rank, salary, assigned duties, awards, and service status.
Legal guidance
Failure to comply with applicable hiring and employment laws can result in a lawsuit or problems with government agencies such as the IRS. If you are unsure which laws apply to your business and need help determining whether your hiring process is legal, you can contact a local business and commercial attorney.