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Poor economy, new legal peril: Refusing to hire the unemployed

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in Discrimination and Harassment,Employment Law,Hiring,Human Resources

THE LAW: No federal law says it’s discriminatory to refuse to hire unemployed people. However, legislatures in several states are considering bills that would make it illegal to discriminate on the basis of current employment status.

Moreover, many who are jobless fall into protected classes—including women, minorities, people with disabilities and those over age 40.

Title VII of the Civil Rights Act prohibits discrimination based on race, color, creed, religion, sex and national origin. The ADA bars employers from discriminating against disabled employees who can perform a job’s essential functions with or without accommodation. The Age Discrimination in Employment Act protects workers age 40 and older. The Uniformed Services Employment and Reemployment Rights Act protects members of the military, National Guard and Reserve from discrimination based on their military service status.

Note: Employment laws grant employers a hiring safe harbor: As long as they choose the best-qualified candidate without regard to race, religion, gender, national origin, disability, military status or age, they violate no law.

WHAT’S NEW: The ongoing recession has created the largest pool of long-term unemployed since the Great Depression. According to the Bureau of Labor Statistics, 6.3 million Americans have been unemployed for six months or longer—nearly nine times the number in 2000. They constitute 41.9% of all unemployed Americans.

Many news reports have surfaced claiming that employers are only hiring applicants who are currently working. Those stories are anecdotal, giving little indication of the severity and extent of such practices. But even in good times, employers looked for shortcuts to winnow through dizzying numbers of résumés and job applications, most of which are submitted online.

With potentially hundreds of applicants for every job opening, employers may be looking for shortcuts. In many cases, the poor economy allows employers to be more selective, choosing only the best possible candidates from a large pool of qualified people.

Justified or not, many employers view people who have been out of work as damaged goods. But the obvious question is, does refusing to hire someone because of a long period of unemployment actually get you the best candidate?

There is little data showing that it does. The practice merely amplifies existing employment discrimination.

Do you think employers lay off older workers because they earn more than younger workers? If you then fail to hire that older worker, you’re making it easy for an applicant to win a discrimination lawsuit, even if there wasn’t enough evidence to sue the initial employer.

Play out the same scenario for women, minorities, the disabled and service members returning from Iraq or Afghanistan.

HOW TO COMPLY: The best road to compliance is also the best road for your company: Hire the most qualified person.

If an applicant has a long period of unemployment, find out why. Perhaps, the applicant’s house was unsellable because of falling home values and the cost of moving to a better employment market was too high. Does this mean the applicant will be a poor employee? Of course not. Focus on the applicant’s qualifications, education and experience.

There may be occasions where a long layoff has led to the applicant’s skills becoming outdated. If so, that may be a reason to hire someone who has kept up.

On the other hand, if the applicant spent the time she was out of work to take classes, volunteer or take other steps to keep up-to-date, it shows initiative. Evaluating how an applicant used a long period of employment may tell you more about the individual than anything else.

Taking shortcuts in the hiring process can be a costly decision. Taking the time to find the right person for the right reasons will pay dividends for years to come.

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