An emerging line of research documents the widespread use of criminal record checks among US employers (Stoll and Bushway Reference Stoll and Bushway2008; Uggen et al. Reference Uggen, Vuolo, Lageson, Ruhland and Whitham2014; Jacobs Reference Jacobs2015). Scholars often point to fear of liability as an important factor motivating this increased demand for criminal record information (Agan Reference Agan2017; Bushway and Kalra Reference Bushway and Kalra2021). In particular, employers’ concerns are thought to center on the negligent hiring cause of action, which imposes liability in situations where an employee harms a third party and the employer knew, or should have known, of the employee’s dangerous propensities (Hickox Reference Hickox2011). While negligent hiring doctrine provides a potentially powerful explanation for the broad appeal of criminal record checks, we know little about how employers understand the threat of negligent hiring or how they envision the role of criminal record checks in managing this risk.
Drawing from neo-institutionalist theory on organizations and their legal environments, this article begins to fill this gap by examining how negligent hiring doctrine and the best practices for managing it are portrayed within the human resources (HR) field—the branch of the management profession that is most directly occupied with organizations’ hiring practices. For neo-institutionalists, “the law” as it is articulated by formal legal institutions often differs in substantial ways from the law as it is understood and acted upon by organizations. These emergent legal meanings are produced as organizational actors interpret law and devise compliance structures that align with managerial logics and suit particular organizational interests (Kelly Reference Kelly2003; Talesh Reference Talesh2015; Edelman Reference Edelman2016). Accordingly, to identify potential divergences in the area of negligent hiring liability, this article reviews the key elements of negligent hiring doctrine as they are articulated by state appellate courts and then uses a qualitative content analysis of trade literature articles to examine the dominant representations of negligent hiring liability that are expressed within the discourse of the HR field.
The article finds that the trade discourse and the courts diverge substantially in their stated visions for the role that criminal record checks should play in shielding organizations from negligent hiring liability. While employers have broad legal latitude to perform criminal record checks at their discretion, courts emphasize that these checks are unnecessary for occupations that do not carry a foreseeable risk of harm to third parties. Some courts go even farther, warning against the excessive use of criminal record checks on public policy grounds, in light of their potential for perpetuating the social exclusion of ex-offenders. Thus, among the legally available options that employers may utilize to screen potential hires, the negligent hiring case law situates criminal record checks as a step that employers should use judiciously and as foreseeable risk dictates. The HR trade discourse inverts this position, framing criminal record checks as the default practice for screening prospective hires irrespective of occupation-specific criminal risks.
The article argues that this divergence between judicial opinions and the HR trade literature results from a situation of structured uncertainty—a feature of the legal environment in which law is incapable of defining specific compliance practices in advance, leaving organizations unclear about which steps are necessary to avoid legal sanctions. This uncertainty is structural in the sense that it does not result from ambiguity in the legal text; to the contrary, negligent hiring decisions express a high degree of clarity by maintaining that employers are not legally required to conduct criminal record checks, and the accumulated case law rejects the notion that these checks should serve as employers’ primary screening method to avoid liability. However, these clear indications from the courts are not sufficient to diminish the uncertainty facing employers, who still must contend with the possibility that the failure to check criminal records may expose their organization to legal risk. This irreducible uncertainty stems from the basic structure of negligent hiring as a common law tort, where law does not mandate employers to use any specific compliance procedure to fulfill the standard of “reasonable care.” Instead, the necessity of a procedure, such as a criminal record check, is adjudicated after the fact on a case-by-case basis. In this way, employers lack prescriptive guidance on which methods will protect them from liability, and the body of case law that indicates that criminal record checks often are unnecessary is not sufficient to eliminate this uncertainty.
In this situation, best practices for compliance under negligent hiring doctrine have come to be defined within the HR trade discourse itself. In the process, the trade discourse has come to settle on criminal record checks as the default response to the uncertainties of negligent hiring litigation. This paradoxical outcome—that the HR field has selected and institutionalized the very compliance practice that courts view as often unnecessary—stems in turn from the alignment of two factors. First, because the costs of performing basic criminal record checks are low, employers can afford to adopt an overbroad reliance on this screening method. This positioning of criminal record checks as the default liability management practice has been actively promoted in the trade literature by commercial information vendors, “interested actors” (Kelly Reference Kelly2003) who sell background-screening services to organizations and frame criminal record checks as being too cheap not to use. Second, alternatives to criminal record checks are viewed as increasingly impractical in light of other developments in employers’ legal environments and their amplification in the trade literature. Reference checks, the most plausible alternative, are thought to be harder to obtain due to widespread concerns about defamation suits. Taken together, the result is that the HR field has come to endorse criminal background screening as a method of risk management that is both strictly compatible with law and, at the same time, substantively at odds with the courts’ stated vision for compliance.
The article extends neo-institutionalist theory on organizations and their legal environments by specifying a novel source of legal uncertainty and tracing its reverberations within the discourse of compliance professionals. As a common law tort doctrine, negligent hiring differs from the cases typically used in neo-institutionalist scholarship, where ambiguity has been examined largely as a property of legal text—principally, as it is found in statutory law (Edelman Reference Edelman2016). In the canonical model, ambiguous legal text prompts organizations to devise novel compliance structures when they lack clear definitions of what they should or should not do to avoid legal sanctions (Edelman Reference Edelman2016). In principle, this type of ambiguity could be reduced through more explicit definitions of compliance within the legal text itself (Edelman Reference Edelman1992, 1532). By contrast, no such resolution to uncertainty regarding negligent hiring is available within judicial opinions—the relevant textual source for this common law cause of action. Accumulated case law may show clearly that criminal record checks are not required and often are unnecessary, but the risk of failing to check remains irreducible as long as the definition of compliance rests with the ad hoc determinations of fact-finders at trial. The article thus argues that uncertainty can present itself to organizations as a structural feature of the legal environment that overrides law’s textual clarity in shaping organizational behavior.
Criminal record checks among US employers
While longitudinal studies are not available to track growth over time, evidence from existing cross-sectional research indicates that criminal record checks have become increasingly common among US employers. Based on data collected in select cities between 1992 and 1994, Harry Holzer, Steven Raphael, and Michael Stoll (Reference Holzer, Raphael, Stoll, Pattillo, Weiman and Western2004) found that 32 percent of firms always checked applicants’ criminal records for entry-level positions, while 17 percent indicated that they sometimes checked. Using a 2001 survey of firms in the Los Angeles area, Michael Stoll and Shawn Bushway (Reference Stoll and Bushway2008) reported that 45 percent of employers always ran criminal record checks and that another 18 percent did so occasionally. Based on a 2003 survey of California establishments, Raphael (Reference Raphael2010) found that nearly 60 percent of employers always check criminal records for non-professional, non-managerial jobs, while Christopher Uggen and colleagues (Reference Uggen, Vuolo, Lageson, Ruhland and Whitham2014) found that two-thirds of hiring managers reported running checks for entry-level positions in fieldwork conducted between 2007 and 2008. Likewise, a 2012 survey by the Society for Human Resource Management (SHRM) (2012) reported that 69 percent of respondent firms conduct checks for “all of their job candidates,” while another 18 percent do so for select positions.
Social scientists frequently nominate negligent hiring as a key concern that leads employers to check criminal records (Finlay Reference Finlay and David2009; Agan Reference Agan2017; Bushway and Kalra Reference Bushway and Kalra2021), although this rationale has not been subject to extensive empirical investigation. Sarah Lageson, Mike Vuolo, and Christopher Uggen’s (Reference Lageson, Vuolo and Uggen2015) research on managerial assessments of criminal records is an exception, finding that employers mention liability as a salient factor alongside concerns about safety and applicant honesty. As one respondent in their study observed,
certainly in the world of HR, negligent hiring and negligent retention certainly weighs heavily on our minds. We live in a very litigious society and I know that if I were to hire a committed sex offender, for example, and he were to be found lurking in the [pool] where we have children, I’d be in big, big trouble. I mean above and beyond personally I couldn’t do that, but professionally it could be very difficult for the company. (190)
Based on fieldwork conducted in 2001, Devah Pager (Reference Pager2007, 131) suggests that concerns about negligent hiring may be concentrated among large highly bureaucratic firms with sizeable HR departments. Most smaller firms in the sample did not express concerns about negligent hiring, and many appeared to be unfamiliar with the doctrine. At the same time, Pager (Reference Pager2007, 131) was careful to point out that negligent hiring was likely to become a more widespread concern over time, and more recent evidence appears to confirm this prediction. For example, in 2012, the SHRM (2012) found that avoiding legal liability for negligent hiring was the main reason (52 percent) employers gave for conducting criminal record checks, while “ensuring a safe work environment” was chosen by 49 percent of respondents.
