5 Legal Lessons for Millennial Background Checks


By the end of 2015, Millennials are expected to outnumber Baby Boomers in the workplace for the first time ever. As the largest generational group in the job pool (depending on your source, people born 1982-2004), they’re a hot commodity. Up until now, most of the focus has been on how to woo them, lure them in and make them so happy that they want to work for you forever (or at least for a few years).  But employers are finding that it’s not all smooth sailing.  Hiring this growing generation of workers introduces a whole new set of legal challenges to the HR department, and the background screening process is one of those challenges.

When it comes to screening Millennials, employers need to take into account not only what’s effective, but also what’s legal. Wait a minute. I know what you’re thinking. How is a Millennial’s background check different from any other background check? Read on to learn how to spot the tricky issues and avoid a legal tangle with this new wave of workers.

1. Social Media Searches

We know that Millennials love their social networks. In fact, social media in many ways defines this generation. Many have grown up with Facebook accounts and can’t remember a world without the Internet or even without Twitter. They chronicle their lives on Instagram. But that familiarity can cut both ways.  Some say Millennials share too freely and fail to appreciate the impact that social media posts can have on their careers. The oversharing can be tempting for hiring managers who are eager to tap into the wealth of online information.

Jumping into social media as a way to screen job candidate can be a risky proposition. Personal social sites are not always privacy protected, so they are often readily available through a simple search on your candidate. Here is the problem—the information you find might not be legal to use in a hiring context. Information about a candidate’s religious affiliation, national origin, sexual orientation, marital status or health condition may all be prohibited under state and federal anti-discrimination laws. Moreover, Millennials appear to reflect more cultural diversity than Gen X or Baby Boomers. For example, 42 percent identify with a race or ethnicity other than non-Hispanic white.

The inherent legal risks associated with social media searches are not unique to Millennials, but because of their diverse make up and propensity to share, employers are more likely to stumble upon protected class information that could get them into hot water.  Employers need to make sure that any social media screening is done by those who are familiar with the legal risks—particularly anti-discrimination and privacy laws.

2. Digital Natives and Age Discrimination

Millennials, currently under the age of 33, are not direct targets for age discrimination. But here’s the rub–the hiring criteria you are using to attract Millennials might be at the expense of those older 40 somethings who are protected by the Age Discrimination in Employment Act (ADEA) and other similar state laws.

A Fortune article on this topic recalled a famous quote from Mark Zuckerberg: “Young people are just smarter.” In 2013, Facebook settled a lawsuit with California’s Fair Employment and Housing Department for posting an employment ad that stated “Class of 2007 or 2008 preferred.” You get the idea.

Another example is the term “digital native.” It’s the new code for a recent graduate and it’s popping up in ads where companies are looking for a person who was born and raised in the digital age. In other words, Millennials. Legal experts agree that pre-screening for digital natives is a form of thinly veiled age discrimination. Instead of screening for digital natives, identify the real job requirements needed for the position. If you want someone who is very skilled in tech and comfortable in the digital environment, those are the words you should probably use. Chances are, lots of people in their 20s and early 30s will be qualified and respond.

3. Driving Records

Apparently Millennials don’t like to drive. According to AARP, Millennials drive around 25 percent less than their counterparts did just eight years ago. If a licensed driver with a clean driving record is your target, you might actually be eliminating a significant number of prospective Millennial applicants. That might not be a big deal, but like all parts of a pre-employment background check, you want to make sure that the information you are seeking is relevant to the job at hand.

Before you run a motor vehicle report (MVR) on an applicant, you should be asking yourself why. Is a clean driving record a bona fide job requirement? Some employers want to check MVRs for reasons other than driving on the job—things like DUI type offenses, or to get a more complete picture of the candidate. Requiring a driver’s license or running a motor vehicle check would not rise to the level of discrimination, per se, but you could be limiting your job pool in the 20-30 year old market.

4. Credit:

Millennials, more than any other generation, tend to rely less on traditional bank loans and credit cards. They are more likely to use cash, and as a group they actually spend less than Gen X or Baby Boomers. They tend to borrow less, which some experts think is related to their large amount of student loan debt.  The term of art here is “underbanked.” Individuals who are underbanked have little or no credit history. If a credit report is one of your job requirements, you can expect to get little or no information about unbanked Millennials.

