This week’s inquiry comes from Mary Anderson:

Jeff, I have been an avid reader of The Fordyce Letter and your “Jeff’s On Call!” column for over 10 years. Reading your column has helped me to avoid a number of pitfalls that you never think will happen to you. Your insight and legal knowledge has been very helpful in running my business. I’ve run into a situation that I don’t recall having been addressed in your column before, but I know you’ll have the answer.

I’ve had a signed contract and have made placements with a firm since 2006. I have not made any placements with them for the last few years due to the economy, ever-changing HR personnel and hiring managers, etc.  However, I have always stayed in touch with them throughout these years and sent them candidates for positions that never went anywhere.

A couple years ago, this firm was bought by another firm, but remains a separate entity in name.

About six months ago, I started working very closely with two new HR people and several hiring managers in different locations. I sent them resumes, they interviewed my candidates, etc. etc. During this process, I was informed by one of the HR contacts that the new company had implemented a new HR system that requires all recruiting vendors to use this system for applicant tracking and client management. I was emailed an RFI to complete and return. The RFI was made up of questions only related to my company’s ethics program. Did I have a formal ethics program? Did we do an ethics audit once a year? Did we regularly train our employees on ethics issues. etc. I am a sole proprietor and do not have a formal ethics program, so I had to answer each of these questions “no.” However I added an addendum stating how long I had worked with the company, the names of the employees I placed with them, the hiring managers I worked with closely, and offered additional references.

I received a call from my HR contact and was told that they could no longer work with me because I was determined to be “adverse.” I asked what that meant and the HR person told me she was only the messenger and did not have any further information. I asked for the name of the person in compliance that made this decision and she wouldn’t give it to me. I told her I had an existing contract and reminded her that the firm has continued to accept and interview candidates from me. I told her my reputation was on the line and that it was very important to me to be able to discuss this further. She said she’d do what she could and call me back. She did call me back and said she was told by compliance that even if I talked to them directly, I would get the same answer. This time the HR person used the words “background check.” Well at that point I could hardly talk because I know for a fact that I have a completely clean background whether it be credit, criminal, or otherwise. She also said that the contract I had with them originally was no longer valid because the new firm was using this new system. I proceeded to tell her that the very last statement on the original contract is in regards to Termination Notice, and it states that either party can cancel the contract with prior written notice. I informed HR that I never received written notice.

At that point the HR person asked me to fax her a copy of the original contract and she would send it over to the compliance department. I did that, but have not heard anything back.

Jeff, can a company do this without informing me as to the reason WHY I have been found to be adverse? Although I don’t want to lose this company as a client, I am more concerned about my reputation. I have strong relationships with hiring managers in this company and I don’t know what I’ll have to tell them when they are ready to hire again. This could really damage my reputation. Also, if I knew for a fact that this was based on the RFI responses, I would research to see if there was some kind of ethics program for a sole proprietor, just so I could fulfill their requirements.

Please Help!

Mary