ESR NEWS: Employment Screening Information for Employers

Getting a college diploma apparently no longer requires years of hard work, going to class, taking tests, paying tuition or even reading a book. Why bother going through the formalities when all a person needs is a credit card and a web browser in order to buy an authentic looking diploma that mimics real colleges, universities and even high schools across the U.S.? Go to any search engine and run keywords such as “Fake Diploma” and anyone can instantly “graduate” from nearly any school in America with a very handsome and authentic looking diploma suitable for hanging.

One such website advertises that it creates “very realistic diplomas/transcripts. These diplomas/ transcripts are extremely high quality printed on official parchment quality paper. You can show your employer and they will never doubt that you indeed attended college. You will not find better quality anywhere!!!”

Some of these sites “officially” caution that the diplomas and transcripts are intended for “Novelty and Entertainment Use Only.” However, the fake documents you receive do not have a disclaimer written any place on them.

With statistics showing that resume fraud is a significant issue, employers must be very cautious about accepting a physical diploma as proof of a degree. When presented with a physical diploma or transcripts, employers should fax a copy to the school to confirm its authenticity. Most background firms can tell stories of faxing copies of degrees, supplied by the applicant, to high schools and colleges only to be told the degree is a fake.

These fakes have not entirely escaped official attention. In Illinois, the legislature passed a law in 2004 aimed at addressing educational fraud. It is now a Class A Misdemeanor to knowingly manufacture or produce for profit or for sale a false academic degree, unless the degree explicitly states “for novelty purposes only.”

Employment Screening Resources (www.ESRcheck.com) has expertise in verifying legitimate education credentials and in spotting phony degrees and or worthless degrees from degree mills.

A new law in Hawaii effective July 1, 2009, regulates the use of employment credit reports by making their use an unlawful discriminatory practice except under certain circumstances.  This will impact Hawaii employment screening background checks significantly.  See the July ESR Newsletter and Legal Update for the full story. To sign up for the ESR Newsletter, go to: http://www.esrcheck.com/newsletter/ and see the full story by employment screening expert Lester Rosen.

On the surface, it is easy to see why a job board may see the  appeal in an excluisve integration with a background firm.   The idea is that an employer can use the job board to find the candidate and at the same time, perform a background check through the partner background firm.  From a business development perspective, it looks like a good arrangement for both the job board and the screening firm, and gives the job board an additional stream of revenue.  

The reality however, may turn out to be much different.  First, very knowledgeable observers of the recruiting world have predicted rough waters ahead for the big job boards.  The July 6, 2009 edition of Business Week noted that the job boards are losing ground to sites such as LinkedIn, Craigslist and Twitter among others.  According to one expert quoted in the article, “The big boards have peaked.”  

What that means is that recruiters are finding candidates from numerous sources.  Since all candidates need to be screened in a similar  fashion to prevent claims of disparate treatment, it make little sense to utilize  background services offered through just  one  job board for some candidates and to make other arrangements for all other candidates.  There is a lot to be said for uniformity of treatment of candidates.  

These types of tie-in arrangements also assume that Human Resources professionals are swayed in large numbers simply by the fact that there is a built –in economic association.  However, most HR professionals have an understanding that just because one firm enters into a business development deal with another does not mean that HR is getting the best deal or that their needs are being meet.  HR professionals do not sacrifice their own due diligence and blindly accept the recommended partner.  

The smart move for job boards that want to retain traffic, service thier clients  and increase business would be to allow employers to do their employment screening with whatever background firm the employer chooses.  That would make a job board even more valualbe as part of the hiring process.  Through standard integration tools, that is something job boards could easily allow.   Exclusive business development  deals with just one screening firm  carries with it the unstated premise that the job boards know better than  HR and recruiters what is good for them.   That  is the same “old school” thinking that may have gotten job boards in trouble in the first place.   Besides, HR professionals clearly understand that when a job board has an exclusive partner, that most likely there is some sort of economic sharing as well. 

