An employer can also be negligent for failing to examine the information on an application or for failing to contact an employee’s prior employer to inquire why the employee left his or her last job.
If the employer was negligent in its hiring practices, the plaintiff must still show that he or she was injured as a direct result of the employer’s negligent hiring.
Checking References is Key
Many employers fail to disclose information about an ex-employee’s misconduct for fear of being sued for defamation. But an employer is being negligent when it fails to disclose knowledge of misconduct.
Some Indiana courts have also said that where there is a "substantial, foreseeable risk" that physical injury even to a third party would result form an employer’s failure to disclose information, the employer can be found negligent.
There is, however, a defense to defamation suits by an employee. As long as the information was not knowingly false or given in bad faith, the employer may disclose the information and cannot be sued.
Indiana statutes do, however, prohibit black-listing or preventing a former employee from obtaining employment. The statute does not prevent an employer from providing a truthful, written statement of the reasons for discharge to anyone to whom the employee has applied for employment. Employers are immune from liability unless the employee can prove that the information disclosed was known to be false at the time the disclosure was made.
Indiana statues give an employer a defense against lawsuits if they give a truthful, written response to inquiries about former employees. That means that not only can you seek information about your applicants, you can provide information about your former employees.
Tips for Preventing a Lawsuit
The following suggestions may help prevent a lawsuit for negligent hiring.
(1) Make sure the job application is completed before the interview.
(2) Review the application for completeness.
(3) Confirm the accuracy of past employment, education and references by calling those individuals listed on the application or using a reference checking service.
(4) Ask about any employment gaps and try to obtain specific explanations for them.
(5) Use the application to find out about any criminal convictions and follow up with questions during the interview. Once you have the information, see if the crime relates to the position for which the applicant is applying.
Additional preventative steps:
(1) If the applicant has previously used another name, find out why and conduct a separate background check under that name.
(2) Obtain a copy of the individual’s driving record.
(3) Conduct a criminal background check in all cities where the applicant has resided.