US employers can access criminal records using a variety of methods. Over the past several decades, states have enacted a range of laws that require or authorize criminal record checks for many occupations (McElhattan Reference McElhattan2018, Reference McElhattan2021). These checks draw from official criminal history records, known as rap sheets, that are maintained by state-level repositories and linked nationally through the Federal Bureau of Investigation’s (FBI) Interstate Identification Index. Presently, no nationwide accounting exists of the proportion of employers who are under a legal mandate for their prospective hires to undergo a criminal record check. However, based on their 2001 survey of firms in the Los Angeles area, Stoll and Bushway (Reference Stoll and Bushway2008) found that approximately 20 percent of employers report that they are covered by such a requirement. Similarly, the 2012 SHRM survey of employer screening practices found that 28 percent of employers reported checking in order to comply with applicable state mandates (SHRM 2012).
The present study focuses instead on employers who do not have—and do not perceive—a legal requirement or authorization to request an official rap sheet check, yet remain legally permitted to check criminal records using alternative means. Among these employers, the most common approach is to use the services of a commercial information vendor, which compiles publicly available criminal record information and sells it in the form of a background check report. Court records, which are presumptively public in the United States, serve as the main source of the criminal record information sold by commercial vendors (Search 2005). As courts increasingly digitize their records, commercial vendors have amassed large proprietary databases by downloading records in bulk from court sources.
The cost of vendor services varies by the method used to obtain the criminal record information. Based on a random sample of fifty firms that provide criminal record checks, Bushway and colleagues (Reference Bushway, Briggs, Taxman, Thanner, Van Brakle, Stoll, Bushway and Weiman2007) found that the cost of a single-county search ranged between $13.50 and $50, with a mean of $24. Database queries can be accomplished cheaply and quickly, with some firms claiming to provide results in as little as one day (Bushway et al. Reference Bushway, Briggs, Taxman, Thanner, Van Brakle, Stoll, Bushway and Weiman2007). Runner services, which obtain records directly from courthouses in the counties where background check subjects have lived, are more time consuming but potentially more accurate than database searches. Runner services also tend to be more expensive, costing an average of $27 for a single-county search, compared to an average of $19 for a digital search (Bushway et al. Reference Bushway, Briggs, Taxman, Thanner, Van Brakle, Stoll, Bushway and Weiman2007; see also Search 2005).
Information vendors range from small local operations to national firms that count many blue-chip corporations as their clients (Search 2005). US Investigation Services (USIS)/HireRight, one of the largest firms, claimed to provide screening for twenty-seven thousand businesses in 2008—among them, 21 percent of Fortune 500 companies; First Advantage, another large firm, claims to conduct nine million criminal background checks annually (Jacobs Reference Jacobs2015). As evidence of its recent growth, the background check industry in 2003 established a non-profit trade association, the National Association of Professional Background Screeners, which was renamed the Professional Background Screening Association (PBSA) in 2019. In addition to providing criminal record checks, commercial vendors also offer any array of other screening services, including checks of credit history, references, employment history, motor vehicle records, and civil court records.
The PBSA’s website explains that the background-screening industry owes its origins largely to the emergence of negligent hiring suits. For instance, the first paragraph of its page on the “History of Background Screening” reads:
The rise in the screening industry, and particularly the use of criminal background checks to pre-screen job candidates, tenants, vendors, and volunteers, stems in large part from the growth of claims alleging that an employer, organization or association can be negligent for hiring or retaining an individual who subsequently engages in violence. The advent of the theory of negligent hiring (and negligent retention) greatly increased an organization’s exposure for large damage awards, making the use of background checks not only a means to prevent violence, but also a defense to liability should violence occur. (PBSA, n.d.)
Despite their proliferation in recent years, commercial background checks suffer from serious limitations and data quality issues. Because of jurisdictional idiosyncrasies in the logistics of access to criminal records, private vendors are unable to provide a service akin to the more comprehensive national fingerprint searches run through official repository checks. In this sense, commercial reports suffer from a problem of under-inclusiveness. Bushway and colleagues (Reference Bushway, Briggs, Taxman, Thanner, Van Brakle, Stoll, Bushway and Weiman2007), for instance, found that a commercial vendor only correctly identified a criminal history 47 percent of the time, while the comparable figure for FBI checks was 72 percent. On the other hand, commercial checks are also over-inclusive in that they often list arrests for charges that were ultimately dismissed while failing to report this disposition. The result is that commercial reports may systematically overstate a criminal record by omitting mitigating information.Footnote 1 Summing up the limitations of commercial reports, Bushway and colleagues (Reference Bushway, Briggs, Taxman, Thanner, Van Brakle, Stoll, Bushway and Weiman2007, 187) conclude that employers can use these services to “obtain a fairly inexpensive and quick but not particularly comprehensive or accurate background check.”
While employers are broadly permitted to perform background checks through commercial vendors, federal law addresses the process of obtaining this information and how it can be used once it is in the employer’s hands. Under the Fair Credit Reporting Act (FCRA), employers are required to receive the applicant’s authorization when using a commercial vendor, to notify the applicant that the results of the check may result in an adverse decision, and to inform the applicant of their right to dispute the report’s accuracy (Jacobs Reference Jacobs2015).Footnote 2 Further, the US Equal Employment Opportunity Commission (EEOC) (2012) advises that blanket bans on hiring individuals with criminal records may constitute illegal disparate impact discrimination under Title VII of the 1964 Civil Rights Act.Footnote 3 In place of outright exclusion, employers instead are instructed to undertake an individualized assessment of an applicant’s record based on “the nature of the crime, the time elapsed, and the nature of the job” (EEOC 2012). Importantly, the EEOC does not specify how these factors should weigh in employers’ decisions, and it does not define the kinds of offenses that would make a person ineligible for particular occupations. Likewise, the guidance does not define the time frame within which a previous conviction is relevant for employment purposes. In these ways, the guidelines provide only ambiguous limitations governing information use, and they do not disturb employers’ basic ability to obtain criminal record information in the first place.
Negligent hiring doctrine
Under the common law doctrine of negligent hiring, employers can be held liable when their employees harm third parties and the employer knew, or should have known, of the employee’s potential risk (Hickox Reference Hickox2011). The negligent hiring cause of action is thus meant to address “risks created by exposing members of the public to a potentially dangerous individual.”Footnote 4 In appellate decisions, courts stress three points that are relevant for the relationship between negligent hiring and criminal record checks. First, risk is not simply a characteristic of individual employees and their backgrounds but, instead, is based on the circumstances of a person’s specific occupational role. Second, a criminal record check is not in itself required to protect employers from negligent hiring liability. Indeed, some courts have further warned that excessive use of criminal record checks carries negative public policy implications that outweigh their benefits to public safety.Footnote 5 Third, criminal record checks are only one method available within a broader set of practices that employers can use for vetting employees as necessitated by foreseeable occupation-specific risks.Footnote 6 Taken together, these elements of negligent hiring case law show that courts do not privilege criminal record checks as a method for thwarting liability. To the contrary, courts view criminal record checks as a measure appropriate for certain high-risk occupations as opposed to a standard best practice for screening job applicants.
Criminal Records and Foreseeable Risk
To advance a claim for negligent hiring, a plaintiff needs to demonstrate the existence of a duty on the part of the defendant, the defendant’s breach of the duty, and damages proximately resulting from the breach.Footnote 7 In establishing a duty, courts consider a range of factors “including the risk, foreseeability, and likelihood of injury weighed against the social utility of the actor’s conduct, the magnitude of the burden of guarding against the injury, and the consequences of placing the burden on the defendant.”Footnote 8 As Stacy Hickox (Reference Hickox2011, 1007) observes, “liability often turns on the issue of foreseeability.” However, courts do not assess the foreseeability of risk as a fixed characteristic of an individual job applicant; instead, risk is only foreseeable relative to the circumstances of a person’s occupational role.
