employers think that background screening is complete once a person is hired
and starts working, but they are mistaken. Many employers have learned the
hard way that even an employee who starts with a clean record can turn in a
different direction somewhere down the line. Read the article below to
learn more about this risk. A more comprehensive examination of the
issues involved when screening an individual’s background is available for
purchase at www.HRTutor.com, an
e-commerce affiliate of The Human Equation.
Why Background Checks Should Never End
By W. Barry Nixon,
National Institute for the Prevention of Workplace Violence
tools are becoming available that will help businesses be informed about
their employees as it relates to professional licenses, certifications,
driving records, criminal convictions, immigration status, etc. Having this
information will help firms make better decisions that will mitigate the risk
associated with many employment decisions including promotions, transfers, etc.
and whether employees continue to qualify for the position they hold. This
will be an important weapon in every business’s arsenal as it will help
prevent many negligent retention lawsuits.
The good news
is that these tools, known as Infinity Screening or Continuous Post-Hire
Screening, have been deemed the "next big thing" in
background screening. The bad news is that businesses should be aware that
implementing an Infinity Screening Program must be given a considerable
amount of forethought to address the trail of legal requirements, human
resource, and employee relations issues. In addition, firms must carefully
consider a myriad of other issues to ensure not only consistent employee
practices, but also that decisions are made that are congruent with the
firm’s culture and human resource philosophy. To ignore this reality will
only lead to future employee relations issues that could have been avoided
with forethought and planning.
Should Firms Consider Implementing an Infinity Screening Program?
First and foremost, infinity screening presents firms with the opportunity to
better manage the risk associated with employees. Too often businesses make
faulty assumptions when they hire a new employee. They presume that because
the person starts a job with a clean criminal, credit or driving record that
this means the person's record will remain this way. Many firms have learned
the hard way that somewhere down the line this same employee who started with
a clean record turns in a different direction. Regular background checks are
the only way an employer can know of changes in employees’ status that may
have a negative impact on the company. Some firms have relied on voluntary
reporting, but this has not worked for obvious reasons.
the negative exposure can take the form of fraud, theft of information and
property, workplace violence, embezzlement, etc. and can have a significant
cost impact on the business. The following illustrates some of the potential
- Employees are responsible
for approximately 60% of losses due to fraud, information and property
- U.S. organizations
lose an average of 6% of their revenues to all forms of occupational
fraud according to the Association of Certified Fraud Examiners.
The cost of fraud from such things as employee espionage or identity
theft is estimated around $6 billion annually.
- The number of
workplace violence homicides has actually decreased over the last
several years, however, horrific incidents continue to happen and cause
tremendous suffering and financial burden on employers. Researchers from
the National Institute for Occupational Safety & Health (NIOSH)
estimate that the average cost of a workplace homicide is
- Negligent hiring
lawsuits that result in a jury trial cost, on average, over $3 million
to employers that lose, while cases settled prior to trial are running
around a half million dollars.
managing risk, the management of a business has a fiduciary responsibility to
appropriately manage and protect the assets of the business. It must
ultimately determine the company's appetite or tolerance for risks - those
risks it will take and those it will not take in the pursuit of its goals and
objectives. Once the level of risk that a firm is willing to accept has been
determined it is management’s responsibility to ensure that the company
implements an effective and ongoing process to identify risk, define the
potential impact and then to activate what is necessary to proactively manage
screening helps to manage risk because having current information on
employees positions you to make proactive decisions versus being caught
off guard in a reactionary position. In other words, Post-employment
screening allows employers to keep ahead, quantify their risk, know where and
in whom their risk lies, and most importantly, it helps with the management
of risk. For example, if you have a driver who delivers products to your
clients and through an infinity screening process you find out he has been
convicted of driving while intoxicated you can make a decision regarding
continuing to allow that person to deliver your product. Without this
information being brought to your attention you could have faced a situation
where the driver has an accident while making a delivery and seriously
injures someone. You then find out he is driving on a suspended license and
has been convicted of a DUI. This is not a pretty picture or a situation that
will make you or your attorney happy since it likely to lead to the company
getting sued for negligent retention.
retention is the legal doctrine that has evolved out of numerous court cases.
The underlying premise of negligent retention is that if an employer is aware
of a problem or should have been aware of the problem and did not take
reasonable actions to address the situation then the employer can be held
liable for their employees’ actions. This concept has been applied to a wide
array of employment situations. To go back to the delivery driver example
identified above, in court, several questions are likely to be raised:
- Is it reasonable to
expect that the company should have been aware of their employee’s
- Were there
reasonable steps that the employer could have taken to have had current
information on their employee’s driving record?
- If they had been
aware of it what action would they have likely taken?
cannot speculate on the decision that a jury might make in this type of
situation you can clearly see where this line of questioning is leading. We
believe that firms can avoid this situation altogether by staying informed
about their employees' records through infinity screening.
screening reduces the risk of a bad hiring decision, post-employment
screening reduces the risk to which a company is exposed over the long term.
These are the actions that a responsible employer should be aware of in their
workforce and may become a new standard for judging if an employer took
reasonable steps to provide a safe work environment.
we have discussed risk it is important to mention the legal issues associated
with infinity screening. Most firms are well aware that the primary
legal requirement for conducting background screening is defined by the Fair
Credit Report Act (FCRA) as amended by FACTA, and this is equally true for
infinity screening. FCRA provides the requirements for using Consumer
Reporting Agencies, which includes background screening firms, however, if a
business does its own background screening using internal staff and does not
use a consumer report in any part of their process they do not have to follow
the FCRA requirements. Although this may be the case, we strongly encourage
businesses to still follow the FCRA requirements to avoid even the appearance
of unfairness and also to place themselves in a rock solid position should
their process get challenged.
In addition, there are several industries where ongoing screening has become
a legal requirement. Medical and healthcare facilities are typically required
to make sure that medical licenses and certifications are current and meet
established standards. The U.S. Department of Transportation (DOT) oversees
drug and alcohol testing programs on mandated employees. The DOT requires employers
to conduct a pre-employment drug test and obtain a two-year drug/alcohol test
history. Additional regulations set forth by the DOT require employers to
monitor their employees on an ongoing basis. DOT employers who fail to
conduct this screening are subject to penalty fines. Section 19 of the
Federal Deposit Insurance Act prohibits any person who has been convicted of
any criminal offense involving dishonesty or breach of trust or money
laundering, or has agreed to enter into a pretrial diversion or similar
program in connection with a prosecution, from becoming or continuing as an
institution-affiliated party; owning or controlling, directly or indirectly,
an insured institution; or otherwise participating in the conduct of the
affairs of an insured institution without the prior written consent of the
FDIC. Banks and brokerage firms have their guidelines as well.
Considerations in Implementing an Infinity Screening Program
Comprehensive Background Screening Policy
very important to set the overall framework for your pre-employment and
post-employment screening process in a comprehensive policy that provides
clear guidance to all.
of the important areas that the policy should address is to classify jobs on
the basis of their sensitivity or the risk factor that is associated with a
specific job. In this context, risk refers to the risk of an incumbent being
able to commit fraud, embezzlement, steal confidential information or
property, etc. For example, a Chief Financial Officer who has signature
authority for up to $100,000.00 has a greater risk factor than a receptionist
who cannot approve any expenditures. This is important because the greater
the risk the higher the sensitivity of the job and therefore, the greater the
precautions the employer should take, such as regularly checking the CFO’s
credit and criminal record. Unfortunately, "very few employers tailor
the background information they collect to the requirements of the job,"
says Lewis Maltby, president of the nonprofit National Workright Institute.
staff and sub-contractors
from permanent employees, companies need to be especially aware of outsourced
staff, or sub-contracted companies (e.g. cleaners, guarding companies and all
personnel who come onto a company's premises). As part of service contracts,
companies should be insisting on ongoing screening as part of service level
agreements. These individuals pose as much a risk as any permanent staff
member and very often are even more of a potential threat with unrestricted
access to all areas and after-hours servicing. For example, consider the
unsupervised access that night cleaning crews have to your facilities.
EEOC guidelines regarding the use of criminal records to not automatically
disqualify an individual from consideration without a legitimate business
reason for doing so, also apply to current employees as do restrictions on
use of arrest records.
Privacy and Monitoring
A policy needs to be very clear regarding not creating an ‘expectancy of
privacy’ and openly communicating to employees about how the firm intends to
monitor their records in areas to be covered (e.g., criminal records,
licensing, etc.) based on the nature of the responsibilities assigned to
specific job function and the qualifications for the job.
Employers must ensure that such checks are done with consent. Ensuring that
employees are given proper notice is a very important part of positioning
your firm to be able to act at a later date should something go awry with the
employees records. It should also be noted that having the traditional
statement that ‘omission of information or giving false statements is grounds
for termination’ may not be sufficient to address the consent issue.
Notification and Appeal Rights
Employees must be given proper notice, the right to challenge incorrect
information, and a reasonable time period to provide correct information.
This raises a question that deals with should the employer grant the employee
time off to rectify or bring in correct records; with pay or without pay?
to information should be tightly controlled for improper viewing, use of
information and to avoid ‘tainted’ views of the employee creeping into
Should You Take Action?
probably one of the most challenging issues related to infinity screening –
defining when to act on the information that is discovered and what is an
appropriate action to take. One option is to put in place a Background
Screening Review Committee composed of a Human Resource Manager, Security
Manager and Legal Counsel with the charge to oversee decision-making
regarding ‘adverse actions’ based on learning about derogatory information.
The intent of this committee is to provide an objective body to review the
totality of the circumstances surrounding a situation and to apply a
consistent framework to how decisions are made.
screening is an idea whose time has come. Businesses should embrace this
opportunity to be able to further manage their risk by being able to identify
potential problems in a proactive manner. In addition, having current
information in employee records positions a business to be able to make
decisions not only to reduce risk, but also to ultimately create a safer
workplace. While it is a well known premise that “knowledge is power,” in
this case we know that having the right information at the right time can
empower businesses to better manage all of their assets to improve overall
"Post-Employment Screening: A Risk Management Tool," Kristen
Halcrow, Employers' Mutual Protection Services, Johannesburg, South Africa.