Summary. Hiring is the densest compliance sequence in employment law, and nearly every step is governed by a rule that differs by state and by city. This toolkit runs the sequence in order — the posting and its pay range, the application and the questions that may not be asked, the interview and the automated tools that screen it, the conditional offer that triggers the background check, the FCRA and fair chance process, verification and payroll setup, and the documents signed on day one. It closes with the multistate architecture that lets a single process work everywhere, and the records that make each step defensible.

What this toolkit is for, and who should use it

A company hires remotely across a dozen states and runs one process. That process is almost certainly unlawful somewhere: a criminal history question on the application, a salary history question in the screening script, a posting with no pay range, a background check disclosure with a liability waiver in it, and an arbitration agreement bundled with the offer letter in a state that requires it to be separate.

This toolkit is for the person who owns hiring — a head of people, a general counsel, or an outside employment lawyer conducting an audit.

Roadmap at a glance

  1. Define the role and the classification.
  2. The posting.
  3. The application.
  4. Screening, interviewing, and automated tools.
  5. The conditional offer.
  6. Background checks and the FCRA.
  7. Fair chance and the individualized assessment.
  8. Testing and medical inquiries.
  9. The offer letter and day-one agreements.
  10. Verification and payroll setup.
  11. Onboarding notices and the handbook.
  12. Multistate architecture and records.

Stage 1 — Define the role

  • Write a job description stating essential functions, required qualifications, physical and environmental demands, supervision, and location or remote eligibility. It supports the ADA analysis, the FLSA exemption analysis, the background screening criteria, and any later performance dispute.
  • Classify the position: exempt or non-exempt under the FLSA and under the stricter state test where one applies, and employee or independent contractor under the FLSA, IRS, and state ABC tests.
  • Do not default to contractor status. Misclassification exposure includes unpaid overtime, penalties, benefits, workers' compensation, and tax liability, and several states apply an ABC test under which most workers are employees.
  • Determine the states in which the role may be performed, because that drives everything downstream.
  • Confirm budget and approval against the compensation band.

Resources

Stage 2 — The posting

  • Include the pay range the employer in good faith expects to pay, where any applicable jurisdiction requires it — and consider posting everywhere, because for a remote role every jurisdiction applies and inconsistency is visible to employees.
  • Include benefits and other compensation where required, and consider including them anyway.
  • No salary history question, and no statement inviting one.
  • No criminal history question in any jurisdiction that prohibits it at this stage.
  • Neutral, job-related language; avoid terms that signal a preference by age, sex, national origin, or other protected characteristic — "recent graduate," "digital native," and "energetic" have all been cited.
  • Post internally where a fair chance, promotion-posting, or collective bargaining obligation requires it.
  • Include the EEO statement and any required fair chance or accommodation statement.
  • Provide the range to external recruiters in writing and audit their postings; several statutes reach third parties and the employer will be the defendant regardless.

Resources

Stage 3 — The application

  • Remove the criminal history question entirely for a multistate employer.
  • Remove the salary history question, and configure the applicant tracking system so the field cannot be populated.
  • Ask only job-related questions. Avoid date of graduation, date of birth, citizenship beyond authorization to work, marital and family status, disability, and religious observance.
  • Voluntary self-identification for EEO and affirmative action purposes, collected separately from the application and not available to the decision-maker.
  • Accommodation statement and a stated process for requesting one.
  • Do not include the FCRA disclosure in the application. It must stand alone on its own page.

Stage 4 — Screening, interviewing, and automated tools

  • Structured, job-related questions applied consistently, with an evaluation form tied to the stated criteria. Structure reduces both bias and litigation exposure.
  • Train interviewers on what may not be asked and on what to do if an applicant volunteers protected information.
  • Document the evaluation contemporaneously; a rating recorded a month later is worth little.
  • Automated employment decision tools — resume scorers, video assessments, ranking algorithms — carry three overlays:
    • Title VII and the ADA: a tool with a disparate impact is unlawful unless job-related and consistent with business necessity, and an assessment screening out individuals with disabilities without an accommodation path violates the ADA. The employer is responsible for a vendor's tool used on its behalf.
    • State and local AI hiring laws, which variously require an annual independent bias audit with published results, advance notice to candidates, and an alternative process on request.
    • The FCRA, where a vendor assembling information and providing a score may be a consumer reporting agency and its output a consumer report.
  • Ask the vendor for the adverse impact analysis and the validation study. If there is none, that is the answer.
  • Keep a human decision-maker who can explain the reasoning, because an individualized assessment requires an explanation.

Stage 5 — The conditional offer

  • Extend the offer in writing, expressly conditioned on satisfactory completion of background screening, reference checks, verification of eligibility to work, and any required licensure.
  • In jurisdictions requiring it, this is the first point at which criminal history may be considered.
  • State the position, classification, compensation, start date, reporting line, and location, and any contingencies.
  • Avoid language implying a term of employment or a guarantee, and state at-will status where applicable — recognizing that Montana is not an at-will state and that several states limit at-will disclaimers in handbooks.

Stage 6 — Background checks and the FCRA

  • A standalone disclosure on a page containing nothing else — no liability waiver, no state notices, no application content, no vendor description. Courts have held that a waiver in the disclosure is a willful violation.
  • Written authorization, which may appear on the same document as the disclosure and nothing else may.
  • State and local notices on separate documents.
  • Investigative consumer report notice where personal interviews will be conducted.
  • Order only what the role requires, documented by job family, with a written targeted screen.
  • Pre-adverse action: the report, the current CFPB summary of rights, any state-required notices, and a cover letter identifying the information at issue — sent before any decision is communicated, with a documented waiting period of at least five business days.
  • Adverse action notice with the agency's name, address, and toll-free number, a statement that the agency did not make the decision, and notice of the 60-day free report and dispute rights.
  • Hold the decision while a dispute is pending.