Credit is already a slippery slope, with many states prohibiting use of credit for pre-employment screening. But for financial institutions and positions with fiduciary responsibilities, the gap in credit information could significantly impact your ability to hire an otherwise qualified candidate. In any case, credit information is already a sensitive topic for many job candidates. It could be even touchier for Millennials.

5. Job History and Verifications

Millennials job hop. According to Data Facts blog, “a whopping 91% of them don’t expect to stay at a job for longer than 3 years”.  They are mobile, more like to move to large urban areas and are less motivated by pay. Their priorities are different from those who came before them and will move on in order to find more meaningful work.  Moreover, according to a recent federal study, millennials are less likely to have worked during school. That means they are more likely to be coming out of college without a work history.

All of this leaves a prospective employer with less to work with in terms of reference checking and verifications. As a result, screening for job history, applied skills and experience might be more challenging than in the past.  Employers might need to get more creative when it comes to evaluating and screening for work experience. One possible solution is expanding the scope of inquiry to include volunteer experience and potentially personal references.  But note that the use of personal references and investigative reports may also necessitate additional notices and further legal compliance under the Fair Credit Reporting Act.


Millennials are just at the beginning of their careers, and as the largest generation in the U.S. (representing 1/3 of the population) they will continue to have a lasting impact on the job market and the economy.  Coming of age during the Great Recession has had an impact on how they approach work and career paths. As Millennials struggle to find a place in the labor market, employers should be aware of the legal challenges and different approaches to screening this generation of job applicants.  These five legal lessons should provide a good starting place for making your screening program more compliant and Millennial-friendly.


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Nevada Removes 7 Year Limit on Criminal Records


Conducting employment background checks in the Nevada just got a little easier. The state has expanded the scope for pre-employment criminal background checks, lifting a 7-year reporting limit on criminal convictions. Nevada Senate Bill 409 was signed by Governor Sandoval last week. The law takes effect immediately. Under the new law, background screening companies are now able to report convictions older than 7 years in Nevada.

Additionally, SB 409 specifically allows gaming operators and employers to conduct more thorough background checks on prospective employees, allowing screening companies to prepare a report at the request of the gaming licensee which may include bankruptcy information older than 10 years and other civil judgments older than 7 years.

The state law is now comparable to the federal law (the Fair Credit Reporting Act) which places no limitation on reporting criminal records that result in a conviction. Employers conducting criminal background checks in Nevada now have the ability to see older conviction records, depending upon availability at the courts.  Employers who are updating their hiring policies are urged to consider EEOC guidance which recommends careful consideration of the age of a criminal offense in relation to the job before disqualifying a candidate based on a conviction.

The full text of Nevada SB 409 is here.
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Counting to Five in the Adverse Action Process


The adverse action process for background checks has been in the spotlight lately, thanks to a growing list of class action lawsuits against employers. In some recent cases, those lawsuits have resulted in multi-million dollar verdicts. Others are still winding their way through the court system, with employers defending their practices and filing motions in an attempt to dismiss some of the more far-reaching claims.

Case in point: Moore v. Rite Aid Headquarters, in the District Court for the Eastern District of Pennsylvania. This case has the full menu of Fair Credit Reporting Act (FCRA) allegations, including a claim that Rite Aid rejected Kyra Moore’s bid for employment without following the proper adverse action process.  Rite Aid filed a motion to dismiss the adverse action claim which the court recently denied.  You can read the court’s opinion here. While this ruling is limited in scope–it allows the Plaintiff to go forward but it’s not a final ruling on the issue–it’s still worth noting as it differs from conventional wisdom. The decision was based in part on Plaintiff’s allegations surrounding the timing of the pre-adverse and adverse action notices, and has set off an alarm for those of us who deal with adverse action on a regular basis.

What is adverse action?

For those readers who are uninitiated in the finer points of the FCRA, it’s the federal law that regulates the background screening process. The background screening bible, if you will. The FCRA requires a two-part notification process when an applicant is disqualified because of something on the background check. The initial, or pre-adverse notice, must be sent prior to making a final hiring decision. This initial notice has to include a copy of the report, thus giving the applicant a chance to dispute the findings of the background check. A second notice must be sent after the final decision not to hire, again spelling out the applicant’ rights under the law.

