All posts by Les Rosen

Past employment verifications and defamation

A Tale of Two References-One Makes You Liable for Damages and the Other Does Not

In a 2008 federal appeals case, two past medical employers gave past employment information for the same anesthesiologist. After the anesthesiologist, Dr. Robert Berry, moved on to yet another hospital, he botched a routine 15 minute procedure, leaving a patient in a permanent vegetative state due to Berry’s own addiction to drugs.

The new hospital and its insurance company settled with the victim and in turn sued the previous two medical organizations for misrepresentations in the past employment information given to the new hospital. The allegation was based upon misrepresentations since the new hospital claimed it hired Berry because the defendants did not give accurate information by withholding information about misconduct and drug use. Continue reading

Hawaii Latest State to Put Limits on Use of Credit Reports

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 ( ) 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:

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.

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.

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

Background Checks for Banks and Financial Institutions

Background check expert 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.

“Today, hiring on gut instinct isn’t an acceptable practice; there’s simply too much at stake,” Mike D’Agostino, Marketing Manager at Information Security Media Group, stated in a press release from BankInfoSecuirty: “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.” Read the press release at

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.” Read more about the webinar at

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 Act (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, and;
  • 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:

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:

Background Check Expert Lester Rosen to Present at Seattle Conference on Social Networking sites

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: 

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

Background checks and your career

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: A companion article discusses what can be found in a background check, at:

For more information on Employment Screening Resources, see:

Employment Screening Expert Lester Rosen interviewed on privacy

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   See:

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 (, 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:

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:

employment screening and liars at interviews

An article on NPR, “Spotting Lies: Listen, Don’t Look,” confirms what ESR has been advising employers for some time: people are not nearly as good a they think they are at detecting liars.  Even highly trained interviewers can make mistakes. See: 

This article underscores again that employers are at a big disadvantage if they are relying on job interviews to avid bad hiring decisions.   Good applicants that are nervous may come off poorly at an employment interview while practiced liars can look you in the eye and you would never know it.  This is yet another  reason that when it comes to employment decisions, employers need objective and verifiable criteria.  This gives new meaning to, “Trust but verify.”

For more information, see the  following ESR post all about why employers cannot rely on job interviews to detect liars, found at:

Basics of credit reports and background checks

There is a great deal of misinformation on the internet about credit reports and job hunting.  It is important to keep in mind that employers are not trying to find ways to eliminate people from jobs. A background check including a credit report is only run AFTER an employer has gone through the time, cost and effort to find the right candidate.  An employer does not invest money in a background report just to find ways not to hire. When an employer initiates a background check, it is because they are interested in hiring the applicant and are conducting due diligence to make sure there is no reason not to hire. Under the federal Fair Credit Reporting Act (FCRA), a credit report is only obtained after the applicant has given consent and after a legally required disclosure on a standalone document has been given.  If the employer utilizes the credit report in any way not to hire, an applicant is entitled to a copy of their credit report, a pre- adverse action notice as well as a statement of their rights. Before any decision becomes final, the applicant also has the right to challenge the credit report before any denial of employment is made final.

To summarize briefly, Employment Screening Resources advises employers to approach credit reports with caution when it comes to background checking, and to articulate a clear rationale as to why a credit report is related to a particular job.  Employers should also be aware that there is the potential for errors in credit reports.  A debt may be reported incorrectly for various reasons. The applicant could also be the victim of identify theft which can also lead to incorrect data. 

Also, negative entries may well not be a valid predictor of job performance.  For example if there is an illness in the family and credit cards are used to pay medical bills, or there has been a long period of unemployment,  a consumer’s credit report may show a large outstanding debt that may not affect suitability for employment.  In fact, an overly board use of credit reports could lead to claims of discrimination if there is a disparate impact on protected groups.

On the other hand, hiring a person that handles money or assets, makes fiduciary decisions, or has access to other people’s private data without running a credit reports could result in allegations of negligent hiring if a theft occurs and a credit report as part of a background check would have lead to relevant information. Embezzlement, internal theft and identity theft are significant problems in the U.S.

