Help Wanted: Are You Practicing Due Diligence in Hiring Your Farm Employees?

You expect the people you hire to be on the job and reliable. (Thinkstock)

Hiring a new employee at your barn can mean playing with fire. Literally. Case in point: the arson committed by 20 year-old farmhand Michael James Holstein. Holstein had been hired by Evergreen Farm in South Charleston, W. Va., to clean stalls and cut weeds for the farm. However, on July 8, 2003, his self-admitted “fascination with fire” led this arsonist turned farm worker to set a barn and indoor riding arena ablaze and take the lives of 15 horses. Download a PDF of this article here.

As the owners of Evergreen Farm found out, hiring the wrong employee for your farm can have disastrous financial and personal consequences. As with any business, a horse farm is not immune to problem employees. It could be the farm hand or riding instructor who is a sex offender like the one who molested four young girls in a 1994 case in Trabuco Canyon, Calif., or the farm employee you put behind the wheel of your horse trailer not knowing that he has several convictions for DUI. It could be person you hired to manage the finances of your farm but who unbeknownst to you has a criminal record that included embezzlement and financial theft, or it could be the worker who has had multiple convictions for violent assaults. Not knowing the individuals who are working for you can leave your equine business wide open to liability.

Furthermore, it isn’t only the employee who will find themselves in legal trouble. You, as the employer can land in hot water as well. Under the legal theory of respondeat superior, an employer is liable for the acts of their employees when the employee is acting within the scope of their employment or in furtherance of the employer’s business. The law further holds that under the theory of vicarious liability, an employer is liable for the wrongdoing of an employee even if the employer did nothing wrong. The acts of the agent of a company are assumed by law to be the acts of the business itself as long as those acts were committed within the course of employment.

For an employer, a negligent hiring lawsuit is a likely consequence of someone who has been injured by your unfit or incompetent employee. A negligent hiring claim asserts that an employer knew or should have known about the employee’s background that indicated a dangerous or untrustworthy character. Half of the states in the United States legally recognize that an employer is responsible and can be held accountable for not checking the background and references of any job applicant before placing that applicant in a position of public contact. Not only are the odds of an employer losing one of these lawsuits very high but also these lawsuits are often very costly. A 2001 Public Personnel Management study reported that employers lost in 79% of negligent hiring lawsuits. Research by Human Resources Management revealed that the average settlement of a negligent hiring lawsuit is nearly $1 million. So, yes, a bad employee can cost you, and due diligence in hiring your employees should be exercised no matter how small your horse business is.

One of the most likely ways to get sued for negligent hiring is for an employer to hire an employee without conducting a reasonable investigation into the employee’s background for the job for which the employee was hired, and as a result, co-workers or third parties were harmed or injured. For a negligent lawsuit to prevail, there has to have been an employment relationship. In deciding whether an employment relationship exists, courts will typically look at evidence that proves that the employer directed and paid wages to the worker, the employer had the power to fire the worker and both the employer and employee considered it to be an employment relationship.

A negligent hiring lawsuit must also prove that the employee was incompetent or unfit to do the job for which (s)he was hired and that because of this incompetence or unfitness it was foreseeable that the worker would put people or people’s property at risk. Additionally, the lawsuit must prove that the employer knew or should have known through reasonable due diligence that the employee was unfit or incompetent. Finally, the lawsuit must show that as a direct result of the lack of due diligence by the employer in hiring, the incompetent or unfit employee committed an act that caused the person bringing the lawsuit to suffer injury, harm or financial damages.

In the context of the horse business the risk of hiring incompetent or unfit workers can be great. If you run a boarding or training facility, your clients’ horses are often one of their most prized possessions. The wrong employee could put those horses at risk of being injured, abused or even stolen. Along with the horse, expensive tack could be destroyed or the object of theft. As the Evergreen Farm case illustrated, a disturbed barn employee may commit arson. If you operate a riding school, an employee who is a sex offender or who has a violent temper can put your clients (especially children) at risk. Without your due diligence, you can face liability for negligent hiring if your employee with a history of DUIs or reckless driving is behind the wheel of your horse trailer and an accident in which they are at fault occurs.

Protecting Yourself from a Negligent Hiring Lawsuit 

By now it ought to be abundantly clear that what you don’t know about your employees can hurt you. There are several important steps you should take to protect yourself and your equine business from a negligent hiring lawsuit.

1) Do a criminal background check. The failure to obtain or to attempt to obtain a criminal history has been shown to be the single most common reason for employer liability. However, in doing so be sure you comply with state and federal law. Most, if not all state governments have online databases that, for a nominal fee, will allow you to do a criminal background check. Additionally, the U.S. Department of Justice has a national sex offender registry ( where you can check out potential employees. There are also various consumer reporting agencies that will provide criminal as well as other background information on individuals for a fee. However, various state and federal laws place some requirements and restrictions on doing criminal background checks. More on this later. Before running such a background check, it is advisable to obtain written consent from the job applicant. It may seem burdensome and perhaps costly to get this information. However, most people convicted of crimes do not put this on their resumes or job applications. The burden and cost of getting background information on a potential employee pales in comparison to the problems and cost of a negligent hiring lawsuit that could result from hiring an unfit employee.

