Over the Governor’s veto, the Hawaiian legislature passed a new law effective July 1, 2009 that put limits on the use of employment credit history or credit reports unless it “directly related to a bona fide occupations qualification,” or falls under another exception.

The bill amends the Hawaiian Fair Employment Practices Act by making it an unlawful discriminatory practice for any employer to refuse to hire or employ, continue employment or to bar or discharge from employment, or otherwise to discriminate against any individual in compensation or in the terms, conditions, or privileges of employment of any individual because of the individual’s credit history or credit report, unless the information in the individual’s credit history or credit report directly relates to a bona fide occupational qualification. Hawaii Revised Statues Sec. 378-2(8).

The new law also indicates that in terms of hiring in the first place, the employer can only inquire into the credit history or credit report on a prospective employee only after there has been a conditional job offer, and only if the information is directly related to a bona fide occupational qualification.

The law makes exceptions for employers that are expressly permitted to inquire into credit history or a credit report by federal or state law, financial institutions that are insured by a federal agency or to managerial or supervisory employees. The law sets out a specific definition of what constitutes a “Managerial” or “Supervisory” employee.

The Governor’s strong veto message (http://www.capitol.hawaii.gov/session2009/Bills/GM813_.pdf ) argued that employers should not be subject to, “another restriction on employers that could impact their ability to protect the safety and financial security of their workplaces.” The Governor indicated that credit reports can have value in particular situations and that Congress has regulated the use of credit reports in the Fair Credit Reporting Act (FCRA).

For a copy and history of the new law, see: http://www.capitol.hawaii.gov/session2009/lists/measure_indiv.aspx?billtype=HB&billnumber=31

It should be noted that even without the new law, an employer that obtains a credit report for employment does NOT obtain a credit score or FICO number. A credit score is not part of an employment credit report since it is not a valid predictor of job performance. However, as noted in an article in USA Today where ESR President Lester Rosen was quoted, credit reports have been strongly criticized for preventing some consumers from obtaining employment. http://www.usatoday.com/news/washington/2009-02-12-creditcheckinside_N.htm

The California legislature, in fact, passed a law in 2008 that would have severely restricted employment credit reports, but it was vetoed by the Governor and did not become law. The new Hawaii law is similar to a restriction passed in the State of Washington in 2007, that required a credit report to be substantially job-related and for the employer’s reasons for the use of such information to be disclosed to the consumer in writing. http://www.esrcheck.com/newsletter/archives/June_2007.php

It is likely that more states will be reviewing the use of credit reports and employment in the future.

Employment screening exert Lester Rosen of Employment Screening Resources (ESR) has provided an in-depth interview as well as an online presentation for BankInfoSecuirty, the top reference tool for the Banking Information Security Community. 

According to a press release form BankInfoSecuirty, “Today, hiring on gut instinct isn’t an acceptable practice; there’s simply too much at stake,” says Mike D’Agostino, Marketing Manager at Information Security Media Group. “When it comes to hiring best practices, Lester Rosen is definitely the go-to guy as he has qualified and testified in the California and Arkansas Superior Courts as an expert witness on issues surrounding safe hiring and due diligence.”    http://www.pr.com/press-release/90980 

BankInfoSecuirty is offering the online webinar for on employment screening for banks and financial institutions on the topic of,  “Avoid Negligent Hiring – Best Practices and Legal Compliance in Background Checks.”   See: http://www.bankinfosecurity.com/webinarsDetails.php?webinarID=87&search_keyword=Rosen&search_method=exact    

The seminar description is: 

All employers have an obligation to exercise a reasonable duty of care in hiring. In addition, many organizations have a legal duty to not employ individuals with certain enumerated criminal records. There are a number of steps that employers can take in the hiring process to reduce their risk when hiring.

First, organizations must carefully review and audit their hiring program, including their application, interview and past employment checking practices, as well as procedures for performing criminal record checks. In addition, employers need to consider a host of legal considerations when screening applicants, including the federal Fair Credit Reporting Ac (FCRA), state laws, Sarbanes-Oxley and discrimination laws as well as privacy implications.

