Peering into the past …

In the litigious world in which modern businesses operate, companies have a tool at their disposal that can help protect them from liability due to bad hiring decisions: an employee background check.
Most but not all companies perform some form of pre-hiring screening on prospective workers, for a variety of reasons. Background checks can include calling former employers for references or investigating a person’s criminal history.
Steve Hawk, area manager of Manpower Professional, said, “Background checks help employers hire the best qualified candidates, while minimizing the risk of making a bad hiring decision.”
There are significant legal ramifications employers need to be aware of before undertaking an employee background check. “The primary legal limit is you can’t do a background check without the employee knowing,” said Pat Ott, current director of property management at Thornton Oliver Keller in Boise and the company’s previous human resources director.
Broader legal restrictions also apply, according to Corrina Brouillard, human resources consultant at AmeriBen/IEC Group in Meridian. “Organizations get into trouble when background check information does not relate directly to the position or job requirements,” Brouillard said.
Some of the specific federal and state laws governing proper procedures for background checks and correct and incorrect ways collected information can be used include: Americans with Disabilities Act, Title VII of the Civil Rights Act, Fair Credit Reporting Act, Age Discrimination in Employment Act, National Labor Relations Act, and the Uniformed Services Employment and Reemployment Act. Brief descriptions of each law include:
• The Americans with Disabilities Act – prohibits discrimination on the basis of disability. According to Brouillard, the ADA prevents prospective employers from asking former employers specific questions related to the applicant’s disability; it does, however, allow for queries relating to the quality and quantity of the applicant’s work, his or her attendance record, and similar job-related issues.
• Title VII of the Civil Rights Act – prohibits discrimination based on race, national origin, color, sex, and religion. The part of this act most relevant to background checks is a segment covering criminal records. “Employers cannot use criminal records as a basis for denying employment to an individual, unless the decision is justified by a business necessity,” said Brouillard.
Other restrictions include gravity of the offense and how much time has passed since the conviction or completion of the sentence. Also, according to Ott, “There has to be a conviction, not just an allegation.”
Shane Compton, who owns Integrity Check, a background checking service in Boise, said, “You can’t use any arrest record older than seven years.”
• The Fair Credit Reporting Act – imposes disclosure requirements on employers who use consumer credit reports to establish eligibility for employment, or to evaluate an employee for promotion, reassignment, or retention.
• Age Discrimination in Employment Act – prohibits discrimination on the basis of age (40 and over).
• National Labor Relations Act – defines basic rights of employees and allows for workers’ rights to join labor organizations. Under this act, employers are refrained from asking prospective employees about their involvement in labor unions.
• Uniformed Services Employment and Reemployment Act – prohibits employers from discriminating on the basis of service in the military. Don’t ask – “employers need to refrain from questions directed toward the applicant’s military service.”
These laws need to be considered when performing background checks or when information protected under these laws surfaces during a check.
Brouillard detailed three primary reasons employers perform pre-employment screening:
• Verification of [job candidate] information. “The percentage of resumes and job applications that contain lies and exaggerations has been estimated at between 30 and 80 percent,” said Brouillard. “Employers who are wise will verify dates of employment, salary, grades, educational degrees, certifications, and verify if [the applicant] is legally qualified to work in the U.S.”
• To protect against negligent hiring. “Criminal background checks protect organizations from safety and security issues,” Brouillard said.
• To provide details of candidates’ characteristics that may not appear on a resume or application. According to Brouillard, these details generally surface during reference checking and can provide an overview of applicants’ interpersonal skills, work ethic, attitude, response to pressure, integrity, punctuality, and reliability.
While reference verification is generally performed by a staff member and can be done quickly and without cost, criminal records checks, credit checks, driving records, and other facts relevant to the position being applied for can require hiring a third party for a fee, and up to three to five days’ work.
Ott and her HR replacement, Sara Clemens, said Thornton Oliver Keller uses an online service called ACRAnet when performing background checks. Per-employee fees are $30. Ott said some information submitted – or not submitted – by tentative workers used to occasionally slip through the cracks, but ACRAnet has “thrown a wider net” for discerning improprieties on employee applications.
Hawk said Manpower recruiters perform some of the staffing agency’s background checks, and “we use a vendor [who] specializes in background checks for others.”
Brouillard said examining a potential employee’s past is worth the cost and effort. “The cost of not having background checks is a higher consequence to the bottom line than paying a small fee for a background check,” she said. “Employers can be held financially and criminally liable for the actions of an employee. Establishing a pre-employment screening program can protect an employer against potential liability.”