How to avoid legal pitfalls when hiring veterans

With the unemployment rate for the most recently returned group of veterans at 10 percent as of October 2013—higher than any other veteran group and the national unemployment rate of 7.3 percent, hiring initiatives, such as the White House’s Joining Forces campaign, hold great promise in transitioning veterans to the civilian workforce. The skill sets required for the rail and transportation industry are a very good match for many of the veterans.

In fact, out of the top 100 “military friendly” employers rated by a respected ratings organization, 11 are transportation companies.

Now is a critical time for businesses to hire veterans, but private employers need to consider both the legal benefits and challenges associated with hiring veterans.

 

THE BENEFITS

Employers benefit from hiring veterans in a number of ways, including tax credits.

President Obama’s 2011 Returning Heroes and Wounded Warrior Tax Credits allow businesses to receive $3,000 to $9,600 per veteran hire, depending on the veteran’s circumstances. Under the Returning Heroes Tax Credit, businesses receive a $2,400 per veteran tax credit for hiring veterans who have been unemployed between four weeks to six months and a $5,600 per veteran tax credit for veterans who have been unemployed for more than six months. The Wounded Warriors Tax Credit allows businesses to receive up to $9,600 per disabled veteran hired if the veteran was unemployed longer than six months and has a service-related injury.

While these tax credits were set to expire at the end of 2013, the proposed budget for the fiscal year 2014 attempts to create a permanent tax benefit for hiring veterans.

 

LEGAL PITFALLS TO AVOID

While employment laws provide some great incentives, private employers should beware of potential legal pitfalls in the hiring process, such as avoiding preferential treatment to veterans or averting discrimination claims based on disabilities and making reasonable accommodations.

Every business should recognize that private employers generally cannot show preference in the hiring of veterans per Title VII of the Civil Rights Act of 1964, 42 U.S.C. 2000e, which prohibits discrimination in employment decisions, including hiring, termination, compensation, promotion because of race, color, sex, national origin or religion. Specifically, preference to veterans is considered unlawfully discriminatory due to the potential disparate impact on female applicants.

This is a result of the long-standing federal statutes, regulations and policies that have excluded women or limited women’s eligibility to serve in the armed forces. Consequently, preference in hiring veterans tends to operate to the advantage of men.

There are exceptions to this rule. According to Section 712 of Title VII, “Nothing contained in [Title VII] shall be construed to repeal or modify any federal, state, territorial or local law creating special rights or preference for veterans.”

Therefore, if the right to veterans preference is created by a federal, state, territorial or local law—as in the states of Washington and Minnesota, private employers can show preference to veterans in their hiring upon meeting certain criteria.

Washington law provides the following:

(1) The legislature intends to establish a permissive preference in private employment for certain veterans. (2) In every private, nonpublic employment in this state, honorably discharged soldiers, sailors and marines who are veterans of any war of the United States, or of any military campaign for which a campaign ribbon has been awarded, and their widows or widowers, may be preferred for employment. Spouses of honorably discharged veterans who have a service connected permanent and total disability may also be preferred for employment. These preferences are not considered violations of any state or local equal employment opportunity law, including but not limited to any statute or regulation adopted under chapter 49.60 RCW (3) “Veteran” has the same meanings as defined in RCW 41.04.005 and 41.04.007, and includes a current member of the national guard or armed forces reserves who has been deployed to serve in an armed conflict.

Minnesota provides the following:

Subdivision 1. Preference permitted. A private, nonpublic employer may grant preference to a veteran in hiring and promotion.

Subdivision 2. Preference for spouse of disabled or deceased veteran; definition. A private, nonpublic employer may grant preference in hiring and promotion to a spouse of a disabled veteran who has a service-connected permanent and total disability and to a surviving spouse of a deceased veteran. “Disabled veteran” in this subdivision means a person who has had a compensable service-connected disability as adjudicated by the United States Veterans Administration or by the retirement board of one of the several branches of the armed forces.

Subdivision 3. Equal employment opportunity law. Granting preference under Subdivision 1 or 2 does not violate any local or state equal employment opportunity law, including, but not limited to, chapter 363A.

