It was every family's nightmare. A thirty-two-year-old quadriplegic contracted for a home health care aide from Trusted Health Resources of Boston. Several months later, the patient and his seventy-seven-year-old grandmother were murdered by his home health aide, allegedly to cover up the fact that the aide had been stealing.
When certain facts came to light, this story became every employer's nightmare, too. The aide failed to answer a question about prior criminal records on his employment application, and Trusted Health did not follow up or perform a background check, which would have revealed six larceny-related convictions. A background check probably would have also shown that he had not attended nursing classes or previously worked for a state agency. The man's parents sued Trusted Health Resources, Inc. and others, alleging that they were negligent in allowing a convicted felon to care for their son. The jury agreed and awarded the family $26.5 million.
While workers in the construction industry may not require the same types of licensing as home health care workers-and case facts as terrible as these are unlikely-the legal concept is the same. In most cases, if your employee harms someone while working, you can be held liable, even if it is a simple accident. Facts like the ones in this Massachusetts case-where a company knew or had a reason to know that its employee could create a risk of harm to others-constitutes a "negligent hiring." Lack of proper oversight makes the stakes much higher.
Since the main issue in lawsuits of this type is the claim that negligence by the employer that resulted in harm, the courts will look carefully at the company's policies and practices to see if they were as thorough and comprehensive as possible when it came to screening out unsafe or inadequately trained employees.
Incidents and Accidents
It is important to understand that employee behavior need not be as egregious as criminal assault for the employer to be considered liable. There are many types of incidents that put another in a difficult or dangerous situation, such as unsafe actions at the jobsite. An employee with a history of putting others at risk also puts his or her employer at risk, especially if a pattern of such behavior could have been uncovered ahead of time. While workers' compensation laws generally limit the financial exposure of the employer, there is a generally available theory of "gross negligence" that could enable someone to get around the normal limits in some cases. Also, employers can be held liable for accidents, if they could or should have known that the employee had a history that may have led to the incident.
For example, several years ago, a young mother in New Jersey was taking her infant son out for a walk in a stroller, accompanied by her father. Walking along the shoulder of the road, both mother and son were hit by a hospital van transporting patients. The baby died and the mother suffered brain injury. As it turned out, the driver allegedly had several moving violations and did not have a commercial driver's license. The woman's husband and father sued the hospital, claiming that the hospital was negligent in hiring, training, monitoring and retaining the driver-basically that the hospital could and should have known that the driver was unfit. The hospital ended up settling the case for $16 million.
Setting Standards and Policies
The best way for companies to avoid or defend negligent hiring lawsuits is to set-and follow-a reasonable and consistent hiring policy that includes researching each prospective employee. It is important to remember that, in most cases, employers are responsible for information they could easily have known. The employment process should include a written application, reference checks, background checks and at least a minimal investigation of an applicant's criminal record.
Review the Employment Application
Require a written application and make sure it is filled out entirely. Ask and clarify any unanswered questions and gaps in employment or education. Confirm that all licenses claimed have been received and are in good standing. Lack of a reasonable explanation should be treated, at least, as a meaningful red flag. Be sure that the application states that the falsification of information could result in termination whenever such information comes to light.
Check References
Make sure prospective employees provide references, and make sure to check them. It probably makes sense to reject an applicant who cannot provide references that can be checked. At minimum, verify previous employment. You may wish to have the applicant sign a release permitting prior employers to provide relevant information since such a release could result in more information being received than merely dates of employment.
Document Everything
All reference or background checks should be maintained in the employee's file. Even unsuccessful attempts to verify should be documented. Remember, in many negligent hiring lawsuits, the standard is what the employer should have known if he/she had made a reasonable effort. Being able to prove that your reasonable efforts did not turn up certain information may make all the difference.
Consistent Policies for Potential Employee Impairment
Zero tolerance for drug, alcohol and prescription medication abuse must be spelled out, and employees should be regularly reminded of the policies and drug tested as permitted by law.
Ongoing Review and Training
Meet with employees on an ongoing basis to make sure they have read and understand company policies. This is also a good time to verify that employees have an appropriate and current license for job duties that require licensing, such as commercial drivers. To the extent permitted by law, employers should also regularly check criminal records to make sure they are updated and on file.
Post-Incident Review and Training
Whenever employees are involved in an incident, conduct a formal review whether the employee was at fault or not. If necessary, consider additional training and possible disciplinary action following an incident.
Follow the Policy Every Time
It is one thing to conceive of hiring procedures and employment policies, but they must be followed, even when a position must be filled quickly. You will rue the day you made an exception "just this once" if it's this employee who takes advantage. Moreover, juries are even more likely to find against a company that did not even follow its own policies.
One fact that construction business owners sometimes forget to consider is that, in many instances, their employees may also be drivers. While he/she may or may not require commercial licenses, it is important for an owner to understand that he/she still may be liable for accidents caused by employees or contractors when behind the wheel. Just like in other areas of responsibility, employers can get in trouble if it turns out they knew-or should have known-that a driver should not have been behind the wheel. Any company whose employees drive company vehicles as part of their job should take additional steps to ensure that they do not knowingly hire and retain anyone with a spotty or questionable record behind the wheel. These steps should be spelled out clearly, documented carefully and strictly enforced in order to ward off potential claims for negligent hiring or retention.
In order to protect themselves from trouble that may be caused by employees while driving, employers should include on their applications a place to list all driving violations or accidents for the past five years. Also include a section authorizing the employer to obtain and review motor vehicle records on a regular basis. Be sure that every employee who will drive while working has signed the consent as a condition of employment. Employers should also contact state agencies about an employee's driving record for the three years and request annual driving records. Employers should also require every driver to prepare and furnish a list of all violations of motor vehicle traffic laws and ordinances during the past year.
Cases such as the murder above are unthinkable and horrific for all involved-and in rare cases, perhaps, they are unavoidable. More typical incidents and accidents can also be troublesome or even tragic. In many instances, such problems can be avoided with careful employee screening and ongoing training and management. Other times, there is simply no way an employer could have known or anticipated an issue. Nevertheless, good policies should at least protect employers from facing severe liability through the concept of negligent hiring and/or retention.
Construction Business Owner, March 2009