For example, in Williams v. Feather Sound, a Florida appeals court held in favor of a plaintiff who had been assaulted by a condominium maintenance worker.Footnote 9 The offending employee, James Carter, was initially hired to perform outdoor landscaping work but was soon transferred to a position that included access to tenants’ homes. Before the change of assignment, the property manager did not contact any of Carter’s previous employers, did not check his references, and did not ask about a possible criminal history. A subsequent investigation would reveal that Carter had an extensive criminal record, including convictions for breaking and entering, “night prowling,” and attempted murder. On the question of foreseeability, the court reasoned:
[In] analyzing the employer’s responsibility to check out an applicant’s background, it is necessary to consider the type of work to be done by the prospective employee. In this case, when Rejko hired Carter to do outside work on the grounds of Feather Sound, during which he would have only incidental contact with the tenants, we cannot see how Rejko had any obligation on behalf of his company to make an independent inquiry concerning Carter’s past if he did not want to. However, in view of the fact that Carter had only been employed for three weeks, we believe that Feather Sound had a duty to make a reasonable inquiry about his background before transferring him to inside work and giving him access to the townhouse passkeys. If an employer wishes to give an employee the indicia of authority to enter into the living quarters of others, it has the responsibility of first making some inquiry with respect to whether it is safe to do so. Feather Sound did not carry out this responsibility. It made no effort to contact prior employers, and it did not seek advice from Carter’s references.
Thus, the level of scrutiny should be commensurate with the risk that is reasonably foreseeable in the circumstances of an occupation. In this case, the defendant did not have a duty to perform an in-depth investigation into the background of a groundskeeper, but at the point the worker assumed a new role with a higher level of foreseeable risk, a more thorough investigation was warranted.
The role of foreseeability is also on view in cases where courts find in favor of the defendants. Here, courts often decline to hold defendants liable even when their employees carried lengthy and serious criminal records. In Yunker v. Honeywell, for instance, the Court of Appeals of Minnesota held that the defendant was not liable for hiring an employee who later shot and killed a coworker.Footnote 10 Randy Landin, the offending employee, had been employed previously at Honeywell and was terminated after strangling a fellow employee to death. Following his imprisonment for that crime, Landin was rehired by Honeywell as a custodian, whereupon he began to harass and threaten a coworker, Kathleen Nesser. Landin would ultimately kill Nesser “in her driveway with a close-range shotgun blast.” Despite Landin’s prior murder conviction, the court held that the murder was not foreseeable under a theory of negligent hiring: “Landin was employed as a maintenance worker whose job responsibilities entailed no exposure to the general public and required only limited contact with coemployees. … Honeywell did not breach a legal duty to Nesser by hiring Landin because the specific nature of his employment did not create a foreseeable risk of harm.”Footnote 11
Courts have taken a similarly narrow view of the crimes that are reasonably foreseeable in connection with occupations that would appear to involve heightened risks. In Connes v. Molalla Transport Systems, a trucking company did not perform a criminal record check on a long-haul driver, Terry Lee Taylor, who later raped a hotel employee during an unsanctioned stop.Footnote 12 On his job application, Taylor had failed to disclose his extensive record of violent and property offenses, and the hiring manager did not perform any further investigation. Finding in favor of the trucking company, the court held:
[We] agree … that Molalla had no duty to conduct an independent investigation into Taylor’s non-vehicular criminal background before hiring him as a long-haul driver. Molalla had no reason to foresee that its hiring of Taylor under the circumstances of this case would create a risk that Taylor would sexually assault or otherwise endanger a member of the public by engaging in violent conduct. To be sure, Molalla had a duty to use reasonable care in hiring a safe driver who would not create a danger to the public in carrying out the duties of the job. … Taylor’s duties were restricted to the hauling of freight on interstate highways and, as such, involved only incidental contact with third persons having no special relationship to Molalla or to Taylor. After checking on Taylor’s driving record and contacting some of his references, Molalla had no reason to believe that Taylor would not be a safe driver or a dependable employee.Footnote 13
Other courts have similarly held that an employee’s criminal record alone is not a sufficient basis to impose liability. Instead, courts consider whether the circumstances of employment share a nexus with the employee’s prior offenses. For instance, in Lou-Con v. Gulf Building Services, a Louisiana court held that an employee’s prior conviction for stealing welfare checks did not make his subsequent arson reasonably foreseeable.Footnote 14 Likewise, a Texas court found that a restaurant manager’s past convictions for selling cocaine and failing to pay child support did not portend his “eventual participation in an aggravated robbery leading to murder.”Footnote 15 However, courts have found in favor of plaintiffs when knowledge of an employee’s prior criminal activity also matches a circumstance of foreseeable risk. For example, in Hawkins v. Wilton, a California court reversed summary judgment for a property management company in a case involving an armed security guard who shot a tenant.Footnote 16 The guard was hired despite the rental company’s knowledge of his history of drug abuse and record of violent offenses, including a voluntary manslaughter conviction.
Negligent Hiring and Criminal Record Checks
Summarizing the role of criminal record checks in negligent hiring case law, the court in Evans v. Morsell asserted: “[The] majority of courts flatly reject the contention that where an employee is to regularly deal with the public, an inquiry into a possible criminal record is required. On the contrary, the cases hold if the employer makes adequate inquiry or otherwise has a sufficient basis to rely on the employee, there is no need to inquire about a possible criminal record.”Footnote 17 Subsequent courts have likewise made clear that a criminal record check is not in itself a requirement to shield against liability (Creed Reference Creed2007). For example, in Najera v. Recana Solutions, a Texas court of appeals decided in favor of a staffing company that did not perform a criminal record check on a mill worker who later assaulted another employee.Footnote 18 Although the offending employee’s criminal record included convictions for assault, drug possession, and driving under the influence, the court found that “[his] job as a laborer … did not require any special or unique skills or experience, and did not involve circumstances of heightened confrontation or particularly dangerous tools or weapons. Therefore, this is not a situation that foreseeably created a peculiar risk of harm to others by reason of the employment duties.” Similarly, the court in Butler v. Hurlbut held in favor of a gas station owner who failed to perform a criminal record check on a cashier who later shot and killed a customer.Footnote 19 Despite the employee’s lengthy conviction record, the court agreed with the defendant that a criminal record check was not needed, as “the only skills required of the job were that the prospective employee be able to count and converse intelligently.”Footnote 20
Other courts have asserted that a requirement to perform criminal record checks for most or all employees would prove a critical barrier to the reintegration and rehabilitation of people with criminal records. For example, the Supreme Court of Minnesota held the following in the widely cited Ponticas case:
Were we to hold that an employer can never hire a person with a criminal record at the risk of later being held liable for the employee’s assault, it would offend our civilized concept that society must make a reasonable effort to rehabilitate those who have erred so they can be assimilated into the community. Moreover, a rule mandating an independent criminal history investigation would counter the many worthwhile efforts of individuals, organizations and employers to aid former offenders to re-establish good citizenship, the sine qua non of which is gainful and productive employment.Footnote 21
A central point in the refusal to endorse the broad use of criminal record checks is the fact that formal, judicially imposed punishments are necessarily finite for most offenders. As courts have argued, by placing temporal limitations on most punishments, the state acknowledges that perpetual social exclusion is not appropriate for most individuals who have been convicted of a crime. Accordingly, in another widely cited negligent hiring case, Evans v. Morsell, the court observed: “[W]hen one has completed a criminal sentence or has been paroled, the employer to some extent is entitled to rely upon the determination of the government’s criminal justice system that the individual is ready to again become an active member of society.”Footnote 22 Framing the implications of a criminal record check requirement in a similar way, the court in Yunker v. Honeywell held that such a rule would “essentially hold that ex-felons are inherently dangerous and that any harmful acts they commit against persons encountered through employment will automatically be considered foreseeable.”Footnote 23
Employer Practices for Avoiding Liability
The case law thus makes clear that criminal record checks are not in themselves required to shield organizations from liability, and some courts have taken the further step of warning against their excessive use. At the same time, negligent hiring doctrine still entails substantial uncertainty for organizations, as no duty exists to use any specific procedure as part of the hiring process. As a New York court of appeals observes, “[t]here is no common-law duty to institute specific procedures for hiring employees unless the employer knows of facts that would lead a reasonably prudent person to investigate the prospective employee.”Footnote 24 Instead, depending on the circumstances, employers may use a variety of practices that are commensurate with the risks involved in a particular job.
