Hiring for Your Healthcare Practice? Mind These Legal Issues

Every step of the hiring process, from job postings to offers, comes with legal risks and constraints. Understand the issues before you step out of bounds.

One woman hiring a female worker

The shortage of healthcare workers across the country has forced practices to spend more time and energy on hiring. But as you hunt for the perfect candidate, you’ll need to avoid liability. So what should practices know as they start or continue the hiring process?

Job Postings

Writing carefully crafted, complete job postings is crucial, especially as more jurisdictions pass laws requiring employers to include specific information. For example, municipalities such as New York City and states such as Colorado and Washington mandate that some employers disclose pay ranges on job postings. 

Healthcare practices may find it beneficial to post pay ranges even when not required by law.  Such information helps employers and job seekers avoid wasting time when the parties’ compensation expectations don’t align. Similarly, it’s imperative to include information about employee benefits.

Specifying whether you’re seeking an employee or an independent contractor is also essential.  Employee misclassification has become increasingly common. Some employers misunderstand the factors determining employee versus independent contractor status. Others seek to avoid providing benefits to eligible employees. Unfortunately, with the rise in misclassification comes a rise in lawsuits from contract workers who assert that they should be employees. To avoid such lawsuits, you should first be sure to classify your workers appropriately. Then, be transparent about the type of worker you intend to hire.  If your practice is confused about which classification is appropriate, consider asking an attorney for guidance.

See the related video, “Is That Worker an Employee or an Independent Contractor? Why Classification Matters.” 


Interviews pose particular challenges for employers. On the one hand, interviewers typically want to know as much about candidates as possible. On the other hand, laws curtail some lines of questioning to promote a level playing field for all workers. Thus, it’s ill-advised to ask questions that could be perceived as discriminatory towards race, gender, religion or national origin, age, or any other protected classes. Also, keep in mind that states, counties, and municipalities may recognize many more protected classes than the federal government (e.g., housing or marital status), so it’s essential to know the boundaries before you inquire about anything outside of a candidate’s professional qualifications.

Some states, such as California, New York, and Illinois, have passed legislation prohibiting employers from asking interviewees about their salary histories. As a compliant alternative, ask candidates about their expectations regarding pay. For more information on the Illinois Equal Pay Act, see our blog “Discussing Salary History: What’s Allowed Under the New Illinois Law?


If your practice has found a candidate you are excited to hire, congratulations! But you still need to be prudent as you take your next steps.

An offer letter can be a valuable tool for the employer and the candidate, highlighting the terms of the relationship, such as job duties, benefits, time off, and pay. While the employment or contractor agreement will likely echo the same information, an offer letter provides a clear written snapshot to help the candidate decide whether to accept the offer or move on. 

Offer letters must avoid language that might mislead a candidate or be mistakenly construed as binding on either party. Again, the role of the offer letter is to clarify the proposed relationship. For instance, a small employer may not be required to provide employee benefits or may be exempt from particular workplace and labor laws. If that is the case, an offer letter should make the candidate aware. Also, do not offer something that you cannot deliver. Speak with your insurance and benefits professionals before you prepare the offer letter, and be sure you understand your benefits package fully.

Rescinded Offers and Rejections

Rescinding an offer letter is hard for both the employer and the candidate. In turbulent times, budgets may force some employers to choose between laying off existing employees and rescinding offers to future workers. If you decide you must rescind an offer, notify the candidate as soon as possible. Your liability may increase if you reverse your hiring decision after the candidate resigns from their current employer or relocates based on the offer. If the candidate incurs financial hardship because of the rescinded offer, consider giving the candidate a stipend or severance-type compensation so they can continue their job search. 

Meanwhile, whenever you reject applicants, make sure to do so without suggesting that discriminatory reasons factored into the decision. Most employers understand that making hiring decisions based in whole or in part on a protected characteristic is illegal. However, simply wording a rejection letter or email the wrong way could expose them to liability.

What’s Next?

Once the job candidate accepts a position, you have a few more steps to ease the transition:

Enter into an employment or independent contractor contract.

Not every hire warrants an employment contract. However, employment contracts can help protect the practice’s interests when appropriate. If you intend to hire an independent contractor, crafting a robust agreement is crucial. (See the article,Why You Need an Independent Contractor Agreement for your 1099 Staff“).

Obtain the right insurance.

Start by asking yourself: Do I have the right insurance for my healthcare practice? If so, add any new providers to your professional liability policy. Also, be sure you understand what your professional liability insurance actually covers.

Provide training and a workforce handbook.

If you haven’t previously done so, determine your staff policies and how you’ll implement them. For example, 

Document these policies in an employee handbook and ask your workers to sign the signature page to acknowledge that they understand the expectations. 

Learn more in the video “Do You Really Need an Employee Handbook for Your Independent Healthcare Practice?”

Get Legal Support

Without question, hiring new workers represents an exciting but complex process for small and mid-sized healthcare businesses and practices.  Fortunately, an experienced healthcare attorney can lighten your load and help you avoid the many common missteps.

Are you expanding a practice in one of the states where we have licensed attorneys? Reach out to us for a free consultation to find out if we’re a good fit for your needs.

This blog is made for educational purposes and is not intended to be specific legal advice to any particular person. It does not create an attorney-client relationship between our firm and the reader. It should not be used as a substitute for competent legal advice from a licensed attorney in your jurisdiction.

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