What are the Legal Issues in Rehiring Laid-off Employees?

When it comes to rehiring previously laid off employees, what are the ground rules? Do we have to wait a certain amount of time before we can hire someone new instead of rehiring someone we laid off?

We're in the middle of that kind of situation right now and we're not sure legally what our obligations are. We recently laid off a number of employees and have already started rehiring some of them back. However, we're in a position to hire some new employees as well but want to make sure we're not stepping on any legal issues by hiring them before we were to rehire some of the laid off folks.

Thanks for you help!

Kindra

Dear Kindra:

Layoffs have been in the news a lot lately. The troubled economic times have sent thousands of workers to the unemployment rolls and uncertain futures. But downsizing has made its impact on companies as well. Many are finding that while they are able to save some money by cutting their staff, they are painfully thin in areas critical to the success of the business. Some, it seems, are resorting to rehiring their laid-off employees.

There are a couple issues to be aware of in this situation. First, unless your company policy or union agreement states otherwise, you do not need to wait any amount of time before hiring new people to positions that were eliminated in a lay off. However, you should be careful. If you are hiring new people and rehiring some laid-off workers but not others, you could find yourself in a potential discrimination lawsuit. For example, let's say a black employee with good performance reviews was laid off along with five others in the same position. Three white workers are rehired along with one new white employee. The black former employee might decide to sue on the basis that he or she was perfectly qualified to be rehired, yet wasn't. You should make sure that you have a very good reason why you are not rehiring someone.

Another issue that needs to be addressed is the benefits of the rehired employees. Many, though certainly not all, companies allow rehired workers to retain their former benefits as if they had not left the company. This means that they will receive all of their accrued vacation time and have no waiting period for health insurance or retirement plans. Other companies may reduce the time of the probationary period before reinstatement.

Good luck!

HR Guy

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