Criminal record checks thus represent one legally available option from a broader range of methods, including contacting references, verifying past employment, and checking job-related credentials and other relevant records.Footnote 25 Among these options, checks of references and any relevant occupational credentials feature prominently in negligent hiring decisions. For example, in Connes v. Molalla, the court pointed to the trucking company’s investigation of the employee’s driving record and references as demonstrating reasonable care.Footnote 26 Similarly, in Kassman v. Busfield Enterprises, a case involving an assault by a nightclub bouncer, the court held that the employer took reasonable care by checking the offending employee’s references and work history, neither of which revealed cause for concern.Footnote 27
Courts have placed similar emphasis on reference checks in cases that were decided against defendants.Footnote 28 For example, in Ponticas, an apartment rental company was found liable for negligently hiring a property manager, Dennis Graffice, who later used his keys to enter an apartment and rape the tenant.Footnote 29 Although Graffice indicated on his application that “traffic tickets” were his only offense, he had an extensive record of violent and property crimes and was on parole for an armed robbery conviction at the time of his application. Additionally, Graffice listed as references two names for which he provided neither an address nor a phone number. These references, it turned out, were his mother and his sister. While the court indicated that an inquiry with the Minnesota Department of Corrections would have served as one avenue for obtaining disqualifying information about Graffice, it rejected “the contention that, as a matter of law, there exists a duty upon an employer to make an inquiry as to a prospective employee’s criminal record even where it is known that the employee is to regularly deal with members of the public.” Instead, the court held that “if the employer has made adequate inquiry or otherwise has a reasonably sufficient basis to conclude the employee is reliable and fit for the job, no affirmative duty rests upon him to investigate the possibility that the applicant has a criminal record.”Footnote 30 By failing to check Graffice’s references—a step that could have revealed a pattern of dishonesty and raised other questions regarding his fitness for the position—the court concluded that the employer’s vetting fell short of the standard of reasonable care.
Institutional approaches to law and organizations
Drawing from the broader neo-institutionalist tradition of organizational scholarship (Meyer and Rowan Reference Meyer and Rowan1977; DiMaggio and Powell Reference DiMaggio and Powell1983), a substantial body of research has examined relationships between organizations and their legal environments (Sutton et al. Reference Sutton, Dobbin, Meyer and Scott1994; Suchman and Edelman Reference Suchman and Edelman1996; Edelman and Suchman Reference Edelman and Suchman1997; Edelman and Stryker Reference Edelman, Stryker, Smelser and Swedberg2005; Edelman Reference Edelman2016). In contrast to a legal formalist approach that views law as a closed domain that shapes organizational behavior as a coercive authority, neo-institutionalist socio-legal research examines how the meanings of law and compliance are produced endogenously in the interaction between organizational fields and formal legal institutions (Edelman Reference Edelman2016). Within this framework, compliance is theorized as a matter of conforming to the institutionalized best practices that emerge as organizations adapt to new developments in their legal environments.
The ambiguity of law is often an important starting point for neo-institutionalist scholarship, where “the law” is theorized as a set of ambiguous—and often conflicting—mandates that “may be best conceptualized not as an objective external constraint but rather as a source of uncertainty in organizational life” (Suchman and Edelman Reference Suchman and Edelman1996, 932). Research in this area has noted especially the high degree of ambiguity in US law regulating employment (Edelman Reference Edelman1992; Dobbin and Sutton Reference Dobbin and Sutton1998). For example, although Title VII of the 1964 Civil Rights Act outlawed discrimination in the US workplace, the statute neither defined discrimination nor elaborated a set of procedures that would constitute compliance (Edelman Reference Edelman1992). Lacking clarity on these important questions, organizations responded by developing internal governance structures meant to signal compliance while maintaining a high degree of managerial prerogative (Edelman Reference Edelman2016). Examples of organizational responses to Title VII included the development of antidiscrimination rules, the creation of civil rights offices, and the establishment of internal grievance procedures—all of which “acquired an institutionalized status as ‘rational’ forms of compliance” despite having no textual basis in Title VII itself (Edelman and Talesh Reference Edelman, Talesh, Nielsen and Parker2011, 108). Organizations came to establish these structures not because they were particularly effective in reducing discrimination but, instead, because collective endorsement made their adoption necessary to maintain legitimacy within their organizational fields (Meyer and Rowan Reference Meyer and Rowan1977; DiMaggio and Powell Reference DiMaggio and Powell1983; Edelman Reference Edelman2016).
Professions are an important conduit for the diffusion of these symbolic compliance structures (Edelman et al. Reference Edelman, Petterson, Chambliss and Erlanger1991; Sutton et al. Reference Sutton, Dobbin, Meyer and Scott1994). Through their networks, conferences, and trade literatures, “compliance professionals” such as HR managers and attorneys interpret developments in the legal environments of organizations (Edelman Reference Edelman, Nielsen and Nelson2005). Yet, in the process of communicating the law, compliance professionals also transform its meaning, such that legal ideals become “managerialized” or refashioned in ways that reflect the values, logics, and interests of organizations (Edelman, Riggs Fuller, and Mara-Drita Reference Edelman, Fuller and Mara-Drita2001). As Jeb Barnes and Thomas Burke (Reference Barnes and Burke2006) observe, professional networks, organizational capacities, and previous experience with adversarial legal threats all combine to produce varying responses to law that defy a simple dichotomy between compliance and non-compliance. The result is that the law as it is perceived and acted upon by organizations may differ in substantial ways from the law as it is expressed by lawmakers and regulators.
Ambiguous law provides compliance professionals with opportunities to frame the legal environment to their own advantage (Edelman et al. Reference Edelman, Petterson, Chambliss and Erlanger1991; Edelman Reference Edelman1992). For example, human resource managers may inflate the threat of litigation or frame it as a risk that they are uniquely equipped to manage (Edelman, Abraham, and Erlanger Reference Edelman, Abraham and Erlanger1992). Likewise, external “legal intermediaries” may construct the terms of compliance in ways that serve their material interest (Talesh and Pelisse Reference Talesh and Pelisse2019). For example, Shauhin Talesh (Reference Talesh2015) shows how insurance companies systematically inflate the threat of discrimination lawsuits and use this exaggerated uncertainty to market employment practice liability insurance to their clients.
The present study builds on previous neo-institutionalist work by specifying a new mechanism that generates legal uncertainty for organizations. In the canonical legal endogeneity model, ambiguous legal text provides conditions for the generation of novel legal meanings and symbolic structures within organizational fields, which then come to shape judicial conceptions of compliance (Edelman Reference Edelman2016). This line of work has developed primarily through the analysis of legal ambiguity as it is found in the text of statutory law—particularly, in the area of employment civil rights (Edelman Reference Edelman1992, Reference Edelman2016). As Lauren Edelman (Reference Edelman1992, 1532) observes, laws vary in ambiguity as a function of their textual features, including the use of language that is “broad,” “vague,” or “controversial” as opposed to “specific” and “substantive.” The important consequence of this variation is that “the opportunity for organizations to mediate law is variable” (1532). In principle, then, legal ambiguity in this traditional sense can be mitigated by increasing the textual clarity of law, which in turn constrains opportunities for organizational fields to construct its meaning.
At the same time, an emerging line of research shows that the law may serve as a resource for strategic manipulation even in situations of low textual ambiguity (Pedriana and Stryker Reference Pedriana and Stryker1997; Kelly Reference Kelly2003). In such cases, “interested actors” may be the source of uncertainty regarding the meaning of law as they attempt to stretch legal mandates in ways that redound to their advantage (Kelly Reference Kelly2003). For example, Erin Kelly (Reference Kelly2003) shows how benefits consultants creatively interpreted otherwise clear tax statutes in order to market dependent care expense accounts, although the federal laws in question plainly were crafted to incentivize employers to establish childcare programs. Here, despite textual clarity in the relevant statute, uncertainty in legal meanings was “a by-product of actors using the law as a resource to pursue their own interests” (616).