Moore’s claim: insufficient adverse action notice

The adverse action notices in Moore’s case were sent out by Rite Aid’s background screening provider–a perfectly legit way to handle adverse action. But Moore argues that because of the way the process was initiated and executed, Rite Aid did not allow her sufficient time to respond.

Moore claims that, contrary to the wording of the notice in the initial letter, Rite Aid did not provide her with a full five business days from receipt of the initial notice letter to dispute the report. The court bought this argument, ruling against Rite Aid and causing a jolt for the company and other employers that have a five day adverse action policy.

Why was the court’s decision on the timing of the letters a wake-up call for some of us? The surprising point is the notion that Rite Aid’s policy of sending the second notice five business days after the initial notice is sent might not be sufficient.  The complaint says that the initial Rite Aid notice informed Plaintiff that she had five business days from the receipt of that letter to provide Rite Aid with additional information before Rite Aid would take action. Plaintiff alleges, however, that it was Rite Aid’s policy for its provider to print and mail the final adverse action notice on Rite Aid’s behalf five business days after mailing the initial notice letter.

How the Plaintiff counted to five

Are you still with me?  To break it down, Plaintiff claims that her initial notice letter was mailed on April 25, 2011, and she received it shortly thereafter. The final adverse action letter denying plaintiff employment with Rite Aid was printed and mailed on May 2, 2011. Assuming her dates are correct and looking at the calendar, May 2, 2011 would be five business days after the date the initial notice letter was sent, but at most four business days from plaintiff’s receipt of the initial notice letter. Because it would take at least one day for the initial notice letter to reach an applicant via mail, she claims that she never had the full five business days to respond before the final adverse action notice denying them employment was mailed.

What it all means

The court said, based on Moore’s timeline, she has enough juice to move ahead with this claim. While this ruling is not an actual ruling on the issue, it is enough to make a case for reevaluating the timing of your adverse action notices. Many companies have long relied on the five day rule for adverse action notices. And many companies have a policy that starts the five day clock running from the date the initial letter is sent—not the date the letter is received. In fact, absent a certified mail receipt or some other form of verification, employers would have no way of even knowing when the initial notice letter is received.

The bottom line:

Take a look at your adverse action program. Now is a great time to reevaluate, regardless of how the case is ultimately decided.

  • Consider extending the notice period. Many clients use ten business days in order to give the applicant more time to evaluate and respond.
  • If you want to stick to a five day waiting rule for the second notice letter, and if you start counting on the date the initial notice is mailed, consider building in a few extra days to allow for receipt of the letter by the applicant. While a certified letter might be expensive and cumbersome, for some employers that might also be an option.
  • Look at the wording of your notices. Are you accurately explaining the process? Don’t promise what you can’t deliver. Here, the wording specified that the applicant would have five days from the receipt of the letter, which the court relied on in allowing the case to move forward.
  • If you use a screening partner for adverse action, now is a good to review the process with your provider. Screening companies can send the letters on your behalf, but ultimately you as the employer are on the hook for the contents of the letters and process.
  • Consult with your legal counsel for legal advice on this topic and reach out to background screening experts to ensure that your process is compliant.

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New FINRA Rule on Background Checks



FINRA (the Financial Industry Regulatory Authority) has issued a rule change for background screening requirements that goes into effect on July 1, 2015. FINRA Rule 3110(e) is based on similar provisions in NASD Rule 3010(e) and NYSE Rule 345.11. For those of us who are acronym challenged, that’s the National Association of Securities Dealers and the New York Stock Exchange, respectively.

In short, FINRA Rule 3110(e) lays out the specifics of what is required for a background check on U4 applicants. The new rule walks through the investigation and verification requirements for information in the Form U4 (Uniform Application for Securities Industry Registration or Transfer). Significantly, the rule introduces a new requirement to search national public records in order to verify U4 information. The full text of the rule and an executive summary can be found here.  Here is an overview of what you need to know.

