The highly unregulated background screening industry has peddled extremely low quality background checks by relying on incomplete databases, limiting the scope of the search to 7 years or not including alias names. Now, there is a fast growing movement to restrict the use of criminal background checks. It is critical that staffing companies understand how to conduct legally compliant criminal background checks that align with: • Ban the Box • EEOC 2012-2016 Strategic Plan • Fair Credit Reporting Act • Social Media Background Checks

1. Warning! How Background Checks Can
Get Your Staffing Agency in Big Trouble
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2. Background
 Founder/CEO Safe Hiring Solutions
 Co Founder/ CEO
 Violent Crime Detective Metro Nashville PD
 2,600 clients
 Provide violence prevention training/ consulting:
 U.S. Dept of Justice
 U.S. Dept of Defense
 U.S. Homeland Security
 Federal Law Enforcement Training Center
 National Sheriff’s Assoc
 Indiana Law Enforcement Training Academy
 Numerous State Attorney General Offices

3. Truth about background screening industry
 Highly unregulated
 Historically low quality product/service
 No standard of care
 Reliance on incomplete databases
 FCRA provides consumer protection but no
standard of care beyond up-to-date information
 Limit reporting to 7 years
 Alias names

4. Why Should You Be Concerned?
 Your Brand Reputation
 Legal Consequences
 Selecting the right screening partner critical
 We can provide integration to your systems
AND provide high quality checks & service

5. Best Practices in Background
Screening
Core Criminal Package
 SSN Verification
 National Criminal
Database
 National Sex Offender
 County Criminal Search
Additional Solutions
 BMV Records
 Federal Criminal Search
 Employment Credit Report
 Child Abuse Registry
 Employment Verifications
 Character Reference
Checks
 eReferenceCheck

6. Due Diligence
 Negligent Hiring Doctrine: If an employer hires someone
that they either knew or should have known was dangerous
or unfit for a position and it was foreseeable that someone
could have be harmed then they could be sued for negligent
hiring. It is the "should have known" that creates problems
for employers.
 Negligent Retention Doctrine: If employer becomes aware or
should have become aware of problems with an employee
who demonstrated unfitness and employer takes no corrective
action (investigating, reassignment or termination). It is not
enough to just screen new hires. Due diligence must be
exercised in an ongoing safe workplace program.

7. 4 Hot Button Areas in
Background Screening

8. #1 “Ban the Box”
 Removes questions on application concerning criminal history
 Removes valuable integrity tool for employers who compare
screening reports against applications
 Theory-
 Ex- offenders being disenfranchised
 Criminal history preventing opportunity to interview
 Does NOT:
 Prevent asking about criminal history during interview
 Conducting criminal background checks
 Numerous municipalities (Indianapolis studying)
 Several bills pending in state legislatures

9. #2 EEOC 2012-16 Strat Plan
 EEOC approved 4/25/12 by
4-1 vote
 Guidance effective
immediately
 No public comment
 Game plan for the EEOC
field offices

10. Guidance replaced:
 1987 EEOC Policy
Statement regarding
conviction records
 Zero tolerance policies
 3 pronged approach
 1990 Policy Guidance on
the Consideration of Arrest
Records

11. Commissioner Constance Smith
Barker Lone Dissenter…
 “Utter lack of transparency”
 “Public has been intentionally
shut out of this process”
 Places a burden on business
owners
 Exceeds the authority for a
regulatory commission
 Not congress
 Not courts

12. Disparate Impact
 EEOC demonstrates the
employer’s facially neutral
policy has disparate impact on a
protected group
 Burden is on employer to show
policy is:
 Job related
 Consistent with business necessity
 EEOC interested in who is
being denied based on
background check

13. Case law…
 Green v. MO Pacific
Railroad (1977)
 Zero tolerance convictions
 3 pronged approach
 El v. SEPTA
 Murder 40 yrs ago
 Policy no violence
 3rd Circuit Ct in favor of
SEPTA

14. Old Guidance…
Employer could demonstrate Title
VII compliance by using 3
factors with background checks:
1. Nature & gravity of crime;
2. Time that has passed since
conviction/completion of
sentence; and
3. Nature of job held or sought

15. New Guidance
Now employers may satisfy Title VII
by using internal policy if it is
“narrowly tailored”
 Not clear what this looks like
 Guidance references “targeted
screens” based on Green factors (3
prongs)
 Allow applicant/employee to
explain the circumstances of the
conviction

16. Guidance list several considerations:
 Facts & circumstances
surrounding the offense or
conduct
 Self reporting from candidate?
 How to verify?
 Evidence candidate performed
same type work, post
conviction, with same or
different employer with no
incidents of criminal conduct
 Employment or character
references

17. Arrest records require further
investigating….
 Arrest alone should NOT be used
to deny employment
 Certain minority groups arrested
at disproportionately higher rates
 FCRA restricts reporting of arrest
records to 7 yrs

18. Considerations….
 Review criminal background screening
policies
 Use of arrest/ non-convictions
 Green 3 pronged test
 Zero tolerance policies

19. #3 Fair Credit Reporting Act
 Yes it does apply even if you don’t use credit info
 FCRA applies if you pay a 3rd party vendor like SHS
 Specific requirements:
 Disclosure & Authorization (written or electronic)
If taking adverse action based in “whole or part” on a
background screening report:
 Pre-Adverse Action Letter, Copy of Report,
Summary of Rights under FCRA
 Adverse Action Letter

20. Willful Non- Compliance of FCRA
Hunter, et al v. First Transit
Inc.
 Failed to provide
disclosures to applicants
BEFORE running
background check;
 Failed to follow two-step
adverse action process
when denied employment
$5.9 Million Settlement

21. Several recent lawsuits for FCRA
violations
 Domino’s Pizza $2.5 Mil
 Running checks without authorization
 Not providing Pre-Adverse Action information
 HireRight
 Allegedly providing inaccurate information
 $2.6 million settlement
 K-Mart $3 Mil for FCRA Violations
Selection of Screening Firm Critical

22. #4 Social Media Background Checks
Be careful….there can be legal implications:
 Discrimination- seeing protected information like
marital status, age, race, etc.
 Privacy- Yes even the internet has a reasonable
expectation of privacy since most sites require
friending
 Authenticity-How do you know it is your candidate?
Common names?

23. Social Media Concerns
 How do you verify information?
 How do you know it is your candidate?
 How do you know that your candidate is not
operating online under an assumed identity?
 21 states have restricted use of social media checks
 Congress HR 537 would make it illegal to ask for
social networking & email passwords

24. Questions?
Mike McCarty
CEO
Safe Hiring Solutions
Danville, IN 46122
317-745-6946
Mike.mccarty@safehiringsolutions.com
www.safehiringsolutions.com