Tag Archives: Best Practices

Lawsuits for use of Social Networking Sites for background Checks

By Les Rosen, Employment Screening Resources

2010 Trends in Screening — Trend Five:  Lawsuits for Use of Social Networking Sites for Background Checks

In past posts, Employment Screening Resources (ESR) has labeled the use of the internet and social networking sites as a hot topic.  In 2010 and onwards, it appears very likely that litigation over the use of these sites will be the hot topic.

One big issue of course is discrimination.  Applicants can bring a “failure to hire” lawsuit if the employer utilized information from a social networking site about their race, ethnicity, nationality, martial status, religious preference, age, etc.  Another issue yet to be decided is privacy. Even though the information is on the internet, strong arguments can be made that consumers have a reasonable expectation of privacy on websites where only friends are supposed to visit and the terms of use prohibit commercial exploitation. In addition, employers need to be careful about the use of legal off-duty conduct.  There are also issues as to authenticity and whether a site really refers to or belongs to an applicant.  Recruiters are also not immune from potential liability just because they are searching for “passive” candidates who may not know they are the victims of discrimination. 

As ESR has described in past articles, discrimination rules apply equally to recruiters.  And firms that use social network sites in a discriminatory fashion could find themselves in hot water if a recruiter spills the beans, or the recruiting practices results in a workforce that is statistically imbalanced. See:  http://www.esrcheck.com/wordpress/775/the-rush-to-source-candidates-from-internet-and-social-networking-sites-2

Stay tuned to the ESR blog for updated information.

(Employment Screening Resources (ESR), a leading national online employment screening background firm, is releasing the “Third Annual Top Ten Trends in the Pre-Employment Background Screening Industry” for 2010. This is the FIFTH of the ten trends ESR will be tracking in 2010.)

Statistics and employment screening background checks

By Les Rosen, Employment Screening Resources

In an article on background checks posted on  Workforce Management in January, 2010, it was suggested  that “Employment and criminal checks also do little to screen out those who commit fraud.”  The reason is that statistics from a  2008 report by the Association of Certified Fraud Examiners based on 959 cases of workplace fraud showed that  Only 7 percent of fraud perpetrators have prior convictions, and only 12 percent have been previously terminated by an employer for fraud-related conduct. 

This is a good demonstration on an often use quote about statistic:  “Do not put your faith in what statistics say until you have carefully considered what they do not say.”  

The article overlooks a critical fact that the use of screening keeps would be embezzlers out of a positions of trust where they handle finances in the first place.  Fraud professionals certainly recommend background checks because it is the first line of defense that keeps former embezzlers out of positions of trust in the first place. As professional screeners, Employment Screening Resources (ESR) has saved many organizations from hiring former embezzlers and thieves for positions of trust  involving finances. However, there is no way to measure the numbers of frauds that are averted due to background checks.  The argument in Workforce is  like arguing flu shots are worthless because people who get the flu shots may still gat a flu.  An accurate assessment of the viability of a tool needs to include what would have happened if the tool was not used.  

The article goes on to suggest that screening for criminal convictions may also be ineffective in reducing workplace violence. That is because, according to the article, contrary to popular belief, the majority of workplace violence incidents are not committed by new hires with criminal convictions. Instead, they result from robberies committed by perpetrators from outside the firm, according to the Bureau of Labor Statistics. 

The suggestion that because most workplace violence is external shows screening of applicants is ineffective is equally illogical.   Screening is used to screen the workforce.  Even if employee violence is not the major cause of workplace violence, it is still a  significant cause.   Experts agree that a common denominator behind many acts of workplace violence by employees is a prior history of violence. That is certainly not true 100% of the time, but it is significant factor. 

Suggesting screening is not effective because outsiders cause the majority crimes is like arguing that healthy habits are a waste of time because sometimes a healthy person comes down sick anyway. When there is an act of workplace violence that could have been prevented by screening that results in a lawsuit against an employer, it is doubtful that any jury will buy that argument suggested in the Workforce article.    To the injured worker, or the to the family of someone killed by an act of preventable workplace violence by an employee, the suggestion that screening is a waste of time will certain ring hallow. 

This argument brings to mind another quote about statistics: “Then there is the man who drowned crossing a stream with an average depth of six inches.” 

