Guilt by Association

Avoid Being Tainted or Blacklisted

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It has long been a truism in career management that you can be tainted by unfortunate associations. These include working for companies touched by scandal or failure, or working under bosses who themselves have fallen into disrepute. Even if you are not culpable yourself, these associations can inflict long lasting damage on your career prospects, if not your ability to change jobs and seek employment elsewhere.

People who have spent time with scandal-ridden or failed companies may carry negative baggage, through no fault of their own. In a difficult employment market, where there can be dozens of qualified candidates for every open position, this can present a huge impediment to being rehired.

Case Study Number One:

Several years ago, a reader made an offline inquiry, fearing that he had been unjustly blacklisted. He had the misfortune of working at one firm that was rocked by criminal malfeasance, and later another that failed. He asserted that he bore no responsibility for the problems at either company, and was never formally implicated in any way. Instead, he had received stellar performance reviews at both firms.

Nonetheless, he believed that he was being scapegoated by the firm that engaged in illegal behavior. He had indications that, when contacted by prospective employers in the course of background checks, they denied his ever having worked there.

This, plus his unfortunate association with the failed firm, rendered him unemployable. He could not afford a lawyer, and thus was at a loss regarding what to do.

What to Do:

If you find yourself in such a position, it is crucial to distance yourself from the wrongdoing or the mistakes. For example, technology workers who lost their jobs because of an accounting scandal cannot reasonably be considered at fault in the remotest degree.

Likewise, a lower-level employee in a different division of the firm should not be held responsible for executive management's decisions elsewhere in the company. Reasonable employers should recognize this, but you should be proactive in making clear that you were not part of the problem.

In a proactive vein, be especially careful about avoiding employers and situations that might reflect badly on you in the future, no matter how unfairly. Guarding your reputation is a vital aspect of career management.

Case Study Number Two:

Some managers attempt to achieve results through duplicity. For example, when Merrill Lynch was expanding its capabilities in management reporting and transfer pricing in the late 1980s, a manager leading part of this effort would tell deliberately conflicting stories to various constituencies in the firm, in a misguided attempt to speed their approval of and cooperation with his project. Not only did this soon put his own reputation in tatters, but it also reflected badly on his superiors and subordinates alike. Even after he was replaced, restoring trust in his organization and its efforts took a great deal of time.

More Suggestions:

Experts in career management offer other suggestions about dealing with associations that now may be a source of potential embarrassment to you.

  • Avoid criticizing a former employer. Often this can make you look guilty.
  • If you worked for a disgraced firm, naming it on your resume can cause immediate rejection. Instead, describe the nature of the firm while leaving it unnamed. If you pass that hurdle and get interviewed, insist on discussing yourself and your accomplishments first before revealing the company's identity.
  • For interviews, be well-rehearsed in explaining your lack of culpability and your dedication to ethical business practices.

Note that, the smaller the disgraced firm, the more likely it is that all former employees will be presumed to have had knowledge of, if not an active role in, its misdeeds or failures. It is much easier to distance yourself from illegal or ill-advised activity if you worked in a corporate giant. Former employees of Bernard Madoff's investment firm, for example, soon found that they were, in effect, blacklisted.

Most major financial services firms have refused to consider them for employment.

Primary Sources: The Sunday February 22, 2009 issue of The New York Times carried an article in the business section entitled "Can an Employer's Past Follow Its Workers?" Additionally, the August 4, 2009 Wall Street Journal ran an instructive article on this topic, "When Scandal Rocks a Resume."