The screening process: how to avoid liability for 'negligent hiring'.

From the angry, dejected factory worker to the disgruntled, gun-toting day trader, shocking headlines warn us of an increasing incidence of workplace violence. The untold story in these tragedies is the fallout facing those who employed the perpetrators--and who now may find themselves the target of negligent hiring lawsuits.

In legal terms, "negligent hiring" occurs when a reasonable person, given the totality of circumstances, failed to adequately investigate a prospective employee's propensity for violence.

How extensive a pre-employment investigation should be often depends on whether the position involves significant contact with customers, members of the public or other employees.

Thus, an employer was held liable when a truck driver with two prior rape convictions sexually assaulted a hitch-hiker because the employer should have known that truckers are likely to pick up hitchhikers.

If you're responsible for screening job applicants and making hiring decisions at your workplace, what can you do to reduce the chances of a negligent hiring lawsuit?

Conducting careful reference and background checks of potential employees, and reviewing any information learned through the investigation in light of the position, is essential. But you must walk a fine line between seeking legitimate information about an applicant and violating that applicant's right to privacy.

Under Michigan law, an employer is immune from civil liability when, in good faith, he or she discloses information about an employee's work performance that's documented in the individual's personnel file.

Nevertheless, many employers are hesitant to disclose information without additional protections. So, as a first step, it's a good idea to require applicants to sign a release authorizing you to collect lawful information and authorizing their current and former employers to disclose all requested information. Employers and former employers are much more likely to provide requested information when presented with a signed release.

Like almost everything else today, the task of screening potential employees is made much easier with the help of the Internet. The Web gives employers a wealth of resources for verifying basic information about applicants, and a number of online employee screening agencies offer a variety of background and reference-related services. The cost of these services depends on the complexity of the assignment, but generally ranges from $5 to $20 for basic information and $50 to 350 more for comprehensive searches.

To check out online services, enter "employee screening" in one of the major search engines. Or, to verify basic information about an applicant, try www.anywho.com.

Payroll expenses

Three simple tips from the American Payroll Association to keep your payroll costs in check.

1. Do it right the first time--Processing your payroll accurately can help your business avoid costly non-compliance fines that quickly eat into profits. Even if you outsource the payroll function, your firm should keep current on local, state and national payroll regulations.

2. Maximize technology--Many payroll technologies can run a variety of reports revealing who's working the most overtime and when. If you outsource your payroll function, work with your vendor to help identify workload peaks and valleys. This information can help you better manage your employees and your business.

3. Use direct deposit--Chances are your company pays processing fees for every check it writes. While these costs may be small, over time they do add up. Encouraging your employees to use direct deposit can result in real and immediate savings for your business.

Tips for your HR department

* Your application form should ask: 1. "Have you ever been convicted of a crime? Explain fully." 2. "Do you currently have any felony charges pending against you? Explain fully." You may not ask about arrests that did not result in a conviction.

* The application form should also include: a request for the names of all prior and current employers; a list of positions held; names of supervisors; dates of employment and reasons for leaving; and a statement that the applicant understands that if false or incomplete information is given, the applicant will not be hired or retained.

* A release form authorizing you to obtain information from prior and current employers, and authorizing them to disclose information, should be attached to your application. You should also attach the appropriate form for a criminal record check, if you require this background screening.

* In most cases, require a completed application form instead of a resume. If both are submitted, look for any inconsistencies between them, or listen for any inconsistent responses during a job interview.

* Always check the applicant's employment and personal references.

Source: Miller, Canfield, Paddock and Stone PLC.

For more details about efficient payroll practices, visit the American Payroll Association at www.americanpayroll.org.

Online HR resources

www.about.allbusiness.com--Click on "Employment and HR" and be sure to note the section that lists several standard forms you can download and use in your own business,

www.all-biz.com--Click on "Human Resources" for links to informative articles on a variety of HR issues.

www.businessnation.com--Click on "Employment," then click on "Human Resources." Lots of helpful HR links--but you need to navigate your way through a slew of topics.

www.hrtools.com--Includes template for employee policy handbooks and other HR information. Registration required, but it's free,

www.ideacafe.com--Under "Running Your Biz," click on "HR" for HR tips plus a neat "CyberSchmooze" section for sharing your HR ideas and challenges.

www.miningco.com--Click on "Small Business," then click on "Human Resources." Includes online discussion rooms where you can swap ideas and information.

www.paychex.com--Click on "Managing Your Employees" for articles and tips on employee benefits plus HR tools.

www.timekeepinglinks.com--A full directory of timekeeping/attendance-related software vendors, links to Websites and links to e-mail addresses for information.

www.worldatwork.org--World at Work (formerly American Compensation Association) Website with lots of news and tips for your HR department.

www.compensationlink.com--Access to comprehensive, current information on pay program design and administration.

www.salaryexpert.com--Salary information by job title, ZIP code or metropolitan area.

Jennifer Walker is an associate in the Labor and Employment Department at the Detroit-based law firm Miller, Canfield, Paddock and Stone PLC.