For information on how to select a screening firm, a sample Request for Proposal (RFP) or how to audit your current screening firm, see information at http://www.esrcheck.com/ESRadvantage.php

The sample RFP is at: http://www.esrcheck.com/backgroundscreeningrfp.php and the article on how to select a screening firm is at: http://www.esrcheck.com/SelectingBackgroundScreeningFirm.php

An essential element of any due diligence plan is a yearly audit of your current practices.  In the event of a worst case scenario, and an employer hires someone that is unfit, unsafe or unqualified, the best defense is that the employer exercised due diligence in its hiring practices, including the choice of a screening firm.  ESR has developed a checklist, provided below, that can be used to send to a screening provider every year to document your due diligence and to measure the effectiveness of your current screening program.  For a Word version, contact Jared Callahan at 415-898-0044 or email him at jcallahan@esrcheck.com.  More information is at www.ESRcheck.com .

This is a yearly process to document that our company is utilizing due diligence in its employment screening processes.  Please fill out and utilize additional paper if necessary.

1. Have there been any material changes in the past year that would adversely affect your ability to provide industry standard employment screening reports?
2. Is all work performed in the USA to protect privacy and control quality (i.e., nothing sent offshore to India or other places)?  If not, please explain in detail how privacy is protected. (See: http://www.concernedc ras.com/)
3. Are all employment and education checks conducted by professionals in a controlled, call center type environment, so that nothing is sent to at-home workers?  If not, please explain how data privacy and the quality of work are monitored.
4. For employment verifications, are anti-fraud procedures in place, such as independent verifications of all past employer phone numbers instead of relying upon an applicant supplied number?
5. For education verifications, are steps taken to verify whether a college or university is accredited and to watch out for Diploma Mills?
6. Are criminal searches conducted using the most accurate means, which normally means on-site (no database substitutes)? (See: http://www.concernedcras.com/)
7. Do you search for both felonies and misdemeanors when available?
8. When a criminal hit is reported, does a knowledgeable person in your firm review the findings to determine whether there are any legal issues in reporting the findings to the employer (as opposed to having the information entered by a court researcher)?
9. When there is a criminal “hit”, do you contact the employer immediately to advise that there is a potential problem?
10. Does your firm take measures to ensure that ALL legal and relevant criminal records are searched, as opposed to just going back “seven” years?
11. If a client orders a “multi-jurisdictional” database search, do you re-verify any criminal “hit” at the courthouse level for maximum accuracy, instead of relying on notifying the applicant of a potential hit? 
12. Do you notify your clients of changes in the FCRA and other applicable laws?
13. Do you at least, on a yearly basis, conduct an internal FCRA compliance audit?
14. Do you offer international background checks? If “yes,” please describe
15. Is your firm “Safe Harbor Certified” to perform screenings of applicants from the EU (European Union)?
16. Do you have data protection, privacy security and data breach policies?  If so, please provide information.
17. Are you a member of the background screening trade association, the National Association of Professional Background Screeners (NAPBS), and does your firm actively participate and support professionalism in the screening industry?
18. What is your average turn-around time?
19. If there is a delay for reasons that are out of your control, are your clients notified online with in-depth notes and the anticipated ETA of information?
20. Are your clients provided with written documentation and resources on safe hiring, due diligence and legal compliance issues?
21. Are your clients provided with upgrades in technology that would enhance workflow, such as the ability to have applicants consent online or integration with an ATS or HRIS system?
22. Please describe your initial training program for team members that work on our account, as well as any ongoing training.

Employment Screening Resources (ESR) has released a free web based interview guide generator to help employers build printed interview forms for any position. The tool allows employers to select from generic interview questions, or to create their own questions, and then create a printed form that can be saved or modified.

 The tool also gives employers the flexibility of adding their own question to different sections of the interview guide. 

