Backman fired after background check shows problems
San Jose Mercury News, CA
Arizona brass did not conduct a criminal background check on Backman before hiring him and were not aware that he had been arrested for driving under the influence...
Background checks save costly errors
The News Journal, DE
By the time a new employee takes their lunch break on the first day at work, a company has paid that person more than the cost of the background check ...
Monday, December 06, 2004
Tuesday, October 12, 2004
What Every Employer Should Know about Drug Testing in the Workplace
American business has a drug problem. According to the U.S. Department of Labor, more than 8 million Americans use some type of illegal substance. As many as 73 percent of all illicit drug users in this country are employed.
Occupational Hazards
by Sandy Smith
A Gallup Survey of employees conducted by the Institute for a Drug-Free Workplace found that 37 percent of all respondents said that workplace drug use problems had increased in the last 5 years. A majority of respondents supported drug-screening tests. In general, it appears that respondents placed the greatest emphasis on drug testing for those employed in occupations where one person has direct responsibility for many.
As part of the federal government's effort to address the issue of substance abuse in the workplace, the Drug-Free Workplace Act of 1988 was enacted as part of the omnibus drug legislation. This Act - in effect since March 18, 1989 - requires contractors and grantees of federal agencies to agree to provide drug-free workplaces as a precondition of receiving a contract or grant from a Federal agency.
According to Edward Poole, president and COO of OHS Health and Safety Services Inc., Costa Mesa, Calif., several government and private industry studies concluded that each drug user in the workplace "can cost an employer an average of $11,000-$13,000 annually." That adds up to a cost to American businesses of billions in healthcare costs, lost production time, injuries and damage to equipment and facilities. And chances are good, says Poole, that if your employer does not have a drug-free workplace policy and program, then he or she has at least one drug user on the payroll.
It Can't Happen Here
Despite studies and surveys indicating that a significant number of substance abusers hold jobs and work while under the influence, Poole points out that many employers have an "it can't happen here" attitude about substance abuse in the workplace.
"Once they get in there and implement a policy and start testing employees, they're usually very surprised by the results," he says.
Poole tells the story of one client who operated a small, local delivery service. When a representative from OHS Health and Safety Services visited the business owner, he was told repeatedly that there was no reason to conduct drug testing in that workplace. After all, the company had only 63 employees. After a couple of years of rebuffing them, the delivery service owner called OHS.
"He said, 'We're having some problems. There's something going on that's kind of strange. We want to start a drug-free workplace program,'" Poole recalls. (See sidebar on page XX for steps to create a drug-free workplace program.)
OHS helped him write up a company policy about drugs and drug use in the workplace. They posted signs stating it was a drug-free workplace, and passed out pamphlets to employees.
Forty-five days later, OHS showed up unannounced and did what's called a "sweep." He was going to test every employee in the workplace. Nine people immediately walked off the job. Says Poole, "One or two probably had deeply rooted beliefs in the right to privacy and all that crap, but it is probably safe to say that most of those nine employees would have tested positive." Out of the 54 who took the drug test, 19 tested positive for marijuana and several tested positive for cocaine as well. "The employer was shocked," says Poole, "shocked. Most employers have no clue how many employees are working under the influence."
Writing a Policy
The first step toward eliminating workplace drug and alcohol use is the establishment of a drug-free workplace policy. The U.S. Department of Labor (DOL) offers a Drug-Free Workplace Advisor at www.dol.gov/elaws/drugfree.htm that offers guidance on how to develop a drug- and alcohol-free workplace. According to DOL, the policy should lay the groundwork for your program and should answer several questions, including:
1. What is the purpose/goal of your program?
2. Who will be covered by your policy?
3. When will your policy apply?
4. What behavior will be prohibited?
5. Will employees be required to notify you of drug-related convictions?
6. Will your policy include searches?
7. Will your program include drug testing?
8. What will the consequences be if your policy is violated?
9. Will there be return-to-work agreements?
10. What type of assistance will be available?
The policy "spells out, in black and white, the employer's policy about drugs in the workplace. It should be explicit about what will not be tolerated," says Poole.
Once the policy is established and communicated to employees through workplace signage, take-home materials and workplace briefings, employers might want to take the next step and begin drug-testing current employees and new hires. (Poole cautions employers to determine the legality of drug testing in their state before instituting a program.)
Types of Testing
There are several types of drug-testing procedures available, including blood, urine and hair specimen testing. Poole says that blood tests are usually only used in extreme cases, such as the employee being unconscious as the result of a workplace accident and under the care of emergency room physicians or, in certain cases, as demanded by a court order. Hair specimen testing costs about $115-$150 per test nationally, Poole estimates. "Hair can indicate drug-use as far back as 90 days," says Poole. "Most drugs are detectable in urine for only 1-4 days."
Of the approximately 55 million drug tests performed in the United States each year, 90 percent are urine tests. Poole estimates the cost of urine specimen drug testing at approximately $44 per employee.
The rumors that it is relatively easy to "cheat" a drug test are highly exaggerated, says Poole. Most of those products must be ingested repeatedly for hours before the test is administered. So, even if they do work, such products would only be useful for scheduled drug tests, which is something most employers offer only to new hires.
Poole suggests that employers make offers to new employees contingent upon them passing a drug test. He also says that testing employees following accidents and near-misses is advisable, as is testing any employee you suspect to be under the influence. Again, he cautions, check with state employment and privacy laws to ensure the legality of your testing program. As for random tests, the industry standard is to always test 50 percent of the total number of employees each year.
Testing Results
Poole uses the following example to show the cost/benefit analysis of drug testing: A company with 100 employees with an annual turnover rate of 30 percent has a cost per drug test of $44. If the company tests all 30 new hires and conducts random drug tests of 50 percent of its employees, then it is conducting 80 tests per year. Add in another 20 drug tests annually, ordered as "post-accident" or due to "reasonable suspicion," for a total of 100 drug tests per year.
"At $44 per test, that means the company is investing $4,400 per year in what would be - I assure you - a very highly effective drug-free workplace program," says Poole.
He notes that in the first 3-4 months of newly instituted random drug testing of their employees, every company can expect drug "positive" rates of anywhere from 5 percent to 22 percent. Construction companies and food service tend to rank on the high end of the positive scale, he adds. Retail and office workers tend to have fewer positive drug tests.
"By the end of the first full year – at the latest – the rate of drug positives coming back on the lab reports will drop by 50 percent to 80 percent," says Poole. "Drug positive rates of 26 percent will drop to as little as 5 percent and positive rates of 5 percent will drop to as low as 1 percent."
Soon, the company that once had 100 employees that included anywhere from five or six to 24 workers who used drugs in the workplace and perhaps even dealt drugs in the workplace becomes a drug-free workplace. Company production increases and quality of products and services improve. Sick days are fewer; injuries decrease; the number of workers' compensation claims get reduced; insurance and workers' compensation premiums stabilize; and equipment and supplies stop being damaged or disappearing as frequently.
"Let's look a bit more closely at the average $4,400 annual outlay that a company of 100 likely needs to invest to reach an effective, year-around drug testing program. Based on 365 days, the hard cost of drug testing for the company dilutes to only $12.05 per day. With 100 employees, that's about 12 cents per day per employee, or less than one-half the cost today of making a local call from a corner payphone," says Poole. "Wouldn't you say that's a sound investment?"
Sidebar: Steps to a Successful Drug-Free Workplace Program
According to Edward Poole, president and COO of OHS Health & Safety Services Inc., there are 14 steps to a successful drug-free workplace program.
1. Prepare a written "drug-free workplace" policy for your legal protection and provide a copy for all employees. Have the acknowledgment of their review and understanding of it signed and dated by them and place it in their personnel file. According to Poole, 14 states have laws requiring a written drug testing policy; two states require state-approval of the policy before implementing a drug testing program. Such a policy should have the following elements: statement of purpose; coverage and implementation; scope of testing; definitions of terms used; alcohol and drug-free workplace program; alcohol policy; legal drugs defined; illegal drugs defined; education and training required for supervisors and employees; substances to be screened; procedure for the collection of specimens; initial screening and test confirmation process; test results/reporting procedure/employee's right to retest; action level for "positive" test results; additional consequences for violation of the company's drug and alcohol policy; reservation of rights; identification of substance abusers; pre-employment, random, reasonable suspicion, post-accident and return-to-duty testing procedures; consequences of a refusal to submit to testing; testing after rehire; disciplinary action; employee responsibilities under the policy and a contact person.
2. Post "We Are a Drug-Free Workplace" or similar signs in the parking gate entrance, the entrance to your building and the lobby, the coffee room and above the employee time clock. Post similar signs where job applicants can see them. (The law in two states actually requires conspicuous posting of this type.)
3. Circulate substance-abuse prevention education materials (e.g., pamphlets/videos) to all supervisors, managers and other employees once annually. A short reminder notice of your drug-free workplace company policy - and perhaps some drug-abuse facts - should be included inside pay envelopes at least once per calendar quarter.
4. Perform pre-employment drug testing on every new hire. Those testing "positive" for drugs should have their employment offer immediately rescinded no matter how qualified they might otherwise appear to be for the position and no matter how badly you need to fill the position. (The law in five states requires that any drug testing be performed post-hire only; law in one state permits pre-employment testing only in conjunction with a "comprehensive physical" exam; rescission of the job offer can be made following a confirmed positive for illicit drugs.)
5. Include a statement - "Employment subject to passing a drug test" or "We drug test all new hires" - in all help-wanted advertisements. (The law of one state requires that at least 10 days notice be given to an employee prior to his or her drug test.)
6. Randomly drug test (laws permitting) at least 50 percent of your employee base annually. Depending on the number of employees you have, perform random testing at least once monthly or every week.
7. Test an employee for "reasonable suspicion" whenever reasonable cause is justified by virtue of their display of any behavioral or physical indicators of drug-use, including a dramatic change in work performance.
8. Arrange substance-abuse awareness training for supervisors and managers at least once per year. Such training will help them to identify the indicators of drug-use among their crew and teach them the most effective methods of isolating and preventing a possible drug-use related workplace problem before it becomes a crisis for your company.
9. "Post-accident" drug test an employee whenever justified by serious injury, damaged/loss of property, or life. (At least 40 states will consider a denial of workers' compensation benefits when an accident is caused by your employee whose post-accident drug test is positive for illicit drugs. The majority of those 40 states also will consider a denial of unemployment benefits for that same reason.
10. Use only federal/state certified labs for the analysis of all specimens that are sent to a lab. Laws in five states and in one U.S. territory require that all elements of a company drug-testing program - including the choice of testing lab - strictly follow U.S. Department of Transportation guidelines.
11. Have all specimens that initially test "positive" (including those based upon results of on-site drug test devices or kits) re-tested by a certified lab.
12. Utilize the services of a medical review officer for all positive results.
13. Ensure that all test results of employees are kept strictly confidential! Inform only those with a "need to know" of final drug test results and maintain all results with strict security.
14. Impose all terms of your company's written testing policy strictly, fairly and equally with all employees.
Sidebar: Drug-Free Workplace Act of 1988
As part of the federal government's effort to address the issue of substance abuse in the workplace, the Drug-Free Workplace Act of 1988 was enacted as part of the omnibus drug legislation. This Act - in effect since March 18, 1989 - requires contractors and grantees of federal agencies to agree to provide drug-free workplaces as a precondition of receiving a contract or grant from a federal agency.
American business has a drug problem. According to the U.S. Department of Labor, more than 8 million Americans use some type of illegal substance. As many as 73 percent of all illicit drug users in this country are employed.
Occupational Hazards
by Sandy Smith
A Gallup Survey of employees conducted by the Institute for a Drug-Free Workplace found that 37 percent of all respondents said that workplace drug use problems had increased in the last 5 years. A majority of respondents supported drug-screening tests. In general, it appears that respondents placed the greatest emphasis on drug testing for those employed in occupations where one person has direct responsibility for many.
As part of the federal government's effort to address the issue of substance abuse in the workplace, the Drug-Free Workplace Act of 1988 was enacted as part of the omnibus drug legislation. This Act - in effect since March 18, 1989 - requires contractors and grantees of federal agencies to agree to provide drug-free workplaces as a precondition of receiving a contract or grant from a Federal agency.
According to Edward Poole, president and COO of OHS Health and Safety Services Inc., Costa Mesa, Calif., several government and private industry studies concluded that each drug user in the workplace "can cost an employer an average of $11,000-$13,000 annually." That adds up to a cost to American businesses of billions in healthcare costs, lost production time, injuries and damage to equipment and facilities. And chances are good, says Poole, that if your employer does not have a drug-free workplace policy and program, then he or she has at least one drug user on the payroll.
It Can't Happen Here
Despite studies and surveys indicating that a significant number of substance abusers hold jobs and work while under the influence, Poole points out that many employers have an "it can't happen here" attitude about substance abuse in the workplace.
"Once they get in there and implement a policy and start testing employees, they're usually very surprised by the results," he says.
Poole tells the story of one client who operated a small, local delivery service. When a representative from OHS Health and Safety Services visited the business owner, he was told repeatedly that there was no reason to conduct drug testing in that workplace. After all, the company had only 63 employees. After a couple of years of rebuffing them, the delivery service owner called OHS.
"He said, 'We're having some problems. There's something going on that's kind of strange. We want to start a drug-free workplace program,'" Poole recalls. (See sidebar on page XX for steps to create a drug-free workplace program.)
OHS helped him write up a company policy about drugs and drug use in the workplace. They posted signs stating it was a drug-free workplace, and passed out pamphlets to employees.
Forty-five days later, OHS showed up unannounced and did what's called a "sweep." He was going to test every employee in the workplace. Nine people immediately walked off the job. Says Poole, "One or two probably had deeply rooted beliefs in the right to privacy and all that crap, but it is probably safe to say that most of those nine employees would have tested positive." Out of the 54 who took the drug test, 19 tested positive for marijuana and several tested positive for cocaine as well. "The employer was shocked," says Poole, "shocked. Most employers have no clue how many employees are working under the influence."
Writing a Policy
The first step toward eliminating workplace drug and alcohol use is the establishment of a drug-free workplace policy. The U.S. Department of Labor (DOL) offers a Drug-Free Workplace Advisor at www.dol.gov/elaws/drugfree.htm that offers guidance on how to develop a drug- and alcohol-free workplace. According to DOL, the policy should lay the groundwork for your program and should answer several questions, including:
1. What is the purpose/goal of your program?
2. Who will be covered by your policy?
3. When will your policy apply?
4. What behavior will be prohibited?
5. Will employees be required to notify you of drug-related convictions?
6. Will your policy include searches?
7. Will your program include drug testing?
8. What will the consequences be if your policy is violated?
9. Will there be return-to-work agreements?
10. What type of assistance will be available?
The policy "spells out, in black and white, the employer's policy about drugs in the workplace. It should be explicit about what will not be tolerated," says Poole.
Once the policy is established and communicated to employees through workplace signage, take-home materials and workplace briefings, employers might want to take the next step and begin drug-testing current employees and new hires. (Poole cautions employers to determine the legality of drug testing in their state before instituting a program.)
Types of Testing
There are several types of drug-testing procedures available, including blood, urine and hair specimen testing. Poole says that blood tests are usually only used in extreme cases, such as the employee being unconscious as the result of a workplace accident and under the care of emergency room physicians or, in certain cases, as demanded by a court order. Hair specimen testing costs about $115-$150 per test nationally, Poole estimates. "Hair can indicate drug-use as far back as 90 days," says Poole. "Most drugs are detectable in urine for only 1-4 days."
Of the approximately 55 million drug tests performed in the United States each year, 90 percent are urine tests. Poole estimates the cost of urine specimen drug testing at approximately $44 per employee.
The rumors that it is relatively easy to "cheat" a drug test are highly exaggerated, says Poole. Most of those products must be ingested repeatedly for hours before the test is administered. So, even if they do work, such products would only be useful for scheduled drug tests, which is something most employers offer only to new hires.
Poole suggests that employers make offers to new employees contingent upon them passing a drug test. He also says that testing employees following accidents and near-misses is advisable, as is testing any employee you suspect to be under the influence. Again, he cautions, check with state employment and privacy laws to ensure the legality of your testing program. As for random tests, the industry standard is to always test 50 percent of the total number of employees each year.
Testing Results
Poole uses the following example to show the cost/benefit analysis of drug testing: A company with 100 employees with an annual turnover rate of 30 percent has a cost per drug test of $44. If the company tests all 30 new hires and conducts random drug tests of 50 percent of its employees, then it is conducting 80 tests per year. Add in another 20 drug tests annually, ordered as "post-accident" or due to "reasonable suspicion," for a total of 100 drug tests per year.
"At $44 per test, that means the company is investing $4,400 per year in what would be - I assure you - a very highly effective drug-free workplace program," says Poole.
He notes that in the first 3-4 months of newly instituted random drug testing of their employees, every company can expect drug "positive" rates of anywhere from 5 percent to 22 percent. Construction companies and food service tend to rank on the high end of the positive scale, he adds. Retail and office workers tend to have fewer positive drug tests.
"By the end of the first full year – at the latest – the rate of drug positives coming back on the lab reports will drop by 50 percent to 80 percent," says Poole. "Drug positive rates of 26 percent will drop to as little as 5 percent and positive rates of 5 percent will drop to as low as 1 percent."
Soon, the company that once had 100 employees that included anywhere from five or six to 24 workers who used drugs in the workplace and perhaps even dealt drugs in the workplace becomes a drug-free workplace. Company production increases and quality of products and services improve. Sick days are fewer; injuries decrease; the number of workers' compensation claims get reduced; insurance and workers' compensation premiums stabilize; and equipment and supplies stop being damaged or disappearing as frequently.
"Let's look a bit more closely at the average $4,400 annual outlay that a company of 100 likely needs to invest to reach an effective, year-around drug testing program. Based on 365 days, the hard cost of drug testing for the company dilutes to only $12.05 per day. With 100 employees, that's about 12 cents per day per employee, or less than one-half the cost today of making a local call from a corner payphone," says Poole. "Wouldn't you say that's a sound investment?"
Sidebar: Steps to a Successful Drug-Free Workplace Program
According to Edward Poole, president and COO of OHS Health & Safety Services Inc., there are 14 steps to a successful drug-free workplace program.
