What you may not have heard is that the search firm responsible for finding Haywood, Parker Executive Search of Atlanta, GA, has accepted responsibility for the recommendation for Pitt to hire Haywood.

Parker Executive Search is a global retained executive search firm that works primarily with intercollegiate athletics programs, leading colleges and universities, Fortune 500 corporations, privately held startups, and non-profit organizations.

Background checks and numerous interviews were conducted before Pitt settled on Haywood. Dan Parker, President of Parker Executive Search, said that he “went back through the checklist and found there wasn’t anything different we could have done on (Pitt’s) behalf…It was one moment in a person’s life, nothing historical we found that indicated this would occur.”

So as recruiters, where do your responsibilities end and the employer’s (and in this case, the employee’s) begin? When do you stop being responsible for the actions of your candidates? If you offer your clients X-day guarantees of service, then obviously your responsibility ends after that guarantee expires. But what about in this case, or in any case of unprecedented criminal activity?

There are three obvious participants who could have prevented this bad hire:

1. The recruiter: Parker Executive Search was ultimately responsible for the recommendation. But they appear to have been extremely thorough with their background investigations into Haywood prior to making that recommendation.
2. The client (Pitt): According to the article, Pitt’s athletic director, Steve Pederson, did indeed do his own background checking on Haywood. They supplemented their search partner’s efforts with their own to make sure they were making the right decision.
3. The candidate: Did he have a history of violence? None of the background checks seemed to indicate so. It was most likely an isolated incident. Therefore, he would have had no cause to disclose any prior altercations.

Recruiters, I do not know the answer to this one. What are your thoughts? Should Parker Executive Search take the blame for this one? Or should Pitt? And what about Haywood’s part in all this? Share your thoughts below.

Incidentally, Pitt  decided to use Parker’s company to assist them in finding Haywood’s replacement (who ended up being former Tulsa head coach, Todd Graham), indicating that a valued and trusting relationship exists between them.

Kaplan Higher Education Corp. was sued last Tuesday by the Equal Employment Opportunity Commission over its use of credit checks. The suit claims Kaplan denied jobs based on credit histories in such a way that it had a disparate impact on blacks.

The EEOC said Kaplan “engaged in a pattern or practice of unlawful discrimination by refusing to hire a class of black job applicants nationwide.”

“This practice has an unlawful discriminatory impact because of race and is neither job-related nor justified by business necessity.” The types of jobs at issue weren’t disclosed.

A company spokeswoman denied the charge saying background checks are conducted on all potential employees. Credit checks are part of the screening for jobs involving financial matters, including advising students on financial aid.

A “disparate impact” case doesn’t require an employer to have intentionally discriminated against a class of applicants. Instead, discrimination can occur by the use of background criteria, experience, education, or other job requirements that appear neutral on their face but which more heavily impact a protected class of applicant. Unless the employer can demonstrate a “business necessity” for the requirement, it may be found guilty of discriminating. Even where business necessity can be established, a violation may still be found if there is another alternative available that is less discriminatory.

Labor lawyers and industry experts have been predicting that the EEOC is becoming more aggressive. Employment attorney Jon Hyman, who blogs at Ohio Employer’s Law Blog, warned last month that “The EEOC is no longer an agency where charges go to die. Employers can expect more thorough investigations, quicker resolutions, and more aggressive enforcement.”

Nick Fishman, chief marketing officer, VP and co-founder of EmployeeScreenIQ, blogged about this same thing recently on ERE. In his look ahead at the background screening trends for 2011, Fishman listed the EEOC aggressiveness first, writing: “The EEOC is especially targeting ‘bright line’ hiring decisions that automatically exclude candidates with criminal records, arrest records that don’t result in a conviction, and/or poor credit.”

After reading about the Kaplan suit, I called Fishman to ask about the issue and for advice about what recruiters can do to insulate their company against EEOC action.

He wasn’t surprised that the EEOC had sued someone over the issue. “They’ve become a lot more active in the last year,” he said.”We’re going to see a lot more out of them.” And, he pointed out, there is no way to protect against someone filing a lawsuit. However, no employer should be deterred from credit or background checks where the job demands it and there’s no intent to discriminate.