In the case of negligent hiring liability, the body of relevant legal text—judicial decisions—provides a high degree of clarity on the role of criminal record checks in thwarting liability, yet the legal meanings and compliance practices that emerge from organizational fields still diverge substantially from courts’ stated vision of compliance. Negligent hiring opinions emphasize that no specific duty exists to conduct criminal record checks, and some have stressed that their overboard use carries negative public policy implications. Thus, among the practices that employers may use to protect themselves against negligent hiring liability, criminal record checks clearly are not positioned in the accumulated case law as the method of first resort. Nevertheless, the HR trade literature frames criminal record checks as the default method for pre-employment vetting, thus placing the heaviest emphasis on the screening practice that judicial decisions have singled out as unnecessary for large numbers of occupations.
The present study argues that this disconnect is the product of structured uncertainty, a feature of the legal environment in which law is incapable of defining the precise nature of compliance in advance, leaving organizations uncertain about what procedures are necessary to avoid legal sanctions. In contrast to statutory law where ambiguity can be mitigated through more carefully crafted language (Edelman Reference Edelman1992; Pedriana and Stryker Reference Pedriana and Stryker1997), no such textual resolution is available for structured uncertainty as it stems from the basic organization of litigation under a common law tort of negligence.Footnote 31
In negligent hiring cases, the existence of a duty is a “question of law” that is answered by judges. Thus, it is for a judge to determine whether an employer was under a duty to perform a reasonable investigation given the foreseeable risks of a particular job. When judicial opinions point out that employers do not have a duty to conduct criminal record checks, they simply mean that the duty to perform a reasonable investigation does not necessarily entail a criminal record check. Instead, given the risks connected to a particular occupation, the employer must take reasonable steps to vet prospective employees, although the steps themselves remain unspecified. If a judge determines that a duty does exist, the case proceeds to resolve the “question of fact” of whether the employer’s screening practices fulfilled the duty of reasonable care. In the event of a jury trial, the jury serves as the fact finder, while judges resolve questions of fact in bench trials. Thus, it is for fact finders to determine whether a criminal record check would have been necessary to meet the standard of reasonable care in the particular circumstances. While many low-risk occupations have been found not to entail foreseeable danger that would trigger a duty to investigate, this question of law is answered only on a case-by-case basis. Likewise, if a judge determines that a duty does exist, fact finders may hold that a criminal record check would have been appropriate to fulfill that duty. As such, employers cannot know in advance and with certainty whether a duty to investigate would apply to a particular position or whether a judge or jury would view the failure to run a criminal record check as breaching that duty.
In this way, the structure of negligent hiring litigation presents uncertainty that cannot be resolved by the textual clarity of accumulated case law, which rejects the notion that the doctrine requires employers to conduct criminal record checks or even that they should do so most of the time. Accordingly, if case law alone were the principal guide to the selection of best practices for shielding against liability, criminal record checks would be assigned a relatively limited role. Yet the opposite outcome has occurred within the HR trade literature, where criminal record checks have been elevated as the standard method for managing the risks of negligent hiring. This outcome—where organizational practices diverge from and even exceed legal requirements—has been observed in other contexts by scholars of tort litigation, who point out that vague standards such as “reasonable care” can prompt organizations to pursue a strategy of “overcompliance” (Calfee and Craswell Reference Calfee and Craswell1984; Chapman Reference Chapman1995; Gibson Reference Gibson2008). On the one hand, by not defining compliance practices in advance, standards such as reasonable care give “courts the flexibility they need to arrive at the correct judgment in fact-dependent contexts” (Gibson Reference Gibson2008, 1649). Yet for organizations governed by these standards, the result can be a pattern of excessive risk aversion. As Bruce Chapman (Reference Chapman1995, 1690) observes, “since the defendant avoids all liability by being slightly above the required care standard, but faces full liability for the plaintiff’s injury in falling only slightly short of it, there is some incentive…to err on the safe side by taking excessive precautions around the care standard.” Thus, uncertainty surrounding legal standards provides the initial condition for overcompliance. In this context, scholars argue that cost also emerges as a salient consideration affecting the likelihood of taking excessive precautions (Calfee and Craswell Reference Calfee and Craswell1984; Chapman Reference Chapman1995; Gibson Reference Gibson2008). Thus, when faced with legal uncertainty, organizations will be more likely to over-comply if their internal costs for doing so are low.
The following section turns to the qualitative content analysis, which shows how responses to uncertainty are articulated within the HR trade literature. The results show that one factor supporting the collective endorsement of criminal record checks in the face of uncertainty is their relatively low cost, a feature that is publicized aggressively by commercial information vendors within the HR trade literature. Yet rational economic calculation is not the only factor that steers HR professionals in this direction. Additionally, the content analysis reveals that other constructions of the legal environment have played an important role in the unique endorsement of criminal record screening as the best defense against negligent hiring liability. Reference checks, the most plausible alternative, are portrayed as increasingly unworkable due to widespread fear of defamation suits.
Content analysis of negligent hiring in HR discourse
Data and Methods
To examine the professional construction of negligent hiring liability and the best practices for managing it, the analysis draws from articles published in top American HR trade journals between 1992 and 2019. Articles were pulled from three journals: HR Focus, the American Management Association’s HR journal; Workforce, a leading HR trade magazine in circulation since 1922; and HR Magazine, the official journal of the SHRM. The analytic period covers the years for which digital full text versions of the journals’ articles have been available.Footnote 32 Articles were identified by searching within each journal using Gale General OneFile for mentions of “negligent hiring” in the text or title of the article. This method produced a total of 111 results across the three journals. Seven of the results were advertisements, and these were excluded from the analysis. Two results included incidental mentions of negligent hiring: one as a citation to separate article and another in the author’s biographical information. These articles were also excluded from the analysis. The full analytic sample is thus comprised of 102 articles. All articles were read multiple times and coded using NVivo12 software to identify common representations of negligent hiring doctrine and best practices for managing this risk.
Findings
Within the HR trade literature, representations of negligent hiring liability diverge substantially from those articulated in the case law. The most notable point of divergence pertains to the role of criminal record checks in shielding organizations from liability. While the case law frames criminal record checks as a practice that is necessary only in circumstances of foreseeable risk, the HR literature describes criminal record checks as the default method for protecting against negligent hiring liability. Although the HR literature does not focus exclusively on criminal record checks for liability management, other screening methods are often framed as necessary only for especially sensitive positions where a foreseeable risk is present—precisely, the circumstances for which courts maintain that criminal record checks can be reserved.
As the results below show, employers’ concerns stem in particular from the fear of unpredictable and costly jury verdicts. In the face of uncertainty about which screening practices are necessary, criminal record checks emerge as the recommended method by virtue of their low cost as well as the perceived deficiencies of alternative methods that grow out of other constructions of employers’ legal environments.
