Continuous Screening of Employees Will Gain More Acceptance as Critical Post-Hire Due Diligence Tool

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Written By ESR News Blog Editor Thomas Ahearn

While most companies currently perform background screening on employees once at the pre-hire stage, “the new normal may call for continuous, post-hire monitoring” in the near future to avoid insider threats, according to a Society for Human Resource Management (SHRM) article. The fact that Continuous Screening is a process that more employers are considering as a critical post-hire due diligence tool is Trend Number 5 in the Employment Screening Resources® (ESR) 10th annual ‘ESR Top Ten Background Check Trends’ for 2017.

“An evolving practice called ‘Continuous Screening’ involves periodic background checks on current employees to identify criminal cases that can occur after a worker was hired. While Continuous Screening can be a risk-management tool, employers need to consider a number of factors to determine if it’s worthwhile, fair, and legally compliant,” says ESR founder and CEO Attorney Lester Rosen. The list featuring emerging and influential trends in the background check industry for 2017 will be available at www.esrcheck.com/ESR-Top-Ten-Background-Check-Trends.

In the story entitled “Is Continuous Screening the Future Normal?,” SHRM editor/manager Roy Maurer interviewed many background screening experts including Rosen, who told Maurer that without Continuous Screening “an employer may discover post-employment that critical information was missed during the hiring process” that may lead to post-hire insider threats that can include embezzlement, fraud, theft, and even violent behavior.

“Continuous Screening” – also called Continual Screening, Infinity Screening, or Re-Screening – is usually performed on workers annually or semi-annually. Although the argument can be made that employers would likely be aware of a crime committed by a current worker because the worker is not at work, there are many serious offenses where a person can be bailed out and serve a sentence with work furlough, weekend jail time, volunteer hours, or some other alternative to actual incarceration.

According to Rosen – author of “The Safe Hiring Manual,” a comprehensive guide to background checks that includes a section devoted to Continuous Screening – employers need to consider these factors:

  • False sense of security, especially if databases are used instead of checking primary sources which can lead to errors.
  • Consent Issues – Does the employee know he or she will be re-screened and the program is in compliance with the federal Fair Credit Reporting Act (FCRA) and state law?
  • Policies and procedure to follow if a record is found.
  • Compliance with the U.S. Equal Employment Opportunity Commission (EEOC) rules on the fair and proper use of criminal records to ensure the screening program is not discriminatory under Title XII, and Impact on Workforce.
  • Numerous additional tools beyond background checks that are needed to combat insider threats, such as an environment of control since background checks by themselves are not going to prevent post-hire problems.
  • Issues associated with employee morale and corporate culture.

Advocates of ongoing Continuous Screening suggest it is a way to continue to demonstrate due diligence, protect the workplace, and combat insider threats and workplace violence. However, Rosen warns in his book that continuous screening on current employees carries risks. The verdict on whether or not the advantages of periodic background checks of current employees outweigh the disadvantages is: “The jury is still out.” Even though periodic criminal screening of current employees may have some apparent advantages, it is an open question whether it is a cost-effective tool or even if the advantages outweigh the disadvantages. Here are several points to consider.

There is little in the way of empirical evidence that shows Continuous Screening results in any advantage to employers, says Rosen. There are no studies to suggest, on a cost-benefit basis, such checks produce results. If such checks are done, the next issue is how. If databases are used, then there is the possibility of both false positives and false negatives since databases available to private employers are not always complete, accurate, or up to date. In large states like California, New York, and Texas, such database searches have very limited value.

If there is Continuous Screening, Rosen says, it should be done ideally on the courthouse level in addition to any databases, which increases the cost. There is also the consent issue. Under the federal Fair Credit Reporting Act (FCRA), all checks including periodic checks must be done with consent (unless there is a specific investigation for suspicion of misconduct or wrongdoing). Although most consent forms contain “evergreen” language that makes the initial consent valid indefinitely or until revoked (usually in writing), at some point, an employee can either withdraw the consent or claim it has become stale over time. In California, the argument has been made that a new consent is needed each and every time.

If an employee withdraws consent, the question arises if the employee can be terminated for refusal to consent. It is clear that employers have much more discretion in requiring pre-employment testing, based on the fact that they do not have experience with the applicant. For that reason, courts have granted wider latitude pre-hire. However, once someone is employed, the necessity argument is less convincing since the employer now has a history with the worker.

Therefore, Rosen explains, it is not clear that an employee can be terminated for a refusal to consent to an ongoing criminal check, absent some explicit employer policy or a strong showing of need. The employer could argue that since employment is “at will,” failure to consent to an ongoing background check can constitute grounds for termination. The problem is that as time goes on, the “at will” relationship can become murky depending upon the facts of the employment relationship.

The issue becomes more complicated if the refusing employee is a member of a protected class. That raises potential discrimination issues. Another complication is when the policy is instituted. If a new worker comes onboard when the policy is in place, it is much harder to object if it is clearly outlined in the employee manual. If conversely, the policy is new, current employees will have more difficulty dealing with it, requiring HR to engage in employee education to show how the policy benefits everyone.

In addition, Rosen explains that a firm needs a well laid out policy in an employee manual as to how they will deal with a new criminal record that may be uncovered during a periodic check. At a minimum, any action must be based upon some business justification, taking into account the nature and gravity of the offense, the nature of the job, and how long ago it occurred per the 2012 EEOC Guidance. In addition, the pre-adverse action notice requirements of the FCRA would come into play as well as the “Individualized Assessment” process outlined by the EEOC.