1. Prepare a written "drug-free workplace" policy for your legal protection and provide a copy for all employees. Have the acknowledgment of their review and understanding of it signed and dated by them and place it in their personnel file. According to Poole, 14 states have laws requiring a written drug testing policy; two states require state-approval of the policy before implementing a drug testing program. Such a policy should have the following elements: statement of purpose; coverage and implementation; scope of testing; definitions of terms used; alcohol and drug-free workplace program; alcohol policy; legal drugs defined; illegal drugs defined; education and training required for supervisors and employees; substances to be screened; procedure for the collection of specimens; initial screening and test confirmation process; test results/reporting procedure/employee's right to retest; action level for "positive" test results; additional consequences for violation of the company's drug and alcohol policy; reservation of rights; identification of substance abusers; pre-employment, random, reasonable suspicion, post-accident and return-to-duty testing procedures; consequences of a refusal to submit to testing; testing after rehire; disciplinary action; employee responsibilities under the policy and a contact person.
2. Post "We Are a Drug-Free Workplace" or similar signs in the parking gate entrance, the entrance to your building and the lobby, the coffee room and above the employee time clock. Post similar signs where job applicants can see them. (The law in two states actually requires conspicuous posting of this type.)
3. Circulate substance-abuse prevention education materials (e.g., pamphlets/videos) to all supervisors, managers and other employees once annually. A short reminder notice of your drug-free workplace company policy - and perhaps some drug-abuse facts - should be included inside pay envelopes at least once per calendar quarter.
4. Perform pre-employment drug testing on every new hire. Those testing "positive" for drugs should have their employment offer immediately rescinded no matter how qualified they might otherwise appear to be for the position and no matter how badly you need to fill the position. (The law in five states requires that any drug testing be performed post-hire only; law in one state permits pre-employment testing only in conjunction with a "comprehensive physical" exam; rescission of the job offer can be made following a confirmed positive for illicit drugs.)
5. Include a statement - "Employment subject to passing a drug test" or "We drug test all new hires" - in all help-wanted advertisements. (The law of one state requires that at least 10 days notice be given to an employee prior to his or her drug test.)
6. Randomly drug test (laws permitting) at least 50 percent of your employee base annually. Depending on the number of employees you have, perform random testing at least once monthly or every week.
7. Test an employee for "reasonable suspicion" whenever reasonable cause is justified by virtue of their display of any behavioral or physical indicators of drug-use, including a dramatic change in work performance.
8. Arrange substance-abuse awareness training for supervisors and managers at least once per year. Such training will help them to identify the indicators of drug-use among their crew and teach them the most effective methods of isolating and preventing a possible drug-use related workplace problem before it becomes a crisis for your company.
9. "Post-accident" drug test an employee whenever justified by serious injury, damaged/loss of property, or life. (At least 40 states will consider a denial of workers' compensation benefits when an accident is caused by your employee whose post-accident drug test is positive for illicit drugs. The majority of those 40 states also will consider a denial of unemployment benefits for that same reason.
10. Use only federal/state certified labs for the analysis of all specimens that are sent to a lab. Laws in five states and in one U.S. territory require that all elements of a company drug-testing program - including the choice of testing lab - strictly follow U.S. Department of Transportation guidelines.
11. Have all specimens that initially test "positive" (including those based upon results of on-site drug test devices or kits) re-tested by a certified lab.
12. Utilize the services of a medical review officer for all positive results.
13. Ensure that all test results of employees are kept strictly confidential! Inform only those with a "need to know" of final drug test results and maintain all results with strict security.
14. Impose all terms of your company's written testing policy strictly, fairly and equally with all employees.
Sidebar: Drug-Free Workplace Act of 1988
As part of the federal government's effort to address the issue of substance abuse in the workplace, the Drug-Free Workplace Act of 1988 was enacted as part of the omnibus drug legislation. This Act - in effect since March 18, 1989 - requires contractors and grantees of federal agencies to agree to provide drug-free workplaces as a precondition of receiving a contract or grant from a federal agency.
Thursday, September 02, 2004
Pre-Employment Screening Articles
Live-in caretaker charged with four felony counts including armed robbery and first degree murder of 79-year-old
Authorities say this is a sad reminder for the public to always do a background check before hiring someone to do this type of work. Read article.
US financial sector warned of insider crimes: report
The study – “Insider Threat Study: Illicit Cyber Activity in the Banking and Finance Sector” – found that banks, investment firms, insurance companies, credit bureaus and others are failing to take the most basic steps such as proper employee background checks to prevent embezzlement, credit and accounting fraud and other crimes. Read report.
Local churches strive to keep sanctuaries safe from sexual predators, harm
Background checks and other implemented safeguards, long held in the secular world, are fast becoming standard practice in the religious realm. Read article.
City of Macon skipped vital step in hiring
The fiasco involving the city of Macon's Finance Director Kelly Clark, if not so painful, would end up on the bloopers show, "How not to hire a finance director." Read article.
Screeners Who Steal
One screener had four Social Security numbers and a conviction for shoplifting, and as seen on a surveillance videotape exclusively obtained by CBS News, he used his position to steal jewelry and more from airline passengers' bags. Read article.
Faculties' pasts go unchecked
The recent discovery that a respected Penn State professor was convicted of murdering three fishermen on a remote Texas inlet in 1965 has fueled a debate over background checks for faculty. Read article.
Authorities say this is a sad reminder for the public to always do a background check before hiring someone to do this type of work. Read article.
US financial sector warned of insider crimes: report
The study – “Insider Threat Study: Illicit Cyber Activity in the Banking and Finance Sector” – found that banks, investment firms, insurance companies, credit bureaus and others are failing to take the most basic steps such as proper employee background checks to prevent embezzlement, credit and accounting fraud and other crimes. Read report.
Local churches strive to keep sanctuaries safe from sexual predators, harm
Background checks and other implemented safeguards, long held in the secular world, are fast becoming standard practice in the religious realm. Read article.
City of Macon skipped vital step in hiring
The fiasco involving the city of Macon's Finance Director Kelly Clark, if not so painful, would end up on the bloopers show, "How not to hire a finance director." Read article.
Screeners Who Steal
One screener had four Social Security numbers and a conviction for shoplifting, and as seen on a surveillance videotape exclusively obtained by CBS News, he used his position to steal jewelry and more from airline passengers' bags. Read article.
Faculties' pasts go unchecked
The recent discovery that a respected Penn State professor was convicted of murdering three fishermen on a remote Texas inlet in 1965 has fueled a debate over background checks for faculty. Read article.
Tuesday, August 17, 2004
Background checks root out job seekers' tall tales
You know who you are. The job hunter who littered his resume with untruths. Or the candidate who feigned a clean criminal record.
The temptation to lie while job-hunting might be strong given the tight economy. But liars beware: More companies are using background checks to vet job applicants. Telling the truth, however tawdry, can only help you get that job.
Take this example from Barry Nadell, president of InfoLink Screening Services in California: An InfoLink client, a hotel owner, did a background check on a potential hire, revealing a prior conviction for prostitution. She wasn't hired, but not because of her illegalities. She had lied on her job application.
Companies have good reason to distrust job applicants. Thirty percent to 40 percent of candidates fudge the truth, according to the Privacy Rights Clearinghouse. Remember University of Notre Dame football coach George O'Leary? He lost his job for lying on his resume about his academic and athletic background.
About 75 percent of businesses surveyed by the national outplacement firm Challenger, Gray & Christmas Inc. said they have been the victim of untruthful hires. The financial hit? About $7,000 for a salaried employee; $10,000 for a midlevel worker; and $40,000 to recruit a new senior executive, according to Recruiting Times.
…
Companies, however, can't freely wander through a person's background. There are guidelines: Officials must get written permission from the applicant; they can use the information only if it specifically applies to the job; and they must give a copy of the report to the candidate if it prompts their dismissal. Did a potential hire, for example, once get convicted for assault - maybe decking a bar patron as a youth? Can't use it against him if he's applying for an engineering job.
What about an accounting candidate who declared bankruptcy? Feel free to reject that person. (Do you really want someone balancing your books who can't balance his or her own?)
Applicants must not lie about past indiscretions. But don't bring them up if you don't have to. "The first thing out of your mouth in an interview shouldn't be, 'I have bad credit,'" said Bob Banuski, president and founder of the Syracuse-based Amtek Human Resources Consultants, which has offices in Rochester.
At InfoLink, 38 percent of its searches in 2004 found problems in applicants' motor vehicle reports. An additional 23.3 percent lied about former employment. Eight percent tried to hide criminal convictions.
Businesses' fear that they will be held liable or lose money from bad hires has fueled growth in such services, Nadell added. From 1996 to 2003, the number of companies doing general background checks jumped from 66 percent to 82 percent, according to the Society for Human Resource Management.
Even InfoLink - a background checking company - isn't immune to fibbing job candidates. One such check revealed a warrant for a candidate's arrest. Another applicant lied about a burglary conviction.
You know who you are. The job hunter who littered his resume with untruths. Or the candidate who feigned a clean criminal record.
The temptation to lie while job-hunting might be strong given the tight economy. But liars beware: More companies are using background checks to vet job applicants. Telling the truth, however tawdry, can only help you get that job.
Take this example from Barry Nadell, president of InfoLink Screening Services in California: An InfoLink client, a hotel owner, did a background check on a potential hire, revealing a prior conviction for prostitution. She wasn't hired, but not because of her illegalities. She had lied on her job application.
Companies have good reason to distrust job applicants. Thirty percent to 40 percent of candidates fudge the truth, according to the Privacy Rights Clearinghouse. Remember University of Notre Dame football coach George O'Leary? He lost his job for lying on his resume about his academic and athletic background.
About 75 percent of businesses surveyed by the national outplacement firm Challenger, Gray & Christmas Inc. said they have been the victim of untruthful hires. The financial hit? About $7,000 for a salaried employee; $10,000 for a midlevel worker; and $40,000 to recruit a new senior executive, according to Recruiting Times.
…
Companies, however, can't freely wander through a person's background. There are guidelines: Officials must get written permission from the applicant; they can use the information only if it specifically applies to the job; and they must give a copy of the report to the candidate if it prompts their dismissal. Did a potential hire, for example, once get convicted for assault - maybe decking a bar patron as a youth? Can't use it against him if he's applying for an engineering job.
What about an accounting candidate who declared bankruptcy? Feel free to reject that person. (Do you really want someone balancing your books who can't balance his or her own?)
Applicants must not lie about past indiscretions. But don't bring them up if you don't have to. "The first thing out of your mouth in an interview shouldn't be, 'I have bad credit,'" said Bob Banuski, president and founder of the Syracuse-based Amtek Human Resources Consultants, which has offices in Rochester.
At InfoLink, 38 percent of its searches in 2004 found problems in applicants' motor vehicle reports. An additional 23.3 percent lied about former employment. Eight percent tried to hide criminal convictions.
Businesses' fear that they will be held liable or lose money from bad hires has fueled growth in such services, Nadell added. From 1996 to 2003, the number of companies doing general background checks jumped from 66 percent to 82 percent, according to the Society for Human Resource Management.
Even InfoLink - a background checking company - isn't immune to fibbing job candidates. One such check revealed a warrant for a candidate's arrest. Another applicant lied about a burglary conviction.
Thursday, August 12, 2004
Pre-Employment Screening Articles
BAD CHECKS
CSO - Framingham,MA,United States
More organizations are investigating criminal histories and other public records to make hiring and firing decisions. It's up to CSOs to make sure this powerful but flawed weapon doesn't backfire
Read article.
Wal-Mart to scrutinize job applicants
No. 1 retailer to announces tighter screening after workers named in sex assault case.
Read article.
CHARLES Schwab Fined for Lax Employee Screening
The New York Stock Exchange fined the San Francisco-based firm $250,000 for failing to comply with several regulations governing the hiring of employees with criminal convictions.
Read article.
Background checks rile professors
Much of the furor is fueled by the discovery last summer that college professor Paul Krueger spent four years teaching at Penn State University before the school learned that he had murdered three fishermen 40 years earlier.
Read article.
Camp counselors may face scrutiny
Some Maine officials say the state should re-examine its regulations governing summer camps following the arrest of a counselor who police say had child pornography on his home computer in Massachusetts.
Read article.
CSO - Framingham,MA,United States
More organizations are investigating criminal histories and other public records to make hiring and firing decisions. It's up to CSOs to make sure this powerful but flawed weapon doesn't backfire
Read article.
Wal-Mart to scrutinize job applicants
No. 1 retailer to announces tighter screening after workers named in sex assault case.
Read article.
CHARLES Schwab Fined for Lax Employee Screening
The New York Stock Exchange fined the San Francisco-based firm $250,000 for failing to comply with several regulations governing the hiring of employees with criminal convictions.
Read article.
Background checks rile professors
Much of the furor is fueled by the discovery last summer that college professor Paul Krueger spent four years teaching at Penn State University before the school learned that he had murdered three fishermen 40 years earlier.
Read article.
Camp counselors may face scrutiny
Some Maine officials say the state should re-examine its regulations governing summer camps following the arrest of a counselor who police say had child pornography on his home computer in Massachusetts.
Read article.
Monday, July 19, 2004
Resumes getting checked twice
From O'Leary to Cyprien, false claims are not unusual
By Pierce W. Huff, Staff writer
The Times Picayune, Sunday, July 18, 2004
Shortly after George O'Leary resigned as the football coach at Notre Dame for putting false information on his resume, Terry Don Phillips, then the athletic director at Oklahoma State, took action.
“After O'Leary, we sent out communication to all our coaches," said Phillips, now the athletic director at Clemson. "If there's something that's not correct on your resume . . . make us aware, so we have a chance to work it out. We had one coach come forward."
Glynn Cyprien wasn't that coach. He was an assistant on Eddie Sutton's staff and played a key role in helping the Cowboys reach the 2004 Final Four. Shortly after that appearance, University of Louisiana-Lafayette athletic director Nelson Schexnayder hired Cyprien as the Ragin' Cajuns' basketball coach.
ULL fired Cyprien on Friday for not having a bachelor's degree from a school that has accreditation recognized by the U.S. Department of Education.
Cyprien listed a bachelor's degree from the University of Texas at San Antonio and bachelor's and master's degrees from Lacrosse University on his resume. He didn't graduate from UTSA, and Lacrosse is an on-line school based in Bay St. Louis, Miss., that doesn't have accreditation recognized by the Department of Education.
Phillips said he was contacted by Schexnayder about Cyprien before he was hired.
"We had a lengthy conversation," Phillips said. "We were flabbergasted to learn what had happened."
It was evident that Cyprien and ULL hadn't learned much from the scandal that rocked college football in 2001. But many institutions, including Notre Dame, changed their policies.
John Heisler, an associate athletic director at Notre Dame, said that before the O'Leary scandal, his university was not in the practice of checking the details of resumes. But that's not the case anymore.
Heisler said Notre Dame has internal and external checks of resumes, and its sports information department always double-checks the details of all press releases involving the hiring of coaches. Athletic director Kevin White and the athletic staff verify the information listed on applications, and the human resources department authenticates degrees and academic information.
"We learned that things we used to take for granted and took as accurate, now we're not taking anything for granted anymore," Heisler said.
LSU athletic director Skip Bertman said his school also learned from the O'Leary scandal.
"When the George O'Leary thing happened, at the next staff meeting I brought out everybody . And one of the topics that zoomed to the very head was for everyone to check their resume," Bertman said. "You know, like I haven't checked mine in years. Check your resume. Go back and really look it over, whoever you are. Fix it so there's nothing -- and I mean absolutely nothing -- with the emphasis being there's nothing in the resume that can get you the job that's more important than if you have lied on the resume. If that's the case, just make sure that everything is verifiable, and I think most of our coaches did that. The O'Leary thing was an eye-opener for a lot of people."
There is no full-proof way to catch every lie in a resume, even with the heightened awareness about past false background scandals. But schools and employers now are convinced that intensive background checks are a must for every new job candidate.
"I mean it costs a lot of money, but it's something that we feel is absolutely necessary," Bertman said. "We started that just about George O'Leary time. We always did some background check, but now we have done one of these professional background checks, where the (prospective coach) has to give you the right to do it. They have to sign off on it, and it's very personal. It's expensive, but obviously it's worth it. So no coach in the LSU athletic department can hire an assistant, not to mention a head coach, until human resources hires a firm and does the background check. It usually takes seven to 10 days, so even if they want to hire the person they have to wait until we're finished."
LSU human resources director David Hurlbert said more and more companies are finding that it pays to do their homework when it comes to new hires.
"I think it's fair to say that there's an increased interest in this area," Hurlbert said. "I think you'll find that with even private-sector employers. People seem to be spending a lot more money and a lot more time on background checks, not just for degrees but for other things too."
Heisler of Notre Dame said he's not sure why some coaches lie about their backgrounds.
"That's hard to say," her said. "Part of it is just the competitiveness in the positions. There is a fine line sometimes between having done the required course work and maybe actually receiving the degree."
But Barry Nadell, the president of InfoLink Screening Services in Chatsworth, Calif., said people stretch the truth on their resumes to get jobs they want.
"They don't believe people like us (employment services) are going to find that information, and so they do it," said Nadell, whose company's list of clients includes the Paramount Pictures, the University of Southern California and Pepperdine University. "We tell people that they are better off being truthful, because often times they'll still get the job by being truthful."
The statistics show that coaches are not alone when it comes to stretching the truth on their resumes. In a study done by Ward Howell International Inc. of 258 human resource executives who reported discovering instances of credential falsification or misrepresentation, 62 percent said they had found fabricated academic credentials, 43 percent found discrepancies in compensation histories and 25 percent said they had come across cases where a criminal record was omitted, according to Business Wire.
According to research done by corporate recruiters and the Society for Human Resource Management, one of four candidates materially misrepresent their educational attainment. Less than 15 percent of all employment applications have educational credentials verified because of the difficulty of getting information required in a timely fashion from multiple sources, according to a story in Certification Magazine by Martin Bean.
Nadell said of the thousands of people that have given the approval for background checks this year, 24 percent have had discrepancies when calling past employers, 8.4 percent have had criminal convictions, 39 percent have had situations ranging from minor to major traffic violations and 5.3 percent have falsified or stretched the truth about their education.
In her book "Lying: Moral Choices in Public and Private Life," Sissela Bok writes: "Some people may not understand what a serious thing it is. When a person does this, after a while they begin to believe it (resume inflation). It obviously hurts institutions and the individuals too."
