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What Every New Jersey Employer Needs to Know: Hiring Practices

Spring 2006Cole Schotz DocketAttorney: Randi W. Kochman

An employer’s knowledge and compliance with State and federal laws governing employment practices is essential to the successful operation of any business.  The first discussion in this two-part article outlines what employers need to do to ensure that their hiring practices are up-to-date and compliant with ever-changing State and federal laws.

Employment Applications

Employers should be sure to elicit only permissible information in their employment applications.  The New Jersey Law Against Discrimination and federal law expressly prohibit any pre-employment inquiries that express any preference or limitation on the basis of any characteristic protected under State or federal law, such as gender, religion, or race.  The employer may ask about information necessary to assess whether a job applicant can perform the position, such as the applicant’s education, experience, training, references, fluency in foreign languages, and willingness to travel.  All applications should include an at-will statement, explaining that, if hired, the applicant will be subject to termination with or without cause. 

Background Checks and Testing

During the hiring process, employers must be careful of the type of pre-employment information they elicit from the applicants.  Employers should not ask about arrests unless it is necessary for some legitimate business purpose, because arrest records could have a disparate impact on minorities.  Employers may drug test applicants, but before conducting such testing, the employer should be sure to institute specific drug testing procedures, including who will be tested and how often.  While employers may not require applicants to take a polygraph test as a condition of employment, employers may fingerprint applicants.  Physical testing is not permitted unless the tested criteria is related to the job position and there is no other test that will not exclude handicapped persons. 

Offer Letters

The offer letter should set forth the essential terms of employment, such as the start date, the job title, compensation, and duties.  It is essential that the offer letter establishes the at-will nature of the employment, and makes it clear that the employment is not for any set term or time period.  The letter should also reference any pre-conditions to employment, such as the necessity of successfully completing a background check, a drug test, or the signing of a non-compete agreement.  The offer should contain an “entire agreement” statement to prevent an employee from later claiming that he/she relied on any other representations from the employer.

Non-Compete Agreements and Restrictive Covenants

Employers that seek to have their employees sign restrictive covenants or agreements not to compete should draft such agreements in such a way that specifically identifies the duration, geographic scope and the activities that the employer seeks to preclude.  The employer should keep in mind that the purpose of the agreement is to protect its legitimate business interests.  An employer is not permitted to impose an undue hardship upon the employee or injure the public in any way.  Some examples of protectable interests include trade secrets, customer lists, pricing policies and other such proprietary information belonging to the employer. 

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