The Legal Issues That Crop Up During the Recruitment Process

Published 14 February 2016

With the holiday season behind us, many businesses will start the process of hiring new employees to fill positions that have become vacant over the past few months.  There are legal risks involved in any recruitment process but with it brings the potential to add talented new employees into the organisation.

The key is to manage the legal issues, without allowing these potential difficulties to limit the organisation’s ability to attract new talent.

Some key issues to be aware of are:

  • Privacy
  • Discrimination
  • Ensuring there are no legal restrictions on the person’s capacity to work.

Whilst the Australian Privacy Principles do not apply to the records of current and former employees, they have important operation in relation to candidate information.  If an employee is an entity covered by the Australian Privacy Principles, there are significant obligations regarding the manner in which candidate information is to be handled. Under the Privacy Act 1988 (Cth), a candidate has the right to access and correct personal information (including a referee’s report) which an organisation holds about the person.

It is therefore important that human resource managers do the following:

  • Advise potential referees that the information they are providing (including notes of telephone references taken) may be accessed by the person who is the subject of the references.
  • If a business intends to hold onto information regarding unsuccessful candidates, it must expressly obtain their permission to do so.
  • Throughout the entire recruitment process, be aware that the file and documents held on a candidate may be able to be accessed by that candidate if they are unsuccessful.

In Bair v Goldpath Pty Ltd & Callinan [2010] QCAT 483 a small school uniform manufacturer and its employee were found to have unlawfully discriminated against a job candidate during an interview when they asked for his date of birth and questioned whether he had children. The Tribunal found that whilst these questions had been asked as a result of a lack of human resource training, there was no reason as to why these questions could be required other than for discriminatory purposes. The company was ordered to apologise to the candidate.

Under state and federal anti-discrimination legislation, it is unlawful to discriminate against a person on the basis of, amongst other things, their age, sex, race, disability, marital or relationship status or carer’s responsibilities. This applies to circumstances where an employer makes a decision based on one of these criteria as to what candidate should be offered a role or what the terms and conditions of their employment will be.

Much of the recruitment process is based on subjective experiences and views. Many unsuccessful candidates will form views (often incorrectly) about the reasons they were unsuccessful and these can include a belief that they have been unlawfully discriminated against.

Some practical measures an employer can take to limit the risks of a discrimination claim being made against it include the following:

  • During interviews, do not ask questions related to such matters as health, family responsibilities, gender, race or sexual orientation.
  • Take great care in relation to the notes made regarding candidates by interviewers. Be aware that in the event of a claim of discrimination, these notes could be discoverable. There is also the possibility of the candidate obtaining access to parts of the file under the National Privacy Principles.
  • If there is a genuine concern about a candidate’s ability to perform the position due to a health matter or family responsibilities, great care must be taken in how this concern is managed. It is only lawful to discriminate against a candidate if they cannot perform the inherent requirement of the position. The inherent requirements of a position does not include everything an employer might want a person to do in a perfect world. It is the essential or necessary parts of the job viewed objectively.
  • Any decision made on the basis of a candidate’s medical condition must be based on information provided by an appropriate doctor (either the treating doctor or an independent expert).

Employee’s legal capacity to work
An important question which many businesses fail to ask before offering a job to a candidate is whether they are subject to any non-compete or post-employment restraints from their previous employment. This can have serious consequences for a business if an employee subsequently breaches their restraints and their old employer commences proceedings against the individual and the new employer.

Whilst asking the question of a candidate during the recruitment process may not ultimately affect the business’ decision to hire the person, it will give them the opportunity to take steps to mitigate the risk of being caught up in a protracted legal battle. This could include approaching the previous employer and coming to some agreement that they will not seek to enforce the restraint or that they will only enforce it for a specific period of time. Alternatively, the business could temporarily place the employee into an area of the organisation where they will have no opportunity or reason to contact previous clients or use confidential information belonging to the old employer during the restraint period.  In many cases it will be appropriate to include in the contract of employment a warranty from the new employee that they are not under any restriction (contractual or otherwise) which would prevent them working.

The Migration Act 1958 (Cth) also imposes significant obligations on employers to ensure that a person is legally able to work as either a citizen or a foreign citizen who holds a valid visa to work in Australia. Employers should, at the appropriate time, request evidence that an employee is legally entitled to work in Australia.

Whilst the recruitment process can be challenging for a business, it can also be extremely rewarding when the right person for the job is found. Being aware of the legal issues that can crop up throughout the process is important for all businesses so that steps can be taken to mitigate the risk of legal difficulties arising.

This content is general in nature and provides a summary of the issues covered. It is not intended to be, nor should it be relied upon, as legal or professional advice for specific employment situations.

Olexo Workplace Law recommends that specialist legal advice should be sought about specific legal issues.