From O'Leary to Cyprien, false claims are not unusual
By Pierce W. Huff, Staff writer
The Times Picayune, Sunday, July 18, 2004
Shortly after George O'Leary resigned as the football coach at Notre Dame for putting false information on his resume, Terry Don Phillips, then the athletic director at Oklahoma State, took action.
“After O'Leary, we sent out communication to all our coaches," said Phillips, now the athletic director at Clemson. "If there's something that's not correct on your resume . . . make us aware, so we have a chance to work it out. We had one coach come forward."
Glynn Cyprien wasn't that coach. He was an assistant on Eddie Sutton's staff and played a key role in helping the Cowboys reach the 2004 Final Four. Shortly after that appearance, University of Louisiana-Lafayette athletic director Nelson Schexnayder hired Cyprien as the Ragin' Cajuns' basketball coach.
ULL fired Cyprien on Friday for not having a bachelor's degree from a school that has accreditation recognized by the U.S. Department of Education.
Cyprien listed a bachelor's degree from the University of Texas at San Antonio and bachelor's and master's degrees from Lacrosse University on his resume. He didn't graduate from UTSA, and Lacrosse is an on-line school based in Bay St. Louis, Miss., that doesn't have accreditation recognized by the Department of Education.
Phillips said he was contacted by Schexnayder about Cyprien before he was hired.
"We had a lengthy conversation," Phillips said. "We were flabbergasted to learn what had happened."
It was evident that Cyprien and ULL hadn't learned much from the scandal that rocked college football in 2001. But many institutions, including Notre Dame, changed their policies.
John Heisler, an associate athletic director at Notre Dame, said that before the O'Leary scandal, his university was not in the practice of checking the details of resumes. But that's not the case anymore.
Heisler said Notre Dame has internal and external checks of resumes, and its sports information department always double-checks the details of all press releases involving the hiring of coaches. Athletic director Kevin White and the athletic staff verify the information listed on applications, and the human resources department authenticates degrees and academic information.
"We learned that things we used to take for granted and took as accurate, now we're not taking anything for granted anymore," Heisler said.
LSU athletic director Skip Bertman said his school also learned from the O'Leary scandal.
"When the George O'Leary thing happened, at the next staff meeting I brought out everybody . And one of the topics that zoomed to the very head was for everyone to check their resume," Bertman said. "You know, like I haven't checked mine in years. Check your resume. Go back and really look it over, whoever you are. Fix it so there's nothing -- and I mean absolutely nothing -- with the emphasis being there's nothing in the resume that can get you the job that's more important than if you have lied on the resume. If that's the case, just make sure that everything is verifiable, and I think most of our coaches did that. The O'Leary thing was an eye-opener for a lot of people."
There is no full-proof way to catch every lie in a resume, even with the heightened awareness about past false background scandals. But schools and employers now are convinced that intensive background checks are a must for every new job candidate.
"I mean it costs a lot of money, but it's something that we feel is absolutely necessary," Bertman said. "We started that just about George O'Leary time. We always did some background check, but now we have done one of these professional background checks, where the (prospective coach) has to give you the right to do it. They have to sign off on it, and it's very personal. It's expensive, but obviously it's worth it. So no coach in the LSU athletic department can hire an assistant, not to mention a head coach, until human resources hires a firm and does the background check. It usually takes seven to 10 days, so even if they want to hire the person they have to wait until we're finished."
LSU human resources director David Hurlbert said more and more companies are finding that it pays to do their homework when it comes to new hires.
"I think it's fair to say that there's an increased interest in this area," Hurlbert said. "I think you'll find that with even private-sector employers. People seem to be spending a lot more money and a lot more time on background checks, not just for degrees but for other things too."
Heisler of Notre Dame said he's not sure why some coaches lie about their backgrounds.
"That's hard to say," her said. "Part of it is just the competitiveness in the positions. There is a fine line sometimes between having done the required course work and maybe actually receiving the degree."
But Barry Nadell, the president of InfoLink Screening Services in Chatsworth, Calif., said people stretch the truth on their resumes to get jobs they want.
"They don't believe people like us (employment services) are going to find that information, and so they do it," said Nadell, whose company's list of clients includes the Paramount Pictures, the University of Southern California and Pepperdine University. "We tell people that they are better off being truthful, because often times they'll still get the job by being truthful."
The statistics show that coaches are not alone when it comes to stretching the truth on their resumes. In a study done by Ward Howell International Inc. of 258 human resource executives who reported discovering instances of credential falsification or misrepresentation, 62 percent said they had found fabricated academic credentials, 43 percent found discrepancies in compensation histories and 25 percent said they had come across cases where a criminal record was omitted, according to Business Wire.
According to research done by corporate recruiters and the Society for Human Resource Management, one of four candidates materially misrepresent their educational attainment. Less than 15 percent of all employment applications have educational credentials verified because of the difficulty of getting information required in a timely fashion from multiple sources, according to a story in Certification Magazine by Martin Bean.
Nadell said of the thousands of people that have given the approval for background checks this year, 24 percent have had discrepancies when calling past employers, 8.4 percent have had criminal convictions, 39 percent have had situations ranging from minor to major traffic violations and 5.3 percent have falsified or stretched the truth about their education.
In her book "Lying: Moral Choices in Public and Private Life," Sissela Bok writes: "Some people may not understand what a serious thing it is. When a person does this, after a while they begin to believe it (resume inflation). It obviously hurts institutions and the individuals too."
Wednesday, June 16, 2004
Reason for Leaving a Prior Job Is the Information Most Frequently Fabricated by Job Seekers, According to Global Survey of Executive Recruiters. Read more...
Summer’s Here – Who's Coaching Our Children
Coaches can become some of the most significant figures in children’s lives. As with any other occupation, some are better than others. However, none should be allowed to become dangerous. Read more...
Public School Audits Background Checks
Rules for background checks on Portland Public School custodians will be reviewed after a worker was arrested on charges of killing her former husband. Read more...
Summer’s Here – Who's Coaching Our Children
Coaches can become some of the most significant figures in children’s lives. As with any other occupation, some are better than others. However, none should be allowed to become dangerous. Read more...
Public School Audits Background Checks
Rules for background checks on Portland Public School custodians will be reviewed after a worker was arrested on charges of killing her former husband. Read more...
Friday, May 07, 2004
Pre-Employment Screening Articles
Changes expected for spa workers
The Illinois Legislature is pushing forward new regulations that would require background checks and fingerprinting of massage therapists as the state looks to clamp down on prostitution rings using massage therapy as a front. Read article
Couple sues Special Olympics over their child's rape
A couple sued the Special Olympics on Thursday, claiming it should have conducted a more thorough background check on a volunteer who raped their disabled son. Read article
Carsonville honors volunteers who get background check
Field- trip chaperones, foster grandparents, room moms and basketball coaches are about to become card-carrying, certified school volunteers. Carsonville Elementary School is starting a program to thank volunteers who go through a criminal background check. Read article
The Illinois Legislature is pushing forward new regulations that would require background checks and fingerprinting of massage therapists as the state looks to clamp down on prostitution rings using massage therapy as a front. Read article
Couple sues Special Olympics over their child's rape
A couple sued the Special Olympics on Thursday, claiming it should have conducted a more thorough background check on a volunteer who raped their disabled son. Read article
Carsonville honors volunteers who get background check
Field- trip chaperones, foster grandparents, room moms and basketball coaches are about to become card-carrying, certified school volunteers. Carsonville Elementary School is starting a program to thank volunteers who go through a criminal background check. Read article
Thursday, April 15, 2004
Cheap Background Checks often Miss Offenders
The Miami Herald
By Greg Burns, Chicago Tribune Knight Ridder/Tribune Business News
Apr. 11 - Employers worried about crime, terrorism and liability are embracing a new breed of online services for screening job candidates, but these low-budget background checks don't always check out. The cheapest ones routinely fail to identify criminals, performing such superficial reviews that serious offenders can get perfectly clean reports, critics say.
Even when these services uncover criminal records, the information often is incomplete and unreliable. And with instant checks costing as little as $10 apiece, the trampling of privacy rights and fair-hiring laws can become as simple as a point and a click, the critics say.
While the private background-check business has a few big players, hundreds of upstarts have emerged in recent years to cash in on the nation's heightened security concerns, according to Shawn Bushway, a criminologist at the University of Maryland who has studied the booming industry.
Some 467 separate companies offer background checks on the Internet, Bushway said. And in at least some instances, they provide little more than false assurances to those vetting everyone from truck drivers to child-care providers.
"It's absolutely impossible to know who these companies are," he said. "They're not responsible to anybody about anything." In conducting his research, Bushway obtained the criminal records of 120 current parolees in the state of Virginia, then submitted their names to a popular online background check company -- he won't say which one. Sixty came back showing no criminal record at all, and many of the other reports were so scrambled their offenses scarcely could be identified, he said. "They look like different people."
The Chicago Tribune conducted a similar spot-check six weeks ago, submitting the names and birth dates of 10 Illinois offenders whose sentences were reported in the media for crimes ranging from drunk driving and fraud to possession of child pornography. InstantPeopleCheck.com found no criminal records for any of them in its $9.95-per-person statewide search. It flagged one as a sex offender, based on his entry in the state's free online registry, but included no corresponding description of his guilty plea a year ago for soliciting a juvenile prostitute.
The service, chosen at random from the Internet, won't disclose the identity of its owners or employees, and lists its mailing address as a post office box in an Anchorage retail mall. Through an unsigned e-mail, InstantPeopleCheck said its search fulfilled the criteria set forth on its Web site. Indeed, the company promised only a cursory check and disclosed that it couldn't guarantee the accuracy or extent of the results. Still, even the simplest searches convey a sense of scope and timeliness that they rarely if ever possess, said Lynn Peterson, president of the PFC Information Services Inc. research firm. Some vendors, she noted, effectively check only for current inmates of state prisons. Their reports indicate "no record" even for those on probation or serving time in a county jail.
Peterson's company specializes in more extensive screenings that involve tracing the addresses and names used by a subject over the years, then hiring researchers known as "runners" to track down public records at each location. "You can do a darn decent background check for a couple of hundred dollars," she said. A thorough screening almost always involves sending runners to the courthouses, noted John Long, chief executive of the publicly held First Advantage Corp., one of the largest background check services: "These instant searches as a general rule of thumb are a bunch of [nonsense]." Even as the rise of the Internet and inexpensive computer databases has transformed the business, verifying and interpreting the mass of available data remains the key, he said. "The Web makes people think they have a lot of information, and they don't." Long estimates that of the more than 400 background check vendors, approximately 100 are what he would consider "reputable."
The privately owned InstantPeopleCheck.com took nearly six months to develop its databases before launching its business about two years ago, according to the unsigned e-mails sent from the service. It offers more thorough and time-consuming searches that could have picked up the prior offenses of the criminals it failed to identify for $9.95, the e-mails claimed. The large, publicly held Choicepoint Inc. also defends the value of the online instant background checks it performs for fees starting at $25 or so, and a spokesman says it is possible to get a meaningful result without any gumshoe work.
Nevertheless, the boom in inexpensive online screenings is fueling a backlash among those who believe the privacy rights of workers are being compromised. No one has established widely accepted guidelines for how the information should be used, labor advocates say. And so much data is available that some, inevitably, is inaccurate and misleading. "The incompleteness usually works to the detriment of the worker," said Mike Ingrao, secretary-treasurer of the AFL-CIO's Transportation Trades Department.
Employers, for their part, are stepping up efforts to protect their companies and workforces. That was the case at Eli Lilly & Co., which started requiring criminal checks for employees of its outside vendors in the wake of the Sept. 11 terrorist attacks. A Lilly spokeswoman said the Indiana-based drugmaker uses much more sophisticated tools than the typical instant online checks. "Our general stance is always that we use the best available technology," she said. But even so, Lilly banned from its premises at least one technician who was mistaken for a relative with a criminal record. The technician got his post back eventually, and "the system is working well," the spokeswoman said.
In fact, background checks present a thicket of conflicting legal issues for employers. At the same time that new rules requiring background checks for certain jobs are proliferating, existing law already imposes some stringent requirements on how those checks can be conducted.
The longstanding Fair Credit Reporting Act, for instance, requires employers to use up-to-date information for screening job candidates. It also says the subjects must give their permission for a background review and receive copies of any records used in employment decisions. The rise of quick online checks makes those rules tougher to enforce, according to the University of Maryland's Bushway. Consequently, a job candidate might never get a chance to explain, for example, that an arrest resulted in an acquittal, he said. "In most cases, you're not going to be hired, and you're not told why."
Performing background checks can leave companies open to allegations of discrimination or defamation. Yet failing to perform background checks can lead to liability for the acts of criminals on the payroll -- so-called "negligent hiring and retention." Balancing those conflicts "puts employers squarely on the horns of a very difficult legal dilemma," said labor and employment attorney Gerald D. Skoning, a senior partner at Seyfarth Shaw in Chicago.
The risks of negligent hiring were demonstrated tragically in a recent case involving a Chicago native murdered in her California home by a carpet cleaner with a long criminal history. The murderer went to prison, and the surviving spouse of Dr. Kerry Spooner-Dean won an $11 million judgment in 2000 that put the carpet company out of business. "The verdict sends a message," said Paul D. Scott, plaintiff's attorney in the case against the company, which performed no screening. "A background check would have helped."
The lesson, however, is that even a sketchy check can reduce liability in such circumstances. As Skoning put it: "They're definitely better than doing nothing. It's a cheap insurance policy."
That reality is small consolation to Spooner-Dean's mother, Mary Spooner of Grayslake, who in the wake of her daughter's death vowed to push for wider use of criminal background checks. She quickly recognized that many businesses still were skeptical of the need for checks, or too eager to seize the cheapest option, she said. "Those $9.95ers," she lamented. "There's so many holes." After a while, Spooner, a dietician at Rush University Medical Center, grew resigned. "It became a very frustrating experience," she recalled. "I just kind of gave up on the whole thing."
-----
To see more of the Chicago Tribune, or to subscribe to the newspaper, go to http://www.chicago.tribune.com
© 2004, Chicago Tribune. Distributed by Knight Ridder/Tribune Business News. FADV, CPS, LLY,
The Miami Herald
By Greg Burns, Chicago Tribune Knight Ridder/Tribune Business News
Apr. 11 - Employers worried about crime, terrorism and liability are embracing a new breed of online services for screening job candidates, but these low-budget background checks don't always check out. The cheapest ones routinely fail to identify criminals, performing such superficial reviews that serious offenders can get perfectly clean reports, critics say.
Even when these services uncover criminal records, the information often is incomplete and unreliable. And with instant checks costing as little as $10 apiece, the trampling of privacy rights and fair-hiring laws can become as simple as a point and a click, the critics say.
While the private background-check business has a few big players, hundreds of upstarts have emerged in recent years to cash in on the nation's heightened security concerns, according to Shawn Bushway, a criminologist at the University of Maryland who has studied the booming industry.
Some 467 separate companies offer background checks on the Internet, Bushway said. And in at least some instances, they provide little more than false assurances to those vetting everyone from truck drivers to child-care providers.
"It's absolutely impossible to know who these companies are," he said. "They're not responsible to anybody about anything." In conducting his research, Bushway obtained the criminal records of 120 current parolees in the state of Virginia, then submitted their names to a popular online background check company -- he won't say which one. Sixty came back showing no criminal record at all, and many of the other reports were so scrambled their offenses scarcely could be identified, he said. "They look like different people."
The Chicago Tribune conducted a similar spot-check six weeks ago, submitting the names and birth dates of 10 Illinois offenders whose sentences were reported in the media for crimes ranging from drunk driving and fraud to possession of child pornography. InstantPeopleCheck.com found no criminal records for any of them in its $9.95-per-person statewide search. It flagged one as a sex offender, based on his entry in the state's free online registry, but included no corresponding description of his guilty plea a year ago for soliciting a juvenile prostitute.
The service, chosen at random from the Internet, won't disclose the identity of its owners or employees, and lists its mailing address as a post office box in an Anchorage retail mall. Through an unsigned e-mail, InstantPeopleCheck said its search fulfilled the criteria set forth on its Web site. Indeed, the company promised only a cursory check and disclosed that it couldn't guarantee the accuracy or extent of the results. Still, even the simplest searches convey a sense of scope and timeliness that they rarely if ever possess, said Lynn Peterson, president of the PFC Information Services Inc. research firm. Some vendors, she noted, effectively check only for current inmates of state prisons. Their reports indicate "no record" even for those on probation or serving time in a county jail.
Peterson's company specializes in more extensive screenings that involve tracing the addresses and names used by a subject over the years, then hiring researchers known as "runners" to track down public records at each location. "You can do a darn decent background check for a couple of hundred dollars," she said. A thorough screening almost always involves sending runners to the courthouses, noted John Long, chief executive of the publicly held First Advantage Corp., one of the largest background check services: "These instant searches as a general rule of thumb are a bunch of [nonsense]." Even as the rise of the Internet and inexpensive computer databases has transformed the business, verifying and interpreting the mass of available data remains the key, he said. "The Web makes people think they have a lot of information, and they don't." Long estimates that of the more than 400 background check vendors, approximately 100 are what he would consider "reputable."
The privately owned InstantPeopleCheck.com took nearly six months to develop its databases before launching its business about two years ago, according to the unsigned e-mails sent from the service. It offers more thorough and time-consuming searches that could have picked up the prior offenses of the criminals it failed to identify for $9.95, the e-mails claimed. The large, publicly held Choicepoint Inc. also defends the value of the online instant background checks it performs for fees starting at $25 or so, and a spokesman says it is possible to get a meaningful result without any gumshoe work.
Nevertheless, the boom in inexpensive online screenings is fueling a backlash among those who believe the privacy rights of workers are being compromised. No one has established widely accepted guidelines for how the information should be used, labor advocates say. And so much data is available that some, inevitably, is inaccurate and misleading. "The incompleteness usually works to the detriment of the worker," said Mike Ingrao, secretary-treasurer of the AFL-CIO's Transportation Trades Department.
