Monday, November 10, 2014

The Top 5 Hot Topics in Background Checks in 2014

How, when, and why you can use Background Checks in your hiring process has changed.  And many of these changes were Hot Topics in 2014.

Here I will discuss my Top 5 and what they mean to you:

  • Consumer Reporting Agencies and Criminal Background Checks

Any employer who obtains criminal history reports on an applicant or employee from a CRA (Consumer Reporting Agency) must follow the Fair Credit Reporting Act.  Your Background Check provider falls under the CRA category.

The key features of the FCRA require that in order to conduct a criminal history check, an employer must do these 3 things:

  1. Obtain a Signed Release granting permission to perform the Criminal History Check
  2. Provide the applicant/employee a copy of the report and a Summary of their rights prior to any adverse action based on the information in the report.
  3. Send Written Notice if a decision not to hire is made based on the criminal history report.

The important takeaway here is that any time your company uses a third party to conduct your background check, you must make sure they understand that the FCRA requirements apply.

I believe your Best Offense is a Good Defense.  In order to avoid FCRA violations, it is crucial that your screening provider is knowledgeable, in full compliance, and can keep you in compliance with the Act. 

It is also important that they use procedures aimed at providing you with accurate and quality information.  Remember, not all background checks are created equal.

Learn more in “Tips to Help Your Business Fly Under the EEOC Radar”.  I help you avoid the pitfalls that can land your company in their sites when it comes to your release forms, your notice of applicant rights, and your adverse action notifications.

  • “Ban the Box” 

At its most basic, “Ban the Box” removes the criminal history question from job applications and delays the question of a criminal record until a conditional offer of employment has been made.

However, and as I discussed in my article, “Discover How Many States are Taking ‘Ban the Box’ too Far”, this trend continues to grow and morph as more states and cities adopt their own policy.

These new legislations are dividing many, with a middle ground currently out of reach:

“Critics of “ban the box” see the current trend as excessive intrusion on a company’s hiring decisions.  Giving extra protection to those with criminal records subjects employers to complicated hiring procedures and to possible litigation for making unsafe hires.

Making any decisions, even the decision to interview, will now be made without having all the facts.  And limiting what kinds of criminal offenses can be considered creates risk.

Opponents to the current and, most likely, future reach of “ban the box” believe having that information early in the process allows employers to make a much more informed decision.

They also believe these laws are a burden, especially to Small Business.  The additional time and money it takes interviewing those who an employer later learns has a criminal record can be damaging.”

  • The U.S. Equal Employment Opportunity Commission (EEOC) approach to the Use of Criminal Records in Hiring

According to the EEOC:

“Federal law does not prohibit employers from asking about your criminal history. But, federal EEO laws do prohibit employers from discriminating when they use criminal history information. Using criminal history information to make employment decisions may violate Title VII of the Civil Rights Act of 1964, as amended (Title VII).”

This next phrase, however, is the most telling:
“Title VII prohibits employers from using policies or practices that screen individuals based on criminal history information if:

  • They significantly disadvantage Title VII-protected individuals such as African Americans and Hispanics; AND
  • They do not help the employer accurately decide if the person is likely to be a responsible, reliable, or safe employee.
  • Another key point here is the emphasis on using Convictions, not Arrests, when making your hiring decisions.

In, “Why Checking an Applicant’s Criminal Past Should be About Convictions, Not Arrests”, I explained that,  

“The EEOC (Equal Employment Opportunity Commission) differentiates between arrests and convictions.  An arrest alone simply does not prove criminal conduct.  It is important to keep in mind that excluding someone based on an arrest record that is not job related or necessary based on your business can be seen as a Civil Rights violation.”

In addition,

“To be safe, employers should give convictions much more weight than arrests in their hiring decision.  When you have evidence of a conviction (especially those verified through a quality background check company), you know the record is that of the applicant and you know the outcome of the case.”

Only then can you make a truly fair and informed determination of the applicant’s suitability for the job.