This free tool solves several issues for employers. It helps employers and HR professionals produce a printed structured interview guide and focus on developing relevant questions for each position. Printed interview forms also help employers ensure that interviewers are asking the right questions every time, in the right way. It  helps to ensure that all applicants for a position  are treated fairly and uniformly  Using a “structured interview “guide helps employers ask permissible questions in a consistent fashion for all applicants for a position. An employer should only choose those questions that are valid predictors of job performance for a particular position.  The tool was created by employment screening background check expert Lester Rosen.

The tool can be found at:  http://www.esrcheck.com/Interviewgenerator.php

American industries that hire large numbers of hourly, temporary or seasonal employees are caught in a Catch-22. 

On one hand, they know that if they don’t take measures to conduct pre-employment screening and exercise due diligence in hiring, it is a statistical certainly they are sitting ducks for expensive litigation, workplace violence, false claims, theft, embezzlement and economic loss. 

Just one bad hire can cost a firm literally millions. Studies show that screening reveals criminal records for up to 10% of job applicants, and at least one-third of all resumes contain materials falsehoods. For food establishments, manufactures, hotels and other business that have a national brand, one negative employee caused event can result in damaging national publicity and significant harm to the brand.  

The catch, however, is that large hourly employers face enormous financial and logistical challenges in implementing safe hiring programs. Screening large numbers can be expensive and time consuming. Some industries hire at multiple locations, and can experience large turnover.

 The problem is compounded when firms hire seasonal, temporary or contract workers as well.  Such industries can include hospitality, manufacturing, service, retail, food and restaurants, and tourism.  The challenge is how industries with a large numbers of hourly, seasonal, temporary or contract workers or significant turnover, can protect themselves in a cost-effective and efficient manner. 

The answer is probably less complicated then it first appears-due diligence and safe hiring does not require a large budget when employers implement a safe hiring system, as opposed to buying background checks. 

Many firms make the mistake of believing that in order to show due diligence, they need to spend a great deal of money to perform background checks and criminal record research. These firms view pre-employment screening as a process that starts after a hiring manager has selected an applicant, and the name is submitted to security or human resources for a background report. Depending upon the employer, it is either outsourced to a background company or investigated internally through corporate security. 

An effective background-screening program, however, does not need to cost a great deal of money because it is much more then just checking background and criminal records after a candidate has been selected. In fact, in an effective safe hiring system, the primary tools are the application, interview and reference checking process, also known as the AIR process. These processes are performed in-house as part of the routine hiring program, and do not cost employers a dime, as long as it is followed. A brief review of the AIR process is contained in the attached Safe Hiring Checklist. 

AIR PROCESS

1. Use an application form, not just resumes.

Use of an employment application form is considered a best practice. Resumes are not always complete or clear. Applications ensure both uniformity and that all needed information is obtained, prevents employers from having impermissible information, and provides employers with a place for applicants to sign certain necessary statements. 

2. Make sure the application form contains all necessary language.

a. Use the broadest possible language for felony and misdemeanor convictions and pending cases. One of the biggest mistakes employers make is to only ask about felonies on an application form since misdemeanors can be very serious. Employers should inquire about misdemeanors to the extent allowed in their state.

b. Statement that criminal records do not automatically disqualify an applicant. This is important for EEOC compliance. It is critical for employers to understand that the background screening is conducted to determine whether a person is fit for a particular job. Society has a vested interest in giving ex-offenders a chance. However, an employer is under a due diligence obligation to make efforts to determine if a person is reasonable fit for a particular position. For example, a person just out of custody for a violent crime would not be a good candidate for a job that require them to go into people’s home, but may perform very well on a supervised work crew. If a criminal record is found, an employer must determine if there is a business reason not to hire the person, based upon the nature and gravity of the offense, the nature of the job and when the crime occurred. There are also limitations to the use of arrests not resulting in a conviction, and a number of states also have rules about criminal records.

 c. Statements that lack of truthfulness or material omissions are grounds to terminate the hiring process or employment no matter when they are discovered. This is particularly important if a criminal record is found. Although a criminal record may not be used automatically to disqualify an applicant, the fact an applicant has lied about a criminal matter can be the basis for an adverse decision. 