Fishman offered this guidance:

• Assess the exposure the company has for each job.
• Make sure there is a legitimate business purpose to conduct a credit check. Do the job responsibilities involve financial records or access to them? For a CFO position, the connection is clear. For a janitorial job, maybe not. Though there might be situations where a janitor has access by virtue of a master key to money or records.
• Have a written background policy for each position, including a description of the business purpose.
• If adverse credit information turns up, don’t automatically reject the candidate. Instead, ask about it.

Through conversations with clients and others in the industry, he’s learned that employers these days are more sympathetic to credit problems. Even in the gaming industry, where many employees routinely deal with large amounts of cash, applicants with credit dings are getting more consideration than in the past, if for no other reason than credit problems are so pervasive.

Nevada, the gaming capital of the US, has the lowest average credit score in the nation. At 668, it’s 24 points below the national average of 692. No wonder, considering that Las Vegas has the highest foreclosure rates in the nation.

Two months ago, the EEOC held a public meeting on the use of credit histories as employment screening devices. It heard from a number of organizations including SHRM, which concluded its presentation saying, “SHRM has significant concerns with efforts to eliminate the ability of employers to consider relevant credit information during the employment process.”

Most of the speakers at the meeting represented private organizations and advocacy groups, however the comments by Richard Tonowski may foreshadow just what the EEOC wants to see from employers using credit checks and background screening generally. Tonowski, the EEOC’s chief psychologist, summarized the day’s proceedings listing four distinct reasons why employers use credit checks.

These are:

• To identify productive employees, a use he said that has “little evidence” to back it up;
• To identify reliable employees. Conceding there is “some evidence” correlating good credit with reliability, he said, “Similar results might be obtained through personality tests or their close cousins, integrity tests.” Interestingly, these, he noted, may soon be examined by the EEOC for having a potential adverse impact on protected classes;
• To confirm employment history, which, though “a credit report can confirm basic information” the same  “might be obtained from background screening providers without the applicant’s financial details”;
• To identify those with incentive for major fraud or theft.

When used to identify potentially dishonest employees, Tonowski said, “This is perhaps the most problematic use, because — fortunately — serious crime is likely a rare event for most employers. It is thus hard to establish a predictive relationship between credit and crime.”

While hearing from the EEOC is enough to cause any HR professional to shudder, even if it decides not to proceed, private actions may be allowed. Two weeks ago the University of Miami was sued over the denial of a job to a black applicant because of a credit check.

2. Negligent Hiring

Employers are now being constantly sued for negligent hiring. This means the act of hiring an unfit employee, who then proximately (directly) injures another, will render the employer liable. As with misrepresentation, the issue becomes whether the employer “knew or should have known” about the dangerous propensities of the candidate.

This isn’t vicarious liability — it’s direct. And yours is too. The victim can name you for your negligent “consulting.” In some states he must — you’re an “indispensable party.” The employer won’t forget it paid your five-figure fee either.

Liability for “negligent hiring” encompasses everything you can imagine (and many things you can’t). Statistically 80% of all resumes contain some false information. That means just by using them you’re exposed. All the victim has to show is that if something falsified had been checked, the injury wouldn’t have occurred.

Let’s say there’s a gap in the candidate’s employment between 1986 and 1987, and his resume doesn’t show it. During that time, he was arrested for drunk and disorderly conduct, and drying out from a chronic alcohol problem. Then he was hired by a source company, you recruited him away, and placed him with your “client.” You checked references by phone, but didn’t pick up the discrepancy. He joined the company bowling team, and after six months began drinking again. One night after a game, he became unruly and punched another employee in the nose without provocation.

Under the negligent hiring theory, a court could easily find the failure to pick up the drinking problem directly caused the injury: The victim’s lawyer would argue that you had a duty to “screen properly,” verify references in writing, then cross-check them for accuracy.

Maybe not a duty to engage an investigation service, check the criminal records or check the civil filings — yet.

Is the employer liable? Probably. You’re jointly and severally liable, though. You can point your fingers at each other from gavel to gavel, but you’re both on the hook. Only fate has kept recruiters out of the “third-party liability” area, since no major cases involving recruiters have been litigated — yet.

