Are Working Interviews Legal? Employer Rules, Pay Requirements, and Compliance Risks

See when working interviews are legal, including employer rules, pay requirements, and compliance risks under federal and California law. Protect your company by paying candidates for tryouts, following safety standards, and avoiding misclassification during working interviews and skills tests.

By Brad Nakase, Attorney

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Table of Contents
1. Introduction
2. Employees Must Be Paid for the Work They Do
3. Labeling Candidates as Externs, Volunteers, or Interns Doesn’t Release Them from Responsibilities
4. Declaring an applicant to be a temporary worker does not absolve them of obligations
5. The Working Interview’s Risks
6. A Skills Test as an Exception to Paying Applicants
7. The Best Ways to Avoid Employment Lawsuits During a Working Interview
8. When California law requires payment for “try-out” time

Introduction

In a resume or job application, a job applicant will normally outline their credentials. In the interview and background check process, the employer would need to assess the suitability of the candidate for the company and whether the skills and experience of the candidate reflect the position. To help the company know whether a candidate has the skills necessary to work in the position, a working interview is one where an applicant comes to the office or workplace and does some work on behalf of the company before finally being hired.

It appears to be a fantastic chance to determine whether the candidate possesses the requisite expertise. However, there are legal requirements for working interviews. Many people ask, “Are working interviews legal?” Here, we examine the legal requirements of the working interview from the employer’s point of view.

Employees Must Be Paid for the Work They Do

Paying employees is mandated by state and federal rules as well as the Department of Labor. Acts done for the company’s advantage throughout a working interview come before an offer of employment, and this is where the responsibility to pay the employee starts. Whether the candidate will be a staff member or a consultant determines the payment method and means.

The rate of remuneration must satisfy state and municipal minimum wages, the United States Department of Labor’s minimum wage requirement, and overtime regulations if the applicant is recruited as an employee. Pre-employment documentation, such as an I-9 & W-4, must be completed by the candidate. Payroll for the required tax withholdings must be set up by the employer. As long as the pay complies with the relevant minimum wage rules, you may offer minimum wage for the period worked, even if the job pays more than the minimum wage.

The candidate is still entitled to payment even if they are recruited as an independent contractor. In general, an applicant is considered an employee if they are utilizing your equipment, performing duties in your office, and under your supervision. If they carry out tasks that an employee would typically complete in the office, simply designating them as an independent contractor or making them execute an agreement does not constitute them as an independent contractor.

Depending on the amount of remuneration, the business must still get a W-9 and disclose this data to the IRS, even if the applicant fits the description of an independent contractor. The firm will have to file on Form 1099-MISC any amount paid to an independent contractor in excess of $600 in the course of a tax year. The company can be fined by the Department of Labor and IRS in case it attempts to avoid the payroll taxes or other employment benefits by declaring them as independent contractors.

Labeling Candidates as Externs, Volunteers, or Interns Doesn’t Release Them from Responsibilities

The requirement of paying for the working interview remains the same if an applicant is simply designated as a volunteer, student, or extern for the purpose of the interview. Whether the label is imaginative or not, the same requirements are applicable, provided that the candidate is under employment as an independent contractor or a staff member. Moreover, wrong classification of an employee as an intern, extern, or volunteer can lead to more severe penalties.

When evaluating “Are working interviews legal?”, the law looks at the work performed.

Declaring an applicant to be a temporary worker does not absolve them of obligations

The company is still required to pay salaries even if an applicant is classified as a temporary employee. For “temporary” employees, the aforementioned wage laws are applicable. Other laws might also be relevant. Companies that employ “day” and “temporary laborers” are subject to additional regulations in some states and municipalities.

“Are working interviews legal?” It depends on proper payment, proper safety precautions, and adherence to employment regulations.

The Working Interview’s Risks

Employers run the risk of being embroiled in employment litigation if they fail to follow the law when performing a working interview. Before conducting a working interview, there are a number of risks to take into account.