Employers, for their part, are stepping up efforts to protect their companies and workforces. That was the case at Eli Lilly & Co., which started requiring criminal checks for employees of its outside vendors in the wake of the Sept. 11 terrorist attacks. A Lilly spokeswoman said the Indiana-based drugmaker uses much more sophisticated tools than the typical instant online checks. "Our general stance is always that we use the best available technology," she said. But even so, Lilly banned from its premises at least one technician who was mistaken for a relative with a criminal record. The technician got his post back eventually, and "the system is working well," the spokeswoman said.
In fact, background checks present a thicket of conflicting legal issues for employers. At the same time that new rules requiring background checks for certain jobs are proliferating, existing law already imposes some stringent requirements on how those checks can be conducted.
The longstanding Fair Credit Reporting Act, for instance, requires employers to use up-to-date information for screening job candidates. It also says the subjects must give their permission for a background review and receive copies of any records used in employment decisions. The rise of quick online checks makes those rules tougher to enforce, according to the University of Maryland's Bushway. Consequently, a job candidate might never get a chance to explain, for example, that an arrest resulted in an acquittal, he said. "In most cases, you're not going to be hired, and you're not told why."
Performing background checks can leave companies open to allegations of discrimination or defamation. Yet failing to perform background checks can lead to liability for the acts of criminals on the payroll -- so-called "negligent hiring and retention." Balancing those conflicts "puts employers squarely on the horns of a very difficult legal dilemma," said labor and employment attorney Gerald D. Skoning, a senior partner at Seyfarth Shaw in Chicago.
The risks of negligent hiring were demonstrated tragically in a recent case involving a Chicago native murdered in her California home by a carpet cleaner with a long criminal history. The murderer went to prison, and the surviving spouse of Dr. Kerry Spooner-Dean won an $11 million judgment in 2000 that put the carpet company out of business. "The verdict sends a message," said Paul D. Scott, plaintiff's attorney in the case against the company, which performed no screening. "A background check would have helped."
The lesson, however, is that even a sketchy check can reduce liability in such circumstances. As Skoning put it: "They're definitely better than doing nothing. It's a cheap insurance policy."
That reality is small consolation to Spooner-Dean's mother, Mary Spooner of Grayslake, who in the wake of her daughter's death vowed to push for wider use of criminal background checks. She quickly recognized that many businesses still were skeptical of the need for checks, or too eager to seize the cheapest option, she said. "Those $9.95ers," she lamented. "There's so many holes." After a while, Spooner, a dietician at Rush University Medical Center, grew resigned. "It became a very frustrating experience," she recalled. "I just kind of gave up on the whole thing."
-----
To see more of the Chicago Tribune, or to subscribe to the newspaper, go to http://www.chicago.tribune.com
© 2004, Chicago Tribune. Distributed by Knight Ridder/Tribune Business News. FADV, CPS, LLY,
Friday, April 02, 2004
Pre-Employment Screening Articles
TEACHERS behaving badly
Deseret News - Salt Lake City,UT,USA
State law requires prospective and license-lapsing teachers to be fingerprinted and undergo a criminal background check, either through colleges of education ...
BACKGROUND check form irks library's volunteers
San Diego Union Tribune - San Diego,CA,USA
The background check for every new county employee and volunteers was initiated and approved by the Board of Supervisors last year. ...
SCRUTINY for school volunteers
New Britain Herald - New Britain,CT,USA
It's very similar to the process you have when you hire staff. You do a background check," Binkowski said. "It's a preventative kind of approach.". ...
Deseret News - Salt Lake City,UT,USA
State law requires prospective and license-lapsing teachers to be fingerprinted and undergo a criminal background check, either through colleges of education ...
BACKGROUND check form irks library's volunteers
San Diego Union Tribune - San Diego,CA,USA
The background check for every new county employee and volunteers was initiated and approved by the Board of Supervisors last year. ...
SCRUTINY for school volunteers
New Britain Herald - New Britain,CT,USA
It's very similar to the process you have when you hire staff. You do a background check," Binkowski said. "It's a preventative kind of approach.". ...
Wednesday, March 03, 2004
Needless Risk - Are you conducting background searches illegally?
By Barry J. Nadell, President InfoLink Screening Services, Inc.
Loss Prevention & Security Journal, June 2003
Faced with danger, it's preferable to do something rather than nothing. Most of us would prefer to manage our fate, instead of just hoping for the best. However, when action is taken there is always a risk of inadvertently making the situation worse. It is a function of loss prevention and security personnel to protect their employer from preventable risks. However, in prevention activities there is often the associated risk of legal compliance. When prevention activities infringe upon laws to which they should be adhering, risk escalates instead of diminishing. It is a professional responsibility to ensure legal compliance always occurs.
The Dangers of Negligent Hiring
There has been a dramatic viewpoint change among those responsible for corporate security. Initially, awareness of the risks associated with the failure to do appropriate background screening was low. However, hiring or retaining dangerous employees is clearly negligent conduct. Spectacular court cases soon brought home to security professionals the legal doctrine of "negligent hiring" and its attendant risks for employers. According to the Workplace Violence Research Institute in Newport Beach, Calif., lawsuits claiming "negligent hiring" or "negligent retention" cost U.S. businesses an estimated $18 billion a year.
The courts have been particularly sensitive to cases where employees directly impact the health, safety and welfare of the public. For example, in Ward v. Trusted Health, No. 94-4297 (Suffolk Superior Court), Trusted Health Resources Inc. hired Jesse L. Rogers in 1991 as an aide in a home healthcare program run by the Visiting Nurses Association (VNA) of Boston. Trusted Health Resources never requested a criminal background check on Rogers, but such a check would have revealed six larceny-related convictions in Massachusetts. Likewise, his bogus claims of working at a state agency and attending nursing classes at Northeastern University would have been uncovered. Rogers was later convicted of stabbing to death John Ward, a quadriplegic under his care, and the victim's grandmother. The murders were apparently committed to cover up thefts from the household. Ward's parents brought suit against Trusted Health and the VNA, winning compensatory and punitive damages of $26.5 million and sending Trusted Health into bankruptcy.
Current Misconceptions
Over the last decade, awareness of the risks posed by negligent hiring and retention has grown and more companies have integrated background screening into their hiring process. As the number of companies conducting screening has grown, however, so has the number of companies that are doing so without full legal compliance. In fact, some startling misconceptions have surfaced that specifically violate the legalities of background screening, exposing companies to needless risk.
Some examples:
• A private investigator is not entitled to conduct background checks simply because he is a licensed P.I.
• An attorney is not entitled to conduct background checks simply because he is an attorney.
• A background check conducted on the basis of a legitimate business need is not justified simply because the person soliciting the report feels he has a legitimate business need for the report.
• The fact that background information is available and can be obtained does not mean that the information can be used legally and without liability.
Temptations of the Internet
In addition to the misconceptions listed, the advent of the Internet has brought new confusion and temptation. Many screening-related sites have sprung up. Some of these are tied to reputable, pre-existing background screening firms that know the law and take steps to ensure their clients' compliance with it. These firms should be quite familiar with the demands of legal compliance and pose no danger.
There are also sites that are primarily reference sites, providing links to sources of information located elsewhere on the Internet. However, those within the industry know that much of the important information typically sought in background screening, such as criminal records, does not exist in the form of a national database and therefore cannot be accessed via the Internet at all.
Most troubling are the Internet sites that seem to freely offer sensitive background information without qualification. To do so is not legal. As will later be fully explained, background searches are permitted by law only for specifically stated purposes. Even then, those seeking information under a permissible purpose must certify that purpose to the information vendor before the information can be released. Regarding these sites, there is every reason to be concerned whether one can actually obtain valuable background information and whether it is being obtained without legal compliance and, therefore, done "illegally."
Here are samples of language used by such Internet sites and in promotional e-mails:
• "Find out anything about anyone."
• "Perform a comprehensive national background search."
• "Conduct a background check on someone, all you need is their name and one of the following: present/previous address, date of birth or social security number."
• "If you've met on the Internet, consider getting a background check before you get too involved."
• However, upon closer review, various disclaimers are also found:
• "Some searches, such as credit checks and driving record searches, require written authorization from the subject of the search in order to comply with federal law."
• "The person you are looking for will not be notified that you are searching for them, therefore, we ask that you act responsibly and in accordance with the law once you receive your search results."
• "Specifically to comply with privacy laws, we do not have access, utilize, reveal or provide any confidential information, such as an individual's financial status, employment background, credit history, or medical records contained in consumer reports, the dissemination of which is strictly prohibited by the Fair Credit Reporting Act. 15 USCS 1681a."
• "This data must only be used to locate or further identify the subject and should not be used in whole or in part to determine a consumer's eligibility for credit, employment or insurance or any other purpose for which a consumer report would be obtained, except in connection with collection of a debt. This data is to be used for lead information only."
A Matter of Definition
When we compare what is promoted as available on the Internet and the disclosures that limit the availability and use of such data, there is an apparent contradiction. As seen from the disclaimers, much of the information is not immediately available or, if it is available, the provider may attempt to surreptitiously place responsibility for legal use of the information on the user and away from itself. Resolving this contradiction requires knowledge of the definitions established by law, as well as the permissible purposes for obtaining background information.
First, it must be observed that some sites may be operating beyond the boundaries required by law and there may come a time when the validity of their operations will be tested in court.
Second, "background check" is a familiar term, but not one that is defined by the applicable laws. The law most directly governing this activity is the Fair Credit Reporting Act [FCRA] of 1970, which was amended in 1997. Don't let the name mislead you--the FCRA covers far more than just consumer credit reports. Besides the FCRA, there are various state laws that do not contradict the federal law, but typically affirm or expand upon it.
It should be noted that where employers perform reference and background checks without using services offered by third parties for a fee, the FCRA generally does not apply. A quick look at the basic FCRA definitions provides considerable insight:
Consumer: An individual.
Investigative consumer report: "The term 'investigative consumer report' means a consumer report or portion thereof in which information on a consumer's character, general reputation, personal characteristics or mode of living is obtained through personal interviews with neighbors, friends or associates of the consumer reported on or with others with whom he is acquainted or who may have knowledge concerning any such items of information."
Common examples of investigative consumer reports are employment verifications and interviews with former employers and co-workers, where these are performed by a consumer reporting agency.
Consumer report: "The term 'consumer report' means any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics or mode of living that is used or expected to be used for the purpose of establishing the consumer's eligibility for [credit or insurance, employment, etc]."
A consumer report would therefore include any oral or written information from a consumer reporting agency, such as a criminal background check, credit histories, ID verification, department of motor vehicle records check, and investigative consumer report information derived from personal interviews.
Consumer reporting agency: "Any person which, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties."
Thus, a consumer reporting agency is basically any organization that supplies and charges for information on consumers. This specifically includes private investigators and companies who refer to themselves as "record search firms."
Under the FCRA, every consumer reporting agency must take appropriate measures to prevent inappropriate disclosures of information. Prospective users of information must identify themselves, certify the purposes for obtaining the information, and certify the information will not be used for any unauthorized purpose.
Consequences on Noncompliance
Compliance with the requirements of the FCRA is enforced by the Federal Trade Commission (FTC). Failure to comply with the FCRA can result in state or federal enforcement actions, as well as private lawsuits. In addition, any person who knowingly and willfully obtains a consumer report under false pretenses may face criminal prosecution.
Regarding employers specifically, failure to comply with the requirements of the FCRA can result in civil liability in the form of actual damages sustained by the applicant or employee, punitive damages (in the case of willful noncompliance with the FCRA), and imposition of costs and attorneys' fees. Additionally, it is a felony to procure a consumer report (i.e., a background check) under false pretenses. If convicted, the person who knowingly and willfully obtained the information is subject to a fine, imprisonment for up to two years, or both.
Hiring a third-party investigator provides more protection for a company than if it performs its own investigations. The FCRA provides limited legal immunity to employers who hire third-party investigators. This legal immunity applies to suits alleging defamation, invasion of privacy or negligence in connection with the investigation. There is no comparable immunity for employers who conduct their own investigations.
Needless to say, the legal risks are accentuated for a user when information is thought to have been obtained legally and when it hasn't.
How To Comply
Those who obtain consumer background information should consult their background screening agency and/or legal counsel for their specific compliance requirements. That said, the general requirements, briefly stated, are as follows:
1. Make required disclosures and obtain written consent to obtain background information.
2. Certify permissible purpose to the credit-reporting agency involved.
3. Make sure the data obtained is FCRA compliant.
4. Give notice before taking "adverse action," namely, by providing the consumer a copy of the negative report along with a statement of rights developed by the FTC and waiting a reasonable period of time for the consumer to contest the information (usually 3-5 days). Then, take adverse action in writing.
Permissible Purposes for Obtaining Background Information
The list of permissible purposes specified by Congress in the FCRA is important, because these purposes have been held by the courts to be exclusive. In other words, access to reports for a non-specified purpose, even though it may have a legitimate business purpose or seem like a good idea, is not permitted. The wording of the FCRA states, "A consumer reporting agency may furnish a consumer report under the following circumstances and no other."
Section 604 of the FCRA contains a list of the permissible purposes under law. These are:
• As permitted by order of a court or a federal grand jury subpoena. [Section 604(a)(1)]
• For any purpose if the consumer gives permission in writing. [Section 604(a)(2)]
• For the extension of credit as a result of an application from a consumer or the review or collection of a consumer's account. [Section 604(a)(3)(A)]
• For employment purposes, including hiring and promotion decisions, where the consumer has given written permission. [Sections 604(a)(3)(B) and 604(b)] (Note: Employment purposes may include hiring, termination, reassignment or promotion of an applicant or employee.)
• For the underwriting of insurance as a result of an application from a consumer. [Section 604(a)(3)(C)]
• When there is a legitimate business need in connection with a business transaction that is initiated by the consumer. [Section 604(a)(3)(F)(i)]
• To review a consumer's account to determine whether the consumer continues to meet the terms of the account. [Section 604(a)(3)(F)(ii)]
• To determine a consumer's eligibility for a license or other benefit granted by a governmental instrumentality required by law to consider an applicant's financial responsibility or status. [Section 604(a)(3)(D)]
• For use by a potential investor or servicer--or current insurer--in a valuation of, or an assessment of, the credit or repayment risks associated with an existing credit obligation. [Section 604(a)(3)(E)]
• For use by state and local officials in connection with the determination of child support payments or modifications and enforcement thereof. [Sections 604(a)(4) and 604(a)(5)]
In addition, creditors and insurers may obtain certain consumer report information for the purpose of making unsolicited offers of credit or insurance.
The following states have implemented their own laws concerning permissible purposes, many of which conform to federal law: Arizona, California, Colorado, Georgia, Kansas, Maine, Maryland, Massachusetts, Minnesota, Montana, Nevada, New Hampshire, New Jersey, New York, Texas, Virginia and Washington. Several other states have additional laws that relate to the FCRA.
In summary, the basic principle governing access to consumer reports is that actions authorized or initiated by the consumer are generally permitted, while unauthorized uses or disclosures are prohibited. Specific exceptions to the general rule have been made to accommodate public interests (alimony, licensing, court orders, etc.).
It is recommended those obtaining background information be thoroughly familiar with FCRA provisions and the permissible purposes for obtaining consumer reports, as well as how these regulations apply to their own specific circumstances. To fail in providing such policies is to incur needless legal risks. *
Barry Nadell is president of InfoLink Screening Services Inc. in Chatsworth, Calif., a nationwide provider of background screening and drug testing programs. The company provides the latest online technology to request, review and archive reports via its secure website at www.InfoLinkScreening.com or (800) 990-HIRE (4473).
By Barry J. Nadell, President InfoLink Screening Services, Inc.
Loss Prevention & Security Journal, June 2003
Faced with danger, it's preferable to do something rather than nothing. Most of us would prefer to manage our fate, instead of just hoping for the best. However, when action is taken there is always a risk of inadvertently making the situation worse. It is a function of loss prevention and security personnel to protect their employer from preventable risks. However, in prevention activities there is often the associated risk of legal compliance. When prevention activities infringe upon laws to which they should be adhering, risk escalates instead of diminishing. It is a professional responsibility to ensure legal compliance always occurs.
The Dangers of Negligent Hiring
There has been a dramatic viewpoint change among those responsible for corporate security. Initially, awareness of the risks associated with the failure to do appropriate background screening was low. However, hiring or retaining dangerous employees is clearly negligent conduct. Spectacular court cases soon brought home to security professionals the legal doctrine of "negligent hiring" and its attendant risks for employers. According to the Workplace Violence Research Institute in Newport Beach, Calif., lawsuits claiming "negligent hiring" or "negligent retention" cost U.S. businesses an estimated $18 billion a year.
The courts have been particularly sensitive to cases where employees directly impact the health, safety and welfare of the public. For example, in Ward v. Trusted Health, No. 94-4297 (Suffolk Superior Court), Trusted Health Resources Inc. hired Jesse L. Rogers in 1991 as an aide in a home healthcare program run by the Visiting Nurses Association (VNA) of Boston. Trusted Health Resources never requested a criminal background check on Rogers, but such a check would have revealed six larceny-related convictions in Massachusetts. Likewise, his bogus claims of working at a state agency and attending nursing classes at Northeastern University would have been uncovered. Rogers was later convicted of stabbing to death John Ward, a quadriplegic under his care, and the victim's grandmother. The murders were apparently committed to cover up thefts from the household. Ward's parents brought suit against Trusted Health and the VNA, winning compensatory and punitive damages of $26.5 million and sending Trusted Health into bankruptcy.
Current Misconceptions
Over the last decade, awareness of the risks posed by negligent hiring and retention has grown and more companies have integrated background screening into their hiring process. As the number of companies conducting screening has grown, however, so has the number of companies that are doing so without full legal compliance. In fact, some startling misconceptions have surfaced that specifically violate the legalities of background screening, exposing companies to needless risk.
Some examples:
• A private investigator is not entitled to conduct background checks simply because he is a licensed P.I.
• An attorney is not entitled to conduct background checks simply because he is an attorney.
• A background check conducted on the basis of a legitimate business need is not justified simply because the person soliciting the report feels he has a legitimate business need for the report.
• The fact that background information is available and can be obtained does not mean that the information can be used legally and without liability.
Temptations of the Internet
In addition to the misconceptions listed, the advent of the Internet has brought new confusion and temptation. Many screening-related sites have sprung up. Some of these are tied to reputable, pre-existing background screening firms that know the law and take steps to ensure their clients' compliance with it. These firms should be quite familiar with the demands of legal compliance and pose no danger.