 

RECRUITMENT THROUGH SOCIAL MEDIA

Companies have long recruited employees through traditional channels, such as advertising in print and online, job fairs and through industry organizations. But with the social media explosion, employers have increasingly been turning to social media platforms to attract highly qualified veteran job applicants.

By utilizing Facebook, LinkedIn and other social media sites, employers make it significantly easier for applicants to find aggregated information about careers, employment opportunities and job fairs in one site. For many applicants, social media job posts are much more accessible and user-friendly than traditional recruiting channels.

While social media is gaining strength as a recruitment technique, employers should be cautious to avoid discrimination claims. Social media profiles, especially Facebook, often disclose personal information that a prospective employer should not consider in a hiring decision.

 

PERSONAL INFORMATION TO OVERLOOK

Not only do employers have to be mindful of the potential to uncover information protected under Title VII as mentioned earlier. Employers also must beware of the Age Discrimination in Employment Act (ADEA), Americans with Disabilities Act (ADA), Genetic Information Nondiscrimination Act (GINA) and statutes specified by particular state laws.

For example, a Facebook page may contain pictures or information about a candidate’s race, gender, religion, national origin or disability. If a potential candidate subscribes to an employer’s page by “liking” it, then the employer would have the ability to view that individual’s Facebook profile, including personal information that would otherwise be protected.

This could give rise to a “failure to hire claim” if the candidate could demonstrate that personal information on his or her Facebook page was a factor in the potential employer’s rejection of the candidate’s application.

Some social media platforms may create less of a risk than others. In particular, LinkedIn may contain less personal information. As LinkedIn is a professional social media site, most users only keep professional information on their profile and usually do not share personal information that is often found on Facebook and other social media sites. Information that an employer is not allowed to consider in a hiring decision, such as political views, country of nationality, expectancy of a child, medical history, arrest history and more, would unlikely be on a user’s LinkedIn page.

While LinkedIn profiles may show information such as race, gender or visible disabilities, the risk of a “failure to hire” claim is smaller because those are the same traits that would be visible to an employer at an interview or job fair prior to hiring decision.

Regardless of the type of social media platform used, one effective way to avoid social media-related “failure to hire” claims is to assign different individuals to manage the social media page from those making the hiring decisions. That way, those who are making hiring decisions do not have access to potentially protected information about applicants.

Additionally, when crafting the job description, employers should thoroughly describe the position and qualifications to avoid discrimination claims. Employers must comply with the ADA, which prohibits discrimination against individuals with disabilities, as well as GINA, which prevents employers from requiring genetic information about job applicants and employees or their family members at any time, including after a job has been offered.

The job description should explicitly note if a position calls for physical activities. Employers can ask about an applicant’s ability to perform specific job functions, qualifications and skills.

 

DISABILITIES AND THE APPLICATION PROCESS

In the application process, employers have an obligation to make reasonable accommodations to enable applicants with disabilities to apply for jobs and participate in the interview process. Furthermore, an employer must also be aware that if an individual with known physical or mental limitations is hired, the employer is required to provide reasonable accommodations to that employee as long as the individual is deemed qualified, with or without a reasonable accommodation, to perform the “essential functions” of the job.

An employer is not required to provide accommodations if it would create an undue hardship on the operation of the business due to significant difficulty or expense. Nor is an employer required to reassign essential job functions as a reasonable accommodation.

Once an employee has made a request for an accommodation, both the employee and the employer have a duty to engage in an interactive process in good faith.

As a result, employers may require medical information to substantiate the employee’s need for a reasonable accommodation. Due to prohibited use of medical information under GINA, it is recommended that if an employer lawfully needs to obtain medical records, the employer should include warning language to the employee on any release to assure that any genetic information that has been obtained in response to the request will be considered inadvertent.

Should a discrimination charge or action be made against an employer under Title VII, GINA, ADA or ADEA, the records should be preserved until the final disposition of the charge or action. State laws may also impose additional record retention requirements.

 

Maisha Shaw and Pamela Nehring are attorneys with Daley Mohan Groble, a law firm located in downtown Chicago (www.daleymohan.com). It primarily serves self-insured entities in the transportation industry, municipalities and other governmental agencies. While rooted in casualty defense trial work, the firm is nationally recognized for its employment and labor practice, and provides a range of sophisticated legal services, including environmental regulatory law and litigation, business litigation, corporate counseling and real estate law.

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