Topics to be discussed in this session include:

       The “Parade of Horrible” facing employers that hire without screening, and why background checks are mission-critical for financial instructions;

       The essential elements of negligent hiring lawsuits, employer defenses and why they are on the rise;

       Why “gut” instinct is not an effective hiring tool;

       The essential elements of a screening program;

       Compliance with the federal Fair Credit Reporting Act (FCRA) and State laws;

       The impact of discrimination laws and privacy laws;

       Best practices for hiring, including the application interview and past employment checking processes;

       How to legally obtain and utilize criminal records;

       Issues affecting past employment, education and credentials verification;

       The use and limitations of credit reports;

       A brief introduction to international background checks and terrorist screening;

       The use of the internet and social networking sites such as Facebook and MySpace to screen applicants;

       An introduction to drug testing. 

In addition, BankInfoSecuirty has released in both print form and podcast an in-depth interview with Mr. Rosen on employment screening background checks and banks and financial institutions.  Community banks and credit unions in particular are addressed in the interview.   See:  http://www.bankinfosecurity.com/p_print.php?t=a&id=691 

ESR is pleased to provide risk management services to banks and financial institutions across the U.S., ranging from a household name intuition to outstanding community banks and credit unions.   For more information, see: www.ESRcheck.com

Employment Screening Resources  a leading international employment screening background checking firm headquartered in the San Francisco area, announced that its president, Lester Rosen, will be presenting before the prestigious Staffing Management Association (SMA) of Seattle on September 16, 2009. 

SMA’s mission is to present practical and relevant information by bringing in top-notch recruiting and retention experts.  See: http://www.emaseattle.org/events.shtml 

Mr. Rosen will be addressing, Landmines, Pitfalls and Potential Law Suits – Understanding the Risks of Using Search Engines and Social Networking Sites to Screen Candidates. 

“am very pleased to have opportunity to discus this cutting edge topic with to-notch staffing professionals in such a critical economic area as Seattle,” commented Rosen. “There is evidence that recruiters and hiring managers are utilizing social network sites to make hiring decisions without taking into account the potential liabilities that employers can face if done incorrectly or unfairly.  This talk is geared to starting a dialogue on the potential landmines that may be encountered if not done correctly.”

Mr. Rosen will review a major new survey that demonstrates what percentage  of employers use these sites, which sites they use,  how often they are used to NOT hire someone, as well as the most frequently seen issues that turn-off employers. 

Mr. Rosen, who is also an attorney, is a nationally recognized, expert, on employments screening background checks.  He is a writer and speaker on the Fair Credit Reporting Act (FCRA), pre-employment screening, and safe hiring issues. In addition, Mr. Rosen is the author of the first comprehensive book on employment screening, The Safe Hiring Manual Complete Guide to Keeping Criminals, Imposters and Terrorists Out of Your Workplace,a 500 pages plus guide that acts as the text book for the screening industry. He also wrote, “The Safe Hiring Audit.”

 Mr. Rosen’s speaking appearances have included numerous national and statewide conferences.  He has testified in the California, Florida  and Arkansas Superior Court as an expert witness on issues surrounding safe hiring and due diligence. Mr. Rosen was the chairperson of the steering committee that founded the National Association of Professional Background Screeners (NAPBS), the professional trade organization for the screening industry, and served as the first co-chairman in 2004.

More information about Employment Screening Resources can be found at www.ESRcheck.com

Two recent articles on the leading career site, The Ladders, feature background screening expert Lester Rosen on the role that employment screening may play in a job search.  The Ladders is the world’s largest community catering exclusively to the $100k+ job market. 

According to the articles by author Kevin Fogarty: 

Recruiters and investigators who conduct employment background checks advise job seekers to know what their records will say to a potential employer and be prepared to correct or explain them in an interview. 