Criminal Record Checks as the Rule for Background Screening
The trade literature frames criminal record checks as the baseline practice for exercising reasonable care in hiring, while other types of checks are described as useful for more sensitive positions and other special circumstances. For example, a 2002 article in Workforce draws on the expertise of a commercial information vendor to give the following advice for how employers should tailor their screening methods:
To decide which checks to apply to which applicants, employers should look at the jobs people do, and match the checks to those classifications. “The reports ordered are dependent on the position, though all positions should be subject to a criminal-record check,” Long says. “For instance, there is usually no need to conduct a credit check or education verification on a forklift operator position who has no contact with corporate assets and possibly limited educational requirements.” … Employers that are concerned only about avoiding liability will do a minimal search that would be considered “a reasonable” effort by the court system—protecting the employer if a negligent hiring suit arises, Long says. Since “reasonable” has not been defined by law, an employer conducting a minimal search is probably protected from negligent hiring claims, Long says. Typically, this minimal search would include a criminal record search in the applicant’s county of residence, along with the counties where he worked and went to school, background checking firms say. (Lachnit Reference Lachnit2002, 52; emphasis added)
Using a manufacturing firm as an example, this construction of criminal record checks is similarly expressed in a 1995 Personnel Journal article titled “Avoid Negligent Hiring”:
Amtel … conducts different types of checks for different positions. Line employees, who typically work in chip fabrication, undergo a Social Security verification and criminal check. Since education and financial issues aren’t important for the job, the company foregoes any background check to verify that information. At the management level, the firm conducts a more detailed investigation. It verifies education, checks that employment dates are correct, conducts a Social Security check, and a criminal-record check. And, depending on the position, it sometimes requests a credit check. “The higher we go up the ladder, the more we focus on personal references,” says LaPlante. (Greengard Reference Greengard1995, 84)
Using the retail industry as an example, a 2010 HR Magazine article likewise portrays criminal record checks as the norm and other forms of screening as the exception:
Many other retailers similarly do not run credit checks. Even though clerks handle a lot of money, they have to balance the cash registers at the end of each day, says Laura Randazzo, chair of the National Association of Professional Background Screeners in Morrisville, N.C., and vice president of global services for Accurate Background Inc. … “I don’t have any clients in retail who do credit histories for store clerks,” she notes. Randazzo says 95 percent of her clients check criminal records but less than 10 percent check credit. (Roberts Reference Roberts2011, 23)
Articles that do forcefully advocate for wider adoption of other screening methods likewise reinforce the view that criminal record checks are the most basic form of liability management. The passage below is written by the head of a firm that specializes in pre-employment reference checks. The author implies a distinction between screening methods that are simply used for liability management and those that ensure that an organization hires the best candidate for the job. Criminal record checks, the author points out, tend to fall into the former category, while reference checks are useful for more than legal “backside covering”:
Why do a criminal court check at all?” There are only two legitimate reasons. *The nature of the position for which the candidate has applied requires it. *There is some doubt or suspicion about the candidate’s background. There is a third reason many companies perform court checks: They believe that a court check will demonstrate that some measure of care was exercised in the employment process and that this will protect them from claims of negligent hiring. Conducting a court check, in other words, is a cheap way to cover the company’s backside in case a charge of negligent hiring is brought against it. Companies interested in more than “backside covering” should be doing reference checking to evaluate past job performance as it relates to the requirements of the position to be filled. They should be talking to work-related references who are familiar with the candidate’s job performance over time. (Barada Reference Barada1998, S16)
Articles often present survey evidence that situates criminal record checks as the default form of liability management. A 2012 Workforce article presented the results of the SHRM survey on employer screening practices, which found that 69 percent of respondent firms conducted criminal record checks for all applicants, while another 18 percent checked for some applicants. The article further observed that “most employers that conduct background checks do so to reduce their legal liability for negligent hiring” (Mihelich Reference Mihelich2013, 50). The article reported that a majority of firms (52 percent) selected negligent hiring concerns as their primary motive for checking criminal records.
Other articles similarly present industry surveys that confirm the widespread use of criminal record checks compared to other screening methods. For instance, a 2004 survey conducted by Pinkerton—another investigation firm—and published in HR Focus found that 68 percent of Fortune 1000 companies used reference checks as part of their pre-employment screening, while a criminal record check was reportedly the most common method at 88 percent of firms (HR Focus 2004, 11).Footnote 33 Accordingly, a 2008 Workforce Management article underlined the ubiquity achieved by criminal record checks in recent years: “A 2006 survey of human resource professionals by the Society for Human Resource Management found that 85 percent of those surveyed hired outside agencies to conduct background checks of potential hires and, of those, 96 percent reported using criminal records checks—up from 51 percent in 1996” (Heller Reference Heller2008, 35).
Likewise, a 2010 article published in Workforce Management reported the results of a survey conducted by HireRight, a large commercial vendor, which found that 93 percent of respondent firms perform criminal record checks, while 48 percent indicated that they regularly check references (Hansen Reference Hansen2010, 27).Footnote 34 While these statistics again provide an indication of the extent of reliance on criminal record checks, the article also reflexively situates their broad use within the context of the uncertainties stemming from negligent hiring litigation, as well as commercial information vendors’ aggressive efforts to market the checks. Noting that “the actual probability of a negligent-hiring lawsuit—a perceived risk that often drives criminal screening practices—remains undocumented” (27), the article points out that “the screening industry continues to play to employer concerns about criminality and promote criminal record checks as an effective countermeasure” (28). In a notable departure from the dominant framing of criminal record checks as an essential practice for liability management, the article questions whether employers are finding “false comfort in a relatively cheap and easy—but unproven—risk management tool while neglecting more effective measures to reduce workplace violence, theft, fraud, and employment-related lawsuits” (28).
Unpredictable and Costly Jury Verdicts
A 2006 article in HR Focus illustrates how negligent hiring risk is framed largely in terms of costly jury verdicts. The article warns: “If a claim reaches a jury, watch out: Jurors tend to believe the employer had a duty, ability, and resources to perform safe hiring. ‘If you could have known, you should have known’” (HR Focus 2006a, 4). The article quotes the head of a commercial screening firm, who highlights how uncertainty is structured by the ad hoc nature of reasonable care determinations in jury trials, advising that “due diligence will be what ‘the jury says it is for private firms’” (4).
Other articles similarly link the risk of negligent hiring to jury verdicts. For example, a 2009 article in Workforce Management advertised a session at the SHRM annual meeting where members would learn about the intricacies of negligent hiring litigation by participating in a mock jury trial: “Lawsuits for negligent hiring are one of the fastest-growing areas of litigation. In this 10 a.m. session, presented by Lester S. Rosen, an attorney with Employment Screening Resources of Novato, California, you act as a juror in a negligent hiring mock trial, which features opening statements, cross-examination of an HR professional, closing arguments, jury instructions and a jury verdict” (Workforce Management 2009, S010). Likewise, a 2003 article in Workforce observes that employers are “increasingly concerned about multimillion-dollar jury verdicts that have resulted from negligent-hiring cases” (Workforce 2003, 56). A 2010 HR Magazine article similarly warned: “State courts are hearing more civil suits like this, based on negligent hiring claims. Plaintiffs argue that employers knew, or should have known, about a hire’s potential threat to others. Juries usually find against employers and, on average, award damages of $1 million or more. For this and other reasons, more employers are conducting pre-employment background checks” (Roberts Reference Roberts2010, 46).
A 2014 Workforce article echoed these risks, citing figures from First Advantage, a large commercial information vendor, to assert that “75% of employers lose negligent hiring cases where the average jury award now exceeds $1 million” (Mihelich Reference Mihelich2014, 52). A 2006 HR Focus article gave an even higher estimate of the potential financial damage, referencing the president of a commercial screening firm to claim that “the average verdict in a negligent hiring action is $2 million” (HR Focus 2006b, 1).
While a systematic analysis of jury verdicts is beyond the scope of this article, research on the “pyramid of disputes” in civil litigation shows that it is uncommon for civil suits to proceed to a jury trial, as the large majority of cases dispose in modest settlements, dismissal, or summary judgment (Galanter Reference Galanter1983; Nielsen and Nelson Reference Nielsen, Nelson, Nielsen and Nelson2005). However, in the rare event that a case reaches a jury, research does indicate that plaintiffs have a higher chance of success compared to earlier stages of litigation. For instance, Theodore Eisenberg and colleagues (Reference Eisenberg, Goerdt, Ostrom and Rottman1996) found that plaintiffs won 49 percent of state jury trials in tort cases between 1991 and 1992, although only 2.9 percent of tort cases survived to a trial during that period. Accordingly, it appears that trade journal articles are focusing on the potential for outsize losses that stem from a narrow slice of cases. As a 2006 article in Workforce Management notes, this outcome may be all the more remote because negligent hiring cases are themselves relatively rare: “Although negligent hiring cases are less common than many types of employment-related lawsuits, the size of the risk is large. Claims arising from workplace violence can result in a huge exposure because there are no caps on punitive damages” (Hansen Reference Hansen2006, 31).
