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How A Small Business Can Avoid Hiring a Criminal for Under 20 Dollars

November 03, 2003

Five easy steps every small business can take TODAY to protect themselves and the public.

It is becoming a familiar story in the news: a small business owner hires a new employee, fails to perform a background check or check references, and only after a crime has been committed does the business find out about the employee’s serious criminal record. By then, it can be too late.

Hiring a person with a criminal record can lead to workplace violence, theft, embezzlement and business disruptions. And in some cases, the cost of hiring a criminal can mean financial ruin, the end of the business itself, or injury and even death for co-workers, customers or innocent bystanders.

There are over 40 million small businesses in America with 20 employees or less, and yet it is estimated that only a very small fraction of those small businesses take meaningful precautions to know exactly who they are hiring.

Every employer has an obligation to take reasonable steps in the hiring process to avoid hiring someone who they either knew, or in the exercise of reasonable care, should have known was dangerous or unfit for a particular job.  That is called "due diligence." If an employer violates that duty, they can be sued for  "negligent hiring."  Employers generally do not hire someone that they know is dangerous or unfit for a job. It is the "should have know" that creates the difficulty.  Without taking steps to hire intelligently, it is almost a statistical certainty that an employer will hire someone with a criminal record that should have been considered in the hiring process.

That does not mean that a person with a criminal record can never get a job. In fact, it is to everyone's best interest that a person with a criminal record be able to find employment to become a productive citizen. But there are certain jobs that just are not appropriate for certain people. A person with a criminal history showing violence, for example, is not a reasonable fit for a job that places them into a person's home.

It can be a challenge for a small business to do background checks. First, there is no such thing as a "nationwide" criminal check. Each courthouse where a person could potentially have a record must be searched. And with over 10,000 courthouses in America, not every courthouse can be checked.

In addition, for many small businesses, the time, money and effort for a background check can seem overwhelming. Being a small business owner is one of the toughest jobs in America. Not only does the owner of a small business have to make sure everything gets done, but the owner only gets paid after everyone else gets his or her money. Background checks can seem like a waste of time and money, particularly if the business had never had a problem in the past. Unfortunately, it only takes one bad hire to ruin a small business or to ruin someone else's life.

The good news is that there are five easy and common sense steps an employer can take immediately. These five steps take practically no time and the cost can be as little as $20 or less. There is no reason that any small business has to hire blind. With theses simple, quick and inexpensive steps, any small business can protect themselves, their workers and the public from a bad hire. Here are the steps:

  • 1. Have each job applicant sign a consent form for a background check, including a check for criminal records. By announcing that your firm checks backgrounds, it will discourage applicants with something to hide, and encourage applicants to be truthful and honest about any mistakes they may have made in the past. For maximum protection, the release should extend to future background checks for retention, promotion or reassignment unless revoked in writing. If the actual job starts before a background check can be done, make sure to tell the applicant that the position is conditioned upon the employer receiving a background report that the employer finds satisfactory.
  • 2. Ask an applicant both in the interview and in writing (on the consent form or application) if they have any criminal convictions or pending cases. During an interview, always ask, "If we were to check with the courts or police department, would we find an criminal convictions or pending cases." Since the applicant realizes they have signed consent for a background search, there is a motivation to be honest. Be sure to not limit the question to only felonies. Misdemeanors can be very serious although some states limit inquiries about certain misdemeanors. But, do not ask about arrests not resulting in a conviction. It is a bet practice to make every job applicant fill out an application.  That protects the employer in many ways.  For example, makes it easier to compare applicants and to verify information
  • 3. Verify the applicant’s employment for the past seven years and ask them in an interview what they think the previous employer would tell you. This is crucial. An employer must call past employers to confirm dates of employment. An employer needs to look into any unexplained gaps in employment where the applicant cannot account for their whereabouts. Many employers make the mistake of not bothering to call previous employers because they have learned from experience that previous employers often will not comment on the specifics of a previous employee's job performance. However, not calling previous employers is one of the biggest and costliest mistakes an employer can make. Even if the past employers do not comment on job performance, it is critically important to at least verify employment dates and job title. Just knowing that the person has a solid job history is vital information. Another vital tool is to ask an applicant questions such as , "If I were to ask a previous employer about your performance, what would they describe as your strong points? What would they describe as needing improvements? Would they have anything negative about your job performance to tell me?" Since the applicant has signed a release, they may well assume that such calls will be made, and there will be an incentive to reveal accurate information.
  • 4. Ask for residence addresses for the past seven years. This information helps an employer establish an applicant’s whereabouts and it should match with the employment history. This can go on the applicant’s consent form. It is also critical in order to assist a professional firm in conducting a background check. Since there is no such thing as national criminal records check for most private employers, that information is necessary to determine where to search. It may also reveal any discrepancies in an applicant's history.
  • 5. Do a criminal check in at least the county of residence.  Small employers can do it themselves, or have professional service do it, usually for less than $20.00. The minimum protection is a one county criminal check, done in conjunction with the other steps. The best protection is a seven year criminal check of every county where a person has lived, worked or studied, based upon the persons job and residence history, as well as a social security trace report that a background company can obtain that lists previous addresses associated with a person. For higher positions, an employer can check Federal court records as well.