Investigation Requirement

The threshold requirement under 3110(e) is that “each member firm ascertain by investigation the good character, business reputation, qualifications and experience of an applicant before the firm applies to register that applicant with FINRA and before making a representation to that effect on the application for registration.” While it does not dictate a specific process, the reg gives the following guidance:

  • Firms are required to complete the investigation process prior to filing the Form U4.
  • FINRA does not place any limits on the scope of such a background investigation—a firm must obtain all the necessary information to make an evaluation.
  • Firms should consider all available information gathered in the pre-registration process for this purpose, including, but not limited to, Form U4 and Form U5, responses, authorized searches of the CRD system, fingerprint results obtained under SEA Rule 17f-2 and communications with previous employers.
  • Firms also may wish to consider private background checks, credit reports and reference letters for this purpose, provided that firms ensure that the background investigations are conducted in accordance with all applicable laws, rules and regulations, including federal and state requirements, and that all necessary approvals, consents and authorizations have been obtained.
  • FINRA Rule 3110(e) clarifies that a firm is required to review a copy of an applicant’s most recent Form U5 if the applicant previously has been registered with FINRA or another self-regulatory organization including amendments.

Verification Process and Public Record Requirement

FINRA Rule 3110(e) requires “that a firm adopt written procedures reasonably designed to verify the accuracy and completeness of the information contained in an applicant’s Form U4 by no later than 30 calendar days after an initial or a transfer Form U4 is filed with FINRA.”

A few of the finer points:

  • If a firm becomes aware of any discrepancies as a result of the verification process after the filing of the Form U4, the firm is required to file an amended Form U4.
  • While FINRA notes that firms are encouraged to complete the verification prior to filing, it provides the 30 day window and allows for unplanned delays as a means for firms to quickly fill open positions and manage hiring needs.
  • If an applicant is already registered with a firm and is transferring to an affiliate, the firm only needs to verify new information on the U4—there’s no requirement to verify historic information.

The New Twist: “Reasonably Available” National Public Record

Here is the new twist: a firm’s verification process “must, at a minimum, provide for a national search of reasonably available public records conducted by the firm or a third-party service provider to verify the accuracy and completeness of the information contained in an applicant’s Form U4.”

FINRA defines public records to include general information, such as name and address of individuals, criminal records, bankruptcy records, civil litigations and judgments, liens, and business records. Since 3110(e) requires that a firm search only “reasonably available” national public records, it clarifies that, at a minimum, such records include criminal records, and bankruptcy records, judgments and liens.

The rule acknowledges that what is “reasonably available” might change over time, and that a firm may find it necessary to conduct a more in-depth search of public records depending on the applicant’s job function, responsibilities or position at the firm. Notably, FINRA says that the public records search requirement does not require a credit report, which contains both public and non-public records, but says a credit report might be just one of several means by which to obtain the information. Other suggested means include obtaining a report from a third party background screening provider containing criminal and financial information, and accessing various database resources.

The Bottom Line

  • Firms subject to regulation by FINRA need to review their investigation policies and practices for U4 applications.
  • Written policies need to reflect a compliant investigation process.
  • Effective July 1, 2015 that process needs to include verification by using reasonably available public record information.

This is a great time to review your screening program. Check with your background screening provider to review your options for conducting a compliant verification process under the new rules, and consult with your counsel for legal advice.

Questions for FINRA regarding the notice and the new rule can go to Afshin Atabaki, Associate General Counsel, Office of General Counsel, at (202) 728-8071 or afshin.atabaki@finra.org.

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New York City Council Passes Ban the Box

New York City

The Fair Chance Act, New York City’s take on Ban the Box, was passed by New York City Council last Wednesday. The bill had overwhelming support; Mayor deBlasio is expected to sign the bill, which will take effect 120 days after its enactment.

If you’re new to ban the box, the “box” refers to the check box on job applications asking applicants if they have a criminal history. The idea is to allow ex-offenders a chance to get past the application stage and increase their job opportunities by delaying a criminal background check or inquiry until later in the hiring process. The full text of the bill can be found here. In a press release issued by the council, supporters clarified that “nothing in the bill would require an employer to hire anyone despite criminal history.”  Like many other ban the box laws, the New York version goes beyond the application check box, and adds some additional restrictions on the use of criminal information in the hiring process that employers need to know. Here is a breakdown:

Continue reading New York City Council Passes Ban the Box

State of Ohio Bans the Box for Civil Service Jobs


While the state legislature has not yet weighed in on the issue, the Buckeye State has taken one step closer to embracing “ban the box.” Effective June 1, state civil service applications no longer include the check box asking job applicants about their criminal history. The question has reportedly been removed from both online and paper applications. Continue reading State of Ohio Bans the Box for Civil Service Jobs

FCRA Case Dismissed! Court says LinkedIn is not a CRA



LinkedIn is off the hook. A California district court has dismissed a class action lawsuit filed against the business networking site. The full decision can be found here. The popular social network was sued last year by job seekers who claimed that LinkedIn’s Reference Searches cost them jobs. The theory of the case was that LinkedIn should be treated like other background screening companies–a theory that was successful against another website, Spokeo.

Case Background

Tracee Sweet, the named Plaintiff, had what she thought was a positive interview with a prospective employer. In fact, she later got word that she would be hired. Soon thereafter, the company called her back and said it had changed its mind. As it turns out, the company had checked some references using LinkedIn’s “References Searches” function. Reference Searches is pretty much what it sounds like—it’s a LinkedIn feature that employers use to track down people with whom an applicant may have worked previously.

Sweet and other similarly situated job seekers filed suit, alleging that the reference feature violated their rights under the Fair Credit Reporting Act. At the crux of the complaint was the plaintiffs’ argument that LinkedIn was acting as a consumer reporting agency (CRA) under the Fair Credit Reporting Act (FCRA), and that Reference Searches were consumer reports. Last week a California U.S. District Court dismissed the case, finding that the Plaintiffs had not alleged sufficient facts to support a plausible FCRA claim.

The Decision

In reaching its findings, the court emphasized the following points:

First, the court found that LinkedIn’s publications of employment histories of the consumers who are the subjects of the Reference Searches are not consumer reports:

“because the information contained in these histories came solely from LinkedIn’s transactions or experiences with these same consumers. The FCPA excludes from the definition of consumer report any “report containing information solely as to transactions or experiences between the consumer and the person making the report.”

Second, the court found that LinkedIn’s publications Reference Searches still would not be consumer reports because Plaintiffs’ allegations do not raise a plausible inference that LinkedIn acts as a consumer reporting agency when it publishes these histories:

The court distinguished the Plaintiffs from the plaintiffs in Robins v. Spokeo, Inc., noting that in Robins, the court held that the plaintiff’s allegations that the defendant “regularly accepts money in exchange for reports that contain data and evaluations regarding consumers’ economic wealth and creditworthiness [were] sufficient to support a plausible inference that [d]efendant’s conduct falls within the scope of the FCRA.”

In this case, the court found that LinkedIn was merely carrying out consumers’ information-sharing objectives and not acting as a consumer reporting agency with regard to its assembly of this information.

Third, the court found that the Plaintiffs’ allegations are insufficient to state a claim that the information in the Reference Search bears on the “character, general reputation, mode of living” and other relevant characteristics of the consumers as required by the FCRA.

Fourth, the court found that Plaintiffs do not state a claim that the Reference Search results are used or intended to be used to determine eligibility for employment. “A communication must be “used or expected to be used or collected in whole or in part for the purpose of serving as a factor in establishing the consumer’s eligibility for . . . employment purposes . . . .” in order to be a consumer report.” The court did not find that the search results themselves were used in the hiring decision. Rather, the results were used to locate people who may or may not then provide information about the candidate.

Bottom Line

The good news is that employers and recruiters can continue to use LinkedIn as they always have, without fear of additional compliance requirements that would have attached if the court had found that the web site was in fact a CRA. Likewise, LinkedIn can carry on business as usual. Since it is not a CRA, it has no duty to verify the accuracy of the information reported in the Reference Searches, nor does it have a duty to put consumers on notice about the use of the information in the hiring process. The results of the case have an upside for users and consumers alike who rely on the power and convenience of LinkedIn every day (including me!).  The downside, if there is one, is buyer beware. Like any other social media source, much of what you find on LinkedIn is user generated content. There’s no good way to know if it’s accurate. My advice–make sure you do your homework and conduct a real background check before hiring someone you find on social media.