Best Practices by Elimination
The structure of negligent hiring litigation may present irreducible uncertainty for employers, but it does not predispose the unique selection of criminal record checks as the best response to this uncertainty. Instead, the trade literature’s distinctive endorsement is aided by perceived deficiencies in other methods. By comparison, criminal record checks stand out for their low cost, broad legal permissibility, and logistical ease. Among the methods that could serve as a plausible alternative to criminal record checks, the literature singles out reference checks for their significant limitations. This framing is notable as the failure to check references features prominently in cases where the court held against the employer.Footnote 35 Although articles emphasize that an honest and thorough reference is a highly valuable screening tool, they point out that such references are increasingly difficult to find due to employers’ fear of defamation suits.Footnote 36
The result is that reference checking is portrayed as impractical and unlikely to reveal useful information. For example, a 1993 HR Focus article observed: “Employers are finding it harder than ever to check references. … Why is it so difficult to get information? Employers are concerned that giving bad references could lead to lawsuits from former employees. ‘We live in a litigious society; everyone is sue-happy,’ said Kathleen Walby, director of HR management at Key Employee Leasing in Southfield Mich. ‘Employers are afraid to say anything about anyone because it could come back to bite them. It’s unfortunate’” (Matthes Reference Matthes1993, 3). Likewise, a 1999 article in HR Magazine characterized the limitations of reference checking:
Fearing lawsuits, most major employers provide only neutral employment references—to the frustration of HR departments trying to screen job applicants. … Many won’t even offer positive comments about an excellent former employee because HR has been told that extolling one employee after only confirming date and position for another is tantamount to giving the latter employee a bad reference.” (Bahls Reference Bahls1999, 2)
Although articles at times point out that the likelihood of losing a defamation case is low, the fear of such lawsuits and the repeated mentions of litigation risk within the broader HR literature still appear to shape employer practices. As a 2000 article in HR Magazine observed: “Many employers are afraid that something negative said about former employees could lead to a defamation or invasion-of-privacy suit. Employers almost always win such cases, according to labor attorneys, but that doesn’t stop them from zipping their lips when prospective employers call” (Hirschman Reference Hirschman2000, 87). Similarly, a 2016 HR Focus article observed: “Employers have long believed that checking references is not the most effective way to get accurate information about a potential hire. … Oftentimes, the person who is contacted for the reference doesn’t share useful information, either because of a lack of information to share or because he or she doesn’t want to share negative details about a former employer” (Douglas Reference Douglas2016, 14).
The literature points out limitations in other screening methods as well. As a 2010 HR Magazine article observed, “checking credit status is not as prevalent, in part because some state laws prohibit or greatly restrict the use of credit history in hiring decisions” (Roberts Reference Roberts2010, 46). A 2011 HR Magazine article noted that “Hawaii, Illinois, Oregon, and Washington have laws restricting the use of credit reports in hiring decisions. Similar bills have been or are being considered in other jurisdictions” (Roberts Reference Roberts2011, 23).Footnote 37 Even when legally permitted, articles will recommend that employers only invest in credit reports or other records, such as driving history, if they are specifically tied to particular occupational responsibilities. For instance, a 2016 article in HR Magazine informed readers that “screening providers can customize workflows based on occupational roles, industries and company size. For example, background checks for financial positions could trigger a credit check, while screens for truck drivers could require motor vehicle records” (Maurer Reference Maurer2016, 69). Likewise, a 2011 article in HR Magazine observed: “Most employers understand that only candidates for positions with significant financial or fiduciary responsibility might need credit checks, and many employers never check credit” (Roberts Reference Roberts2011, 23).
Criminal record checks, by contrast, are framed as the basic and most cost-effective option for shielding an organization from liability. For example, a 2002 article in Workforce drew upon the expertise of a commercial vendor to describe the fee structures associated with different screening methods: “A comprehensive check, including criminal, employment, education, plus a few other specific checks, typically ranges in price from $100 to $200, says John Long, president and CEO of HireCheck, in St. Petersburg, Florida. A basic criminal check could be as little as $25. ‘It’s a small price to pay for peace of mind,’ Boden says” (Lachnit Reference Lachnit2002, 51). Elsewhere in the article, the author quotes a commercial vendor to compare the low fee for a criminal record check to the potential for costly jury awards:
By not conducting a check, the employer may be subject to lawsuits and crippling penalties and court awards if an unchecked employee commits a crime against a client or fellow employee. The average jury award for negligent hiring against a company was $870,390 in 2000, according to Barry J. Nadell, president of InfoLink Screening Services, in Chatsworth, California. Contrast that with the $25 your company could spend on a basic criminal background check. (52)
Similarly, a 1995 Personnel Journal article observed:
Better safe than sorry. Indeed, the horror stories abound. … [A] Florida furniture company recently got walloped with a $2.5 million judgment for negligent hiring after an employee—whose background hadn’t been checked—returned to a home after a delivery and viciously attacked a woman with a knife, nearly killing her. At the ensuing trial, it became clear the man had an extensive criminal record and a long history of mental problems. Says [the] president of Hudson, Ohio-based Corporate Solutions Inc., a company that conducts background checks: “The entire incident would never have taken place if the company would have spent a few dollars on a criminal check.” The dollars spent for a check are nothing if you consider workplace violence and harassment cost businesses more than $4 billion a year, according to the National Safe Workplace Institute in Monroe, North Carolina. Or that workplace theft tops out at more than $120 billion annually—more than 10 times the cost of all theft that takes place in the streets of America. Or that a single lawsuit for negligent hiring can drain a company of millions of dollars and severely cripple its stability. (Greengard Reference Greengard1995, 84)
Conclusion
The present study finds that the HR trade literature and appellate courts express contrasting visions for the role that criminal record checks should play in shielding organizations from negligent hiring liability. While courts portray criminal record checks as a measure that is appropriate for sensitive occupations that present foreseeable risks, the trade literature positions criminal record checks as an essential investigation tool that employers should use to demonstrate reasonable care in hiring. Accordingly, the findings indicate that criminal record checks have been collectively endorsed by the HR field as a response to the structured uncertainty of the civil litigation process rather than the substantive treatment of criminal records within the negligent hiring case law. If the HR field were taking its cues from the latter, criminal record checks should occupy a less prominent place in discourse related to negligent hiring and in employer practices. Instead, the structure of negligent hiring litigation presents uncertainties for employers that cannot be resolved within the body of relevant case law alone. Faced with this situation, best practices for compliance have come to be defined with the HR trade discourse, where criminal record checks have been endorsed as an essential practice due to their low costFootnote 38 as well as ambivalence regarding other methods. In particular, although reference checks feature prominently in the case law, they appear to have fallen out of favor in practice due in large part to fear of defamation suits.
This disconnect between law and employer behavior carries implications for theory and research on organizations and their legal environments. In the traditional legal endogeneity model, ambiguous legal text—principally, as it is found in statutory law—creates uncertainty about the nature of compliance for organizations and courts alike (Edelman Reference Edelman2016). Lacking clarity, best practices are then devised and institutionalized within the very organizational fields that the law “seeks to regulate” (Edelman Reference Edelman, Nielsen and Nelson2005, 337). These practices eventually come to constitute compliance in the eyes of the courts, which are tasked with interpreting the ambiguous statute. By contrast, in the case of negligent hiring liability, there is no common textual ambiguity that organizations and courts are both seeking to resolve, as would be the case with a vague statute that does not define the terms of compliance. This is because, by their nature, negligence torts do not mandate specific compliance practices. Recognizing this, courts simply fulfill their institutional imperative to adjudicate cases based on precedent and the facts at hand. Yet even a well-established pattern of adjudication that indicates that criminal record checks are often unnecessary does not fundamentally address the problem of risk management for employers, who still may face legal consequences for not checking in the future. Thus, organizations’ own imperative to manage risk may result in a pattern of excessive precaution relative to the case law. In this way, structured uncertainty creates the conditions for organizational compliance practices that depart from—and, in this case, vastly exceed—the role they have been accorded within the text of judicial opinions. Thus, unlike the traditional legal endogeneity model where organizational and judicial meanings eventually converge, these meanings may remain divergent when the source of uncertainty is structural and derived from common law, as opposed to when the source is textual and derived from statutory law. To further investigate this possibility, future research could employ longitudinal quantitative methods to test systematically what role—if any—criminal record checks play in the outcomes of negligent hiring cases and whether this relationship changes over time.
Relatedly, an important limitation of the present study is that the analysis of employers’ legal environment is limited to appellate decisions in negligent hiring cases. While systematic data on the earlier stages of negligent hiring cases is not currently available, the long line of socio-legal research on the “pyramid of disputes” would suggest that appellate decisions represent only a small share of the overall volume of litigation in this area (Galanter Reference Galanter1983; Eisenberg et al. Reference Eisenberg, Goerdt, Ostrom and Rottman1996; Nielsen and Nelson Reference Nielsen, Nelson, Nielsen and Nelson2005). Accordingly, despite the pattern of case law that indicates that judges do not uniquely favor criminal record checks as the best practice for shielding against liability, employers may still view the checks as an important tool for steering earlier stages of litigation in their favor. For instance, in settlement negotiations, it may be the case that the employers have greater leverage if they had performed a criminal record check. While the present study did not find evidence within the trade literature that would point directly to this dynamic (instead, risk was framed largely in terms of jury verdicts), this possibility is one that warrants examination in future research. In particular, future work in this area would benefit from a systematic sampling of filings at the district court level to gain a fuller picture of the role that criminal records may play in the litigation process.