Consider the Missouri case of a male employee at Monsanto who had access to addresses of coworkers. He was infatuated with a female secretary and followed her home one evening. Then he killed her and was convicted of murder. Her parents sued Monsanto. The Missouri Court of Appeals held the violent background of the employee was an issue, and that the jury could hear it to determine whether he should have been hired into a position where he foreseeably could injure others. (Gaines v. Monsanto Co., 655 S.W.2d 568)

Coworkers aren’t the only people who win lawsuits like this. Customers are “customarily” injured by employees through fraud, embezzlement, defamation, (libel and slander), intentional infliction of emotional distress, assault and battery, false imprisonment, invasion of privacy, and even usual negligence and breach of contract. There’s exposure to you in every placement.

This might cause you to “fireproof” your ads, brochures, fee schedules and other written PR items. They often contain flammable words (“highly qualified,” “thoroughly screened,” “carefully checked,” “guaranteed,” etc.).

The first smoke signal will have you ready to evacuate.

3. Strict Liability

We’re starting to see cases move toward a strict liability approach to hiring. Strict liability short-circuits all the common law rules and says simply: If you hire someone and they injure someone else during any activity connected with the job, you’re liable. If you recruit someone for a “client,” the same rule applies.

These cases are pending at the trial level. All it will take is one to be lost and affirmed on appeal for a fireball to start rolling downhill.

The “strict liability” concept is applied when your dog bites someone, or if you manufacture a defective product that injures someone. A few limitations on the ambit of liability exist, but they’re not anything definite enough to save your insurance premiums. The fact is people who injure other people usually have a history of some similar act. We’re all remarkably predictable.

We also blaze a trail behind us from our first cry. As Irwin Blye and Ardy Freidberg observed in Secrets of a Private Eye:

Information from government agencies, insurance companies, loan companies, even banks, is accessible legally and without misrepresentation. You just have to know how to do it. The jargon and turns of a phrase that are peculiar to certain fields are the keys to this information kingdom.

. . . While you ponder the enormity of the fact that all this information is available to you, let me add that computerization has made access to this information faster and more complete than ever before . . . [C]onsider that intimate details of your life exist on whirring computer tapes and that those tapes often spill their proverbial guts when the right button is pushed.

I hope you’ve taken steps to fireproof your business. Headhunter’s forest is becoming a dangerous place for the unprotected.

This article is for informational purposes only. Please consult your attorney for specific legal advice.

3. Intentional Infliction of Emotional Distress

No negligence here — you have to show the conduct was intentional — “outrageous.” In fact, some states call the tort outrage.

It’s not difficult for courts to find this in the supervisor-subordinate relationship. Men brutalizing women, whites enslaving blacks, and survival of the fittest as the law of the jungle.

The Restatement of Torts is the model for legal analysis in this area. Its official comments specifically note that abusive conduct by supervisors is likely to be considered “outrageous.” In such cases, the resulting distress may be inferred. [Rest. of Torts 2d 46(e),(f),(j)]

Liability for recruiters is vicarious (indirect) here, unless it can be tied to misrepresentation or conspiracy (Item 1).

The candidate is placed, then the employer springs a lie-detector test, for example.

It’s a good example, too. A pharmacy employee who refused a polygraph pursuant to a Maryland statute was fired. The jury returned a $1.3 million verdict ($1 million in punitives) and the Court of Special Appeals affirmed. (Moniodis v. Cook, 64Md.App. 1, 494 A.2d 212 cert den. 304 Md. 631, 500 A.2d 649, 1IER 441).

And what about a candidate who consents to a lie-detector then suffers nightmares 16 months later? In Minnesota, a jury said it was worth almost $l00,000. The Court of Appeals agreed. (Kamrath v. Suburban Nat’l Bank, 363 N.W.2d 108).

Signed releases don’t help here either, because the “consent” is really not consent to the test — it’s consent to keeping the job. The Pennsylvania Superior Court decided that one. (Liebowitz v. H.A. Winston Co., 342 Pa.Super. 456, 493 A.2d 111).

We’re getting close to the day when referring a candidate to a job for which he is unqualified may also be deemed “outrageous.” A union in California referred a member to less desirable jobs because its officials disagreed with him on policy matters. The jury awarded him $182,500 (including $l75,000 punitives), and the case shot up to the U.S. Supreme Court on procedural grounds. The Supremes said the outrageous conduct was of such substantial and enduring quality that “no reasonable man in a civilized society should be expected to endure it.” (Farmer v. United Bhd. Of Carpenters, 430 U.S. 290, 94 LRRM 2759).