Once again, statistics can lead down a very wrong road.

The  Workplace article is at: http://www.workforce.com/archive/feature/26/21/11/index.php (may require sign-up and log-in)

For more information on why background checks are mission critical tool for employers, see www.ESRcheck.com

2010 trend on criminal databases

By Les Rosen, Employment Screening Resources

2010 Trends in Screening Trend Four: The battle over databases will continue – the latest wrinkle is the proliferation of cheap do-it-yourself websites and even iPhone apps

An ongoing area of controversy in the screening industry is the use of commercially assembled national multi jurisdictional databases. These databases are complied from numerous sources that will sell or make data available. By no means are these databases complete and accurate, nor up-to-date.  Some results do not provide any additional identifiers beyond the first and last name.  As a result, a great many criminals would come up as “clear.” This is called a “false negative.”  These databases are practically useless in states like New York and California, two large areas.  In Texas, the criminal data is also very hit and miss.

Conversely, databases can result in a person being labeled a criminal when they are not.  That is a “false positive. 

In the hands of a professional background screening firm, these databases have significant value as an additional but secondary tool that can lead to further places to search.  However, the downside is that some employers want the database information without doing court searches, meaning that some people will be falsely labeled as criminal when they are not and some people will be falsely cleared as having no criminal record when they do.

Under the FCRA, a screening firm has the option of reporting a database search without courthouse confirmation as long as the consumer gets a notice at the same time about the search. Over 120 background firms, however, and the State of California (by statute), have disavowed this approach.  See http://www.concernedcras.com/ 

Another fallout from these databases are consumer scams, where fly-by-night quick-buck artists have set up background checking sites that merely rehash old data at exorbitant prices.  And even worse, many of these sites do not make it crystal clear to employers that they must comply with the FCRA, or that the database results can be incomplete or inaccurate.

The latest twist is that these data searches are now offered over “smart phones. Given the problems with such data, it’s hard to see how someone on a date can really get much value from these database searches.  On the other hand, such applications have been labeled a must have for stalkers and sexual predators becsue these apps apparently include personal data such as address. 

One of the challenges facing the screening industry is to educate employers that these do-it-yourself sites are dangerous and can embroil an employer in all sorts of problems.  The problems can include lawsuits form applicants whose rights were violated, to victims whose injuries could have been prevented by a real background check. 

(Employment Screening Resources (ESR), a leading national online employment screening background firm, is releasing the ESR Third Annual Top Ten Trends in the Pre-Employment Background Screening Industry for 2010. This is the FOURTH of the ten trends ESR will be tracking in 2010.)

The Unfair Use of Credit Reports and Criminal Records and the EEOC E-Race Initiative

By Jared Callahan, Employment Screening Resources

According to an article in HR Morning, the two biggest headaches for employers when it comes to hiring are the blanket  exclusion of individuals with poor credit histories or a criminal, record, and not showing a correlation between background checks and the job itself. 

The author notes that in response to seeing an increase in claims of discrimination based upon criminal records and credit reports,  the EEOC began the E-RACE Initiative (Eradicating Racism And Colorism from Employment).  This excellent article can be found at:


As ESR has advised employer on a number of occasion, the unfair use of credit reports or the automatic exclusion of individuals with criminal records without considering if there is a business justification are two big area of potential liability for employers.  The Safe Hiring Manuel, the first comprehensive book on background checks that was written by ESR goes into these issues in detail.  It can result in an action by the EEOC or a lawsuit for discrimination.  Needless to say, employers would rather not face either.  As noted in a recent ESR blog, the EEOC has brought a legal action against one national employer alleging the discriminatory use of credit reports and criminal records. http://www.esrcheck.com/wordpress/1057/new-eeoc-lawsuit-for-discrimination-based-on-credit-report-and-criminal-records 

The one thing that small and medium businesses do not want to do is to use screening software that makes automated decision.  That is a big risk taken for no good reason.  