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Litigation Update: FCRA Claim Against Paramount is Thrown Out

Background Checks

Paramount Gets FCRA Claim Thrown Out

Finally, a voice of reason. Employers got some good news from a judge in the Northern District of California last week, when the court granted Paramount Picture’s motion to dismiss a class action claim for alleged Fair Credit Reporting Act (FCRA) violations. The case was one of the many class actions that have been flooding the federal courts, disputing the validity of the disclosure form used for running a background check. This wave of litigation has erupted over the past twelve months, putting employers on the defensive against FCRA claims seeking millions in statutory and punitive damages.  The judge’s decision to dismiss the case against Paramount is a welcome development, and may be a turning point for employers facing FCRA class actions of this type.

The plaintiff alleged that Paramount violated the FCRA’s requirements for disclosure of consumer reports. The specific code section, 15 U.S.C. § 1681b, provides that before conducting a background check, an employer must make a “clear and conspicuous disclosure”, “in a document that consists solely of the disclosure” (emphasis added). The plaintiff alleges that Paramount violated the above provision of the FCRA by including some extraneous information in its disclosure form—namely a certification that the information provided by the plaintiff was true and correct.

If this sounds like splitting hairs to you, suffice it to say that the court agreed. Citing a 1997 opinion[i] letter from the FTC, the court maintained that the one-sentence certification Paramount included in its disclosure form, while not technically part of the statutorily permitted authorization, was close enough. The court found that while Paramount may not have followed the exact letter of the law, its actions certainly did not rise to the level of willful disregard of the statute.  The court reasoned that the additional sentence served to “focus the consumer’s attention on the disclosure.”

[E]ven if inclusion of the certification in Paramount’s disclosure form did not comply with a strict reading of § 1681b(b)(2)(A)’s requirement that the document consist solely of the disclosure and the authorization, it is not plausible that Paramount acted in reckless disregard of the requirements of the FCRA by using this language.

The icing on the cake was the judge’s determination that there was nothing the Plaintiffs could do to amend the claim to refile or salvage their case.  Let’s hope that other courts hearing dozens of similar cases will follow Judge Chhabria’s lead.

Case Name: MICHAEL PEIKOFF, Plaintiff, v. PARAMOUNT PICTURES CORPORATION, Defendant Case No. 15-cv-00068-VC, U.S. District Ct. for the Northern District of California.

Case File Date: February 19, 2015

Dismissal Date: March 25, 2015

Cause of Action: Class Action, Fair Credit Reporting Act 15 USC 1681

Bottom Line: Finally a voice of reason from California’s Northern District. The court threw out an FCRA class action claim for alleged disclosure violations, finding that the additional language in the document did not constitute a willful violation of the statute and did not rise to the level of a violation. This is welcome news for employers facing similar claims for their background screening process.

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[i] See Letter from William Haynes, Attorney, Div. of Credit Practices, Fed. Trade Comm’n, to Harold Hawkey, Emp’rs Assoc. of N.J. (Dec. 18, 1997), 1997 WL 33791224.


Government Study on Background Checks Addresses Incomplete FBI Criminal Records

Missing Data

The Government Accountability Office (GAO) has been busy. At the request of Congress, it’s been looking into criminal background checks. Last week the GAO released a report of findings from a two year study titled “CRIMINAL HISTORY RECORDS: Additional Actions Could Enhance the Completeness of Records Used for Employment-Related Background Checks.” The report lives up to that lengthy title–it is the most comprehensive accounting of the current state of FBI background checks, criminal record databases, and practices since 2006. It reveals when and why states conduct FBI record checks, and looks at whether states have improved upon reporting complete records into the FBI database. It also looks at the practices of private companies that conduct criminal record checks.

Congress has good reason to be concerned. Every year, more state and federal agencies are turning to statewide databases and the FBI records to screen employees for safety and security reasons. The number one concern is this: incomplete records.

Back in 2006, the Attorney General reported that the FBI criminal background check system was woefully inadequate, consisting of a patchwork of state and federal laws. It found inconsistencies in access to FBI criminal record checks across states and industries, concluding that records were incomplete and were not reported consistently. Since then, little has changed.