4. Assault and Battery

Battery is the intentional contact with another’s body without his consent. Assault is intentionally placing another in apprehension (fear) of the contact by some overt act. Merely using threatening words is insufficient to constitute an assault; they help, but there must be some threatening physical movement.

The three major areas of concern are drug testing, polygraph testing, and sexual harassment.

In the drug and polygraph testing areas, the arguments are usually that needles, probes, wires, pressure cuffs, suction cups, electronic contraptions, or other instruments caused the employee fear (assault), and that the actual contact with him was without his consent (battery). The “harmful” requirement (necessary in some states) is easily satisfied by the fact that shots are painful, EKGs use electrical current, etc.

A Texas case concerning two employees who sued their employer for requiring blood and urine specimens for drug testing could have easily resulted in “affirmation” by the U.S. Court of Appeals. The court ruled that since they were union employees, the grievance procedure had to be used instead of the court system. Next time, the employer and recruiter might not be so fortunate. (Strachan v. Union Oil Co., 768 F.2d 703, 1 EIR 1844).

As mentioned with regard to reference checking (Item 2), “releases” by employees are often considered insufficient to prove consent: You can’t consent if you don’t have a choice.

A polygraph case involving this issue arose recently in Pennsylvania. There, the U.S. Court of Appeals found that a bus company employee (also in a union, incidentally) presented a “triable issue of the fact” as to whether the release was valid. If it wasn’t (and therefore no consent existed), an action for assault and battery was proper. (Smith v. Greyhound Lines, Inc., 614 F.Supp. 558 aff’d. 800 F.2d 1139).

You can readily see how sexual harassment fits right into the traditional common law assault and battery theories. Almost anything qualifies if the employee is offended and touched.

One of the examples of the games supervisors play resulted in the Georgia Court of Appeals decision in Newsome v. Cooper-Wiss, Inc., 179 Ga.App. 670, 347 S.E.2d 619. A secretary alleged her male boss made lewd comments to her and “made a practice of touching her and rubbing up against her in the office.” She complained to the personnel manager and was fired within a month. Since the harasser wasn’t fired, the court found that the employer ratified (impliedly accepted) the supervisor’s conduct.

The employer was therefore held liable.

Of course, supervisors can get a lot more physical than just touching and rubbing, sexually or otherwise. The recruiter who places a candidate in something other than a professional wrestling job could easily be in the ring of fire with the employer.

5. False Imprisonment

This strange-sounding civil wrong simply means the intentional restraint of someone against his will. Since most employees feel “restrained” just because they’re working instead of playing, you can see the possibilities here.

Detaining employees for questioning (even about job-related incidents) is the most common area of liability. However, requiring that they remain for testing, remain at company softball games, and even remain in the supervisor’s office while he insults them will qualify.

It’s one of those offenses that’s regularly included in pleadings as a “catch all” if one of the other theories can’t be proven.

Some very bizarre uses of ropes, swings, pulleys, chains, knives, swords and guns can be found in your state’s casebooks. They make great adult bedside reading.

You’ll be up a lot at night if false imprisonment (through conspiracy) is alleged against you. There’s open-ended liability when a candidate becomes a victim, even if he’s not placed.

6. Invasion of Privacy

A candidate can be “over-interviewed” or an employee can be “over-investigated.” Invasion of privacy is vaguely defined as “intentional interference with the right to be let alone.”

Recent cases have been decided in Texas about searching employees’ lockers (K-Mart Corp. v. Trotti, 677 S.W. 2d 632); California about searching employees’ desks (O’Connor v. Ortega, l07 S.Ct. 1492, 1 EIR 617); and Pennsylvania about opening employee’s private mail (Vernors v. Young, 539 F.2d 966).

Since privacy is a constitutional right, you may find yourself defending the employer’s actions in Washington, D.C. before the U.S. Supreme Court. For more information on this expanding area see Chapter 52 in Placement Management entitled “A Candidate’s Right to Privacy.” (Search Research Report No.)