There are also sites that are primarily reference sites, providing links to sources of information located elsewhere on the Internet. However, those within the industry know that much of the important information typically sought in background screening, such as criminal records, does not exist in the form of a national database and therefore cannot be accessed via the Internet at all.
Most troubling are the Internet sites that seem to freely offer sensitive background information without qualification. To do so is not legal. As will later be fully explained, background searches are permitted by law only for specifically stated purposes. Even then, those seeking information under a permissible purpose must certify that purpose to the information vendor before the information can be released. Regarding these sites, there is every reason to be concerned whether one can actually obtain valuable background information and whether it is being obtained without legal compliance and, therefore, done "illegally."
Here are samples of language used by such Internet sites and in promotional e-mails:
• "Find out anything about anyone."
• "Perform a comprehensive national background search."
• "Conduct a background check on someone, all you need is their name and one of the following: present/previous address, date of birth or social security number."
• "If you've met on the Internet, consider getting a background check before you get too involved."
• However, upon closer review, various disclaimers are also found:
• "Some searches, such as credit checks and driving record searches, require written authorization from the subject of the search in order to comply with federal law."
• "The person you are looking for will not be notified that you are searching for them, therefore, we ask that you act responsibly and in accordance with the law once you receive your search results."
• "Specifically to comply with privacy laws, we do not have access, utilize, reveal or provide any confidential information, such as an individual's financial status, employment background, credit history, or medical records contained in consumer reports, the dissemination of which is strictly prohibited by the Fair Credit Reporting Act. 15 USCS 1681a."
• "This data must only be used to locate or further identify the subject and should not be used in whole or in part to determine a consumer's eligibility for credit, employment or insurance or any other purpose for which a consumer report would be obtained, except in connection with collection of a debt. This data is to be used for lead information only."
A Matter of Definition
When we compare what is promoted as available on the Internet and the disclosures that limit the availability and use of such data, there is an apparent contradiction. As seen from the disclaimers, much of the information is not immediately available or, if it is available, the provider may attempt to surreptitiously place responsibility for legal use of the information on the user and away from itself. Resolving this contradiction requires knowledge of the definitions established by law, as well as the permissible purposes for obtaining background information.
First, it must be observed that some sites may be operating beyond the boundaries required by law and there may come a time when the validity of their operations will be tested in court.
Second, "background check" is a familiar term, but not one that is defined by the applicable laws. The law most directly governing this activity is the Fair Credit Reporting Act [FCRA] of 1970, which was amended in 1997. Don't let the name mislead you--the FCRA covers far more than just consumer credit reports. Besides the FCRA, there are various state laws that do not contradict the federal law, but typically affirm or expand upon it.
It should be noted that where employers perform reference and background checks without using services offered by third parties for a fee, the FCRA generally does not apply. A quick look at the basic FCRA definitions provides considerable insight:
Consumer: An individual.
Investigative consumer report: "The term 'investigative consumer report' means a consumer report or portion thereof in which information on a consumer's character, general reputation, personal characteristics or mode of living is obtained through personal interviews with neighbors, friends or associates of the consumer reported on or with others with whom he is acquainted or who may have knowledge concerning any such items of information."
Common examples of investigative consumer reports are employment verifications and interviews with former employers and co-workers, where these are performed by a consumer reporting agency.
Consumer report: "The term 'consumer report' means any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics or mode of living that is used or expected to be used for the purpose of establishing the consumer's eligibility for [credit or insurance, employment, etc]."
A consumer report would therefore include any oral or written information from a consumer reporting agency, such as a criminal background check, credit histories, ID verification, department of motor vehicle records check, and investigative consumer report information derived from personal interviews.
Consumer reporting agency: "Any person which, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties."
Thus, a consumer reporting agency is basically any organization that supplies and charges for information on consumers. This specifically includes private investigators and companies who refer to themselves as "record search firms."
Under the FCRA, every consumer reporting agency must take appropriate measures to prevent inappropriate disclosures of information. Prospective users of information must identify themselves, certify the purposes for obtaining the information, and certify the information will not be used for any unauthorized purpose.
Consequences on Noncompliance
Compliance with the requirements of the FCRA is enforced by the Federal Trade Commission (FTC). Failure to comply with the FCRA can result in state or federal enforcement actions, as well as private lawsuits. In addition, any person who knowingly and willfully obtains a consumer report under false pretenses may face criminal prosecution.
Regarding employers specifically, failure to comply with the requirements of the FCRA can result in civil liability in the form of actual damages sustained by the applicant or employee, punitive damages (in the case of willful noncompliance with the FCRA), and imposition of costs and attorneys' fees. Additionally, it is a felony to procure a consumer report (i.e., a background check) under false pretenses. If convicted, the person who knowingly and willfully obtained the information is subject to a fine, imprisonment for up to two years, or both.
Hiring a third-party investigator provides more protection for a company than if it performs its own investigations. The FCRA provides limited legal immunity to employers who hire third-party investigators. This legal immunity applies to suits alleging defamation, invasion of privacy or negligence in connection with the investigation. There is no comparable immunity for employers who conduct their own investigations.
Needless to say, the legal risks are accentuated for a user when information is thought to have been obtained legally and when it hasn't.
How To Comply
Those who obtain consumer background information should consult their background screening agency and/or legal counsel for their specific compliance requirements. That said, the general requirements, briefly stated, are as follows:
1. Make required disclosures and obtain written consent to obtain background information.
2. Certify permissible purpose to the credit-reporting agency involved.
3. Make sure the data obtained is FCRA compliant.
4. Give notice before taking "adverse action," namely, by providing the consumer a copy of the negative report along with a statement of rights developed by the FTC and waiting a reasonable period of time for the consumer to contest the information (usually 3-5 days). Then, take adverse action in writing.
Permissible Purposes for Obtaining Background Information
The list of permissible purposes specified by Congress in the FCRA is important, because these purposes have been held by the courts to be exclusive. In other words, access to reports for a non-specified purpose, even though it may have a legitimate business purpose or seem like a good idea, is not permitted. The wording of the FCRA states, "A consumer reporting agency may furnish a consumer report under the following circumstances and no other."
Section 604 of the FCRA contains a list of the permissible purposes under law. These are:
• As permitted by order of a court or a federal grand jury subpoena. [Section 604(a)(1)]
• For any purpose if the consumer gives permission in writing. [Section 604(a)(2)]
• For the extension of credit as a result of an application from a consumer or the review or collection of a consumer's account. [Section 604(a)(3)(A)]
• For employment purposes, including hiring and promotion decisions, where the consumer has given written permission. [Sections 604(a)(3)(B) and 604(b)] (Note: Employment purposes may include hiring, termination, reassignment or promotion of an applicant or employee.)
• For the underwriting of insurance as a result of an application from a consumer. [Section 604(a)(3)(C)]
• When there is a legitimate business need in connection with a business transaction that is initiated by the consumer. [Section 604(a)(3)(F)(i)]
• To review a consumer's account to determine whether the consumer continues to meet the terms of the account. [Section 604(a)(3)(F)(ii)]
• To determine a consumer's eligibility for a license or other benefit granted by a governmental instrumentality required by law to consider an applicant's financial responsibility or status. [Section 604(a)(3)(D)]
• For use by a potential investor or servicer--or current insurer--in a valuation of, or an assessment of, the credit or repayment risks associated with an existing credit obligation. [Section 604(a)(3)(E)]
• For use by state and local officials in connection with the determination of child support payments or modifications and enforcement thereof. [Sections 604(a)(4) and 604(a)(5)]
In addition, creditors and insurers may obtain certain consumer report information for the purpose of making unsolicited offers of credit or insurance.
The following states have implemented their own laws concerning permissible purposes, many of which conform to federal law: Arizona, California, Colorado, Georgia, Kansas, Maine, Maryland, Massachusetts, Minnesota, Montana, Nevada, New Hampshire, New Jersey, New York, Texas, Virginia and Washington. Several other states have additional laws that relate to the FCRA.
In summary, the basic principle governing access to consumer reports is that actions authorized or initiated by the consumer are generally permitted, while unauthorized uses or disclosures are prohibited. Specific exceptions to the general rule have been made to accommodate public interests (alimony, licensing, court orders, etc.).
It is recommended those obtaining background information be thoroughly familiar with FCRA provisions and the permissible purposes for obtaining consumer reports, as well as how these regulations apply to their own specific circumstances. To fail in providing such policies is to incur needless legal risks. *
Barry Nadell is president of InfoLink Screening Services Inc. in Chatsworth, Calif., a nationwide provider of background screening and drug testing programs. The company provides the latest online technology to request, review and archive reports via its secure website at www.InfoLinkScreening.com or (800) 990-HIRE (4473).
Tuesday, March 02, 2004
High unemployment spurs need for background checks
Fairfield County Business Journal, February 2004
By Jen Malcom
In today's world of rampant theft, violence, false workers' compensation claims and poor performance at the workplace, employers must protect themselves, their employees, their clients, customers and the public from potential employees who can cause them harm, said Barry Nadell, president of InfoLink Screening Services Inc., a national provider of background screening.
"The states have laws regarding negligent hiring and consequently if someone hires a criminal because they haven't screened their background and they hurt someone, the company is liable," said Nadell.
"Fraud by applicants is at a ridiculously high rate these days and is far more prevalent when the unemployment rate is high," said David Lewis, president of Operations Inc.com, in Stamford and vice president of the Southern Connecticut Chapter of SHRM (the Society for Human Resource Management).
"People when unemployed for long periods of time are more desperate and more willing to compromise some of their values, and less likely to be honest on their resumes."
There is a trend to conduct more employment checks when the economy is down. "If an employer is hiring in a down economy, they have a more difficult time determining who is truly representing themselves accurately," said Lewis. Mary Beth Rippert, managing director of Strategic Staffing L.L.C. of Shelton, said before hiring a prospective employee she checks their references and confirms dates of employment as well as asking them to rate the employee from one to 10 on various categories such as communication skills and strengths and weaknesses. She usually talks to at least three people including a coworker and boss. She conducts drug or criminal screening if requested by the client.
"I feel employment checks are necessary. If applicants say they have experience programming and they just sat next to one or if they say they were a team leader and they were just an acting one for the day, I'll find out," said Rippert. "If they lie they are disqualified."
More employers checking
A recent survey completed by the SHRM found that the number of employers reporting they conduct criminal background checks has increased by 29 percent since 1996. Eighty percent of HR professionals now say they conduct such checks and 35 percent conduct credit checks to screen potential employees. Eighty-two percent of HR professionals report their organizations investigate the background of potential employees, which is up from 66 percent in 1996.
InfoLink Screening Services Inc. "found that of those employees checked who authorized a background check in writing: eight percent had criminal convictions, three and a half percent tested positive for drugs, 37 percent have DMV issues, 23 percent have something negative on their credit report, and 17 percent had discrepancies on their reference checks," said Nadell.
As a present employer looking to evaluate and verify information that is presented in a resume or application to insure it is accurate and complete, it is also vital to look for information that wouldn't be on a resume such as prior criminal history, said Lewis. It's essential to be take a proactive approach to prevent future problems.
"Just calling a past employer today won't give you the answers you are looking for to see if the person has the character, experience and abilities to be a good worker," said Nadell. "Companies need to access all the possible information available to make good hires."
Reference checks are limited by companies not giving out information for fear of being sued, said Lewis. Background checks go deeper, they don't give performance information but they give dates of employment and educational background. It is becoming more and more common that checks come back with data that conflicts with information that comes from resumes or applications.
Components of a good check
A good background check includes "an onsite search of the courts in all counties where the individual resides, a social security check and a motor vehicle report (even if they don't drive for you)," said Nadell.
Employers must have a "permissible purpose to perform a background check or the subject may sue," warned Nadell. "For employment, a written disclosure must be authorized in advance. Before taking adverse action, the subject must be given a copy of the report with their rights as prescribed by the Federal Trade Commission (FTC) and an opportunity to dispute the information in the report."
Many times the applicants sign a release on the back of their employment application. "It's always a good idea to have an additional form signed saying this is what we're going to be checking with a space for social security number and name and signature," said Lewis. "Once the release is put in front of someone especially someone aware that the information they provided wasn't accurate they often request their application back to check their information."
Another screening tool, credit reports, should only be used when the person can affect the company financially but are a good indicator of character, said Nadell. "If someone has financial responsibility and can't handle their own finances, there may be a problem. Also, hiring someone in big debt for a low wage could be an indicator of a problem waiting to happen."
Ridgefield Bank, for example conducts a credit check, background check, and drug test for all new employees. "If we're hiring for a teller and they have bad credit that gives you a red flag, said Susie Costello, Ridgefield Bank, human resource systems. There are both federal and state laws that employers must follow while screening their employees. The Federal Fair Credit Reporting law and laws such as the Americans with Disabilities Act are the prevailing federal laws. In addition, many states have their own laws in this area including state fair credit laws, state labor codes, state civil laws and state civil rights laws, said Nadell.
In addition certain state laws also govern what you do with the information when you get the report back. In Connecticut, employers are required to keep at least two files per employee. One focuses on performance and other on qualifications. Benefits and personal info goes to another file to be held separately because no manager needs to know personal information about you in order to manage you, said Lewis.
It is most important to get a reputable service provider. The completeness of the report and ease that it gets back is key. Larger, well-established companies have great channels of info already established, said Lewis. The cost of background checks have "come way down over the years and one can obtain a good comprehensive background check for often less than $15 to $50 depending on the services requested," said Nadell.
Fairfield County Business Journal, February 2004
By Jen Malcom
In today's world of rampant theft, violence, false workers' compensation claims and poor performance at the workplace, employers must protect themselves, their employees, their clients, customers and the public from potential employees who can cause them harm, said Barry Nadell, president of InfoLink Screening Services Inc., a national provider of background screening.
"The states have laws regarding negligent hiring and consequently if someone hires a criminal because they haven't screened their background and they hurt someone, the company is liable," said Nadell.
"Fraud by applicants is at a ridiculously high rate these days and is far more prevalent when the unemployment rate is high," said David Lewis, president of Operations Inc.com, in Stamford and vice president of the Southern Connecticut Chapter of SHRM (the Society for Human Resource Management).
"People when unemployed for long periods of time are more desperate and more willing to compromise some of their values, and less likely to be honest on their resumes."
There is a trend to conduct more employment checks when the economy is down. "If an employer is hiring in a down economy, they have a more difficult time determining who is truly representing themselves accurately," said Lewis. Mary Beth Rippert, managing director of Strategic Staffing L.L.C. of Shelton, said before hiring a prospective employee she checks their references and confirms dates of employment as well as asking them to rate the employee from one to 10 on various categories such as communication skills and strengths and weaknesses. She usually talks to at least three people including a coworker and boss. She conducts drug or criminal screening if requested by the client.
"I feel employment checks are necessary. If applicants say they have experience programming and they just sat next to one or if they say they were a team leader and they were just an acting one for the day, I'll find out," said Rippert. "If they lie they are disqualified."
More employers checking
A recent survey completed by the SHRM found that the number of employers reporting they conduct criminal background checks has increased by 29 percent since 1996. Eighty percent of HR professionals now say they conduct such checks and 35 percent conduct credit checks to screen potential employees. Eighty-two percent of HR professionals report their organizations investigate the background of potential employees, which is up from 66 percent in 1996.
InfoLink Screening Services Inc. "found that of those employees checked who authorized a background check in writing: eight percent had criminal convictions, three and a half percent tested positive for drugs, 37 percent have DMV issues, 23 percent have something negative on their credit report, and 17 percent had discrepancies on their reference checks," said Nadell.
As a present employer looking to evaluate and verify information that is presented in a resume or application to insure it is accurate and complete, it is also vital to look for information that wouldn't be on a resume such as prior criminal history, said Lewis. It's essential to be take a proactive approach to prevent future problems.
"Just calling a past employer today won't give you the answers you are looking for to see if the person has the character, experience and abilities to be a good worker," said Nadell. "Companies need to access all the possible information available to make good hires."
Reference checks are limited by companies not giving out information for fear of being sued, said Lewis. Background checks go deeper, they don't give performance information but they give dates of employment and educational background. It is becoming more and more common that checks come back with data that conflicts with information that comes from resumes or applications.
Components of a good check
A good background check includes "an onsite search of the courts in all counties where the individual resides, a social security check and a motor vehicle report (even if they don't drive for you)," said Nadell.
Employers must have a "permissible purpose to perform a background check or the subject may sue," warned Nadell. "For employment, a written disclosure must be authorized in advance. Before taking adverse action, the subject must be given a copy of the report with their rights as prescribed by the Federal Trade Commission (FTC) and an opportunity to dispute the information in the report."
Many times the applicants sign a release on the back of their employment application. "It's always a good idea to have an additional form signed saying this is what we're going to be checking with a space for social security number and name and signature," said Lewis. "Once the release is put in front of someone especially someone aware that the information they provided wasn't accurate they often request their application back to check their information."
Another screening tool, credit reports, should only be used when the person can affect the company financially but are a good indicator of character, said Nadell. "If someone has financial responsibility and can't handle their own finances, there may be a problem. Also, hiring someone in big debt for a low wage could be an indicator of a problem waiting to happen."
Ridgefield Bank, for example conducts a credit check, background check, and drug test for all new employees. "If we're hiring for a teller and they have bad credit that gives you a red flag, said Susie Costello, Ridgefield Bank, human resource systems. There are both federal and state laws that employers must follow while screening their employees. The Federal Fair Credit Reporting law and laws such as the Americans with Disabilities Act are the prevailing federal laws. In addition, many states have their own laws in this area including state fair credit laws, state labor codes, state civil laws and state civil rights laws, said Nadell.
In addition certain state laws also govern what you do with the information when you get the report back. In Connecticut, employers are required to keep at least two files per employee. One focuses on performance and other on qualifications. Benefits and personal info goes to another file to be held separately because no manager needs to know personal information about you in order to manage you, said Lewis.
It is most important to get a reputable service provider. The completeness of the report and ease that it gets back is key. Larger, well-established companies have great channels of info already established, said Lewis. The cost of background checks have "come way down over the years and one can obtain a good comprehensive background check for often less than $15 to $50 depending on the services requested," said Nadell.