To attempt to minimize exposure, employers may want review the following articles by ESR:

  1. http://www.esrcheck.com/wordpress/815/basics-of-credit-reports-and-background-checks
  2. http://www.esrcheck.com/wordpress/942/the-basics-of-criminal-records-searches

2010 Trend on more lawsuits including class action litigation over accuracy, privacy, and consumer rights

By Les Rosen, Employment Screening Resources

2010 Trends in Screening–Trend Two:

Employment Screening Resources (ESR), a leading national online employment screening background firm, is releasing the ESR “Third Annual Top Ten Trends in the Pre-Employment Background Screening Industry” for 2010.   This is the SECOND of the ten trends ESR will be tracking in 2010.  The ten trends will be released over the next three weeks:

2.  More lawsuits including class action litigation over accuracy, privacy, and consumer rights: 

News stories in 2009 blasted the screening industry for inaccurate reports, and it appears that lawsuits are on the rise and will continue in 2010.  It is not surprising, since screening has become a large industry, and enough people have been the subject of screening reports that the whole area has come to the attention of plaintiff’s lawyers.  In addition, 2009 saw class action lawsuits for violation of the procedures under the FCRA, and there is every reason to believe that screening firms and employers can expect more of the same.  The bottom line is that a Background Check is a highly legally regulated professional service, and it is important to ensure that a supplier of this service understands the legal framework and, further, approaches the screening process as a professional service, and not just as a data provider.

2010 Trend on Increased focus on whether credit reports and criminal records are discriminatory

By Les Rosen, Employment Screening Resources

2010 Trends in Screening–Trend One:

Employment Screening Resources (ESR), a leading national online employment screening background firm, is releasing the ESR “Third Annual Top Ten Trends in the Pre-Employment Background Screening Industry” for 2010. ESR has identified new trends that are starting to make a difference, as well as old trends that have evolved as the screening industry matures and as plaintiff’s attorneys, including class action lawyers, have started to focus on background checks. 

This is the first of the ten trends ESR will be tracking in 2010.  The ten trends will be released over the next three weeks:

  1. Increased focus on whether credit reports and criminal records are discriminatory: When the EEOC filed a lawsuit against a national employer in October 2009 alleging that credit reports and criminal records were being used to discriminate against members of protected groups, it did not come as much of a surprise to industry watchers.  (See ESR blog at: http://www.esrcheck.com/wordpress/1057/new-eeoc-lawsuit-for-discrimination-based-on-credit-report-and-criminal-records.)  There has been a steady drumbeat of concern about credit reports and criminal records.  Credit reports have come under increasing criticism as reported in the media for being inherently unfair and potentially discriminatory. California, for example, has twice passed laws that would have severely limited credit reports (although both were vetoed by the governor).  A bill has been introduced in Congress to amend the federal Fair Credit Reporting Act (FCRA) to outright prohibit the use of credit reports for employment, and it has 46 co-sponsors in the House of Representatives. In 2009, Hawaii passed a bill limiting credit reports.  (See past ESR blogs on the pros and cons of credit reports.) The use of criminal records is also getting scrutinized. New York in 2009 passed new laws to ensure that employers were not automatically rejecting applicants with criminal records without considering the individual on his/her merits.  In recent years, the Conference of Mayors has addressed the issue of criminal records baring ex-offenders from getting a second chance, and the State of Minnesota joined a number of large cities in adopting a “ban the box” approach to governmental employment , meaning that questions about a past criminal record are not requested initially on an employment application in order not to deter ex-offenders form even applying. On one hand, without exercising due diligence, firms can sued for negligent hiring, suffer financial loss, and/or put public safety at risk if “red flags” are not located. On the other hand, critics are concerned that with undue emphasis on credit reports or criminal records, people are being shut out of the workforce.  For instance, unless ex-offenders can get a job, there is a high likelihood of recidivism which means more taxpayer dollars are being spent on prisons instead of schools or hospitals.  The bottom-line is that screening occurs at the intersection between concerns over security and safety on one hand, and privacy and fairness on the other, and society is constantly defining the boundaries. Of course, it is interesting to note that nearly every time a legislator objects because there is too much screening, there is often a call by some other elected official for even more screening after it is revealed that some crime or offenses occurred where an inappropriate applicant was hired without a sufficient background check.  A listing of proposed legislation related to screening shows that legislators are both calling for increased privacy and protections for consumers at the same time they are introducing bills to increase background check requirements.  This underscores the fact the screening occurs at the intersection where privacy and security concerns meet, and the lines are constantly being tested. One area where employers need to review their practices is on using automated scoring matrixes where a candidate is given a green, orange, or red light.  That sort of automation where an individual is judged entirety by his/her membership in a particular category instead of his/her personal abilities is precisely the type of process that is likely to get some unwarranted attention in the courts as a discriminatory practice. This practice presents dangers to large employers and small and medium enterprises certainly should not be engaging in automated decision making based on background checks. 