Resources

Stage 7 — Fair chance and the individualized assessment

  • Apply the three factors from the EEOC's guidance: the nature and gravity of the offense, the time elapsed, and the nature of the job.
  • Conduct an individualized assessment: notify the individual, give an opportunity to explain and provide additional information, and consider it before deciding.
  • Consider the facts and circumstances, the number of offenses, age at the time, the same work performed without incident since, employment history, rehabilitation and training, references, and bondability.
  • Blanket exclusions are the highest-risk practice and are what enforcement targets.
  • Comply with the applicable fair chance ordinance's procedure: a written preliminary decision identifying the conviction, a copy of the report, the reasoning, a response period of five business days or longer, consideration of the response, and a final notice with any reconsideration rights.
  • Build to the strictest jurisdiction in which you hire, or maintain jurisdiction-specific workflows in the applicant tracking system.

Stage 8 — Testing and medical inquiries

  • No medical inquiry or examination before a conditional offer. After the offer, an examination is permitted if required of all entrants in the job category and the results are kept in a separate confidential file.
  • Drug testing consistent with state law, including the states prohibiting adverse action based on off-duty cannabis use or on a positive test for metabolites, with exceptions for safety-sensitive and federally regulated roles.
  • Skills and personality assessments must be job-related and validated where they screen out protected groups.
  • Credit checks only where the state permits and the role has financial responsibility, with the reason stated where required.
  • Reference checks conducted directly are not consumer reports; document what was said and by whom, and recognize that most large employers confirm only dates and title.

Stage 9 — The offer letter and day-one agreements

  • Offer letter: position, classification, compensation and any variable pay with its terms, benefits eligibility, start date, location and remote arrangement, contingencies, and at-will status.
  • Confidentiality and invention assignment agreement, signed before or on the first day, with an assignment backup to any work-for-hire characterization and the state-required notice where a statute limits assignment of inventions developed on the employee's own time without company resources.
  • Arbitration agreement, where used: consider whether it must be a separate document with separate consideration in the applicable state; whether a class waiver is enforceable; the effect of the federal statute making pre-dispute arbitration unenforceable for sexual harassment and sexual assault claims at the claimant's election; and the cost-allocation and forum provisions that determine enforceability.
  • Restrictive covenants: evaluate enforceability in the employee's state before including one. A growing number of states prohibit non-competes outright or above a compensation threshold, require advance notice before the offer, or mandate garden leave. Prefer narrowly drawn non-solicitation and confidentiality provisions, which are enforceable more widely.
  • Equity documents where applicable, with the grant approved and the § 83(b) election flagged where restricted stock is issued — thirty days, no extension.
  • Relocation, sign-on, and training repayment agreements, each reviewed for enforceability and for wage-deduction limits.

Resources

Stage 10 — Verification and payroll setup

  • Form I-9 completed — Section 1 by the employee no later than the first day of employment, and Section 2 by the employer within three business days. Accept any document from the Lists of Acceptable Documents the employee chooses; do not specify which, and do not over-document.
  • E-Verify where required by federal contract or state law, used only after an offer and acceptance and never to prescreen.
  • Remote verification using the alternative procedure only if the employer is enrolled and in good standing in E-Verify and applies the procedure consistently.
  • State new hire reporting within the required period, typically twenty days.
  • Payroll setup: federal and state withholding elections, state unemployment insurance registration, workers' compensation coverage, and any local tax registration — in every state where the employee works.
  • Direct deposit consistent with state law, which in several states requires an alternative.
  • Pay frequency and pay statement content per the employee's state, which differ materially.

Resources

Stage 11 — Onboarding notices and the handbook

  • Wage notices at hire in the states that require them, with the prescribed content and language, and acknowledgment retained.
  • Paid sick leave and paid family leave notices, and any state-specific rights notice.
  • Workers' compensation notice and posting.
  • Anti-harassment policy and training, which several states mandate within a defined period after hire and on a recurring schedule.
  • Handbook distributed with an acknowledgment, containing an at-will disclaimer where applicable, the complaint and reporting procedures, leave policies mapped to the employee's state, accommodation procedures, and technology and monitoring policies.
  • Benefits enrollment with the required plan notices, including the summary plan description and any HIPAA special enrollment notice.
  • Required workplace postings, physical and — for remote employees — electronic, in the manner the agencies accept.
  • Emergency contact, direct deposit, and equipment acknowledgments.

Stage 12 — Multistate architecture and records

  • Build a state matrix: posting requirements, salary history rules, fair chance timing and procedure, drug testing limits, non-compete enforceability, wage notice content, pay frequency, paid leave, training mandates, and required postings — refreshed annually and whenever a hire in a new state is approved.
  • Make the applicant tracking system jurisdiction-aware, driven by the position's location and the applicant's location, so the correct forms and waiting periods apply automatically.
  • Approve new states deliberately. A single remote hire creates registration, withholding, unemployment, workers' compensation, leave, and posting obligations, and the cost of the first hire in a state is far more than the salary.
  • Records: application, evaluation forms, offer letter, FCRA disclosure and authorization, report, pre-adverse and adverse action notices, individualized assessment, I-9 (retained separately from the personnel file for the longer of three years from hire or one year from termination), medical information in a separate confidential file, agreements, acknowledgments, and payroll registrations.
  • Audit annually: pull five recent hires from different states and trace every step against the matrix. Any gap is systemic, because the same process ran for everyone.

Master resource index

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Related toolkits

External and primary sources

This toolkit is educational and not legal advice. State and local hiring requirements differ substantially and change frequently, and several federal forms and standards are updated periodically. Consult qualified employment counsel before implementing or modifying a hiring process.