Monday, March 01, 2004
Health Providers at Risk Without "Safe Hiring" Practices
Background Screening Uncovers Applicants' Criminal Backgrounds
by Barry J. Nadell
Health care providers have reason to practice safe hiring according to the results of study released today which shows that 11.5% of employment applicants (better than one in ten) carry criminal records, whether felony or misdemeanor. The study was conducted internally by InfoLink Screening Services, Inc., a nationwide screening company and provider of services to many health care organizations. Other than those offering in-home health care, health providers are not required by law to conduct criminal searches. However, the results of the study validate the concerns of organizations which conduct such screening anyway.
The security measures of health care providers are a consumer issue, states Barry Nadell, President and co-founder of InfoLink Screening Services. If you are a patient or related to one, you want to feel comfortable with the people delivering that care. More and more providers are taking advantage of background screening to ensure that the environment they offer to both their patients and staff is a secure one.
Major findings of the study reveal that of those with criminal records, auto-related crimes were the largest category of offence at 34.8%, followed by theft/fraud offences at 20.8%. Crimes of violence or threatened violence accounted for 15.4% of the crimes uncovered. Another 14.9% were caused by alcohol and narcotics offenses. The remaining 14.5%, classified miscellaneous, included crimes such as prostitution, violation of probation, contempt of court, criminal trespass and others.
Within the largest category of automotive-related crimes, key sub-categories included DUIs accounting for 42.3% of offenses, unlicensed drivers for 19.5% and driving with a suspended license for 18.1%.
The theft/fraud category of convictions was split between theft convictions of 78.3% (including theft, grand theft, petty theft, shoplifting, burglary) and fraud convictions of 21.7% (including forgery, welfare fraud, passing worthless checks).
Convictions in the violence/threats category consisted mainly of battery (44.1%) or public disturbance (35.3%); the latter category including arson, fighting in public, resisting arrest, disturbing the peace and creating a public nuisance.
InfoLink provides background screening to over 1,200 health care facilities nationwide. The study addressed 1,920 applications from fifteen randomly selected California providers. Each organization had processed over 100 applicants dating from as early as April, 1999, to the present. The study addressed searches of criminal records only and did not include other types of screening such as DMV records, Social Security identity checks, credit checks, or checks of past employment and education which can also be run by prospective employers. The report is one in a series conducted by InfoLink to identify and address the employment screening requirements of specific industries it serves.
Employers may not deny employment to an applicant strictly due to a past conviction or convictions, unless their profession is one where laws prohibit hiring those with criminal backgrounds, or unless the employer can show the conviction relates directly to the position applied for. However, many applicants disqualify themselves by attempting to conceal past convictions which are nevertheless uncovered during background screening by a professional consumer reporting agency.
Background Screening Uncovers Applicants' Criminal Backgrounds
by Barry J. Nadell
Health care providers have reason to practice safe hiring according to the results of study released today which shows that 11.5% of employment applicants (better than one in ten) carry criminal records, whether felony or misdemeanor. The study was conducted internally by InfoLink Screening Services, Inc., a nationwide screening company and provider of services to many health care organizations. Other than those offering in-home health care, health providers are not required by law to conduct criminal searches. However, the results of the study validate the concerns of organizations which conduct such screening anyway.
The security measures of health care providers are a consumer issue, states Barry Nadell, President and co-founder of InfoLink Screening Services. If you are a patient or related to one, you want to feel comfortable with the people delivering that care. More and more providers are taking advantage of background screening to ensure that the environment they offer to both their patients and staff is a secure one.
Major findings of the study reveal that of those with criminal records, auto-related crimes were the largest category of offence at 34.8%, followed by theft/fraud offences at 20.8%. Crimes of violence or threatened violence accounted for 15.4% of the crimes uncovered. Another 14.9% were caused by alcohol and narcotics offenses. The remaining 14.5%, classified miscellaneous, included crimes such as prostitution, violation of probation, contempt of court, criminal trespass and others.
Within the largest category of automotive-related crimes, key sub-categories included DUIs accounting for 42.3% of offenses, unlicensed drivers for 19.5% and driving with a suspended license for 18.1%.
The theft/fraud category of convictions was split between theft convictions of 78.3% (including theft, grand theft, petty theft, shoplifting, burglary) and fraud convictions of 21.7% (including forgery, welfare fraud, passing worthless checks).
Convictions in the violence/threats category consisted mainly of battery (44.1%) or public disturbance (35.3%); the latter category including arson, fighting in public, resisting arrest, disturbing the peace and creating a public nuisance.
InfoLink provides background screening to over 1,200 health care facilities nationwide. The study addressed 1,920 applications from fifteen randomly selected California providers. Each organization had processed over 100 applicants dating from as early as April, 1999, to the present. The study addressed searches of criminal records only and did not include other types of screening such as DMV records, Social Security identity checks, credit checks, or checks of past employment and education which can also be run by prospective employers. The report is one in a series conducted by InfoLink to identify and address the employment screening requirements of specific industries it serves.
Employers may not deny employment to an applicant strictly due to a past conviction or convictions, unless their profession is one where laws prohibit hiring those with criminal backgrounds, or unless the employer can show the conviction relates directly to the position applied for. However, many applicants disqualify themselves by attempting to conceal past convictions which are nevertheless uncovered during background screening by a professional consumer reporting agency.
Friday, February 27, 2004
Screening = Long-Term Aid to Temporary Hiring
By Jim Calahan
"I'd rather not fill a position than send someone who is wrong for it," states Joe Cummings of Royal Staffing, in Westlake Village, CA, "because that person represents you in the client's office." Joe is a fourteen-year veteran of the staffing industry and one of sixteen full-time employees in two offices the 33 year-old firm maintains. Joe is the screening "guru" for the firm which handles the whole gamut of employee placement from clerical employees to executive search and various points in-between, including financial and IT specialists.
"We began screening around 1993," Joe recalls, "when one of our larger clients began requesting criminal and DMV [Department of Motor Vehicle] searches on their placements." Screening continues to be primarily client-driven at the company to this day. "The quals for placing someone in an executive assistant position, for example, can vary quite a bit. Some firms request that background checks be done and some don't," notes Mr. Cummings. Another example is credit checks. "Some clients value them and others do not."
"Hiring" a screening firm to provide Royal with additional types of background checks was fairly simple. Royal has been using InfoLink Screening Services, located in Chatsworth, CA, since 1993. "Barry Nadell, the President of InfoLink, was acquainted with Mrs. Wolff, our Founder and President, through PIHRA [Professionals in Human Resources Assn.]," Joe Cummings recalls. "When he first came out to our offices it was very relaxed; there was no sales pitch. Barry answered our legal concerns very clearly. We updated our forms with InfoLink's suggested language and we have sometimes called Barry to get 'Do's and Don'ts about certain screening procedures. For example, we had some misgivings about collecting credit information on individuals, but Barry indicated it was perfectly all right to do so as long as our clients were consistent in requiring credit checks for where they could affect our client financially. We always want to make sure our procedures are legally correct in order to protect ourselves and our clients from needless lawsuits."
Although concern for correct legal procedure may have initiated the relationship between Royal and InfoLink, other factors have maintained the relationship over time. "InfoLink offers a complete program of background screening including drug-testing. Their rates are competitive and the quality of their research is very good," states Joe Cummings. "Turnaround time is crucial for us. To maximize billings, we need to have our temps out working. Also, while waiting on screening results you risk a temporary being picked up on someone else's assignment. InfoLink has been able to accommodate us on the occasional rush cycle."
Other contributions by InfoLink have included maintaining separate billing records for the two Royal Staffing offices as well as the development of web-based services. Screening requisitions can now be initiated and retrieved online through InfoLink's secure Web site as well as by fax, the method traditionally used by Royal Staffing.
After implementing the initial screening program with InfoLink, Royal staffers soon saw some surprising results. "One thing that always surprises me is how some of the applicants react or don't react to the screening procedure. I am very direct with them when screening is involved in their placement. I say, 'We are going to do a background check on you that includes a drug test, criminal history and credit check. Will you pass such a check?' They may say 'yes', but sometimes the results come back showing a lien, judgment, or conviction and I want to say, 'Did you forget about this?' I think for some of them, if not working now, they are willing to take their chances. However, for me it becomes a credibility issue after that."
While screening has become a part of the staffing business, it hasn't changed essential skills, but has enhanced them. "I am very experienced at interviewing," states Joe Cummings, "and very straightforward with my applicants. I tell them, 'I can ruin my reputation all on my own without assistance. I can help you get work, but you have to help me by being honest."
"I think a good interviewer is very skilled at detecting deception," he continues, "but screening still adds a lot. First, some people are just very expert at deception and they can slip by. Second, you have to make sure that you are asking the right questions; sometimes you can sense something is wrong without being able to exactly put your finger on it. Another major factor is the economy right now. With employment so high, most of the good ones are already working, so you may have to do ten or fifteen interviews to get two or three prospects."
The advancement of screening affects staffing in other ways, too. "When we take on a new employer," Joe notes, "it is not unusual for them to ask about our screening capabilities. Employers certainly realize that a person dressed up for an interview is not always what they seem to be. Also, I will suggest to them that when temporary staff is taken on with a potential of permanent hire, they should do any desired screening up front. This avoids issues arising once the person is already on the job."
Joe's experience with screening over the last eight years encourages him to offer several words of advice. "I think you have to be very careful to check an applicant's references and ensure they can do what they say they can do. It's very easy for someone to get a piece of company letterhead and write themselves a letter of recommendation with a forged signature. Some have even forged diplomas! I say, if you ever have an uncertain feeling about an applicant, or the references don't seem to add up, you cannot hesitate to do a screening on them."
"The other thing is to know the law," he adds. "We have never been sued by an applicant and I think this derives from the fact that we have been in legal compliance through InfoLink from the very beginning and we have maintained that compliance to the present day. If the applicant sees that you are fully knowledgeable of the law, then they are unlikely to attempt legal action. If they say 'That's discrimination!' I can immediately explain the situation to them and they'll recognize that it isn't."
By Jim Calahan
"I'd rather not fill a position than send someone who is wrong for it," states Joe Cummings of Royal Staffing, in Westlake Village, CA, "because that person represents you in the client's office." Joe is a fourteen-year veteran of the staffing industry and one of sixteen full-time employees in two offices the 33 year-old firm maintains. Joe is the screening "guru" for the firm which handles the whole gamut of employee placement from clerical employees to executive search and various points in-between, including financial and IT specialists.
"We began screening around 1993," Joe recalls, "when one of our larger clients began requesting criminal and DMV [Department of Motor Vehicle] searches on their placements." Screening continues to be primarily client-driven at the company to this day. "The quals for placing someone in an executive assistant position, for example, can vary quite a bit. Some firms request that background checks be done and some don't," notes Mr. Cummings. Another example is credit checks. "Some clients value them and others do not."
"Hiring" a screening firm to provide Royal with additional types of background checks was fairly simple. Royal has been using InfoLink Screening Services, located in Chatsworth, CA, since 1993. "Barry Nadell, the President of InfoLink, was acquainted with Mrs. Wolff, our Founder and President, through PIHRA [Professionals in Human Resources Assn.]," Joe Cummings recalls. "When he first came out to our offices it was very relaxed; there was no sales pitch. Barry answered our legal concerns very clearly. We updated our forms with InfoLink's suggested language and we have sometimes called Barry to get 'Do's and Don'ts about certain screening procedures. For example, we had some misgivings about collecting credit information on individuals, but Barry indicated it was perfectly all right to do so as long as our clients were consistent in requiring credit checks for where they could affect our client financially. We always want to make sure our procedures are legally correct in order to protect ourselves and our clients from needless lawsuits."
Although concern for correct legal procedure may have initiated the relationship between Royal and InfoLink, other factors have maintained the relationship over time. "InfoLink offers a complete program of background screening including drug-testing. Their rates are competitive and the quality of their research is very good," states Joe Cummings. "Turnaround time is crucial for us. To maximize billings, we need to have our temps out working. Also, while waiting on screening results you risk a temporary being picked up on someone else's assignment. InfoLink has been able to accommodate us on the occasional rush cycle."
Other contributions by InfoLink have included maintaining separate billing records for the two Royal Staffing offices as well as the development of web-based services. Screening requisitions can now be initiated and retrieved online through InfoLink's secure Web site as well as by fax, the method traditionally used by Royal Staffing.
After implementing the initial screening program with InfoLink, Royal staffers soon saw some surprising results. "One thing that always surprises me is how some of the applicants react or don't react to the screening procedure. I am very direct with them when screening is involved in their placement. I say, 'We are going to do a background check on you that includes a drug test, criminal history and credit check. Will you pass such a check?' They may say 'yes', but sometimes the results come back showing a lien, judgment, or conviction and I want to say, 'Did you forget about this?' I think for some of them, if not working now, they are willing to take their chances. However, for me it becomes a credibility issue after that."
While screening has become a part of the staffing business, it hasn't changed essential skills, but has enhanced them. "I am very experienced at interviewing," states Joe Cummings, "and very straightforward with my applicants. I tell them, 'I can ruin my reputation all on my own without assistance. I can help you get work, but you have to help me by being honest."
"I think a good interviewer is very skilled at detecting deception," he continues, "but screening still adds a lot. First, some people are just very expert at deception and they can slip by. Second, you have to make sure that you are asking the right questions; sometimes you can sense something is wrong without being able to exactly put your finger on it. Another major factor is the economy right now. With employment so high, most of the good ones are already working, so you may have to do ten or fifteen interviews to get two or three prospects."
The advancement of screening affects staffing in other ways, too. "When we take on a new employer," Joe notes, "it is not unusual for them to ask about our screening capabilities. Employers certainly realize that a person dressed up for an interview is not always what they seem to be. Also, I will suggest to them that when temporary staff is taken on with a potential of permanent hire, they should do any desired screening up front. This avoids issues arising once the person is already on the job."
Joe's experience with screening over the last eight years encourages him to offer several words of advice. "I think you have to be very careful to check an applicant's references and ensure they can do what they say they can do. It's very easy for someone to get a piece of company letterhead and write themselves a letter of recommendation with a forged signature. Some have even forged diplomas! I say, if you ever have an uncertain feeling about an applicant, or the references don't seem to add up, you cannot hesitate to do a screening on them."
"The other thing is to know the law," he adds. "We have never been sued by an applicant and I think this derives from the fact that we have been in legal compliance through InfoLink from the very beginning and we have maintained that compliance to the present day. If the applicant sees that you are fully knowledgeable of the law, then they are unlikely to attempt legal action. If they say 'That's discrimination!' I can immediately explain the situation to them and they'll recognize that it isn't."
Wednesday, February 25, 2004
How to Avoid the Employee From Hell - Legally!
by Barry J. Nadell
The "employee from hell" is easy to identify after the fact. An Oakland civil jury awarded over $11 million to a woman’s husband after she was murdered by a man who came to clean their carpets. Under the legal doctrine of negligent hiring Americas Best Carpet Care was ordered to pay over $9 million of the award despite their defense that the perpetrator was an independent contractor and not an employee. This is a hellish scenario for any human resources professional!
As President and co-founder of InfoLink Screening Services, Inc., I have a front row seat on the trends shaping Americas hiring practices. On the one hand, I see the Internet progress we have made; increasing the speed and convenience of screening services, while lowering the cost. On the other hand, I see workplace trends that are making hiring more difficult and the need for screening more acute than ever. “To screen or not to screen?” is a crucial question affecting several areas of your business.
HIRING:
The current extremely low unemployment rate makes finding qualified employees more difficult than usual and may tempt employers to speed hiring decisions with shortcuts. When someone perceived as the right applicant comes along, you may want to act quickly before someone else hires them, or you may want to avoid alienating the prospect with the disclosures and possible delays of a thorough screening process.
As an employer myself I believe its a top priority to ascertain an applicants honesty in presenting himself, or herself. The major purpose of screening is to verify that the information submitted by the applicant is indeed a fair and correct history. Sometimes the person who seems too good to be true is exactly that! A survey published by the Society of Human Resource Management in 1998 gave the following results for resumes and job applications where falsification had been detected:
• Length of employment 53%
• Past salaries 51%
• Criminal records 45%
• Former job titles 44%
• Former employers 35%
• Driving records 33%
• Degrees 30%
• Credit 24%
• Schools attended 24%
• Social security number 14%
It still amazes me when InfoLink, as an employer, finds the perfect person for a position only to discover through our own screening process that the person was not all they seemed to be. How could someone applying for a position at a screening company attempt to materially misrepresent himself or herself, or fail to disclose vital information requested on the application? Yet, it continues to happen. One such applicant was found to have a current arrest warrant outstanding for a drug violation! Another had a serious misdemeanor conviction which had not been disclosed.
If these sorts of incidents can happen to us in the screening industry, then I am confident they can happen to you as well. Remember that you are not only assessing the possible contributions of an applicant, but their potential employee costs in terms of low morale, lateness, absenteeism, accidents, insurance claims and turnover as well as possible theft, violence or lawsuits.
SECURITY:
In the past, sensitive positions in security or law enforcement, finance and health care were most often professionally screened. However, current social trends such as drug abuse and workplace violence have shown a need for broader screening processes. Department of Labor statistics show, surprisingly, that 73% of all current drug users age 18 or older are employed, with over 80% employed full-time. Businesses without a drug-screening program are naturally more likely to hire such individuals and to suffer the hidden costs associated with them. A U. S. Postal Service study indicated that employees who tested positive on their pre-employment drug test were 77% more likely to be discharged within the first three years of employment and were absent from work 66% more often than those that tested negative.
As previously noted, jobs with access to customers homes are particularly susceptible to abuse by unethical or criminal employees and can create huge legal liabilities. However, screening can help with lesser problems as well. One InfoLink subscriber reports occasional instances when its employees have been accused of theft, sometimes as a distraction by the real thief. In addressing such claims, the employer finds it worthwhile to disclose that its employees have undergone extensive background screening a much more thorough check than is given to the typical domestic worker!
LEGAL:
An overlooked, but a most important reason for screening is lawsuits. Corporations are increasingly held legally responsible for the types of individuals they hire, especially if those individuals engage in criminal activity.
Examples of a dire nature are, unfortunately, not difficult to find. PDQuick recently made headlines in Los Angeles when one of its home delivery drivers; two weeks on the job, allegedly committed sexual assault on a San Gabriel woman as well as attacking two other women. PDQuick had failed to check the criminal history of the employee who, unknown to them, was on parole for a violent conviction.