  • The Rise in Class Action Lawsuits involving the Federal Fair Credit Reporting Act (FCRA).

In 2013 there were 3500 more cases filed (alleging FCRA violations) than in 2012. (Source: Lexology)

Employers are in a tough spot.  They need to practice Due Diligence in hiring, while at the same time dealing with changing compliance issues.  Because of this, companies can expect to see an increase in lawsuits for both failing to use background checks in hiring and for failing to use them correctly.

According to an article published in Lexology by Sara Hutchins Jodka (Porter, Wright, Morris, & Arthur LLP), “The FCRA is the new FLSA ” (Fair Labor Standards Act);

“Many employers run into problems because they fail to comply with one or more of these four distinct steps (disclosure, authorization, pre-adverse notice, adverse notice), but even employers who do manage comply with these four broad requirements tend to miss some of the more intricate, lesser-known requirements that each step further requires. Add a per-violation statutory penalty and an award of attorneys’ fees for each FCRA violation an employer commits and it becomes clear how FCRA class actions are quickly becoming the new go-to class action lawsuits for plaintiff-employment lawyers.”

This climate makes it more important than ever for employers to consult legal counsel well versed in FCRA compliance and employ a good Background Check company to help. 

  • Use of Social Media in Background Checks.

A 2014 CareerBuilder study shows that, “Forty-three percent of employers use social networking sites to research job candidates, up from 39 percent last year and 36 percent in 2012.”  

I have always been an advocate of knowing what is “out there” about you, especially before beginning any job search.

In Part 1 of my series, “Social Media, Background Checks, & Company Policy:  The Good, The Bad, and the Ugly”, I share exactly how Social Media posts, pictures, etc. are used during the hiring process.

It is important to understand that “many times it is not part of the formal background check investigation, but is often an 'added tool' used by the hiring company or background check investigator to get a clearer picture of the applicant”.

In Part 2, I go further and explain the importance of a sound Social Media Policy, “5 Things a Good Social Policy Needs”.

While it is easy to see why using social media in your hiring process is appealing (it is free and quick after all), employers need to be wary.

Existing laws that govern fairness in employment still apply.  Any personal information you discover that relates to protected classes as defined by Title VII (race, religion, etc.), cannot be used in your employment decisions.

The problem is, once you have seen something, it cannot be unseen.  This results in an added risk to your company.  If you make the determination not to hire someone, proving that you did not factor in anything you may have seen online covered by Title VII can prove difficult.

Your best bet is is use a 3rd party screening company to conduct all aspects of your background check.  They will be well versed in what information they can and cannot include in their reports.

  • Use of Credit Reports

Employers would do well to approach the use of credit reports in their hiring process with caution.

It is important to know your existing state laws governing credit reports (and be aware that these laws may change) and understand whether a credit report is necessary and relevant to the job.  Having a permissible purpose for the credit report and meeting all guidelines is crucial.

Employers also need to be aware that credit reports are not infallible.  They can contain errors.  In addition, the growing problem of identity theft creates a nightmare for victims in terms of their credit reports.

2014 saw employment credit checks continue to be looked on with disfavor.  In “Employment Credit Checks, Will They Soon be a Thing of the Past?”, I wrote;

“I do not think using credit checks to determine employment is necessary.  The information obtained in a credit check, even the “modified” ones supplied to employers, is simply not needed in making an informed hiring decision.  Unless required by law or when hiring for upper level positions, other options are available to employers for determining whether an applicant is the right choice.”

This tool could possibly disappear from employer’s hiring practices in the near future.

I believe each of these trends will continue to be Hot Topics in the coming year.  That is why making sure you keep up to date is the primary goal of your background check provider.

While this can seem like a daunting prospect, being flexible and trusting in your screening company is key.

Authored by   

If you have questions on how you can make new hires or screen existing employees safely, I can help.  Contact me at or check out my website,, for more information.  I can offer you a free consultation or simply answer any questions you may have concerning your hiring needs.

I would also love to connect with you on Facebook, LinkedIn, Twitter, and Google+!

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