Following these simple steps will go a long way toward protecting your business. Remember, if a person has a criminal record, an employer should not automatically exclude the person from employment without first determining whether there is a sound business reason, based upon the nature and gravity of the offense, the nature of the job and when the crime occurred. In addition, just because a person has made a mistake in the past does not mean that they should never get a chance. However, certain jobs may not be appropriate for a person with certain types of convictions.

Important Note: The information in this article and the form below are not given or intended as legal advice. It is based upon generally accepted Human Resource and industry practices. An employer should check with their own attorney to determine how state or local law affects their business, and for any legal advice.

Sample Release Form: A release form such as this should be a standard part of any employment application. If an employer is using the services of a professional firm that performs background checks, called a Consumer Repotting Agency (CRA), then a federal law called the Fair Credit Reporting Act (FCRA) applies.  The background firm should provide the employer with the necessary forms, including an employer certification s well as the Release and Disclosure that must be given to the job applicant.  In fact, under federal law, the disclosure form must be on  separate document.  In addition, if an employer uses an "online" service to obtain information, an employer is well advised to utilize the forms needed under the FCRA, as well.  Any service an employer uses should be able to give the employer the forms and information they the need on how to conduct a legal background check in their state.

The following form is for an employers who wants to take steps in-house.  It is not intended as a form to be used under the FCRA:

Authorization and Consent for Pre-Employment Screening Report

I, _____________________________________________, in connection with my application for employment at ________________________________________________, hereby authorize the Employer and any agent it authorizes to perform a pre-employment background screening check (including future screenings for retention, promotion or re-assignment if applicable unless revoked in writing). I understand and agree to the following:

I understand that the employer may obtain information about ne having a bearing on job performance, and may include information from public and private sources, public records, courts, schools, former employers and references concerning my driving record, court records, credit, worker’s compensation record, education, credentials, identity and previous employment.

I authorize and release people, companies, references, current and former employers, schools, credit bureaus, municipal, county, state and federal agencies and courts, to provide all information that is requested to the employer or its authorized agents. I further release and hold harmless all of the above, including the employer, to the full extent permitted by law, from any liability or claims arising from retrieving and reporting of information concerning me.

I agree that a copy or fax of this document shall be as valid as the original.

Have you ever been convicted of a crime? (Please exclude convictions for minor marijuana related offenses, convictions that have been sealed or legally eradicated and misdemeanor convictions for which probation was completed and the case was dismissed.) Yes__________ No ____________

Are you currently out on bail or released on your own recognizance pending trial? Yes _________ No ________

If the answer to either one is YES, please explain on a separate piece of paper. (An affirmative answer to any of the above will not necessarily disqualify you from employment).

(For California ONLY)

__ I waive my right to receive any public record obtained by the employer, including court records.

I verify and affirm that all the information on this form and all information on my resume and application as well as all information given during any interview is true and correct. Any false information or material omission is grounds to terminate the hiring process, or to terminate employment at any time if it has started.

Your signature_______________________________________ Date__________________

©1999-2003 by Lester S. Rosen, Founder & CEO of Employment Screening Resources. All rights reserved. May not be reprinted or published in whole or in  part without authorization.

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