In another recent instance, a home health care provider in Massachusetts named Trusted Health Resources unknowingly hired someone with a criminal record as a home attendant. That individual subsequently murdered a young paraplegic man placed under his care as well as the patients grandmother, apparently to cover up a theft. When the employee was later tried and convicted of the crime, the victims family sued the company on the basis of negligent hiring and obtained damages of $26.5 million dollars. Not surprisingly, Trusted Health is no longer in business.
In addition to these high-profile cases, there is also danger from lawsuits incurred due to noncompliance with Federal and state laws governing background check procedures. Non-compliance with these laws is fairly common. Even among companies that have previously used a background screening service, about 75% of the employers I see have language (or are missing language) in their documents that violates either Federal or state law. When choosing a background screening company to hire, I often recommend analyzing the documentation provided by that company for legal compliance. If the documentation violates state or FCRA law, its a serious problem. How can one trust a company’s reporting procedures when their documentation and procedures do not even conform to the applicable laws of their industry?
SCREENING PITFALLS:
While the above examples show the need for increased scrutiny, the difficulty in detecting unflattering backgrounds has also increased:
• When employers conduct reference checks, they are increasingly met with a limited or nonexistent response as legal concerns make former employers reluctant to provide anything more than a confirmation of name, job title and dates of employment.
• Workers with imperfect backgrounds often gravitate towards working as temps, either out of necessity, or as a means of masking their histories. Employers hiring a temporary worker through an agency may not feel the need to conduct the normal background check, but the company is nevertheless considered a co-employer for liability purposes and is liable along with the agency.
THE SOLUTION:
The way to avoid hiring the employee from hell for most companies is a background check by a professional screening company which complies with the applicable legal procedures. These checks typically include criminal history search, motor vehicle report information and a social security number trace. The importance of criminal checks is self-evident, but the others may not be so clear. A motor vehicle report discloses convictions for DUI (Driving Under the Influence), drug possession and failures to appear. In addition, current arrest warrants may be found. Social Security checks help identify false numbers and identities used by an applicant to evade screening of their own personal history.
Other frequently performed checks include:
• References
• Verification of education, licenses, or military service records.
• Credit checks or searches for liens and judgments which help indicate character
• Worker compensation filings which can identify past employers not revealed on an application
Turnaround times for these checks range from the immediate (with online access to credit and other up-to-date databases) to generally two or three working days, depending on the type and extent of search desired. Fees are surprisingly low and can range from $3, up to $50-80 depending on several factors: the package of searches required for a particular position, the number of references contacted and the number of counties searched for criminal activity. It is important for a business to have a screening program appropriate to the type of personnel that they are hiring and to design searches based upon job requirements. As an example, you should not perform a credit check on someone who couldn’t affect you financially, but should always require one for someone in accounting, or who handles money.
If an employer relies on any third party such as a private investigator, public record provider or professional screening service (all considered consumer reporting agencies under Federal law) for references or a more involved background screening, there are a number of additional requirements that must be met. These include legal disclosure and adverse action procedures that must be followed as required by both the Fair Credit Reporting Act and applicable state laws. Because of the complexity of both Federal and state laws, a professional service should be engaged to provide the appropriate documents and expertise to set up such a program. An effective one shields the company from needless lawsuits and promotes morale by screening out the employee from hell.
by Barry J. Nadell
The "employee from hell" is easy to identify after the fact. An Oakland civil jury awarded over $11 million to a woman’s husband after she was murdered by a man who came to clean their carpets. Under the legal doctrine of negligent hiring Americas Best Carpet Care was ordered to pay over $9 million of the award despite their defense that the perpetrator was an independent contractor and not an employee. This is a hellish scenario for any human resources professional!
As President and co-founder of InfoLink Screening Services, Inc., I have a front row seat on the trends shaping Americas hiring practices. On the one hand, I see the Internet progress we have made; increasing the speed and convenience of screening services, while lowering the cost. On the other hand, I see workplace trends that are making hiring more difficult and the need for screening more acute than ever. “To screen or not to screen?” is a crucial question affecting several areas of your business.
HIRING:
The current extremely low unemployment rate makes finding qualified employees more difficult than usual and may tempt employers to speed hiring decisions with shortcuts. When someone perceived as the right applicant comes along, you may want to act quickly before someone else hires them, or you may want to avoid alienating the prospect with the disclosures and possible delays of a thorough screening process.
As an employer myself I believe its a top priority to ascertain an applicants honesty in presenting himself, or herself. The major purpose of screening is to verify that the information submitted by the applicant is indeed a fair and correct history. Sometimes the person who seems too good to be true is exactly that! A survey published by the Society of Human Resource Management in 1998 gave the following results for resumes and job applications where falsification had been detected:
• Length of employment 53%
• Past salaries 51%
• Criminal records 45%
• Former job titles 44%
• Former employers 35%
• Driving records 33%
• Degrees 30%
• Credit 24%
• Schools attended 24%
• Social security number 14%
It still amazes me when InfoLink, as an employer, finds the perfect person for a position only to discover through our own screening process that the person was not all they seemed to be. How could someone applying for a position at a screening company attempt to materially misrepresent himself or herself, or fail to disclose vital information requested on the application? Yet, it continues to happen. One such applicant was found to have a current arrest warrant outstanding for a drug violation! Another had a serious misdemeanor conviction which had not been disclosed.
If these sorts of incidents can happen to us in the screening industry, then I am confident they can happen to you as well. Remember that you are not only assessing the possible contributions of an applicant, but their potential employee costs in terms of low morale, lateness, absenteeism, accidents, insurance claims and turnover as well as possible theft, violence or lawsuits.
SECURITY:
In the past, sensitive positions in security or law enforcement, finance and health care were most often professionally screened. However, current social trends such as drug abuse and workplace violence have shown a need for broader screening processes. Department of Labor statistics show, surprisingly, that 73% of all current drug users age 18 or older are employed, with over 80% employed full-time. Businesses without a drug-screening program are naturally more likely to hire such individuals and to suffer the hidden costs associated with them. A U. S. Postal Service study indicated that employees who tested positive on their pre-employment drug test were 77% more likely to be discharged within the first three years of employment and were absent from work 66% more often than those that tested negative.
As previously noted, jobs with access to customers homes are particularly susceptible to abuse by unethical or criminal employees and can create huge legal liabilities. However, screening can help with lesser problems as well. One InfoLink subscriber reports occasional instances when its employees have been accused of theft, sometimes as a distraction by the real thief. In addressing such claims, the employer finds it worthwhile to disclose that its employees have undergone extensive background screening a much more thorough check than is given to the typical domestic worker!
LEGAL:
An overlooked, but a most important reason for screening is lawsuits. Corporations are increasingly held legally responsible for the types of individuals they hire, especially if those individuals engage in criminal activity.
Examples of a dire nature are, unfortunately, not difficult to find. PDQuick recently made headlines in Los Angeles when one of its home delivery drivers; two weeks on the job, allegedly committed sexual assault on a San Gabriel woman as well as attacking two other women. PDQuick had failed to check the criminal history of the employee who, unknown to them, was on parole for a violent conviction.
In another recent instance, a home health care provider in Massachusetts named Trusted Health Resources unknowingly hired someone with a criminal record as a home attendant. That individual subsequently murdered a young paraplegic man placed under his care as well as the patients grandmother, apparently to cover up a theft. When the employee was later tried and convicted of the crime, the victims family sued the company on the basis of negligent hiring and obtained damages of $26.5 million dollars. Not surprisingly, Trusted Health is no longer in business.
In addition to these high-profile cases, there is also danger from lawsuits incurred due to noncompliance with Federal and state laws governing background check procedures. Non-compliance with these laws is fairly common. Even among companies that have previously used a background screening service, about 75% of the employers I see have language (or are missing language) in their documents that violates either Federal or state law. When choosing a background screening company to hire, I often recommend analyzing the documentation provided by that company for legal compliance. If the documentation violates state or FCRA law, its a serious problem. How can one trust a company’s reporting procedures when their documentation and procedures do not even conform to the applicable laws of their industry?
SCREENING PITFALLS:
While the above examples show the need for increased scrutiny, the difficulty in detecting unflattering backgrounds has also increased:
• When employers conduct reference checks, they are increasingly met with a limited or nonexistent response as legal concerns make former employers reluctant to provide anything more than a confirmation of name, job title and dates of employment.
• Workers with imperfect backgrounds often gravitate towards working as temps, either out of necessity, or as a means of masking their histories. Employers hiring a temporary worker through an agency may not feel the need to conduct the normal background check, but the company is nevertheless considered a co-employer for liability purposes and is liable along with the agency.
THE SOLUTION:
The way to avoid hiring the employee from hell for most companies is a background check by a professional screening company which complies with the applicable legal procedures. These checks typically include criminal history search, motor vehicle report information and a social security number trace. The importance of criminal checks is self-evident, but the others may not be so clear. A motor vehicle report discloses convictions for DUI (Driving Under the Influence), drug possession and failures to appear. In addition, current arrest warrants may be found. Social Security checks help identify false numbers and identities used by an applicant to evade screening of their own personal history.
Other frequently performed checks include:
• References
• Verification of education, licenses, or military service records.
• Credit checks or searches for liens and judgments which help indicate character
• Worker compensation filings which can identify past employers not revealed on an application
Turnaround times for these checks range from the immediate (with online access to credit and other up-to-date databases) to generally two or three working days, depending on the type and extent of search desired. Fees are surprisingly low and can range from $3, up to $50-80 depending on several factors: the package of searches required for a particular position, the number of references contacted and the number of counties searched for criminal activity. It is important for a business to have a screening program appropriate to the type of personnel that they are hiring and to design searches based upon job requirements. As an example, you should not perform a credit check on someone who couldn’t affect you financially, but should always require one for someone in accounting, or who handles money.
If an employer relies on any third party such as a private investigator, public record provider or professional screening service (all considered consumer reporting agencies under Federal law) for references or a more involved background screening, there are a number of additional requirements that must be met. These include legal disclosure and adverse action procedures that must be followed as required by both the Fair Credit Reporting Act and applicable state laws. Because of the complexity of both Federal and state laws, a professional service should be engaged to provide the appropriate documents and expertise to set up such a program. An effective one shields the company from needless lawsuits and promotes morale by screening out the employee from hell.
Thursday, January 01, 2004
FTC Flexes Muscles on "Consumer Rights" Affecting All Employers
by Barry J. Nadell
Companies who background screen job applicants or employees (obtaining public records, references, etc. on job applicants or current employees) must be aware of the amended Fair Credit Reporting Act! Penalties on those who do not comply include actual damages, punitive damages, costs, and attorneys fees. In addition, civil and criminal penalties may apply. (15 U.S.C. 1681n, 1681o, 1681s).
The Consumer Credit Reporting Reform Act of 1996, (CCRRA) became effective on September 30, 1997. The CCRRA affects all employers by amending the Fair Credit Reporting Act (FCRA), 15 U.S.C. 600-624, which governs the use of consumer reports for employment purposes. Do not be fooled and think that this new law only deals with credit issues. The law makes serious changes in the procedures every employer must use to screen applicants or investigate current employees.
Definitions of key terms. 603:
• A consumer report is a report of any information provided by a consumer reporting agency bearing on a consumers credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used or collected in whole or in part for employment purposes.
Any background report from a consumer reporting agency offering public record information or where the information is obtained through personal interviews provides insight into the consumers character or personal characteristics. Unless an employer is not obtaining information from a consumer reporting agency, there are very few exceptions to what the CCRRA considers a consumer report. The following would be considered consumer reports: criminal history report, credit history, motor vehicle report, social security identification, education, license verification, military record verification, or workers compensation history.
Credit reports fall under the definition of consumer reports. When credit reports are sought for employment purposes, the user of the report must adhere to additional requirements outlined in the CCRRA and in state law.
• The term "investigative consumer report" means a consumer report or portion thereof in which information on a consumer's character, general reputation, personal characteristics, or mode of living is obtained through personal interviews with neighbors, friends or associates.
Investigative consumer reports are a form of a consumer report. The difference is the information in the report is obtained through talking to people. When an investigative consumer report is used, the user of the report must conform to additional requirements not required if requesting a consumer report.
Employers seeking an investigative consumer report must clearly and accurately disclose to the consumer that an investigative consumer report including information as to his character, general reputation, personal characteristics and mode of living, whichever are applicable, may be made. 606(a)(1). The disclosure must also indicate that the information may be obtained through personal interviews with neighbors, friends, or associates of the consumer reported on, or with others with whom he/she is acquainted or who may have knowledge concerning any such items of information. 603(3). The disclosure must be provided in writing not later than three days after the date on which the report was first requested. 606(a)(1)(A). The disclosure must also include a statement informing the consumer of their right to request additional disclosures of the nature and scope of the investigation. 606(a)(1)(B). The language required for an investigative consumer report need not be on the disclosure for a consumer report or consumer credit report. Finally, the employer must include the summary of consumer rights. 609(c).
• A consumer reporting agency is an organization which, for monetary fees, engages in whole or in part in providing information on consumers for the purpose of furnishing consumer reports to third parties.
Consumer reporting agencies are defined very broadly. They include any company who obtains information on a consumer and charges a fee to the user of the report for the information. They also include companies who charge fees for services rendered, and in order to provide the service, obtain background information on a consumer that may or may not be given directly to the employer. Included in the CCRRAs definition of a consumer reporting agency is a public records provider, licensed private investigator, detective agency, on-line database company, or the like. In addition, a government agency like a state Department of Motor Vehicles, who sells public information is a consumer reporting agency.
• Employment purposes are when reports are used for the purpose of evaluating a consumer for employment, promotion, reassignment or retention as an employee.
• Adverse action is a denial of employment or any other decision for employment purposes that adversely affects any current or prospective employee.
• The term "consumer" means an individual. Therefore, a background check of an organization does not fall into the purview of the FCRA.
Certification: Before requesting a report an employer must sign and have on file a written certification form with the consumer reporting agency they use. The certification form requires the employer (user of the report) to certify as to the permissible purpose intended and that they will comply with proper disclosure and adverse action requirements. Finally, the employer must certify that the information from the consumer report will not be used in violation of any applicable Federal or state equal employment opportunity law or regulation. 604(b).
Notification: Prior to an employer requesting any consumer report or an investigative consumer report the employer must make a disclosure to the consumer. This notification is required in all instances except for an investigative consumer report (talking to people) where the consumer did not initiate the cause for the report. 604(b)(2)(B).
The notification must be a clear and conspicuous written disclosure that consists solely of the disclosure, and must be provided prior to requesting any consumer report. The disclosure must include the name, address, and toll-free telephone number of the consumer reporting agency. 615(a)(2)(A). A separate disclosure designed for credit reports must be used if the employer seeks a credit report. Federal law specifically states the disclosure must indicate that a consumer report may be obtained for employment purposes. 604(b)(1), 606(a)(1).
Prior to the CCRRA, the only requirement imposed upon the employer was to notify the consumer. Where an employer wishes to obtain public records or obtain an investigative report, they must now obtain authorization from the employee to do the background check.
The requirement for the consumer to authorize the disclosure with their signature places a substantial burden on employers. What is an employers responsibility and authority should a consumer refuse to authorize the background check? In this regard, a background screening can be analogous to drug screening. There is ample authority that if an applicant refuses to authorize a drug screen, the employer can terminate the employment application process and the employer is under no obligation to hire the consumer. Therefore, any applicant who refuses to authorize the background check immediately disqualifies himself or herself from the employment process. Likewise, if an employee refuses to authorize a background screen required by the employer prior to a potential promotion or reassignment, the employee automatically removes his or her candidacy.
Unfortunately, the employers rights are not clear when the employer is in the process of an investigation and, due to the nature of the investigation, requires an employee background search. Where employees have signed only an employment application and refuse to sign a disclosure form authorizing a background check, employers may not be able to take any adverse action against the non-complying employee. If the employee however, previously agreed in writing to provide any support requested by the employer in an investigation and had agreed to all remedies available to the employer including termination if the employee refuses to help in the background investigation, the employer may be able to terminate the employee.
Where an investigative consumer report is to be prepared on a current employee, and to be used for employment purposes for which a consumer has not specifically applied, section 606(a)(2) provides that the notice otherwise required by section 606(a)(1) need not be sent. This is the only exception to disclosure of the background check. For example, if an employer hires an outside agency to perform an investigation, and such investigation is on a current employee who has not applied for a promotion or reassignment, and the agency only obtains information through personal interviews with co-workers, disclosure is not required.
Information within the report: Information must be up to date. Records are considered up to date if they are the current public record status of the item at the time the report is reported. 613(2). Information from public records (i.e. arrest, conviction, judgment, etc.) shall not be furnished unless the consumer reporting agency verifies the accuracy of the information during the 30 day period (which ended on the date on which the report is furnished) that the source of the information is the best possible. 606(d)(4)(A). Information obtained from a CD-ROM or on-line service generally provides only hearing dates and may not indicate if the consumer was convicted, or whether the conviction was expunged or dismissed. Therefore, provisions in the CCRRA which require the reporting of timely information indicate that employers must be very careful and only use agencies which provide direct research at the Superior or Municipal Court (hand searches). Anything less than a hand search will not qualify due to timeliness and/or accuracy.
The most accurate and up to date criminal information available resides in the physical records of each counties’ Superior and Municipal Courts. On-Line access to these records by Consumer Reporting Agencies is not available. Some states allow on-line access to records through their state repository; however, records are generally not up to date and some are up to a year old.
In order to offer records on-line some companies transcribe court microfiche records. Companies using these services experience very high error rates. In addition, microfiche records only offer hearing or filing dates. These dates provide arrest information and the consumer may never have been convicted. If sought pre-offer, knowledge of this data is unlawful. Where a consumer had been convicted, microfiche data does not reveal if the case has been expunged or dismissed. Finally, due to the time it takes to input this information into a computer, it is not timely and up to date, a new requirement under provisions of the CCRRA.