Rosen told Maurer in the SHRM article that “job application forms should make it clear that any material falsehood or omission from the applicant can result in termination no matter when it is discovered. Employee handbooks should include language on what will happen if the employer discovers falsehoods or omissions post-hire.” He also said employers “should ensure background check releases have an evergreen clause to allow future screening if needed. Some firms include a policy that employees must self-report any arrest that can impact their ability to perform their jobs.”

There are also the cultural considerations with Continuous Screening, says Rosen. What type of message does it send the workplace if workers are constantly suspected of criminal activity? What type of workplace stress is created if an otherwise long time and loyal employees feel they are subject to dismissal at any time for a minor offense that may or may not bear upon their suitably as an employee? If the employer is unionized, then union rules can also play a role.

One possible solution for employers that have determined that Continuous Screening is necessary is to conduct it in a similar fashion to random drug testing done for certain drivers that are controlled the Department of Transportation. Random pools can be set up and “real” criminal checks done at the courthouse rather than a so-called “national” database that can be subject to false positives and false negatives.

One company ended up paying $1.6 million to re-screen their workers. On September 8, 2015, the U.S. District Court for the District of South Carolina entered a consent decree ordering BMW Manufacturing Co., LLC (BMW) to pay $1.6 million as part of the resolution of a lawsuit filed by the EEOC that claimed BMW excluded African-American logistics workers from employment at a disproportionate rate when the company’s new logistics contractor applied BMW’s criminal conviction records guidelines when re-screening incumbent employees.

The EEOC complaint alleged that when BMW switched contractors handling the company’s logistics at a production facility, the company required the new contractor to perform a criminal background re-screening on all existing logistics employees who re-applied to continue working in their positions at BMW. At that time, BMW’s criminal conviction records guidelines excluded from employment all persons with convictions in certain categories of crime, regardless of how long ago the employee had been convicted or whether the conviction was for a misdemeanor or felony.

After the criminal background checks had been performed, BMW learned that approximately 100 incumbent logistics workers at the facility, including employees who had worked at there for several years, did not pass the re-screening. The EEOC alleged 80 percent of the incumbent workers disqualified from employment as a result of applying BMW’s guidelines were black.  Following an investigation, the EEOC filed suit alleging that blacks were disproportionately disqualified from employment as a result of the criminal conviction records guidelines. EEOC sought relief for 56 African-Americans who were discharged. BMW has since voluntarily changed its guidelines.

Having noted the disadvantages, the case can well occur where an employer is sued for a failure to check current employees if such a failure to check was the proximate cause of workplace violence or some other harm that arguably could have been prevented. The bottom line is that this is an issue that will be worked out in a court decision in the coming years. In the meantime, employers contemplating such periodic checks should approach it with caution and seek the advice of their attorney.

Rosen says there is also the issue of whether Continuous Screening is even an effective tool to counter insider threats.  Although pre-employment background checks are often cited as an essential element of an insider threat prevention program, they are just one part of an overall strategy. The identification and prevention of insider threats requires an inter-disciplinary approach that can include mental health assessments, psychological testing, physical security, internal controls, continuous evaluation of personnel, supervisor and co-worker training to recognize danger signals, identification of risk factors, sharing and analyzing information between responsible parties, and a culture of safety, reporting, and integrity. Most critically, an organization needs to have a commitment to prevent these threats, and a leadership team and professionals who are able to formulate and implement an overall strategy.

Rosen concludes that an organization considering continuous screening needs to bolster all aspects of its insider threat protection program, and understand that such screening is just one element of an overall program that needs to be approached with caution in order to ensure it does not create workplace or legal issues.  The bottom line: if an employer is interested in continuous screening, it needs to work with a screening partner who can assist the employer with understanding all of the pros and cons in order to make an informed decision and to avoid pitfalls in setting up the program, and avoid providers that  simply want to sell more searches that could  end up doing more harm than good.

Employment Screening Resources® (ESR) offers employers an article written by ESR CEO Rosen entitled “Background Check Strategies for Reducing Insider Threats After Hiring” on how Continuous Screening and other due diligence tools can reduce insider threats from employees, temp workers, contractors, and others with the ability to wreak havoc on an organization from the inside at www.esrcheck.com/Articles/Background-Check-Strategies-for-Reducing-Insider-Threats-After-Hiring/203/.

ESR Top Ten Background Check Trends for 2017 Webinar

Employment Screening Resources® (ESR) founder and CEO Attorney Lester Rosen will host a live complimentary webinar entitled ‘ESR Top Ten Background Check Trends for 2017’ on Wednesday, January 18, 2017, from 11:00 AM to 12:00 PM Noon Pacific Time. To register for the free webinar, please visit https://attendee.gotowebinar.com/register/733293271056375556.

The webinar is approved for 1.0 (HR (General)) recertification credit hours toward PHR, SPHR, and GPHR recertification through the HR Certification Institute (HRCI). The webinar is worth 1.0 Professional Development Credit (PDC) from the Society for Human Resource Management (SHRM) for the SHRM Certified Professional (SHRM-CP™) and SHRM Senior Certified Professional (SHRM-SCP™).

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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