Consider your liability for “cold calling” recruits at work if it jeopardizes their job (or worse).

7. Inducing Breach of Contract, Interference with Contractual Relations and Interference with Prospective Economic Advantage

Any time a candidate is motivated to leave his job, inducing breach of contract can be alleged against you. It makes no difference whatsoever that there’s no written employment agreement. Interference with contractual relations, and subsequent interference with prospective economic advantage (even by a placement that doesn’t work out) also apply.

The Alabama Court of Appeals upheld a jury award of $120,0000 on “prospective” grounds (including fraud) when a recruiting employer told two candidates their non-compete agreements were “not worth a damn.” (Empiregas, Inc. v. Hardy, 487 So.2d 244 cert. den. 106 S.Ct. 1973).

I hope you’ve taken steps to fireproof your business.

Headhunter’s forest is becoming a dangerous place for the unprotected.

We’re not alarmists, just front-line firefighters. A little prevention now can keep you from being in a five-alarm fire dialing our hotline when it’s too late.

Editor’s note: Tomorrow we will go into the unknown territory of liability after the candidate is placed and injures someone else.

This article is for informational purposes only. Please consult your attorney for specific legal advice.

The company tried out a test: it requested a master’s degree in economics for its president and C.O.O., Jason B. Morris. In exchange for $75, they would send a “genuine” diploma. For an extra $75, the diploma mill would verify the degree by phone or email. EmployeeScreenIQ says it received the diploma within seven days; it featured raised seals and was printed on the type of paper one would expect for an academic degree. It had the proper dates and signatures and was ready to be framed.

For the full list (and it’s extensive, including such prestigious-sounding names as International Theological University – California; Northwest Florida
University; and Northern New England University), either click here to read the school names or download the entire free report at http://www.employeescreen.com/whitepapers_articles.asp.

While recruiters may have to adjust their strategies, there are still some basic components to successfully recruiting the right person:

• Look at the company first, then the candidates. Start each assignment by first looking at the company. What is the culture and the management style of the executive leadership team and the extended organization? Will potential candidates fit this culture? Should the company make adjustments to become more attractive to potential candidates? Why is there a vacancy to begin with? Did the former CEO or other executive step down to retire, or is there a deeper issue within the company that needs to be addressed before you will find the right person for the job?
• Don’t just focus on big accomplishments, focus on the person. Companies want a leader with honesty and integrity, one subordinates can look up to and respect. They want a person who promotes teamwork, collegiality, and fun. They also want executives who listen to and value input. As recruiters, we need to pay more attention to this, while still looking closely at the outstanding accomplishments on one’s resume. One top-level executive may be more qualified for a position in terms of industry knowledge and procedures, but if he or she is not able to garner the respect of those under him or her, the company as a whole will not be successful. What personal values will the potential executive bring to the work place? What has he or she done in past positions to foster teamwork and bring unity to a company?
• Beyond background checks and references. It’s time to become Matlock, in a sense. Recruiting at the executive level is a different ballgame than recruiting for the entry- or mid-level associate. These are top men and women, so it’s critical to only present the truly qualified as potential candidates. Companies rely on recruiters to find executive level talent to lead them into the future. Recruiters need to rely on more than background checks and references. Anyone a candidate lists as a reference is likely to have positive things to say about that person. Endeavor to speak with clients the executive has worked with in the past. Speak with co-workers where appropriate. Have the potential executive give specific examples or stories of how he or she made a difference and ask to speak with those people who were directly involved. Make your own list of people you want to talk with to find out more information about the potential candidate.
• Understand the needs of your client. Understanding the exact needs of the company is very important as a recruiter. Learn how the company operates, the types of people currently employed, what kind of decisions senior management made in the past, and how that played out across the company. Have a clear understanding of the goals to be achieved in the next year to three years. Being able to present as much information about the company you are recruiting for to the different candidates will help narrow the field that much quicker.

As the economy remains unstable, recruiters will encounter more challenges. The bottom line is companies still need leaders, and leaders still need opportunities to show what they can do. Regardless of economic conditions, there will always be a need for recruiting top-level talent.

As time goes on, it’s human nature to get comfortable with how we do things. Recruiting isn’t any different. Sometimes a refresher on some of the most basic steps is all that is needed to bring success back to your searches.