Hiring New Employees in Tennessee: Legal Guidelines for Employers

Develop a clear job description that outlines the position's responsibilities, required qualifications, and essential functions. Ensure the description complies with Tennessee employment laws and does not contain discriminatory language. This will help attract qualified candidates and serve as documentation for the position requirements.

Advertise the position through appropriate channels such as job boards, company website, social media, or recruitment agencies. Ensure job postings comply with anti-discrimination laws and do not indicate preference based on protected characteristics (race, color, religion, sex, national origin, age, disability, or genetic information).

Create or update your employment application form to collect necessary information from candidates. Ensure the form complies with Tennessee laws regarding prohibited pre-employment inquiries. Avoid questions about age, race, religion, disability, or other protected characteristics unless they are bona fide occupational qualifications.

Review applications, conduct phone screenings, and schedule in-person interviews. Prepare interview questions that focus on job-related qualifications and avoid discriminatory inquiries. Document the selection process to demonstrate fair hiring practices.

Create a form that complies with the Fair Credit Reporting Act (FCRA) to obtain the candidate's consent for background checks. In Tennessee, employers must provide clear notice and obtain written authorization before conducting background checks. The form should be separate from the employment application.

After obtaining written consent, conduct appropriate background checks based on the position requirements. In Tennessee, employers can check criminal history, but should consider the nature of the crime, its relation to the job, and time elapsed since conviction. Follow FCRA requirements for adverse action procedures if you decide not to hire based on background check results.

Draft an offer letter that outlines the position, salary, benefits, start date, and employment relationship (at-will employment is standard in Tennessee). The letter should clearly state that employment is contingent upon successful completion of background checks and verification of eligibility to work in the United States.

If using an employment contract rather than at-will employment, draft a contract that clearly outlines terms of employment, compensation, benefits, duration, termination conditions, and any restrictive covenants. Tennessee generally enforces reasonable non-compete agreements, but they must be limited in geographic scope and duration.

Draft a non-disclosure agreement to protect confidential business information. In Tennessee, NDAs are generally enforceable if they are reasonable in scope and duration and protect legitimate business interests. The agreement should clearly define what information is considered confidential.

If necessary for the position, draft a non-compete agreement that complies with Tennessee law. In Tennessee, non-compete agreements must be reasonable in terms of geographic scope, duration, and protected business interests. Courts may modify overly broad agreements to make them reasonable rather than invalidating them entirely.

Prepare to verify the new hire's eligibility to work in the United States. Familiarize yourself with acceptable documents for Form I-9 completion and ensure you have the most current version of the form. Tennessee employers must use E-Verify for state agencies and certain contractors.

Create or update your employee handbook to include company policies, procedures, and expectations. In Tennessee, important policies to include are at-will employment disclaimer, anti-discrimination and harassment policies, leave policies (including Tennessee's pregnancy and adoption leave law for employers with 100+ employees), workplace safety, and disciplinary procedures.

Gather or create forms for enrolling the new employee in company benefits such as health insurance, retirement plans, and other optional benefits. Include clear information about eligibility requirements, enrollment deadlines, and costs.

Create a form for employees to authorize direct deposit of their paychecks. Include fields for bank account information and employee authorization. In Tennessee, employers cannot require direct deposit as the only method of payment unless certain conditions are met.

Create a form to collect emergency contact information from the new employee. This should include primary and secondary contacts with phone numbers and relationship to the employee.

Have the new employee complete Section 1 of Form I-9 on their first day of work. As the employer, complete Section 2 within 3 business days of the employee's start date after physically examining the employee's identity and work authorization documents. Store I-9 forms separately from personnel files and retain for the required period (3 years after hire date or 1 year after termination, whichever is later).

Have the new employee complete the federal W-4 form to determine federal income tax withholding. Ensure you're using the current year's form as the IRS periodically updates it. Maintain the completed form in the employee's payroll records.

Have the employee complete Tennessee's state tax withholding form. While Tennessee does not have a state income tax on wages, there may still be required state tax forms depending on your business type and the employee's situation.

Complete and submit the Tennessee New Hire Reporting Form within 20 days of hiring a new employee. This is required by federal and state law to help enforce child support obligations. Report can be submitted online through the Tennessee New Hire Reporting Program or by mail.

Add the new employee to your workers' compensation insurance policy. In Tennessee, employers with five or more employees must carry workers' compensation insurance (construction and coal mining employers must carry coverage regardless of the number of employees).

Ensure all required federal and Tennessee-specific workplace posters are displayed in a prominent location accessible to all employees. Required posters include federal notices (FLSA, FMLA, OSHA, etc.) and Tennessee-specific notices (Workers' Compensation, Unemployment Insurance, etc.).

Schedule and conduct an orientation session to introduce the new employee to company policies, procedures, culture, and job expectations. Review the employee handbook and have the employee sign an acknowledgment of receipt.

Add the new employee to your payroll system with the correct tax withholding information, pay rate, and payment method. Ensure compliance with Tennessee wage payment laws, which require regular paydays and pay statements showing hours worked, gross wages, and deductions.

If hiring a minor (under 18), ensure compliance with Tennessee child labor laws, which restrict working hours and prohibit certain hazardous occupations. Minors 14-15 years old have more restrictions than those 16-17 years old. Obtain work permits if required.