Guidelines for Rehiring Workers

With the economy gradually improving, many employers are thinking about rehiring laid-off workers. Having clear rehire guidelines is critical to avoiding lawsuits for discrimination and wrongful termination. A positive, well-documented rehire process can also foster employee loyalty and increase employee morale.

In February 2011, businesses created an additional 192,000 jobs. Leaders in the employment increase were factories, business services, education, professional services and health care. Jobs were lost in the retail industry, and in state and local governments.

An employer who will rehire workers needs to have a clear, objective selection method in place. The employer should assume that she will have to explain the rehire criteria to a judge or the EEOC to defend herself against a charge of discrimination.

A collective bargaining agreement may specify which employees will be rehired. In the absence of such an agreement, the employer must make fair decisions according to attorney Wayne Pinkstone with Fisher & Philips of Philadelphia. 

Many employees assume that workers will be recalled based on seniority, but this is not true. There is no law that requires the employer to consider seniority. In fact, an employer can choose to rehire the most recently hired (and therefore lowest-paid) employees.

Employees can be selected for rehire based upon many factors, or a combination of factors including:

Experience in the industry

Seniority with the company

Performance review ratings

Lack of disciplinary problems

Education

Performance on skills tests or other objective measures

Performance in rehire interviews

An employer can base rehire decisions on any one of these factors, or on a combination of these factors.

Employers should beware of “playing favorites” or using personal, subjective criteria for recalling laid-off employees. The danger is clear. A supervisor who has only one slot open may choose to recall “Joe”, his favorite employee. If “Joe” is Caucasian, male or both, this may very well be illegal discrimination. Other laid-off employees could sue for wrongful termination, claiming that the lay-off was simply a pretext to fire minority or female employees. If “Joe” is genuinely the best candidate for the job, the employer should be able to prove it with objective information. Employers should document each rehire as if they will have to defend the decision in court.

There is no law that an employer must recall laid off individuals, ever. (Rehire may be required under some union contracts.) Some companies will opt to conduct an open search for new employees. Laid-off workers will be allowed to apply for the new positions, but will compete against new candidates. This tactic allows the company to select the most qualified candidates from a wealth of applicants.

One of the best defenses against a discrimination suit is accurate, well-documented evidence that the chosen criteria were objective, and that the employer applied the criteria consistently.