Time Limit on Reporting Information: Information provided in reports is generally limited to seven years (ten years for bankruptcies). This limit is based upon the type of report and may have an exception for state laws in existence prior to September 30, 1996, if there is no conflict with California’s Investigative Consumer Reporting Agencies Act (ICRAA). Suits, judgments, and paid liens are reportable for seven years for both the CCRRA and in California. The ICRAA allows unsatisfied judgments to be reported for ten years while the CCRRA has no time limit as the section only addresses paid liens. 605(a)(3), 1786.16. The CCRRA limits the reporting of records of arrest, indictment, or conviction of a crime to only seven years from the date of the disposition, release, or parole. Under the ICRAA, there was an exception to this time period based on an income of $30,000. 1786.16(b)(2). This exception for California employers will no longer be applicable.
In order to compute the reporting time period for a crime, the reporting agency must analyze whether the conviction of the crime includes a sentence of confinement. If the consumer was convicted of a crime, but the sentence does not include confinement, the reporting period of seven years is controlled by the date of the disposition.
For example, a report provided on September 1, 1997, may not include a crime where the date of the disposition was before August 31, 1990. However, if the consumer was imprisoned, the date of release or placement on parole controls the reportable time frame and the crime may be reported until seven years after parole or confinement is terminated. 605(a)(5). For example, if the consumer was released from confinement on January 15, 1993, and the disposition for the crime was on June 15, 1988, the crime could be reported as the release date is within the normal reportable period of seven years. Information indicating a date, which may be found later from another source like newspaper or interview, does not serve to extend the reporting period. Only the date of disposition, release or parole determines a reporting period. Employers should review their employment application, paying close attention to language that limits the time period an applicant should report a conviction for a crime.
Federal law exempts the time limit on credit reports if the employee earns or is expected to earn $75,000 per year. However, at least one credit reporting agency has advised our firm that they will not produce an extended credit report based on the exceptions in the CCRRA. The information will only extend back seven years (ten for bankruptcies).
Credit Reports: Employers, when seeking a credit report for employment, must obtain a report that has been designed only for employment as the permissible purpose. This type of report is different than one obtained for the purpose of borrowing money. Credit reports which are designed specifically for employment purposes provide everything a normal credit report provides including bankruptcy, liens, judgments, past dues, collection accounts, etc. However, these reports omit date of birth, account numbers, and do not place an inquiry that a lender may see if the applicant applies for credit.
The California Consumer Credit Reporting Agencies Act requires employers who seek a credit report to place a box on the disclosure form that the consumer can check if he or she wants a copy of the credit report. If the box is checked, the consumer must receive a copy of the report at no charge along with their rights concurrently with the employer who requested the credit report. 1785.20.5.
Employers should exercise caution when requesting credit reports on consumers. The August 1997, BNAs Policy and Practice Series, published by the Bureau of National Affairs, Inc., indicates employers should be able to establish a business necessity for using credit checks to avoid the risk of being sued for a Title VII violation, and he or she should inform applicants if hiring is contingent on the results of the checks. PM:201:3416, pg. 20. An employer should only seek credit information if the job description would place the consumer in a position which can potentially affect the company financially (i.e. employees handling cash, in the accounting department, or handling company credit cards or credit card transactions).
Adverse Action Requirements: Taking adverse action is now a two step process. Prior to actually taking adverse action, an employer must provide a copy of the report and a copy of the consumers rights as indicated by the FTC to the consumer. The CCRRA does not place a time period between the time of providing a copy of the report, including the consumers rights notice and the time the employer may advise the consumer of the adverse action taken. Notwithstanding, the employer must perform these functions in the specified order. Official commentary indicates that the employer must wait reasonable time prior to actually denying employment or taking other adverse action.
Once the employer has properly provided a copy of the report and the consumers rights, the actual adverse action must be disclosed with specific language. 615(a). This disclosure must provide (1) oral, written, or electronic notice of the adverse action to the consumer, (2) the name, address, and telephone number of the consumer reporting agency (including a toll-free telephone number established by the agency if the agency compiles and maintains files on consumers on a nationwide basis) that furnished the report to the person, (3) a statement that the consumer reporting agency did not make the decision to take the adverse action and is unable to provide the consumer the specific reasons why the adverse action was taken, (4) a statement of the right of the consumer to obtain a free copy of a consumer report on the consumer from the consumer reporting agency, (5) notice of the sixty day period for obtaining such a copy, and (6) notice of the consumers right to dispute the accuracy or completeness of any information in a consumer report furnished by the consumer reporting agency.
The person who procures or causes to be prepared an investigative consumer report, must upon the written request made by the consumer within a reasonable period of time after the initial disclosure, make a complete disclosure of the nature and scope of the investigation that is requested. 606(b). This disclosure must be in a written statement that is mailed, or otherwise delivered, to the consumer no later than five days after the date on which the request was received from the consumer, or the report was first requested, whichever is later in time. 606(b).
Summary: Job applicants and employees are quick to seek legal remedies should their consumers rights be violated. Failure, ignorance or noncompliance on the part of an employer or the consumer reporting agency to comply with the provisions of the Consumer Credit Reporting Reform Act of 1996 will be costly. Employers must seek and use a competent and detail oriented consumer reporting agency that understands this new law and complies with all of the acts provisions.
This enclosed article is not intended to provide legal advice regarding the Consumer Credit Reporting Reform Act of 1996, the Fair Credit Reporting Act, or state laws. This article represents the authors interpretation of the changes mandated by the CCRRA. Prior to making any changes in your screening of job applicants or current employees, please consult your legal counsel for verification and more detailed information regarding the CCRRA’s impact on your company.
by Barry J. Nadell
Companies who background screen job applicants or employees (obtaining public records, references, etc. on job applicants or current employees) must be aware of the amended Fair Credit Reporting Act! Penalties on those who do not comply include actual damages, punitive damages, costs, and attorneys fees. In addition, civil and criminal penalties may apply. (15 U.S.C. 1681n, 1681o, 1681s).
The Consumer Credit Reporting Reform Act of 1996, (CCRRA) became effective on September 30, 1997. The CCRRA affects all employers by amending the Fair Credit Reporting Act (FCRA), 15 U.S.C. 600-624, which governs the use of consumer reports for employment purposes. Do not be fooled and think that this new law only deals with credit issues. The law makes serious changes in the procedures every employer must use to screen applicants or investigate current employees.
Definitions of key terms. 603:
• A consumer report is a report of any information provided by a consumer reporting agency bearing on a consumers credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used or collected in whole or in part for employment purposes.
Any background report from a consumer reporting agency offering public record information or where the information is obtained through personal interviews provides insight into the consumers character or personal characteristics. Unless an employer is not obtaining information from a consumer reporting agency, there are very few exceptions to what the CCRRA considers a consumer report. The following would be considered consumer reports: criminal history report, credit history, motor vehicle report, social security identification, education, license verification, military record verification, or workers compensation history.
Credit reports fall under the definition of consumer reports. When credit reports are sought for employment purposes, the user of the report must adhere to additional requirements outlined in the CCRRA and in state law.
• The term "investigative consumer report" means a consumer report or portion thereof in which information on a consumer's character, general reputation, personal characteristics, or mode of living is obtained through personal interviews with neighbors, friends or associates.
Investigative consumer reports are a form of a consumer report. The difference is the information in the report is obtained through talking to people. When an investigative consumer report is used, the user of the report must conform to additional requirements not required if requesting a consumer report.
Employers seeking an investigative consumer report must clearly and accurately disclose to the consumer that an investigative consumer report including information as to his character, general reputation, personal characteristics and mode of living, whichever are applicable, may be made. 606(a)(1). The disclosure must also indicate that the information may be obtained through personal interviews with neighbors, friends, or associates of the consumer reported on, or with others with whom he/she is acquainted or who may have knowledge concerning any such items of information. 603(3). The disclosure must be provided in writing not later than three days after the date on which the report was first requested. 606(a)(1)(A). The disclosure must also include a statement informing the consumer of their right to request additional disclosures of the nature and scope of the investigation. 606(a)(1)(B). The language required for an investigative consumer report need not be on the disclosure for a consumer report or consumer credit report. Finally, the employer must include the summary of consumer rights. 609(c).
• A consumer reporting agency is an organization which, for monetary fees, engages in whole or in part in providing information on consumers for the purpose of furnishing consumer reports to third parties.
Consumer reporting agencies are defined very broadly. They include any company who obtains information on a consumer and charges a fee to the user of the report for the information. They also include companies who charge fees for services rendered, and in order to provide the service, obtain background information on a consumer that may or may not be given directly to the employer. Included in the CCRRAs definition of a consumer reporting agency is a public records provider, licensed private investigator, detective agency, on-line database company, or the like. In addition, a government agency like a state Department of Motor Vehicles, who sells public information is a consumer reporting agency.
• Employment purposes are when reports are used for the purpose of evaluating a consumer for employment, promotion, reassignment or retention as an employee.
• Adverse action is a denial of employment or any other decision for employment purposes that adversely affects any current or prospective employee.
• The term "consumer" means an individual. Therefore, a background check of an organization does not fall into the purview of the FCRA.
Certification: Before requesting a report an employer must sign and have on file a written certification form with the consumer reporting agency they use. The certification form requires the employer (user of the report) to certify as to the permissible purpose intended and that they will comply with proper disclosure and adverse action requirements. Finally, the employer must certify that the information from the consumer report will not be used in violation of any applicable Federal or state equal employment opportunity law or regulation. 604(b).
Notification: Prior to an employer requesting any consumer report or an investigative consumer report the employer must make a disclosure to the consumer. This notification is required in all instances except for an investigative consumer report (talking to people) where the consumer did not initiate the cause for the report. 604(b)(2)(B).
The notification must be a clear and conspicuous written disclosure that consists solely of the disclosure, and must be provided prior to requesting any consumer report. The disclosure must include the name, address, and toll-free telephone number of the consumer reporting agency. 615(a)(2)(A). A separate disclosure designed for credit reports must be used if the employer seeks a credit report. Federal law specifically states the disclosure must indicate that a consumer report may be obtained for employment purposes. 604(b)(1), 606(a)(1).
Prior to the CCRRA, the only requirement imposed upon the employer was to notify the consumer. Where an employer wishes to obtain public records or obtain an investigative report, they must now obtain authorization from the employee to do the background check.
The requirement for the consumer to authorize the disclosure with their signature places a substantial burden on employers. What is an employers responsibility and authority should a consumer refuse to authorize the background check? In this regard, a background screening can be analogous to drug screening. There is ample authority that if an applicant refuses to authorize a drug screen, the employer can terminate the employment application process and the employer is under no obligation to hire the consumer. Therefore, any applicant who refuses to authorize the background check immediately disqualifies himself or herself from the employment process. Likewise, if an employee refuses to authorize a background screen required by the employer prior to a potential promotion or reassignment, the employee automatically removes his or her candidacy.
Unfortunately, the employers rights are not clear when the employer is in the process of an investigation and, due to the nature of the investigation, requires an employee background search. Where employees have signed only an employment application and refuse to sign a disclosure form authorizing a background check, employers may not be able to take any adverse action against the non-complying employee. If the employee however, previously agreed in writing to provide any support requested by the employer in an investigation and had agreed to all remedies available to the employer including termination if the employee refuses to help in the background investigation, the employer may be able to terminate the employee.
Where an investigative consumer report is to be prepared on a current employee, and to be used for employment purposes for which a consumer has not specifically applied, section 606(a)(2) provides that the notice otherwise required by section 606(a)(1) need not be sent. This is the only exception to disclosure of the background check. For example, if an employer hires an outside agency to perform an investigation, and such investigation is on a current employee who has not applied for a promotion or reassignment, and the agency only obtains information through personal interviews with co-workers, disclosure is not required.
Information within the report: Information must be up to date. Records are considered up to date if they are the current public record status of the item at the time the report is reported. 613(2). Information from public records (i.e. arrest, conviction, judgment, etc.) shall not be furnished unless the consumer reporting agency verifies the accuracy of the information during the 30 day period (which ended on the date on which the report is furnished) that the source of the information is the best possible. 606(d)(4)(A). Information obtained from a CD-ROM or on-line service generally provides only hearing dates and may not indicate if the consumer was convicted, or whether the conviction was expunged or dismissed. Therefore, provisions in the CCRRA which require the reporting of timely information indicate that employers must be very careful and only use agencies which provide direct research at the Superior or Municipal Court (hand searches). Anything less than a hand search will not qualify due to timeliness and/or accuracy.
The most accurate and up to date criminal information available resides in the physical records of each counties’ Superior and Municipal Courts. On-Line access to these records by Consumer Reporting Agencies is not available. Some states allow on-line access to records through their state repository; however, records are generally not up to date and some are up to a year old.
In order to offer records on-line some companies transcribe court microfiche records. Companies using these services experience very high error rates. In addition, microfiche records only offer hearing or filing dates. These dates provide arrest information and the consumer may never have been convicted. If sought pre-offer, knowledge of this data is unlawful. Where a consumer had been convicted, microfiche data does not reveal if the case has been expunged or dismissed. Finally, due to the time it takes to input this information into a computer, it is not timely and up to date, a new requirement under provisions of the CCRRA.
Time Limit on Reporting Information: Information provided in reports is generally limited to seven years (ten years for bankruptcies). This limit is based upon the type of report and may have an exception for state laws in existence prior to September 30, 1996, if there is no conflict with California’s Investigative Consumer Reporting Agencies Act (ICRAA). Suits, judgments, and paid liens are reportable for seven years for both the CCRRA and in California. The ICRAA allows unsatisfied judgments to be reported for ten years while the CCRRA has no time limit as the section only addresses paid liens. 605(a)(3), 1786.16. The CCRRA limits the reporting of records of arrest, indictment, or conviction of a crime to only seven years from the date of the disposition, release, or parole. Under the ICRAA, there was an exception to this time period based on an income of $30,000. 1786.16(b)(2). This exception for California employers will no longer be applicable.
In order to compute the reporting time period for a crime, the reporting agency must analyze whether the conviction of the crime includes a sentence of confinement. If the consumer was convicted of a crime, but the sentence does not include confinement, the reporting period of seven years is controlled by the date of the disposition.
For example, a report provided on September 1, 1997, may not include a crime where the date of the disposition was before August 31, 1990. However, if the consumer was imprisoned, the date of release or placement on parole controls the reportable time frame and the crime may be reported until seven years after parole or confinement is terminated. 605(a)(5). For example, if the consumer was released from confinement on January 15, 1993, and the disposition for the crime was on June 15, 1988, the crime could be reported as the release date is within the normal reportable period of seven years. Information indicating a date, which may be found later from another source like newspaper or interview, does not serve to extend the reporting period. Only the date of disposition, release or parole determines a reporting period. Employers should review their employment application, paying close attention to language that limits the time period an applicant should report a conviction for a crime.
Federal law exempts the time limit on credit reports if the employee earns or is expected to earn $75,000 per year. However, at least one credit reporting agency has advised our firm that they will not produce an extended credit report based on the exceptions in the CCRRA. The information will only extend back seven years (ten for bankruptcies).
Credit Reports: Employers, when seeking a credit report for employment, must obtain a report that has been designed only for employment as the permissible purpose. This type of report is different than one obtained for the purpose of borrowing money. Credit reports which are designed specifically for employment purposes provide everything a normal credit report provides including bankruptcy, liens, judgments, past dues, collection accounts, etc. However, these reports omit date of birth, account numbers, and do not place an inquiry that a lender may see if the applicant applies for credit.
The California Consumer Credit Reporting Agencies Act requires employers who seek a credit report to place a box on the disclosure form that the consumer can check if he or she wants a copy of the credit report. If the box is checked, the consumer must receive a copy of the report at no charge along with their rights concurrently with the employer who requested the credit report. 1785.20.5.
Employers should exercise caution when requesting credit reports on consumers. The August 1997, BNAs Policy and Practice Series, published by the Bureau of National Affairs, Inc., indicates employers should be able to establish a business necessity for using credit checks to avoid the risk of being sued for a Title VII violation, and he or she should inform applicants if hiring is contingent on the results of the checks. PM:201:3416, pg. 20. An employer should only seek credit information if the job description would place the consumer in a position which can potentially affect the company financially (i.e. employees handling cash, in the accounting department, or handling company credit cards or credit card transactions).
Adverse Action Requirements: Taking adverse action is now a two step process. Prior to actually taking adverse action, an employer must provide a copy of the report and a copy of the consumers rights as indicated by the FTC to the consumer. The CCRRA does not place a time period between the time of providing a copy of the report, including the consumers rights notice and the time the employer may advise the consumer of the adverse action taken. Notwithstanding, the employer must perform these functions in the specified order. Official commentary indicates that the employer must wait reasonable time prior to actually denying employment or taking other adverse action.
Once the employer has properly provided a copy of the report and the consumers rights, the actual adverse action must be disclosed with specific language. 615(a). This disclosure must provide (1) oral, written, or electronic notice of the adverse action to the consumer, (2) the name, address, and telephone number of the consumer reporting agency (including a toll-free telephone number established by the agency if the agency compiles and maintains files on consumers on a nationwide basis) that furnished the report to the person, (3) a statement that the consumer reporting agency did not make the decision to take the adverse action and is unable to provide the consumer the specific reasons why the adverse action was taken, (4) a statement of the right of the consumer to obtain a free copy of a consumer report on the consumer from the consumer reporting agency, (5) notice of the sixty day period for obtaining such a copy, and (6) notice of the consumers right to dispute the accuracy or completeness of any information in a consumer report furnished by the consumer reporting agency.
The person who procures or causes to be prepared an investigative consumer report, must upon the written request made by the consumer within a reasonable period of time after the initial disclosure, make a complete disclosure of the nature and scope of the investigation that is requested. 606(b). This disclosure must be in a written statement that is mailed, or otherwise delivered, to the consumer no later than five days after the date on which the request was received from the consumer, or the report was first requested, whichever is later in time. 606(b).
Summary: Job applicants and employees are quick to seek legal remedies should their consumers rights be violated. Failure, ignorance or noncompliance on the part of an employer or the consumer reporting agency to comply with the provisions of the Consumer Credit Reporting Reform Act of 1996 will be costly. Employers must seek and use a competent and detail oriented consumer reporting agency that understands this new law and complies with all of the acts provisions.
This enclosed article is not intended to provide legal advice regarding the Consumer Credit Reporting Reform Act of 1996, the Fair Credit Reporting Act, or state laws. This article represents the authors interpretation of the changes mandated by the CCRRA. Prior to making any changes in your screening of job applicants or current employees, please consult your legal counsel for verification and more detailed information regarding the CCRRA’s impact on your company.
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