Hiring New Employees in Maryland: A Legal Guide

Create a clear job description that outlines the position's responsibilities, required qualifications, and compensation. Ensure the job posting complies with Maryland's anti-discrimination laws and does not contain language that could be interpreted as discriminatory based on protected characteristics (race, color, religion, sex, age, national origin, marital status, sexual orientation, gender identity, disability, or genetic information).

Develop an application form that collects necessary information from candidates while complying with Maryland law. Avoid questions about protected characteristics, arrest records (as opposed to convictions), and other potentially discriminatory inquiries. Include an at-will employment disclaimer and authorization to verify information provided.

Interview qualified candidates and select the best fit for the position. Ensure interview questions comply with Maryland anti-discrimination laws. Document the selection process and reasons for hiring decisions to demonstrate non-discriminatory practices.

Draft an offer letter that includes position title, start date, compensation, benefits, and employment conditions. In Maryland, clearly state the at-will employment relationship unless you intend to create a contract for a specific term. Include any contingencies such as background checks or drug testing.

If offering more than at-will employment, prepare a formal employment contract. In Maryland, employment contracts should clearly outline terms of employment, compensation, benefits, termination conditions, and any restrictive covenants. Consider having an attorney review to ensure enforceability under Maryland law.

Create an NDA to protect confidential business information. In Maryland, NDAs must be reasonable in scope, duration, and geographic area to be enforceable. Clearly define what constitutes confidential information and the employee's obligations regarding such information.

If necessary, draft a non-compete agreement. In Maryland, non-compete agreements must be reasonable in duration, geographic scope, and protected interest to be enforceable. Note that Maryland law prohibits non-compete agreements for employees earning equal to or less than $15/hour or $31,200 annually. Consider having an attorney review to ensure enforceability.

Create a form that complies with the Fair Credit Reporting Act (FCRA) and Maryland law. The form must be clear, conspicuous, and standalone (not part of the employment application). Obtain written consent before conducting background checks, and follow proper adverse action procedures if you decide not to hire based on the results.

After receiving signed authorization, conduct background checks in compliance with Maryland law. Maryland follows the 'ban the box' law for state government positions, but several jurisdictions within Maryland (including Baltimore City, Montgomery County, and Prince George's County) have ban-the-box laws that apply to private employers, prohibiting criminal history inquiries until after the first interview.

Employers must register with the Maryland New Hire Registry to report new hires. This is required for child support enforcement purposes. Set up an account if you don't already have one.

Federal law requires all employers to verify employment eligibility using Form I-9 within 3 business days of hire. Have the employee complete Section 1 on their first day, and you must complete Section 2 after reviewing original documents that establish identity and work authorization. Retain the completed I-9 for the later of 3 years after hire date or 1 year after termination.

Have the new employee complete the federal W-4 form to determine federal income tax withholding. Provide the most current version of the form from the IRS website.

Have the employee complete Maryland Form MW507 for state income tax withholding. This form determines how much Maryland state income tax to withhold from the employee's wages.

Create a form for employees to authorize direct deposit of their paychecks. Include fields for bank account and routing numbers. In Maryland, employers cannot require direct deposit as a condition of employment unless the employer is the federal government or a state or local government entity.

Create a form to collect emergency contact information. Include fields for multiple contacts and their relationship to the employee. This information is crucial in case of workplace emergencies.

Complete and submit the New Hire Reporting Form to the Maryland New Hire Registry within 20 days of hire. This can be done online through the Maryland New Hire Registry portal, by mail, or by fax. Include the employee's name, address, Social Security number, and start date, as well as your company name, address, and Federal Employer Identification Number (FEIN).

If offering benefits, provide the employee with information about available programs and enrollment deadlines. Have them complete the necessary Benefits Enrollment Forms. In Maryland, employers with 15 or more employees must provide sick and safe leave benefits under the Maryland Healthy Working Families Act.

Give the new employee a copy of your Employee Handbook and have them sign an acknowledgment of receipt. The handbook should include policies on anti-discrimination, anti-harassment, leave policies (including Maryland Healthy Working Families Act requirements for sick leave), workplace safety, and other important workplace policies. Maryland employers with 15 or more employees must have a written sexual harassment policy.

Ensure all required federal and Maryland-specific workplace posters are displayed in a prominent location. These include posters on minimum wage, equal employment opportunity, workplace safety, and Maryland-specific posters such as the Maryland Equal Pay for Equal Work notice and Maryland Healthy Working Families Act notice.

Ensure your workers' compensation insurance coverage includes the new employee. All employers in Maryland with one or more employees must have workers' compensation insurance. Notify your insurance carrier about the new hire if necessary.

Schedule and conduct an orientation session to familiarize the new employee with company policies, procedures, and culture. Cover important topics such as workplace safety, emergency procedures, and company expectations.

Add the new employee to your payroll system. Ensure compliance with Maryland's minimum wage ($13.25/hour as of January 1, 2024, increasing to $15/hour by 2025 for employers with 15 or more employees), overtime requirements, and pay frequency laws. Maryland requires at least biweekly or semimonthly pay periods.

Create a personnel file for the new employee that includes all employment documents, tax forms, and signed agreements. In Maryland, employees have the right to inspect their personnel records. Maintain confidentiality of these records and store them securely.