“If they got a degree at a diploma mill, that will be revealed in a respectable background check; if they didn’t work at an employer they listed, or didn’t have the job title they said they had, that will come out,” said Les Rosen, former California deputy district attorney; president of Employment Screening Resources of Novato, Calif.; and founding member of the National Association of Professional Background Screeners. 

The problem for job seekers is that there isn’t a lot they can do to keep “secrets” under wraps while they’re job-searching or even afterward. If you have a black mark on your record, expect it to surface, Rosen said. “When a person with something minor in their background tries to hide it, they are taking a risk.” 

The article also discusses the fact that so much information is now available online: 

“Derogatory information honestly revealed and discussed by the applicant is much less harmful than if it’s discovered by a third party,” ESR’s Rosen said. “Even if the company’s not really looking, one of the most productive sources of background checks is co-workers. 

“If you’re a six-figure person, you have to start with the assumption there are a lot of people working with you or under you who are interested and are going to look you up,” he said. “They’re ready to go on the Internet and see if you’re a sex offender – because that information isn’t hard for consumers to find – or what degrees you’re claiming in your LinkedIn profile or other business connection, and whether you ever went there.”

 The full article is available at:  http://www.theladders.com/career-advice/background-check-makes-tough-interview-questions A companion article discusses what can be found in a background check, at:  http://www.theladders.com/career-advice/anatomy-background-check

For more information on Employment Screening Resources, see: www.ESRcheck.com

Employment screening expert Lester Rosen will be the guest on a leading radio show dedicated to privacy on September 2, 2009.  The show, “Privacy Piracy,” is broadcast Wednesday afternoon from 5-6 PM, line, Pacific Time on 88.9 FM in Irvine and WORLDWIDE live audio streaming at www.kuci.org   See: http://www.kuci.org/privacypiracy/

The show is hosted by Mari Frank, an attorney and privacy consultant, and the creator of The Identity Survival Kit.  Ms. Frank has testified many times on privacy and identity theft issues in the California legislature and in the US Congress. In May 1999, she was summoned to the White House to a press conference to speak on Consumer Privacy, and the speech was broadcast on C-SPAN. In December 2004, and March 2005, Mari’s ninety-minute PBS Television special, “Identity Theft: Protecting Yourself in the Information Age,” aired nationwide and aired again in June 2005. Both of her new books were featured as gifts for viewers who pledged support for local PBS stations.

Mr. Rosen will be discussing background checks and privacy right, including the federal Fair Credit Reporting Act (FCRA) and the impact of identity theft. 

The guest, Lester S. Rosen is an attorney at law and President of Employment Screening Resources (www.ESRcheck.com), a national background screening company located in California and a recognized expert on background checks.
He is the author of, “The Safe Hiring Manual–Complete Guide to Keeping Criminals, Imposters and Terrorists Out of Your Workplace.” (512 pages-Facts on Demand Press), the first comprehensive book on employment screening. He has also authored “The Safe Hiring Audit.” In addition, he has produced a DVD training top showing a negligent hiring mock trial, and has produced an online 20 hour training course in he area of safe hiring and background checks. See: http://www.backgroundchecktraining.com/

He is a consultant, writer and frequent presenter nationwide on pre-employment screening and safe hiring issues. His speaking appearances have included numerous national and statewide conferences. He has qualified and testified in the California, Florida and Arkansas Superior Courts as an expert witness on issues surrounding safe hiring and due diligence.

He is a former deputy District Attorney and criminal defense attorney and has taught criminal law and procedure at the University of California Hastings College of the Law. His jury trials have included murder, death penalty and federal cases. He graduated UCLA with Phi Beta Kappa honors, and received a J.D. degree from the University of California at Davis, serving on the Law Review. He holds the highest attorney rating of A.V. in the national Martindale-Hubbell listing of American Attorneys.

Mr. Rosen was the chairperson of the steering committee that founded the National Association of Professional Background Screeners (NAPBS) a professional trade organization for the screening industry, which now has over 500 members. He was also elected to the first board of directors and served as the first co-chairman in 2004.  For more information on Employment Screening Resources, see: www.ESRcheck.com