State Reporting and the FBI

The FBI database relies on the states to supply complete and accurate records. The GAO reports that while some states have made improvements, more progress is needed. More records now contain both the arrest and final disposition (e.g., a conviction), but there are still gaps. According to the report, twenty states reported that more than 75 percent of their arrest records had dispositions in 2012. That means around 25 percent of those state’s records did not have dispositions. That’s a pretty big gap. Those of us in the private sector know from experience that incomplete records can’t be relied upon for hiring decisions; they lead to delays in hiring, rejection of qualified candidates, and lawsuits.

The report notes that the FBI’s Advisory Policy Board, which includes representatives from federal, state, and local criminal justice agencies, created a Disposition Task Force in 2009 to address this very problem. But the Task Force has no current plans or time frames in place to do what’s needed—to make improvements in national standards for collecting and reporting disposition information.

Private Background Companies

Given the state of affairs with state reporting and FBI sources, it’s no wonder that employers, including government agencies, have turned to private screening companies. The report notes that the use of private companies to conduct criminal history record checks appears to be increasing because of employer demand:

“(P)rivate background check companies can offer benefits that government agencies are not always able to provide, including collecting and consolidating criminal justice information from multiple sources, achieving faster response times than Management officials from state agencies, and creating reports that include non-criminal-justice information.”

Private companies are able to return results faster because they don’t rely on the FBI database or state-reported records. They conduct name-based searches on a wider variety of sources, going directly to the courts for the most current and up-to-date information. The report points out challenges to the private model as well, like false positives—which can occur when a person with a common name is associated with another person’s records—and false negatives, which can occur when a search misses a record because of errors in the record. However, private background check companies mitigate these errors by using additional identifiers—such as date of birth and address— when conducting checks. Moreover, regulators like the FTC are actively enforcing consumer protection laws like the Fair Credit Reporting Act, to keep private companies in line.


After conducting a nationwide survey of 47 states and the District of Columbia, interviewing officials that manage checks from the FBI and 4 states, speaking to stakeholders like private background companies and trade associations for background screeners, and regulators like the Federal Trade Commission, the GAO concluded that one thing is clear. Criminal background checks are here to stay. Employers and government agencies are increasingly using criminal history records for employment, volunteers, and licensing. And to do that well, they need accurate and complete criminal records— including the final disposition of any criminal charges.

What the GAO Recommends

The report concludes with these specific recommendations:

  • To improve disposition reporting that would help states update and complete criminal history records, we recommend that the Director of the FBI task the FBI Advisory Policy Board to establish a plan with time frames and milestones for achieving its Disposition Task Force’s stated goals.
  • To potentially help states enhance the completeness of their criminal history records, we recommend that the Director of the FBI and the Director of the Office of Personnel Management clarify what disposition information OPM will provide to the FBI and formally agree on how OPM will provide it. This would enable the FBI to forward the information to states and allow each state to determine if the information can be used to update their criminal history records.
  • To better equip states to meet the regulatory requirement to notify individuals of their rights to challenge and update information in their criminal history records, and to ensure that audit findings are resolved, we recommend that the Director of the FBI—in coordination with the Compact Council—determine why states do not comply with the requirement to notify applicants and use this information to revise its state educational programs accordingly.

It will be interesting to see the kind of follow up that ensues. One thing conspicuously absent from the recommendations is any follow up with private industry, which has an active stake in the process. Ironically, the private background screening industry is miles ahead of the states and other government employers when it comes to ensuring the accuracy of records and protecting the rights of consumers in the screening process.

Criminal Background Checks

Is Big Brother Watching? When Big Data Meets HR


Big Data and Work-Force Science: A Boon for HR

Big data is transforming the information world at an alarming rate. It’s no surprise that the data being collected, sliced, sorted, and sold is being used to help businesses make better hiring decisions. According to the New York Times, a growing number of entrepreneurs are applying big data to human resources and the search for talent, creating a field called work-force science. To quote technology writer Steve Lohr, “work-force science, in short, is what happens when big data meets HR”  The data part of the equation is collecting all of the digital imprints that a worker or job seeker has left in the course of web browsing, e-mailing, instant messaging, or posting on social media. The “science” part—evaluating and measuring the data—is the tricky part. Silicon Valley start-ups are developing analytics and algorithms to put this data to work for recruiters and employers. Continue reading Is Big Brother Watching? When Big Data Meets HR