Beyond neo-institutionalist theory, the results help to situate criminal background screening—and the role of liability concerns in spurring its growth—within the context of broader developments in American punishment over the past several decades. The growth of criminal record checks overlaps historically with the massive expansion of incarceration and other forms of criminal legal control in the United States—a set of transformations that scholars have come to label as “mass imprisonment” (Garland Reference Garland and Garland2001, 1) or “mass supervision” (Miller and Stuart Reference Miller and Stuart2017, 532). While the origins and effects of these broader transformations have been extensively analyzed elsewhere, the findings of the present study speak to two features in particular.
First, a long line of research demonstrates that the stigma of a criminal record is unevenly distributed along lines of race and class. Becky Pettit and Bruce Western (Reference Pettit and Western2004), for instance, estimate that 30 percent of non-college Black men born between 1965 and 1969—and 59 percent of Black men who dropped out of high school from this cohort—had faced a term of imprisonment by 1999. Reliance on criminal record screening for employment thus carries the potential for a “massive disparate effect” (Western Reference Western2008, 414), particularly in light of the evidence reviewed above which shows that criminal record checks have expanded to cover many entry-level jobs that do not require a college degree. The present study finds that this practice of screening entry-level positions by default is endorsed in the trade literature as, at least in part, a defense against negligent hiring liability. Yet the review of case law indicates that the returns for liability protection may diminish when criminal record checks are expanded in this way, given appellate courts’ emphasis on occupation-specific risks in determining the extent of pre-employment investigations. This points to a dynamic in which the effect of criminal record screening for exacerbating inequalities may be at its greatest at the same time that its utility for liability protection is at a relatively low point. This is a troubling possibility in light of extremely low employment rates among people with recent prison records (see, for example, Sabol Reference Sabol, Stoll, Bushway and Weiman2007) as well as research that demonstrates the importance of employment itself as a social tie that promotes desistance from crime (Sampson and Laub Reference Sampson and Laub1990).
The use of background checks to defend against liability also resonates with the actuarial turn in American punishment (Simon Reference Simon2005), although the logic of pre-employment background screening departs in notable ways from actuarialism as it is practiced within the criminal legal system. As Malcolm Feeley and Jonathan Simon (Reference Feeley, Simon and Nelken1994, 174) describe it, actuarialism “promises to reduce the effects of crime in society not by altering either offender or social context, but by rearranging the distribution of offenders within society.” Criminal record checks clearly serve this distributional purpose, but unlike the actuarial tools used to guide criminal legal decision making, their aim is not to calibrate levels of supervision but, instead, to inform a choice between admission into, or exclusion from, privately governed spaces. The latter logic reflects what Pat O’Malley (Reference O’Malley1992) terms “prudentialism,” a defensive posture adopted by private actors who increasingly shoulder responsibility for governing risks that have been desocialized from collective state management. While state criminal legal actuarialism aims to assess and contain criminal risk, private governance instead aims to identify and deflect it (Rose Reference Rose1996; Shearing Reference Shearing2001). Crucially, this devolution of responsibility may foster indifference to the social costs that accumulate from the practices of fragmented private actors who are tasked only with securing their own individual domains. Thus, when private organizations pursue overbroad criminal background screening as a defense against liability, the social costs are felt in terms of the amplified race and class inequalities described above.Footnote 39
Accordingly, the present study carries implications for current reform efforts aimed at restricting the use of criminal records in hiring decisions. In its essentials, negligent hiring doctrine promotes extensive use of criminal record checks not because of what the law says but, instead, as a result of the irreducible uncertainties that it presents for employers. As such, policy solutions should aim to reduce or eliminate these uncertainties by relocating decision-making authority and shifting the burden of risk management away from employers and back onto the state itself (Bushway and Kalra Reference Bushway and Kalra2021). Consistent with these objectives, a number of states have enacted laws that attempt to remove criminal record barriers while providing some measure of resolution to employers’ concerns regarding negligent hiring liability. One common approach involves granting certificates of rehabilitation on a case-by-case basis to record subjects who meet certain criteria (McCann et al. Reference McCann, Kowalksi, Hemmens and Stohr2018). These certificates, which require a lengthy application process, protect their holder from being denied work solely on the basis of their criminal record, while providing their employer with immunity from negligent hiring claims as long as they were aware of the certificate at the time of the alleged negligence.
While helpful in principle, these certificates have limited practical impact due to the difficulty of obtaining them (Radice Reference Radice2012). To solve this problem of scale, states could borrow from the logic of clean slate laws, which automatically seal criminal records that meet certain criteria (Lageson Reference Lageson2020, 170). Applied to certificates of rehabilitation, this approach would involve automatically granting a certificate to most people convicted of crimes upon completion of their sentence, with exceptions carved out for statutory bans that apply to various types of employment. Such an approach would have the benefit of neutralizing the potential for legal liability attached to a criminal record and locating decision-making authority in the hands of the state rather than with private employers. At the same time, however, this framework may risk creating even greater reliance on criminal record inquiries, as employers would need to be made aware of the credential in order to receive cover from negligent hiring claims. This scenario could in turn open the door to other mechanisms of discrimination against record subjects that do not involve liability concerns alone.Footnote 40
In light of this risk, an alternative approach would provide employers with automatic statutory immunity against negligent hiring claims made on the basis of a criminal record, without having to rely on a certificate. Here again, states could make exceptions for statutorily mandated criminal record checks that bar eligibility based on certain types of offenses. This approach would have several advantages. First, it would remove any incentive to perform excessive criminal record checks that are based solely on negligent hiring concerns. Second, even for individuals with serious criminal records, it would align with the case law, which holds that the job—not the record alone—is the basis for assessing risk. This determination would be placed in the hands of the state rather than with individual employers who would otherwise bear the legal cost of underestimating risk (Kurlychek, Bushway, and Denver Reference Kurlychek, Bushway and Denver2019; Bushway and Kalra Reference Bushway and Kalra2021). Third, this approach comes without the unintended consequences that may accompany efforts to regulate the use of criminal record checks themselves—another prominent focus of reform. In other words, laws that regulate criminal record inquiries without addressing underlying liability concerns may simply push employers to seek this information through other means (Agan Reference Agan2017). For instance, a number of recent studies suggest that ban-the-box laws prompt employers to (illegally) use race as a proxy for criminality—a process known as statistical discrimination (Doleac and Hansen Reference Doleac and Hansen2016; Vuolo, Lageson, and Uggen Reference Vuolo, Lageson and Uggen2017; Agan and Starr Reference Agan and Starr2018). Imposing a broader ban on commercial criminal record checks—along the lines of state efforts to curtail pre-employment credit checks—could pose similar problems. As with ban-the-box laws, recent work indicates that statistical discrimination has occurred in the context of state restrictions on credit reporting (Ballance, Clifford, and Shoag Reference Ballance, Clifford and Shoag2020).
At the same time, this framework for negligent hiring immunity would not entirely resolve other ambiguities regarding criminal records. Available evidence suggests that state laws that mandate criminal record checks are themselves another source of uncertainty for employers. Holzer, Raphael, and Stoll (Reference Holzer, Raphael, Stoll, Stoll, Bushway and Weiman2007), for instance, find that approximately 50 percent of respondent employers in Los Angeles who always check criminal records believe that they are under a legal mandate to do so, as do roughly 20 percent of employers who sometimes check. Yet only 56 percent of these firms report that their checks are run through the state’s central criminal history repository, as would be the case under a statutory background check requirement. As such, this finding indicates that a substantial minority of employers wrongly perceive that they are legally required to check under existing laws. Likewise, recent work indicates that the rap sheets that states disseminate under these requirements often contain significant errors and omissions that create interpretive difficulties for employers (Lageson Reference Lageson2020; McElhattan Reference McElhattan2021). Accordingly, while the scope of the present study is limited to the uncertainties that employers face as a result of negligent hiring liability, this does not preclude the existence of other ambiguities that complicate employers’ perceptions of their legal environment.