  • The candidate has the same civil liberties as other members of the staff, such as the right to complain about any misconduct during a job interview or hiring discrimination.
  • During the working interview, the candidate can sustain an injury. In the event of a workers’ compensation claim, you would be held accountable as the employer. Your compensation provider may reject the claim if the staff member was not appropriately reported and compensated.
  • If you don’t hire the applicant for more work following the working interview, they may claim unemployment. In most cases, unemployment tax is based on the applicant’s earnings from the previous year rather than the employer’s. Nevertheless, the amount that an individual will deduct from the unemployment account will decrease with the length of time they have worked for your organization.
  • The applicant had access to sensitive and secret information that would normally be shielded by anti-compete and employee confidentiality agreements.
  • Part of this is that the candidate is potentially dangerous to the organization or other employees in case they are not fit to perform the desired tasks. They should take measures before giving the applicant a chance of demonstrating their skills to be trusted to perform the tasks in a proper and safe way. OSHA affirms that an employee is entitled to work on safe equipment, get training in a language that they comprehend, and receive the provision of required safety equipment, including gloves, a safety harness, and a lifeline in the event of a fall.

When trying to answer “Are working interviews legal?”, these considerations are important.

A Skills Test as an Exception to Paying Applicants

The candidate must be compensated if they carry out any task for the company that benefits the employer. This is not the case if the task is a skills test. A skills test can be used to determine the knowledge, skills, and abilities of the applicant in performing the duties of the job. A skills test is included in the interview when the candidate is not working for the business, and the company is not gaining anything from the test. Make sure that taking a “skills test” won’t put you at risk for job lawsuits.

The tests ought to be relevant to the job and accurately predict performance in the role; they should be administered to all candidates for the same vacancy under the same terms; and they should be modified to meet all acceptable requirements for applicants with disabilities.

The Best Ways to Avoid Employment Lawsuits During a Working Interview

The following should be taken into account before starting if you decide to use a working interview model.

  • Ask the candidate to fill out Forms 1-9 & W-4 (for employees) or W-9 (for independent contractors).
  • Before the job interview, finish all federal and state background checks that are required of workers in a particular field.
  • Before the working interview, confirm that the candidate has the necessary state and federal licenses.
  • Pay the candidate a rate that meets or surpasses all applicable minimum wages at the federal, state, and municipal levels.
  • If you want to establish clear boundaries for the start and finish of the working interview, discuss wages before it starts.
  • Think about whether the worker will require HIPAA or other confidentiality training in order to carry out the job.
  • When the working interview is over, be prepared to give the applicant the money.
  • OSHA, which establishes and enforces preventative health and safety at work requirements, and other applicable federal, state, and municipal working rules should be met or exceeded.
  • As required by the Americans with Disability Act, make accommodations for candidates with impairments by changing the working conditions.
  • When doing a working interview with numerous applicants, try to ensure that each applicant has the same job duties and obligations.

As with each additional component of the interview process, make sure that no process in the working interview violates the human rights granted to all employees by reviewing the laws about hiring applicants, including both federal and state human rights laws.

When you have the question, “Are working interviews legal?” adhering to the above points makes it legal.

When California law requires payment for “try-out” time

Employers must be careful when recruiting someone to ensure that any skill tests conducted throughout the hiring procedure do not turn into actual work for which the candidate must be compensated.  Occasionally, employers will ask candidates to demonstrate their ability to handle equipment in a factory setting, prepare food in a restaurant, or type in an office. We address five things that companies should consider to ensure that “staging” or “test out” time does not turn into work that needs to be paid for:

  1. The time doesn’t have to be paid as long as it is genuinely testing the applicant’s skills rather than training them.

“Hours worked” is defined by California Wage Orders as “the time during which a worker is subject to the authority of an employer.” Title 8 of the California Code Regulations, Section 11040(2) (K).  Therefore, it doesn’t make sense to be compensated as long as the hiring manager is merely spending the time to assess the applicant’s talents.

  1. The time is not required to be paid if the candidate’s labor does not result in productivity.
  2. The duration of the employee’s exam is “appropriate under the conditions.”
  3. Every situation is unique, and the duration of an employee’s test will vary depending on their role.

“The duration of time to evaluate the abilities of a sewing machine worker will be substantially less than that needed to assess the abilities of a computer programmer,” according to the Division of Labor Standards Enforcement & Interpretations Manual published by the DLSE.  Refer to section 46.7 of the DLSE Manual.  When deciding whether to pay for the testing or try out, employers must consider the position, the abilities being examined, and the interview’s general context.

  1. Pay the candidate for their time when in doubt.

If the applicant’s product is used or distributed to clients, or if the testing requires a long period, the employer may be required to compensate the applicant for this productive time.

Are working interviews legal? Yes, but only when employers follow wage laws, safety rules, and classification standards.

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