3. Require a release for a background check in the application process. Have each job applicant sign a consent form for a background check, including a check for criminal records, past employment and education. Announcing that your firm checks backgrounds may discourage applicants with something to hide, and encourage applicants to be truthful and honest about mistakes they have made in the past. If a firm outsources to a third party vendor, then under the federal Fair Credit Reporting Act (FCRA), there must be a disclosure on a separate standalone document. 

4. Review the application carefully. In most instances, when there is an employee problem or lawsuit, a careful review of the application would have alerted the employer in advance that they were hiring a lawsuit waiting to happen, Look for the following red flags:

Applicant does not sign application.

Applicant does not sign consent or background screening.

Applicant leaves criminal questions blank (the honest criminal syndrome-dopes not want to lie about a criminal past).

Applicant self-reports a criminal violation (Applicants can self report matters incorrectly.)

Applicant fails to explain why he or she left past jobs,

Applicant fails to explain gaps in employment history.

Applicant gives an explanation for an employment gap or the reason leaving previous job that does not make sense. 

Excessive cross-outs and changes (as though making it up as they go along) 

Applicant fails to give complete information (i.e. insufficient information to identify a past employer, leaves out salary, etc).

Applicant failed to indicate or cannot recall the name of a former supervisor. 

5. In reviewing applications, look for unexplained employment gaps.

It is critical to verify past employment to determine where a person has been for the last 5-10 years, even if you only get dates and job titles. Look for unexplained gaps in employment. Generally, if you can verify that a person was gainfully employed for the last five to ten years, or their whereabouts can be verified it is less likely the person spent time in custody for a serious offense, although this does not eliminate the possibility of lesser offenses. 

6. In reviewing applications, examine reasons for leaving each job.

7. Always ask these five questions (during housekeeping stage of interview). Since they have signed consent and believe you are doing checks, applicants have a powerful incentive to be truthful. These questions are the equivalent of a New Age Lie detector test.  Good applicants will shrug it off and applicants with something to hide may reveal vital information. 

a. We do background checks on everyone we make an offer to. Do you any concerns about that you would like to discuss? (Good applicants will shrug off)

b. We also check for criminal convictions for all finalists. Any concerns about that? (Make sure the wording of the question reflects what an employer may legally ask in that state)

c. We contact all past employers. What do think they will say?

d. Will past employer tell us that e.g. your were tardy, did not perform well etc.

e. ALSO, use interview to ask questions about any unexplained employment gap

8. Check references and look for Unexplained Employment Gaps:

Verifying past employment is one of the single most important tools for an employer. It can be as important as doing criminal checks. Past job performance can also be an important predictor of future success. Some employers make a costly mistake by not checking past employment because they believe past employers may not give detailed information. However, even verification of dates of employment and job titles are critical because an employer must be concerned about unexplained gaps in the employment history. 

In addition, documenting the fact that an effort was made will demonstrate due diligence. Although there can be many reasons for a gap in employment, if an applicant cannot account for the past seven to ten years, that can be a red flag. 

It is also critical to know where a person has been because of the way criminal records are maintained in the United States. Contrary to popular belief, there is not a national criminal database available to most private employers. Searches must be conducted at each relevant courthouse, and there are over 10,000 courthouses in America. However, if an employer knows where an applicant has been as a result of past employment checks, it increases the accuracy of a criminal search, and decreases the possibility that an applicant has served time for a serious offense

After the AIR process, a firm is well advised to perform a criminal check. The good news is that with an effective AIR process, the possibility of locating a serious criminal record is greatly reduced. A firm can dramatically lower their cost by concentrating on the most recent counties where an applicant resides or spent a long period of time. Some experts contend that statistically, a person is more likely to commit a criminal offense in their county of residence. As a result, a check of the county of current residence gives an employer the most return for the expenditure.

