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Davis Brown Employment and Labor Law Blog

Employment Law Blog: Preferential Hiring Beyond the OFCCP - Goodbye Employment-At-Will - October 16, 2013

When the Office of Federal Contract Compliance Programs (OFCCP) announced its rules on the hiring of veterans and those with disabilities this generated significant discussion on preferential hiring programs as well as the issues relating to veteran employment.  Concerns were expressed by various organizations and groups relating to everything from how this would impact upon other preferential hiring goals expressed by OFCCP, such as for women and other minorities and the interaction of the OFCCP guidelines with the ADA/ADAAA.  However, separate from these requirements for federal contractors, public employers in Iowa face various state law concerns, specifically those under Chapter 35C, the Iowa Veteran’s Preference Act.  The Act provides for several very specific requirements in the hiring of veterans for public employers and that veterans are entitled to “preference in appointment in employment over other applicants of no greater qualifications.”  In addition to the statutory language there have also been several specific court cases which relate to the Act, which provide additional guidance in how the Act is to be implemented.  In summary, it requires the following:

  1. A veteran as defined by Iowa Code Section 35.1 is to be provided preferential treatment in hiring.  This section, 35.1, provides very specific definitions as to who is a qualified Veteran.  Listing specific wars, specific times and noting that members of the reserve forces and members of the Iowa National Guard are considered veterans for the purposes of this statute if they had served at least 20 years and were discharged under honorable conditions.  
  2. As a public employer, the entity is required to have a section on its application which allows a veteran to list his or her military service.  Given that honorable discharge is typically required pursuant to the statute an inquiry as to whether or not the veteran was honorably discharged is appropriate.  
  3. If the veteran has the same qualifications as other applicants the veteran receives preference for hiring.
  4. Typically, employers are required to make an investigation of the “preferred person.”  This includes an investigation into the qualifications of the applicant for the position, determination if the applicant has “good moral character” and is able to perform the duties of the position.  Presumably, if you are a public employer who is required by statute to provide for specific background checks, such as the SING process or debarred providers, this standard background process must also be accomplished.  
  5. The person in charge of hiring or the decision maker must reduce his/her decision regarding the hiring to writing and “file for public inspection” the grounds upon which the person was hired or refused.  However, at the time of application, or during an interview “an applicant may request notification of refusal only or notification of refusal on the specific grounds for refusal.  That notification must be sent within ten days after the successful applicant is selected.”  
  6. In the event that the public employer provides testing for any portion of competency to determine hiring, the veteran receives a 5% bump on his/her score, increasing the total average of the score.  The Veteran must meet any minimum requirements to pass the test without this 5% bump in order to qualify for the score increase.
  7. Once a veteran is hired, the preference set forth in Iowa Code Chapter 35C applies to employment status, negating the basic requirement of employment at will in the state of Iowa. 
  8. In the event a veteran is going to be terminated, the employer must provide the veteran with a written statement showing or listing that the veteran has demonstrated incompetence or misconduct
  9. The veteran is entitled to a pre-termination hearing, although the statute does not define the nature of quality of a hearing.  The employer must show by a preponderance of evidence that the veteran is incompetent or has engaged in misconduct.
  10. The hearing must afford the veteran a reasonable opportunity to present information to challenge the termination.  There is no indication that counsel is required or must be allowed as part of the “hearing” process.  The burden of proof rests with the employer to show cause for termination of the veteran.

In the event that a public employer fails to act in accordance with these requirements, the covered person may seek mandamus (Court Order requiring specific action) to right the wrong or in the alternative seek judicial review under Iowa Code Chapter 17A.  Additionally, the person may bring suit in the district court in the County where refusal occurred and seek a declaration as to whether or not that person fills the requirements of the section. A potential remedy under the Section would be the requirement that the person be hired by the public employer.  Note that there are no attorney fees provisions contained in this statute and no indication that attorney’s fees would be awarded.  There are also statutory requirements for arbitration if the employers fail to apply the preference, such arbitration to be done in conformance with the American Arbitration Association requirements.