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Are You Discriminating Against Unemployed Workers?

Human Resources

One of the many tasks that small business owners must handle is the process of recruiting potential employees, interviewing them and then hiring those who are qualified. As an owner, you've no doubt experienced this firsthand, especially when your company was first getting underway. You probably put out job advertisements, answered phone calls from candidates and asked qualified ones to come into the office for an interview. After speaking with applicants face-to-face, you then determined which ones were the best fit and then extended an offer.

And this is just a general overview of the hiring process.

As your business continues to grow, you will need to bring on more staff members to help you expand operations, provide customer service and oversee various elements. While finding the right fit among a field of qualified potential workers is something you may be accustomed to, you also need to keep in mind that there are various laws and regulations pertaining to employment which you must follow. Failing to comply with applicable laws and regulations may result in costly fines, potential litigation or even a damaged reputation for your organization. So fully understanding these hiring regulations is vital.

For example, there are employment statutes at the local, state and federal level which prohibit employers from discriminating against individuals based on a variety of protected classes, including but not limited to race, religion, gender, age, nation origin, and disability. Perhaps one of the most recent protected classes which may be applicable to you, is job status.  Under these statutes, covered employers are prohibited from discriminating against an individual because he or she is currently unemployed.

Unemployed doesn't mean unemployable

As of right now, there is no federal law on the books that makes it illegal to discriminate in employment against an individual who does not hold a current job. However, efforts have been made on a national level to enact legislation of this type, The Hill reports. In 2011, as part of his administration's American Jobs Act, President Barack Obama included a bill, "Prohibition of Discrimination in Employment on the Basis of an Individual's Status as Unemployed," that would have made it illegal for companies to not hire someone based on his or her current lack of employment. The president's overall jobs bill did not garner enough votes in the Senate, and the American Jobs Act is now somewhat in limbo after President Obama said he would revise his proposed law. It is unclear whether that will include the unemployment discrimination bill.

On the other hand, as of this date three states and New York City have made it illegal for covered businesses to discriminate against an individual in their hiring based on the unemployed status of the job seeker. Specifically under the law passed in NYC, effective June 11, 2013, employment candidates are protected from this type of discrimination, and companies are not allowed to post job advertisements which state that current employment is required for the open position. Hiring managers are restricted from taking into consideration the job status of a candidate and must instead base their hiring decisions on other non-discriminatory factors.

Navigate hiring regulations with professional help

During the recent economic recession, many individuals were involuntarily laid off from their jobs. This may have been the main impetus for the unemployment discrimination clause in the American Jobs Act.

As a small business owner, you know your staff members serve a valuable role in your operations and you want to be sure you are bringing on the right candidates, whether they come straight to you from another organization or have been out of work for some time before you hire them. You also want to ensure that you remain compliant with all applicable regulations, including those laws which prohibit discrimination based on protected classes in the hiring process. Paychex can assist you in your efforts to effectively navigate these laws and potentially avoid costly and damaging violations and/or litigation while you find the right employees for your business.

This website contains articles posted for informational and educational value. Paychex is not responsible for information contained within any of these materials. Any opinions expressed within materials are not necessarily the opinion of, or supported by, Paychex. The information in these materials should not be considered legal or accounting advice, and it should not substitute for legal, accounting, and other professional advice where the facts and circumstances warrant.