Massachusetts Passes Law with Strongest Background Check Requirements in Nation for Transportation Network Companies

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Written By ESR News Blog Editor Thomas Ahearn

On August 5, 2016, Massachusetts Governor Charlie Baker signed bipartisan legislation – Bill H. 4570 – an Act for regulating drivers of  “transportation network companies” (TNCs) such as Uber and Lyft that includes “the strongest state background check requirements in the nation,” according to a press release from the Governor’s office.

Enacted on the date of the signing, H. 4570 requires TNCs to maintain active rosters of their drivers who must undergo a full state Criminal Offender Record Information (CORI) background check, including sex offender registry status, and a bi-annual national commercial background check conducted by the TNC.

In a press release about H. 4570, Governor Baker stated thatMassachusetts remains a leader for innovative new technologies” and the “regulatory framework includes many of our own proposals to embrace disruptive technology and prioritize public safety to give consumers safe and reliable travel choices.”

Under the law, TNCs that use a digital network to connect riders to drivers to pre-arrange and provide transportation must ensure each driver “successfully completed a background check, maintains a valid background check clearance certificate, is a suitable driver, and has a transportation network driver certificate.”

The new law also provides for the Massachusetts Department of Public Utilities (DPU) to have regulatory authority over TNCs and establishes minimum disqualifying offenses for drivers, transparent pricing, properly marked and inspected vehicles, and clear insurance standards including a guaranteed $1 million minimum coverage.

H. 4570 will be gradually implemented over one year in order to ensure no interruption in existing TNC services and include an assessment of TNCs that covers structure and oversight costs. A copy of H.4570, ‘An Act regulating transportation network companies’ is available at: https://malegislature.gov/Bills/189/House/H4570.

The so-called “gig economy” where temporary work – or “gigs” – and independent workers are common is growing fast. A 2015 American Action Forum Report estimated the “gig economy” accounted for 30 percent of new jobs and created new income sources for 2.1 million people in the United States between 2010 and 2014.

A report from Intuit predicts the “gig” economy will reach 7.6 million people by 2020, and grow by 18.5 percent in the next five years. The report also revealed the “contingent” or “independent contractor” workforce grew “from 17 percent of the U.S. workforce 25 years ago, to 36 percent today, and is expected to reach 43 percent by 2020.”

“This type of part-time ‘gig’ economy should still be subject to some sort of background check process used in the full-time economy to ensure safe workplaces,” says Attorney Lester Rosen, founder and CEO of San Francisco, California area background check firm Employment Screening Resources® (ESR).

“The problem with applying this part-time economy approach in HR technology – especially in the background check process – is that background checks are closer to rocket science in terms of its sheer complexity than simply data retrieval and distribution,” says Rosen, author of ‘The Safe Hiring Manual.’

“Background check laws are constantly subject to legislation, regulation, and litigation,” explains Rosen. “Along with the federal Fair Credit Reporting Act (FCRA), there are additional laws for all 50 states as well as Equal Employment Opportunity Commission (EEOC) guidance on how to use using criminal records.”

ESR Provides Background Check Solutions for the “Gig” Economy

Employment Screening Resources® (ESR) is a strategic background screening choice that consistently delivers fast, accurate, compliant, and affordable information so employers can make hiring decisions more quickly and easily. To learn more about background check solutions from ESR, visit www.esrcheck.com.

NOTE: Employment Screening Resources® (ESR) does not provide or offer legal services or legal advice of any kind or nature. Any information on this website is for educational purposes only.

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