One thing to keep in mind: it is an urban myth that employers receive a credit score. Employment credit reports simply do not contain a credit score since there is no evidence of a connection between a credit score and employment.  An employment credit reort is much different than a credit report used for lending. Anyone that says employers are using credit scores just does not know what they are talking about. On the other hand, employment credit reports do contain a credit history, which will tell an employer if an applicant pays on time, or has such a large monthly debt that it raises a red flag if a person is to be put in charge of cash or assets or placed in a fiduciary position. In addition, there are limitations on using a bankruptcy for employment, since a person that goes through bankruptcy is entitled to a “fresh start.”  For more information, see:

Two states, Hawaii and Washington, have passed laws regulating the use of credit reports for employment and more states are apparently looking at similar rules.

Another aspect of the use of credit reports are the vastly increased regulations imposed by the credit bureaus on background screening firms and employers, in order to protect privacy and counter identity theft. Legitimate screening firms that are in compliance with the contractual obligations set forth by the credit bureaus are required to essentially do a background check on employers that want credit reports.  This can include on-site inspections by third party agencies of the employer’s premise, as well as checking bank and trade references and other steps to ensure the employer is legitimate, has a permissible purpose and meets the guidelines set out by the credit bureaus.  Certain businesses, such as home based operations, or businesses that share space with prohibited users cannot qualify for credit reports. In addition, the new ‘Red Flag’ rules require employers to have a written policy and procedure in place to deal with address discrepancies.  See:

Although ESR assists employers in navigating the process and supplies a sample Red Flag policy, small and medium businesses (SMB) often find that requesting a credit report adds a significant layer of complexity to the process. Other searches typically done as part of a background check, such as criminal records, do not carry these added complications. Many SMB avoid these headaches by simply requesting that an applicant obtain their own credit report and present it to the employer.  This is easily done since every consumer by federal law is entitled to one free copy of their credit report from each of the three major credit bureaus yearly from However, employers must still use caution to ensure that the use of credit reports is fair and non-discriminatory.

Criminal Records, Employment and Employment Applications

Employers have become increasingly aware of the importance of knowing if an applicant has a criminal record. Employers have a legal duty to make reasonable inquiries about who they hire, and to provide a safe workplace. An employer who hires a person with a criminal record can be found liable for negligent hiring where the hiring decision results in harm, and it could have been avoided by a simple criminal record check. Checking criminal records demonstrates Due Diligence and is also an important preventative measure to protect against workplace violence. One of the most effective tools an employer has is the use of an application form in the hiring process. An application enables an employer to directly ask an applicant if they have a criminal record The advantage is that an employer can use a well worded application form to discourage applicants with something to hide, and to encourage applicants to be open and honest. Unfortunately, many employers use language in their applications that is either to narrow, too broad or too ambiguous. Each of these mistakes can put an employer in difficulty.

For details on these three mistakes and language for employment applications, see:

Employment Screening is our only business

In reviewing the Internet, it is clear there are a number of screening firms that advertise their service.  Although there are many excellent screening firms, when doing some digging, it also appears that there are some firms that are  background screening firms in name only.  ESR only does one thing—pre-employment screening background checks.  ESR is not an internet marketing firm in disguise, not a branch of a foreign owned company trying to make money in the U.S. market, not a fake front for some other firm, not a data vendor that views the Internet as a way to sell data for a quick buck, and not a firm that dabbles in employment screening as a side business. We are employment screening experts.  Background screening and risk management are our only business.  Period.

ESR’s take the approach that background screening is a heavily legally regulated, knowledge based professional service that requires a great deal of expertise.  The pre-employment background screening experts at ESR are always there to help.  In selecting a screening firm, employers may want to consider sticking to organizations that have a demonstrated commitment to risk management and helping employers as thier primary mission. If an employer has a question about the ability of a screening firm to do the job, ESR has prepared a 22 question audit that can be sent to a screening firm to determine if they are for real.  See: