Effective July 21, 2011, Fair Credit Reporting Act (“FCRA”) adverse-action and risk-based pricing notices must disclose any numerical credit score that contributed to the: (1) adverse action; or (2) extension of credit on terms materially less favorable than those available to a substantial portion of customers.

If you are hearing this for the first time, you aren’t alone.  And here’s why most of you shouldn’t care.

These rules only …

Jason B. Morris, President & Chief Operating Officer
Jason Morris co-founded EmployeeScreenIQ in 1999 and currently serves as the company’s President and Chief Operating Officer. Morris is a Licensed Private Investigator in the states of OH, NJ and NV. Morris is a frequent speaker at industry events that focus on background checks, global screening, recruitment and staffing. With over 15 years of experience in employment screening, Morris also serves as an Expert Witness in the areas of background checks, employment screening and the FCRA. He serves as a past board member of the National Association of Professional Background Screeners (NAPBS). Morris was the 2005-2006 Co-Chairman for the organization and remains an active member.

As Co-Chairman of NAPBS, Morris made frequent presentations to government agencies including members of the U.S. House of Representatives and the U.S. Senate. Morris has lobbied on behalf of the screening industry and has consulted with officials from the Federal Trade Commission (FTC), Department of Homeland Security (DHS) and the US Department of Justice (DOJ). Morris’ comments were published on the US Department of Justice website regarding pending legislation on the Federal Register. Active in community and philanthropic causes, he is a current board member of The American Cancer Society, Cuyahoga County. Morris is a criminal justice studies graduate of Kent State University.

Nick Fishman, Chief Marketing Officer and Executive Vice President
Nick Fishman co-founded EmployeeScreenIQ in 1999 and serves as the company’s Chief Marketing Officer and Executive Vice President. Nick oversees all of EmployeeScreenIQ’s sales and marketing activities, including business development and brand building initiatives. Nick is the chief pioneer and architect of EmployeeScreen University, a first-of-its-kind online, educational learning resource for human resource, security and risk-management professionals. He is a frequent speaker on industry issues including: New Technologies in Employment Screening, Best Practices and Industry Trends. Nick is also a frequent blogger on the company’s “IQ Blog”, conducts regular podcast interviews with industry insiders and serves as editor of the company’s quarterly newsletter, The Verifier.

Nick currently serves on the Accreditation Marketing Committee for the National Association of Professional Background Screeners (NAPBS) and has also served as the organization’s co-chair of the Public Awareness Committee. Prior to his work with EmployeeScreenIQ, Nick helped Fortune 500 organizations build their brands through sports sponsorships including the Olympics, the National Football League, NASCAR and Major League Baseball.Nick holds a Bachelor of Arts in Political Science from The Ohio State University and has extensive experience in the development of sales and marketing campaigns for both, large and small organizations.

Kevin W. Bachman, Vice President, Quality Service
Kevin Bachman serves as Vice President of Quality Service for EmployeeScreenIQ. Prior to this role, he served as the Director of Client Relations. Kevin is responsible for overseeing the company’s overall commitment to Total Quality Service. He is a member of the National Association of Professional Background Screeners (NAPBS), serving on the Best Practices Committee. He is a frequent contributor and author of company white papers and other industry trends, seeking to educate clients on proper screening tools and the creation of thorough background check programs. He is active in several charities and strongly supports the American Cancer Society, Meals on Wheels and the United Way. Kevin holds a Bachelor’s of Communications and Master’s in Communications Management from John Carroll University.

CLEVELAND / December 6, 2010 – Discrimination issues, global screening, contractors, credit checks, social networking and a tsunami of legislation headline the 2011 list of top background screening trends from EmployeeScreenIQ.

Since 2007, the global employment screening company has developed an annual list for HR professionals and executives. This year’s trends are designed to equip hiring professionals with advance information on crucial screening topics before they become everyday news.

The top nine trends for 2011 include:
1 – EEOC takes aggressive action toward employment background checks. The Equal Employment Opportunity Commission (EEOC) has increased their scrutiny of hiring practices, exposing employers to a greater risk of discrimination lawsuits. The EEOC is especially targeting “bright line” hiring decisions that automatically exclude candidates with criminal records, arrest records that don’t result in a conviction, and/or poor credit. When adverse information surfaces, employers need to consider the severity of the offense, how long ago it occurred, if the person is a repeat offender and most importantly how closely it relates to the job being filled.

2 – Legislation and litigation deterring the practice of checking credit. The states of Hawaii, Oregon, Washington and Illinois have passed legislation aimed at curbing the use of employment credit reports, with nearly 20 other states proposing legislation. There is also an effort at the federal level (HR #3149) to do the same. A number of existing laws already provide protection for job candidates, but credit checks are becoming a hot button issue and the controversy only looks to intensify.

3 – “Ban The Box” laws take effect. Massachusetts, New Mexico, Connecticut and other states have passed “ban the box” laws that prohibit employers from asking for an applicant’s criminal background on the initial job application. Other effects of these laws involve changes to how long felony convictions will display on a person’s record, as well as the need for employers to have a written criminal offender record policy.

4 – Industry accreditation sets the bar for screening providers. Earlier this year the National Association of Professional Background Screeners (NAPBS) announced a new Background Screening Agency Accreditation Program (BSAAP). Only one percent of employment screening companies have earned this distinction, including EmployeeScreenIQ. Looking ahead, accreditation will serve as an important seal of approval that all companies should look for when choosing a background screening provider.

5 – Reigning in global screening. It’s a pervasive trend: companies establish offshore operations and also transport workers to North America from other countries. As this practice matures, employers must take a strict approach to developing best practices, understanding the individual laws and guidelines of each country and securing universal compliance.

6 – Screening contractors goes mainstream. Once small in number, contract employees have gained a significant presence among companies nationwide—and HR executives who take a hands-off managing approach are setting their company up for big risks. Over two-thirds of companies perform background checks on temporary workers, according to a 2010 survey by EmployeeScreenIQ. However, employers need to apply the same screening processes to temporary workers as they do for permanent employees.

7 – Emerging popularity of self-screening candidate tools. Up to 85 percent of job candidates are subjected to employer background checks, but many have no idea what might turn up. That’s changing with the widespread use of self-screening tools such as EmployeeScreenIQ’s TransparentMe.com service. Now candidates can perform an online criminal background check on themselves, avoiding unpleasant surprises and safeguarding against identity theft.

8 – Congress unveils the Consumer Financial Protection Agency. In July 2011, the new Bureau of Consumer Financial Protection will begin to carry out “consumer financial protection functions” previously done by Federal banking agencies and other authorities. The agency’s powers will extend far beyond mortgages and real estate, including credit reporting agencies in its oversight. It is still unclear how this will play out, but will likely affect any employment background screener that provides credit reports and any employer that uses them and subjects both parties to a dual regulator: the new Bureau and the Federal Trade Commission.

9 – Hiring controversies due to social networking. Social networking has exploded in popularity and employers now use Twitter and Facebook to influence hiring decisions.  However, many sites have no verification process and several can be edited by anyone with access to the Internet—putting companies as risk for violating FCRA (Fair Credit Reporting Act) regulations and EEOC guidelines.

“As the background screening world becomes ever more complex in 2011, HR professionals need to be vigilant in reviewing all the elements of a background check,” said Nick Fishman, chief marketing officer of EmployeeScreenIQ. “Every organization is unique in their hiring needs and practices. Every individual that you consider for employment should be judged on their own merit, strengths and weaknesses, by someone in the hiring organization that can consider the complete individual.”

September 28, 2010

Source: ERE.net

Employee referrals and social media have begun to blend together. Could background checks and social media be next?

A new company called “Social Intelligence” says it’ll “track the worldwide network of social media, including Facebook, Twitter, Flickr, YouTube, LinkedIn, individual blogs, and thousands of other sources.”

Social Intelligence will, within 24-48 hours, produce a report on a job candidate using both automation as well as humans, the latter there to make sure there aren’t “false positives.” It says it will weed out “protected class” information it finds, such as race and religion. The company is also offering a version to monitor what existing employees are up to.

As far as the hiring version, a screenshot, which you can click on to enlarge, shows that the employee profile screens for such things as: ”Gangs,” “Drugs/drug lingo,” “demonstrating potentially violent behavior,” and “poor judgment” — something we could all agree can be found in ample supply on social media.

I asked the company’s CEO, Max Drucker, whether this judgment thing is kind of subjective. “We err on the side of not flagging something,” he says, adding that “serious red-flag issues” are what they’re really looking for. He also notes that the firm has three people review information before the profile’s done. So, “Todd beat Sean in the 600-meter dash” shouldn’t show up as a Todd-beats-people flag. I hope.

Nick Fishman, the co-founder of EmployeeScreenIQ, doesn’t envision his or other similar companies going down the social-media background-checking road. “Not only are they not now, but I don’t foresee getting into it in the future,” he says. “It’s a hornet’s nest.” Awaiting employers in that nest, he says, are FCRA regulations and EEO rules.

More

The FTC has announced that they are proposing revisions to the notices that consumer reporting agencies (such as employment screening firms) provide to consumers, and to users and furnishers of credit report information under the Fair Credit Reporting Act (FCRA).

The proposed changes seek to alter the consent and authorization form needed to conduct an employee check as well as the “Summary of Your Rights” document which must be provided to the job applicants before a background check can be conducted.

See notice from FTC below.

The Federal Trade Commission is proposing revisions to the notices that consumer reporting agencies provide to consumers, and to users and furnishers of credit report information under the Fair Credit Reporting Act (FCRA). The FCRA requires the FTC to publish model notices for several forms that must be provided by consumer reporting agencies. The proposed changes are designed to reflect new rules that the FTC and other financial regulators have enacted under the Fair and Accurate Credit Transactions Act of 2003, and to make the notices more useful and easier to understand.

In addition to revising the general Summary of Rights notice, which informs consumers about their FCRA rights, such as how to obtain a free credit report and dispute inaccurate information in credit reports, the FTC also is proposing improvements to the notices that credit reporting agencies provide to users and furnishers of credit report information. The User Notice and Furnisher Notice inform users and furnishers of their obligation to provide certain protections to consumers. The model notices were originally issued in 1997 and revised in 2004. The FTC is accepting public comments on the proposed changes until September 21, 2010. The Commission vote authorizing the Federal Register notice was 5-0. (The staff contact is Pavneet Singh, Bureau of Consumer Protection, 202-326-2252.)

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,800 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics.

When was the last time you heard these urban legends?

• “If we eat pop rocks and then drink a coke, our stomachs will explode!”
• “Elvis seen eating a Big Mac!”
• “If you stretch your face out to make funny faces, it will stay that way!”

In honor of these and many more, we present the 5 urban legends of employment background checks.

1. “I hear everyone uses credit reports to make hiring decisions. I should too.”

Because the word “credit” is included in the name of the federal law that governs the background check process, clients and applicants often think a “credit check” is automatically part of it. In reality, recent research shows credit reports are ordered on only 10% to 20% of background checks. We recommend clients consult with their legal counsel to determine the necessity and job relatedness of a credit check before ordering one.

For an in-depth review of this issue, check out our most recent white paper, Credit Reports and the Hiring Process: The Value (and Risk) to HR Professionals

2. “These new database products I hear about are great!”

Employers are bombarded with offers for cheap database products that promise background check results in seconds. However, these “databases” are simply compilations of information bulk purchased from a hodgepodge of sources across the country. There is no promise they are accurate, complete or up to date. This hit and miss product is not considered a compliant product under the Fair Credit Reporting Act. Employers that rely on these as the sole source of their criminal screening program expose themselves to much more risk that a client who orders the accurate, FCRA-compliant services recommended by EmployeeScreenIQ.

However, they can serve a purpose. For more on how National Database Searches can help your screening effort, check out, Background Screening Paradigm Shift: Time to Embrace Database Search?

3. “My applicant’s data is secure. Right?”

Off shoring data to complete the background check is an emerging trend among background screeners. What does this mean? The background check you ordered may not be done by the background check company who sold you their services. Privacy laws, data protection, secure storage of personally identifiable information. The standards you wish to uphold when trying to protect your applicant’s confidential information? They may not be followed when your background check company hands the process off to someone else. EmployeeScreenIQ does not offshore any confidential data.

For more information on data security check out EmployeeScreenIQ’s Privacy Policy

4. “I don’t bother with employment verifications. Everyone says companies don’t provide anything!”

Most clients do not order employment verifications, but you don’t know what you’ll get until you ask! EmployeeScreenIQ’s team of background specialists receives dates and title 93% of the time and gets a “full” verification 50% of the time. Dates of employment, salary, title, reason for leaving, and rehire eligibility! Almost always, EmployeeScreenIQ clients who order this service receive information and half the time they get everything they could want from their candidate’s previous employer.

5. “I called his references. He sounds great!”

This goes hand in hand with the reluctance to order employment verifications. We recommend our clients take the opposite approach. Always order employment verifications before reference interviews. It gives you more value for your money. Think of it like this. How many bad reference interviews do you see? Candidates want a job, so they will only provide references who think they’re the greatest thing since the printing press. Please let me know if you have a company full of “greatest thing since the printing press” employees. Seriously. We’re looking to hire.

Kevin Bachman is Vice President of Quality Service for Cleveland-based EmployeeScreenIQ, a best practices provider of pre-employment screening services throughout the U.S. and worldwide. Kevin can be reached at (800) 235-3954 ext. 450 or by email at kbachman@employeescreen.com.

June 28 presentation will examine emerging trends and explain how recruiters and HR professionals can protect their companies in the age of Facebook

Cleveland (PRWEB) May 18, 2010 — Jason B. Morris, president and COO of EmployeeScreenIQ, will speak about the dangers of using social networking sites to screen job applicants at the 2010 SHRM Annual Conference and Exhibition in San Diego, Calif.

“Social Networking Sites: Can You Always Trust What You See?” is the title of the presentation, which will take place Monday, June 28, at 4 p.m. (PST) at the San Diego Convention Center. The 75-minute session will highlight a variety of emerging employment screening trends with a focus on the use of social networking sites to conduct background checks.

“The social networking revolution has changed many communication channels. Web sites such as Facebook, My Space, Twitter and LinkedIn contain a wealth of personal information, but many recruiters place their blind trust in the information found on these sites,” said Morris. “In many cases, this poses a threat to violation of the Fair Credit Reporting Act (FCRA) and EEOC guidelines and other regulations.”

Morris’ session will explain how recruiters and HR professionals can protect their company in the age of Facebook. Attendees will learn which social networking sites are most popular with recruiters and applicants, their impact on employment screening and the hiring process, and how to develop a social media policy. Finally, Morris will examine other Web 2.0 trends such as the rampant use of “diploma mills” and the emergence of phony online job reference sites known as “employment mills.”

The annual SHRM conference typically draws about 12,000 professionals in the HR and benefits space. This year’s keynote speakers include Al Gore, former vice president and the world’s leading voice of climate control, and Steve Forbes, president and chief executive officer of Forbes, Inc. and editor of Forbes magazine.

For more information on the conference, including speakers, exhibitors and registration, visit http://annual.shrm.org/.

View Full Release

EmployeeScreenIQ’s Jason B. Morris will be speaking at the 2010 SHRM Annual Conference and Exhibition in San Diego, CA at the San Diego Convention Center on June 28, 2010 at 4:00 pm pst.

Social Network Sites: Can You Always Trust What You See?

Workplace Application: This presentation will highlight a variety of emerging employment-screening trends with a focus on the use of Social Networking Sites to conduct background checks.

The social network revolution has changed many communication channels, but should it affect the way job applicants are screened? Sites such as Facebook, My Space, Twitter and LinkedIn contain a wealth of personal information, but should you trust the information found on these sites? Does this practice pose a threat to possibly violating FCRA and EEOC guidelines and other best practices?

Join EmployeeScreenIQ’s President and COO Jason Morris for an informative session about how to protect your company in the age of Facebook.  You’ll learn which social networking sites are most popular with recruiters and applicants, and their impact on employment screening and the hiring process.  Attendees will also learn how to develop a social media policy and spot the warning signs of diploma and employment mills.  Finally, you’ll examine other Web 2.0 trends such as screen scraping and instant screening.

SHRM Conference Sessions

It might seem like a no-brainer these days that employers are mandated by the Fair Credit Reporting Act (FCRA) to obtain an applicant’s written consent to conduct an employment background check.  And by and large we find that most employers are aware of this.  But have you taken a look at your release lately and wondered if the form that was created for you 10 years ago is still working for your organization?

Defining the Scope

The applicant release is designed to notify your candidate that you and, or your background screening provider will be performing a background check to determine if they are eligible for hire.  The release should include the scope of the search.  Most companies opt for a more generic scope, while others will specifically detail exactly what will be searched.  An example of a generic scope would be the following:

You may be the subject of a “consumer report” and/or an “investigative consumer report” which may include information about your character, general reputation, personal characteristics, driving record, and/or mode of living, and which can involve personal interviews with sources such as your current and past employers, friends, or associates.

Now, upon consent you as the employer may not choose to exercise your right to request all of the information detailed above, but the fact that you have included it allows you to do so if you deem it appropriate or germane to the candidate.

Other companies choose to include specific language about what will be checked which is fine, however unless they modify the language, the scope of their search should never include other information.

What if I want to Re-Screen the Candidate or Conduct Another Check Throughout Their Employment?

If you want to avail yourself of this option, and most companies do, you must include it in the applicant release.  Otherwise, you’ll have to get a new consent form each time you want to run a background check.  This can be pretty awkward with existing employees, particularly if you want to conduct the check because you have reason to believe there might be some adverse information out there.  An example of language that allows for this is below.  Once you have the authorization signed, just rinse, lather and repeat.

These reports may be obtained at any time after receipt of your authorization and, if you are hired, throughout your employment.

Notifying Applicants of Their Rights

Of course protecting ourselves by protecting our applicants is in everyone’s best interest.  A good release will ask the candidate to acknowledge that they have received a notice that a background check will be conducted (aka the release you are asking them to sign).  And if you plan to utilize employment and, or education verifications and, or reference interviews (these services are part of what is referred to as an “Investigative Consumer Report”), you should also provide them with a copy of a document called “A Summary of Your Rights Under the FCRA” and have them acknowledge receipt as part of your release.  Even if you do not choose to conduct an Investigative Consumer Report, it might make sense to include the language and give them the notice, just in case your policies ever change.  Again, this will save you from having to obtain a new release if you choose to utilize these services at a later date and time.

Does My Release Comply with Individual State Laws?

True, the FCRA is the federal law that governs the use of employment background checks and in almost all cases, it is the prevailing law that defines a consumer’s rights.  However, when it comes to applicant releases there are some state laws that supersede the FCRA.  The following states mandate that you notify the consumer of these specific rights:

• New York- You must inform the applicant that they have a right to inspect and receive a copy of their investigative consumer report by contacting the screening company directly.
• Minnesota and Oklahoma- You must notify the candidate of their right to request a copy of their consumer report and allow them to do so on the applicant release document.
• California- See requirements for Minnesota and Oklahoma.  Plus, you must give the applicant “Notice Regarding Background Investigation Pursuant to California Law” (see page four of sample release) and have them acknowledge that they have received it.

That begs the question, “Do I have to have separate applicant releases for each of these states?”  The answer is yes and no.  First, you can consolidate all of these notices in one nice and neat release form.  If for some reason you do not want to do this, then yes, you would have to create separate release documents for candidates in these states.  The benefit of having one seems fairly obvious, plus it takes the chance of having the wrong release executed out of the equation.

Just A Few More Things:

• The applicant release should never be a part of the job application.  It can be presented at the same time, but must be its own separate document.
• Many wonder if it is acceptable and, or legal to ask for the candidate’s date of birth on the applicant release.  The answer is yes.  You will need that information in order to conduct a complete and accurate search.
• This release should be kept on file for the duration of an employee’s tenure with the company.  It is generally recommended that employers should keep the release on file for 5 years following the employee’s termination.  If the individual is not hired, the release should be kept on file for a minimum of two or up to 5 years.

As you can see, there is a lot of information to weigh in determining if your company’s applicant release needs updating.  These are all good starting points for you to consider as you build your authorization, but above all else you should work with your legal counsel to determine the final product.

And in the spirit of compliance, I have to include the following language which proves that I am not a lawyer; I just play one on TV.

EmployeeScreenIQ is not providing legal advice or counsel and nothing provided on this website or otherwise by EmployeeScreenIQ should be deemed as legal guidance or advice. Users are solely responsible for complying with all local, state, and federal laws relating to the use of any information provided on this website and any information products provided by EmployeeScreenIQ. Users should consult with their own legal counsel if they have questions regarding their legal responsibilities or any information provided by EmployeeScreenIQ.

Nick Fishman is Chief Marketing Officer for Cleveland-based EmployeeScreenIQ, a best practices provider of employment screening services throughout the U.S. and worldwide. Nick can be reached at (800) 235-3954 ext. 441 or nfishman@employeescreen.com.