Employee Problems are Caused by Problem Employees

Question from the mailbox:  Is performing background checks worth the time and effort it takes?     

Answer:  For employers that do not perform background checks, one of the most frequently asked questions is why do it?  The short answer is that employee screening is one critical way to keep problem employees out of the workplace.  As any employer or human resources professional know, a great deal of time is spent dealing with employee problems. As Employment Screening Resources (ESR) advised  employers in the first edition of The Hiring Manual back in 2005, “problem employees usually cause employee problems.”  An employer is certainly ahead if they can try to minimize the problem employees in the first place. 

Of course, there is no perfect system to prevent bad hires.   Background checks alone are not going to keep an employer from hiring people they later regret having in the workforce.  The hiring process has a number of moving parts, but the background check is the critical final step. 

In addition, the cost if a background check will typically be less than the cost of that new employee on his or her first day on the job. That is pocket change compared to the damage one bad hire can cause. It is ironic that some firms will spend hours shopping for a computer bargain yet at the same time try to save money by not adequately checking out a job applicant, even though each hire  represents an enormous investment and potential risk.   

Nor is it difficult to set up a screening programming. Even for an overburdened HR, security, or risk management department already handling numerous tasks, outsourcing background screening can be done very quickly and effectively. ESR can set up the entire program, provide all the necessary forms in a short time and assist with legal compliance.

Employment Screening Guidelines Released by Foremost Security Association

The second edition of the ASIS International Preemployment Background Screening (PBS) Guideline has been released to the public. ASIS is the preeminent organization for security management professionals worldwide. According to the press release:

The guideline, designated ASIS GDL PBS-2009, is an educational and practical tool that organizations can use as a resource in understanding the reasons for preemployment background screening of job applicants, as well as the legal principles surrounding the issue of preemployment background screening. The PBS guideline can also assist in developing policies and procedures that will enhance an organization’s hiring policy.

ASIS and the National Association of Professional Background Screeners, in an effort to promote shared cooperative interests, collaborated in the revision of the 2006 version of the ASIS Preemployment Background Screening Guideline.

This PBS guideline presents practical information concerning the value of preemployment background screening, the importance of the application form, important legal issues and considerations (such as the Fair Credit Reporting Act, privacy issues, state laws, rules and regulations), the key elements of preemployment background screening, the types of information to utilize in verifying the key elements, the use of credit reporting agencies in preemployment background screening, and an appendix of a sample preemployment background screening flow chart.

A number of members of the National Association of Professional Background Screeners (NAPBS) joined together with security professionals to serve on the committee that updated the Guidelines. ESR is pleased to note that its president, Lester Rosen, had the privilege of serving with this outstanding group of dedicated professionals on the original committee as well as the committee that produced the second edition.

The Guideline is available on the ASIS web site at www.asisonline.org

International Background checks

Did you know?  Given the mobility of workers across international borders, an employer’s obligation of due diligence may no longer be limited to employment screening just in the United States. A 2000 government study shows that 11.5 percent of the population consists of immigrants, and an increasing number of workers have spent part of their professional careers abroad.

Employers cannot assume that the U.S. government has conducted background checks on workers who hold visas. Government checks appear to be aimed at reviewing watch lists rather than verifying past employment or education or checking criminal records for employment purposes.

Given these issues, employers should consider background screening internationally for criminal records, employment history, and education credentials. Standard background checks conducted in the United States do not include international employment and criminal records. One caveat is that international checks typically take longer and are more costly than domestic screening, but they can be worth it if they help a company limit its exposure to future liability. Another issue is data and  privacy protection issues. 

For more information, see: http://www.esrcheck.com/international.php  ESR was the third U.S. background firm to be Safe Harbor certified for dealing with the European Union.  More information about international background checks is available in The Safe Hiring Manual.