2) Check references and talk with former supervisors if at all possible.

3) Review the applicant’s employment history, look for unexplained gaps in employment or frequent job changes over short periods of time.

4)Validate educational degrees. According to the employment screening service HireRight, in a 2010 survey of 1,818 organizations, 69% reported catching a job candidate lying on his or her resume.

5) If the position involves handling money, do a credit check along with a criminal background check. Far too often an individual with money problems can be tempted to use other people’s money (yours!) to solve them.

6) If the job involves driving your farm’s vehicles, check the applicant’s driving record.

7) Perform drug screenings if it is indicated for the position.

The amount of screening required for your potential employee should be proportionate to the risk presented. The greater the risk, the more effort you as the employer should make to investigate your potential employee’s background. Be sure to document your findings and keep your records.

When Hiring, Don’t Run Afoul of the Law

Background checks are essential to be sure the person truly knows what she’s doing. (Thinkstock)

In the process of hiring new employees, there is often a fine line between practicing due diligence as you carefully consider an applicant and violating various federal and state employment laws. With the enactment of such laws as the Civil Rights Act of 1964, the Americans With Disabilities Act and the Age Discrimination In Employment Act of 1967, employers must be cognizant of legal and illegal hiring practices. This holds true for those operating equine businesses as well.

The Equal Employment Opportunity Commission (EEOC) is a federal law enforcement agency that enforces laws intended to stop workplace discrimination. The EEOC reports that there were nearly 100,000 job bias charges made in 2012. Failure to comply with employment laws can result in your business being hit with hefty fines and bad publicity.

Title VII of the Civil Rights Act of 1964 prohibits an employer from discriminating against a job applicant on the basis of race, color, religion, sex (including pregnancy), national origin or age (40 years or older), disability or genetic information in every aspect of employment (hiring, promoting, etc.). It’s important to understand that as an employer you must treat all applicants fairly and equally. If you require job applicants to take a test (skills test, drug test) the test must be necessary and related to the job and you may not exclude people or treat applicants differently on the basis of their race, color, religion, sex (including pregnancy), national origin or disabilities. If an applicant has a disability and requires certain accommodations to apply for a job (Example: A sign language interpreter for a person with hearing impairment), you are required to provide such accommodation so long as it does not cause significant difficulty or expense.

Federal law does not prohibit employers from asking about an applicant’s criminal history. However, the law does prohibit employers from treating people with similar criminal records differently because of their race, national origin, color, sex, religion or disability. Several states limit the use of arrest and conviction records to make employment decisions. These laws may outright prohibit employers from asking about arrest records or they may require employers to wait until late in the hiring process to ask about conviction records. The best idea is to contact your state fair employment agency for information concerning employment screening and the use of criminal background checks in your state.

The EEOC does require that if you as the employer obtain an applicant’s criminal history from a consumer reporting agency, you must meet the requirements of the Fair Credit Reporting Act. These requirements include: (1) getting permission (preferably in writing) from the applicant before asking a consumer reporting agency for a criminal history report and (2) before taking a negative employment action, you must give the applicant a copy of the report and a summary of his/her rights under the Fair Credit Reporting Act.

In addition to complying with various state and federal laws pertaining to employment screening and testing, there are also interview questions that may inadvertently get you in trouble with employment laws. As an employer you need to be cautiously aware of how to ask certain interview questions. We’ve attached a chart below to assist you.

In today’s world, employment laws can be complex and a trap for the unwary. No business, even a small horse farm, is immune from potentially running afoul of the law. In his book, “The Complete Equine Legal Business Handbook” (a book that should be on every horse owner’s bookshelf), author Milton Toby says, “It is possible and, given the level of complexity of federal and state law, even probable that an employer can discriminate against a job applicant or an employee without intending to do so.” He adds, “In the area of employment, an ounce of prevention in the form of a discussion and planning with an employment attorney truly is worth a pound of cure.”

We would also add that an ounce of prevention in the form of care and due diligence in hiring your employees is also worth a pound of cure. A horse business often represents life-long hard work and immense personal financial investment. The wrong employee can destroy it all in a single act. Better to find out all you can about potential employees. The last thing you ever want to say is, “If I had only known.”

 Staying Legal When Conducting a Job Interview

Federal law prohibits job discrimination based on race, color, religion, sex (including pregnancy), national origin, age (40 years or older), persons with disabilities or genetic information. Without even intending to discriminate, there are interviewing questions that can violate the law. Here are some examples of illegal questions and suggestions for questions that comply with anti-discrimination laws:

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