Many employers use background checks as part of the pre-employment screening process, and those who don’t should. If an issue arises, such as an employee physically harming another employee or a customer, a lawsuit may follow. If the employer failed to conduct a background check, they can be held liable for damages due to negligent hiring.

Some employers choose not to run background checks because they believe what they don’t know won’t hurt them. That assumption is risky. Courts examine not only what an employer actually knew, but also what they reasonably should have known.

Damages for negligent hiring can be substantial, including what is often referred to as a nuclear verdict. A nuclear verdict typically involves a jury award that is unusually high, often $10 million or more. Even larger awards are sometimes called thermonuclear verdicts and can exceed $100 million.

In a 2024 judgment, a jury awarded plaintiffs more than $60 million stemming from injuries suffered in 2018 when a man was attacked by a security guard at the Texas Live! entertainment complex in Arlington, Texas. The guard knocked the man down, struck him over the head with a glass mug, and punched him, causing serious injuries including a traumatic brain injury.

The guard had a prior assault conviction. Texas law prohibited hiring a security guard with a felony battery conviction within the previous 10 years, which applied in this case. The employer claimed they were unaware of the conviction. However, they did not have an employment application on file and failed to properly screen the guard before hiring him.

In another Texas case, a jury awarded $7 billion in punitive damages, in addition to $330 million in compensatory damages, to the family of an elderly woman who was murdered by a cable technician the day after he made a service call to her home. The technician worked for Charter Communications, which operates under the name Spectrum.

A proper background screening would have revealed that the technician had been terminated from previous jobs for harassing co-workers and forgery. He had also received a written warning for stealing credit cards and financial information from elderly female customers.

In 2024, an Ohio jury awarded $27 million in another negligent hiring case, a verdict that ultimately forced the employer out of business. The employer had not conducted pre-employment background checks and had failed to provide proper training. The award followed the 2022 death of a man who was beaten by two of the bar’s security guards.

Negligent hiring can carry significant financial and reputational consequences. Employers must ensure they understand what they should know before bringing someone onto their team.

Sources: hrmorning.com, coverlink.com, Dickinson-wright.com