An employer may wish to do a more in-depth search depending upon the type of position. An employer may want to review those positions with a greater risk for increased scrutiny, such as:

a. Supervisors

b. Workers handling cash or Personal Identifyable information (PII).

c. Remote or unsupervised workers

d. Workers that go into people’s homes

e. Workers with Access to assets

f. Vendors

g. Temporary workers

h. Contractors

Employers who hire vendors, temporary employees or contractors can insist that the provider of these services do screening. Many firms may have janitorial crews in the faculties at night, or vendors supplying vital parts or services. Employers are within their rights to insist that third party provider certify that they have performed checks as well. 

Implementing a Program throughout the company

 The biggest challenge for an organization is to promote safe hiring and due diligence across an organization. The goal is to ensure that hiring managers across different divisions and sometimes across different physical locations follow procedures and pay attention to safe hiring.

The answer is to set up a S.A.F.E. Hiring System. It stands for:

S-Set-up a program, policies and procedures to be used throughout the organization, including the AIR process

A-Acclimate/train all persons with safe hiring responsibilities, especially hiring

managers.

F- Facilitate/Implement the program.

E-Evaluate and audit the program by making sure that everyone responsible understands that their compensation and advancement is judged in part by the attention they pay to the hiring process. Organizations typically accomplish those things that are measured, audited and rewarded. The attached chart will help supervisors implement the program and for management to audit hiring practices.

By following the AIR process as part of an overall S.A.F.E. Hiring System, employers can demonstrate due diligence in the hiring process and protect themselves from bad hires in a cost-effective manner.

This article was prepared by background checking expert Lester Rosen.

Employers have long recognized that conducting due diligence on new hires is a mission- critical task. Firms cannot afford to be sidetracked by employee problems such as workplace violence, theft, false resumes, embezzlement, harassment or trumped-up injury claims. Employers can be the subject of lawsuits for negligent hiring if they hire someone that they should have known, through the exercise of due diligence, was dangerous, unfit or unqualified.

However, with the mobility of workers across international borders, it is no longer adequate to conduct these checks just in the United States. A 2000 government study shows that 11.5% of the population consists of immigrants. In addition, an increasing number of workers have spent part of their professional career abroad. The number of countries from which employers seek additional information about applicants is expansive, and includes India, China, the Philippines, France, Germany, Russia, Brazil, Mexico, Australia, Japan and Canada, among others.

Because of the perceived difficulty in performing international employment screening, some employers have not attempted to verify international credentials or to perform foreign criminal checks. However, the mere fact that information may be more difficult to obtain from outside of the U.S. does not relieve an employer of their due diligence obligation.

Nor can employers simply assume that the U.S. government has conducted background checks if the worker was issued a visa. After the events of 9/11, the U.S. has increased checks on foreign visitors and on workers on government “watch lists.” However, the government checks are generally not aimed at verifying a credential or checking for criminal records for employment purposes.

Education
Verification of an educational degree earned abroad is critical to verify credentials and to avoid fraud. An employer needs to determine if an applicant in fact attended the school claimed and received the degree claimed. Statistics show that education fraud can run as high as 20%. The employer also needs to determine if the school is accredited and authentic. The world is awash with phony schools and worthless diplomas. If the employer is not familiar with a school, the employer should conduct its own research. A legitimate school will often have an e-mail address or phone number so that they can be contacted to verify a degree.

Employment
Foreign employment can also be verified by contacting the employer even though they are in a foreign country. Often such calls will be made in the middle of the night due to time differences. The critical step is to obtain as much information about the past employer as possible from the applicant. If the employer does not speak English, an interpreter may be needed.

In order to assist employers in the requirements worldwide, ESR has published a helpful chart showing what is required in each country around the world. See: 

http://www.esrcheck.com/internationalscreening.php

In order to comply with international data and privacy protection laws, ESR does not send personal information offshore.  The verifications are conducted from the U.S.   The only exceptions are certain countries referred to as “Red Zones,” where due to unique circumstances, a local researcher may be needed.  

