Domino’s Pizza is the latest employer to find themselves in court facing a class action law suit alleging that their background check process violates the Fair Credit Reporting Act (FCRA).

The former employees claim that the company (1) ran background checks on employees without proper authorization; and (2) “systematically” failed to provide employees with copies of their background checks prior to taking adverse employment action against them.

This should not be news to employers. It’s Background Checks 101. So it is not surprising that last week, a Maryland US District Court judge allowed the case to move forward, denying Dominos motion to dismiss. In a long and critical opinion, the Court ruled that the plaintiffs properly alleged that Domino’s violations were “willful.” That means that the claims are putitive and if the Plaintiffs are successful, Domino’s pays an addtitional statutory penalty of $1000 per plaintiff. Ouch.

Sound familiar? It should. The Plaintiffs’ counsel– Minnesota firm Nicols Kastor, PLLP, filed a similar suit in December of last year against banking giant Capitol One. We told you about that case a few weeks ago. Plaintiff Kevin Smith accuses Capital One of violating the FCRA by combining it’s authorization with the company’s standard application. On this claim, Capital One may be liable to all employees and prospective employees who signed Capital One’s standard job application. Double ouch. The lawsuit also alleges that Capital One failed to provide copies of the reports when it used them to take adverse employment actions. Same story, different day.

Employers, these law suits are not going away. Review your adverse action process, and check your forms. If you need a compliant authorization form, you can get one from us.

The Catholic Church is no stranger to controversy, especially when it comes to background screening.  For years the public demanded better screening of Priests and other congregant workers.   These demands and other public pressures is likely why they adopted a policy a few years back.  However, as we can see here, when Ms. Collins was hired in June 2003, background checks were not common practice in the church.  Like we always say, money is easy(ier) to recover than ones reputation.   Careless oversight and lack screening policies have led them to where they are today.  As you will read later in the article, a simple criminal records check on Ms. Collins would have revealed a past recrod; According to court records, Ms. Collins was arrested in June 1999, and charged with stealing at least $46,000 over 16 months from AccuStaff, a Manhattan temporary employment agency where she worked as a payroll manager.

In Million-Dollar Theft Case, Church Worker With a Secret Past

Last week my esteemed colleague, Nick Fishman, wrote about the IRS’ current state of background screening and fingerprinting for tax preparers.  According to Bloomberg, the IRS has decided to table the decision but is still considering the use of Consumer Reporting Agencies (CRA’s) to be a part of the process.

According to Bloomberg:

IRS will not go forward with fingerprinting of tax preparers as part of the background check that will determine if they are eligible to receive a preparer tax identification number, an IRS official says on a wide- ranging Tax Talk Today broadcast that covers 2011 filing changes. Preston Benoit, deputy director of the IRS’s Return Preparer Office, says that IRS has “tabled the fingerprinting option right now.” Instead a group has been formed to determine how to move forward, with consumer reporting agencies still a likely contender.

It was just announced that Pepsi Beverages will pay $3.13 million to settle a lawsuit with the Equal Employment Opportunity Commission (EEOC) over alleged discriminatory background screening practices.

The case centered around Pepsi’s policy to not hire applicants on a permanent basis whose background checks revealed an arrest that did not lead to conviction for positions at their factory.  In particular, the EEOC said that 300 black applicants were denied permanent employment due to arrests that did not lead to convictions.  The policy was deemed discriminatory because there was “reasonable cause to believe that the criminal background check policy formerly used by Pepsi discriminated against African Americans in violation of Title VII of the Civil Rights Act of 1964.”

Personally, I wish this case didn’t solely focus on minorities.  After all, I have to believe that white applicants were treated the same way.  It’s like saying that the policy would have been fine had they not attempted to hire minorities.

Using arrest records that didn’t lead to convictions is a tough policy to enforce, especially when it is a blanket policy, but it is permissible (please consult with your legal counsel for more on this).  This case underscores the need for employers to take a close look at their background screening standards and to align non-hireable convictions (or arrests) with the responsibility of the job itself.

Sorry, I’m a little slow on posting this, but the EEOC recently wrote an opinion letter that suggests that requiring a high school diploma as a condition of employment may be discriminatory.

Now as many of you know, I would usually take this opportunity to excoriate the EEOC.  However, I’m turning over a new leaf this year and refuse to be drawn into negativity (anyone want to place a wager on how long this will last for?).

ERE’s John Zappe wrote a great post on this topic.  See excerpt below.

An “informal discussion letter” just posted to the EEOC’s website says that under certain circumstances, requiring a diploma may run afoul of the Americans with Disabilities Act. If the requirement screens out persons unable to earn a diploma because of a bonafide disability, the employer has to justify the requirement as job-related and consistent with business necessity.

Doing that for some jobs isn’t going to be easy. Employers almost as a matter of routine include at least a high school degree requirement in every job posting, including for janitors and cleaners. The U.S. Labor Department, however, says, “Most building cleaning workers, except supervisors, do not need any formal education and mainly learn their skills on the job or in informal training sessions sponsored by their employers.”

Informal discussion letters aren’t policy. That’s up to the Commission members. However, employment lawyers see the letter as signaling the possibility that the EEOC may be looking to step up its enforcement of other provisions.

Says Proskauer Rose attorney Nigel F. Telman, “I could see them potentially … saying at some point” that a high school diploma requirement “may have a disparate impact on a particular class of people.”

For instance, 87.1 percent of the U.S. population older than 24 has a high school degree. However, only 62.9 percent of Hispanics do. So requiring a degree does have a disparate impact nationally. That alone isn’t illegal. But it does mean you’ll have to justify the requirement as both job related and consistent with business necessity.

If it’s the ADA that’s involved, you’d also have to also establish that with or without an accommodation the disabled person is unable to do the job.

Read Full Article

Discriminatory?  Really?

Doesn’t everyone in this country has access to public education?  What they chose to do with that access is up to them. I agree that every job should have requirements that correspond to the position, but discriminatory?  What on earth is the EEOC thinking?  Why not just make it illegal to actually have a degree?  I’m sure our kids would love that. I guess they aren’t happy until their relentless policies force everyone into court (or out of business).

So much for turning a new leaf.  I couldn’t hold back:)

By Jason Morris, President & Kevin Bachman, VP of Quality Service.

We have made a conscious effort over the years to NOT make our blog a self-promotional site.  In fact, it’s with great care that we let you draw your own conclusions from the information that we put out.

On Sunday a story hit the AP wire that has made its way around our industry.  The article, points a wicked finger at the screening industry as dangerous, lazy and careless.  The article calls out a few background check companies, also known as Consumer Reporting Agencies (CRA’s) for reporting incorrect, and un-verified information to employers. Employers use these inaccurate reports to deny people jobs, hurting innocent people simply looking for work.

We love to take strong positions against inaccurate reporting. We find no more pleasure than calling out news that is wrong, looking smarter than some reporter looking to make his bones by writing a careless expose… WE CAN’T DO THAT HERE.  The reporter was right in all aspects except one; WE ARE NOT ALL THE SAME!

Are there companies that are careless and quick to pass along outdated or inaccurate information? YES. Are there companies that use only databases and don’t research actual court records? YES. Are there companies that simply scrape data off of court websites and don’t check it for accuracy? You guessed it, YES AGAIN.  It’s these companies that give us all a bad name; pushing onto employers the idea that screening is a commodity then sell the cheapest product possible to fit neatly into the world they’ve just created.

There are reasons for this.  Conducting background checks is a complicated business. The employers are generally unaware of the nuances of local, county, state, and federal laws, their processes, problems or regulations. And that’s not their fault. It’s not their business.  But without this knowledge, and with all companies claiming to do the same thing, it’s easy to discount claims of service and accuracy and simply look at price and whiz-bang technology systems.  On the other side, these screening companies know this; and their use of terms like “criminal search”, “instant” and “national background check,” combined with bells and whistles software allows them to perpetuate a higher degree of accuracy than their processes actually provide.

Last week we wrote about our experience at the Criminal Records and Employment Conference at Cornell ILR Law School in NY.  We wrote about the civil rights activists that were upset about all things screening.  We still stand tall and disagree with many of their positions; however, it’s stories like this that help us realize why they are so upset!  People are getting hurt everyday by these careless background checks and companies hiding behind loopholes in the Fair Credit Reporting Act rather than taking personal responsibility for their actions.

Its because of all this that EmployeeScreenIQ takes a “No Shortcuts” approach to all things screening.  “No Shortcuts” is more than just a tagline or fancy marketing campaign. It is the foundation for how we operate our business. This mantra is employed at every level of our organization so that you can make informed hiring decisions. One of the worst things you can do in your background screening process is to make a hiring decision based on inaccurate data. Rather than just reporting raw, unconfirmed information, EmployeeScreenIQ takes the necessary steps to ensure the results are reliable, accurate and up to date. Three fundamental principles of the Federal law WE choose to follow.

Before reporting criminal records to you, our Public Records department actually confirms that the information we’ve found belongs to your applicant. They also actually consult our 50 state compliance guide to ensure that the record is legally reportable. Believe it or not, the same methods apply to verifying other pieces of adverse information such as employment and education verifications. We’re all for streamlining the process and reducing turnaround time, but it should NEVER come at the expense of a quality product. Want proof that our methods work? Only .017% of all county criminal checks we complete are disputed.  (A dispute rate that this article points out screening companies are unwilling to publish!!!)

The proof is in the pudding.  EmployeeScreenIQ has successfully achieved compliance with the National Association of Professional Background Screeners accreditation program and is formally recognized as Background Screening Credentialing Council Accredited.  This recognition affirms EmployeeScreenIQ’s commitment to excellence, accountability, high professional standards and continued institutional improvement. Less than 2% of employment screening companies have earned this distinction and we are pleased to share such a small stage.

Accreditation is an important seal of approval that all companies should look for when choosing a provider as it is the only program in our field that proves their procedures are compliant with industry best practices. It also affirms security protocols, industry knowledge and expertise.

