HR Question of the Month: Internal vs. External Hiring
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Answer:
It is generally a business decision whether to consider internal candidates for a particular position. There is no specific requirement that an employer consider internal candidates. However, if a company has a policy regarding accepting applications from internal candidates, that policy should generally be followed. If the policy does not provide for the flexibility that is needed, it should be amended and the new policy communicated to employees.
It is common for employers to request approval from an internal candidate’s current manager before making an offer to the candidate or authorizing a transfer. However, you may wish to consider the effect that rejecting an applicant’s request due to the needs of their current department will have on the employee’s morale and their future employment with the company. An employee who is otherwise qualified for the position but is passed over for this reason may become disgruntled and may end up leaving the company altogether.
An employer or manager may think that keeping an employee in their current position would be the best result for the company as a whole. However, employees will also want to prioritize their own career interests, and it is generally recommended for managers to support qualified employees in their professional development. It cannot be guaranteed that an employee will be satisfied with an employer’s unilateral decision that the employee will not be permitted to work in a different department. An employment decision that does not support an employee’s interest in advancement could lead the employee to seek that advancement outside the company. If the employee is otherwise well-qualified and valued, the employer could be losing a valuable asset while also failing to keep original department well-staffed.
Employers should take care to ensure that any employment decision should not discriminate against employees based on any protected classes under federal or state law. Even if discrimination based on a protected trait is unintentional, it is still unlawful. However, on its own, status as a current employee is not a protected trait and it would not be illegal discrimination to not consider internal candidates. However, fairness could still be an issue in this type of situation, especially if other current employees from other divisions are considered. Ultimately, the employer will need to make a decision based on the needs of its particular workforce and its specific priorities.