In some countries, verifications can be especially difficult due to problems in that country with communications or other barriers. In the event a country does not utilize the English alphabet or an employer or school cannot communicate in English, it may be necessary to request applicant information in the language of that country.  A U.S. firm that performs international screening should also be Safe Harbor Certified.

The use of the California Sexual Registration listing, commonly known as Megan’s Law, is widespread among employers.  However, there is a little known provision in California that may actually limit an employer’s legal use of that information in some situations.

The Megan’s Law was first passed in 1996.  Originally, information on sex offenders that register under California Penal Code Section 290 was only available by personally visiting police stations and sheriff’s offices, or by calling a 900 number. The website at       www.meganslaw.ca.gov was established by the California Department of Justice pursuant to a 2004 California law for the purpose of allowing ”the public for the first time to use their personal computers to view information on sex offenders required to register with local law enforcement under California’s Megan’s Law. “

The purpose of Megan’s law is summarized on the web site: 

California’s Megan’s Law provides the public with certain information on the whereabouts of sex offenders so that members of our local communities may protect themselves and their children. Megan’s Law is named after seven-year-old Megan Kanka, a New Jersey girl who was raped and killed by a known child molester who had moved across the street from the family without their knowledge. In the wake of the tragedy, the Kankas sought to have local communities warned.

The California site allows anyone to search the database by a sex offender’s specific name, obtain ZIP Code and city/county listings, obtain detailed personal profile information on each registrant, and use a map application to search their neighborhood or anywhere throughout the State to determine the specific location of any of those registrants on whom the law allows us to display a home address.

Megan’s law contains a provision which prohibits the information to be used when it comes to insurance, loans, credit, employment, education, housing or accommodation or benefits or privileges provided by any business.  California Penal Code Section 290.4(d) (2). 

However, there is an exception.  According to California law, “A person is authorized to use information disclosed pursuant to this section only to protect a person at risk.” California Penal Code Section 290.4(d) (1).

The problem for employers that want to use this information:  There is no legal definition for the term “person at risk.”  Neither the California Penal code, the legislative history of the section or the Megan’s law website defines a “person at risk.”

Until a court provides a definition, employers are well advised to apply a common-sense approach by looking at risk factors associated with the nature of the job. For example, there is a widespread industry agreement that vulnerable individuals are at risk, such as the young, the aged, the infirmed, or the physically or mentally disabled. In addition, people inside their own home are likely to be at greater risk, since it is harder to obtain help, so home workers may be considered a population that works with people at risk.  Another category is workers that operate under some sort of badge or color of authority or who wears a uniform.  In that situation, a person may let their guard down.  Until a court makes a clear decision, employers should make an effort to determine if there is a good faith belief that it is reasonably foreseeable that a member of a group at risk could be negatively impacted if a sexual offender was hired.  

Of course, if the underlying criminal record is discovered and otherwise meets the many complicated rules governing the reporting and use of criminal records in California, then the “group at risk” analysis is not needed, and the employer handles it like any other criminal record. 

There are two other challenges for California employers using the Megan’s law website:

First, it is possible that a person may be registered as a sex offender, but their crime is beyond the 7 year California reporting provisions that restrict what a Consumer Reporting Agency can report.  Although not yet tested in the Courts, the industry standard is for a screening firm to report the listing, on the basis that the background firm is reporting on the offender’s current status as a registered sexual offender.

The other issue is that there are large numbers of sex offenders that either do not register or abscond from the jurisdiction(s), or do not re-register.  The Safe Hiring Manual, by ESR President, Lester S. Rosen, reported on studies suggesting a significant number of sex offenders did not have current registration and authorities have lost track of their whereabouts.

The bottom line: Where an employer is hiring an applicant for a position where it is foreseeable that there would be contact with members of groups at risk, then the sexual offender database search can be valuable.  However, employers should keep in mind that there are limitations that have yet to be fully defined by courts or the legislature, and the databases may not be up-to-date or 100% accurate.