AP IMPACT: When your criminal past isn’t yours

I just saw a press release from an attorney who is leading a class action in Maryland against Capital One on behalf of those who say that the company violated the Fair Credit Reporting Act (FCRA) for the manner in which they conduct employment background checks.  The suit alleges that the company has harmed their job applicants by:

• Burying the Applicant Release and Disclosure form in the job application
• Not providing the proper Adverse Action notifications and copies of the background check result when an applicant was denied employment
• Using improper formatting requirements on the release (font must be a certain size)

If true, this could lead to either a large settlement or verdict against the company.  If so, you can be sure that the attorneys leading the class will be asking the company “What’s in Their Wallet!”

Whether these allegations are true of not (and it is our hope that they are not), employers should take note that it is far easier to comply with the FCRA than to face this type of action.

P.S. Even though I know the reason why, I still can’t get over law firms sending out press releases on the cases they file.

CBS3 in Philadelphia is reporting that former Penn State coach, Jerry Sandusky was denied the opportunity to coach at a local college because the school saw that he was under investigation at the time they conducted a background check.  Well, thank goodness for that.

It’s been quite a year for those involved in the background screening industry: employers, consumer reporting agencies, attorneys, etc.  Every time we turn around it seems the industry is being attacked and accused of being the sole reason why people cannot find jobs.  And sure, it’s easy for these folks to file suit against, conduct studies unfavorable to background checks and to create a media storm about people that are denied work.  There are a lot of stats they can rely on and in many cases, twist to prove their point.

However, on our side of the equation, the stats are hard to come by.  How do you prove that you prevented loss, violence, a bad hire when you didn’t hire the person because the background check gave you pause?  Well, unfortunately, this Sandusky case helps us prove our point.  Being denied this job might not have stopped him from abusing others, but it wasn’t going to happen at this school.

Do we need further proof that background checks work; that they are a vital part of the hiring process?  Do we need to continue to prove that children’s lives were not altered, that families weren’t shaken to their core, and that the employer wouldn’t be responsible for millions of dollars in damages?

It’s time for those who oppose what we do to take a good look at the whole picture.  There are many ways to address the problems of former convicts finding work, combating recidivism and not create a disparate class of those who are unemployable.  They just can’t come at the expense others.

Background Check Law Could Get Some Pennsylvania Teachers Fired

(Reuters) – A new Pennsylvania law requiring all school workers to disclose their criminal history next month could see some employees who have been convicted of various crimes lose their jobs.

The law, signed by Governor Tom Corbett in June, went into effect in September and mandates background checks for all employees of public, private and vocational schools. Administrators must notify employees of the law and have them return a form reporting any criminal history by December 27.

“Our focus now is on helping our members comply with the law,” said Wythe Keever, spokesman for the Pennsylvania State Education Association, the union representing teachers and other school employees.

The law, which is retroactive, bans anyone convicted of certain crimes from school district employment for anywhere from three years to life. A conviction for stalking, kidnapping, aggravated assault or other child-related crime convictions would result in a lifetime ban.

School workers convicted twice for driving under the influence of alcohol would be barred from working for a school district until three years after completing their sentence.

Those convicted of a first-, second-, or third-degree felony would be barred from working for a school district for 10 years, while those convicted of first-degree misdemeanors cannot be hired for five years.

Keever said the union was concerned about conflicts in wording between the law and the form school employees must fill out. He said the law only requires convictions be reported, while the form asks employees to check “arrested or convicted” or “never been arrested or convicted”.

The teachers’ union was asking school districts not to require employees to fill out the forms until that issue is clarified. Keever said the union’s attorneys were also considering whether to issue a legal challenge regarding retroactive implementation.

“It may be unconstitutional to apply the law retroactively,” Keever said.

The law also requires school employees to inform administrators within 72 hours of fresh arrests or convictions. A school administrator who suspects an employee was arrested or convicted and failed to report it can require the employee to get a background check.

Any worker who refuses to fill out the form must submit a current criminal history record from the state and federal government at the employee’s own expense.

According to People Magazine (yes, I really just quoted People), Top Chef finalist, Morgan Wilson has been indicted on charges of possession and intent to distribute child pornography.

Now, to be fair to the Bravo television network, it looks like the arrest took place after the show was aired last fall.  However, Wilson does hold a job with the Ritz Carlton hotel in Dallas.

So, here’s the question.  Should the hotel have known about this arrest?  Well, he was hired in 2007, so a background check at that time wouldn’t have revealed these charges.  It is, however surprising that the hotel wouldn’t have heard about this before the indictment was announced earlier this month given Wilson’s high profile status.

Okay, so let’s say that the hotel wasn’t aware of the arrest and charges.  What could they have done?  Many organizations are now performing criminal background checks on their employees on a regularly scheduled basis to ensure that nothing has changed since the time of their hiring.  Now, I certainly can’t fault the Ritz for not doing this, since those that do are still in the minority.  Just something to think about though.  In this case, it certainly might have helped keep their name out of the papers.

P.S. Not that the allegations against Chef Robert Irvine for resume fraud were even close to as serious, but this isn’t the first time a television chef has fallen from grace.