background screening: evaluating your screening program


The Basic Truths About Background Screening:Evaluate Your Screening Program (continued)

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6. Best Practice Screening Policies And Procedures

7. Policy And Practice Regarding Taking “Adverse Action” Based On Information Contained In A

“Background Check” 8. The Criteria Used To Evaluate Background

Screening Providers And Background Screening Products/Service


BEST PRACTICES#6

EEOC Best Practices


BEST PRACTICES#6

No Bright Line TestsEliminate policies or

practices that exclude people from employment

based on any criminal record

Written Policy and Procedure

Develop a narrowly tailored written policy and procedures for screening

for criminal records

Regular Non-Discrimination Training

Train managers, hiring officials, and decision-makers about Title

VII and its prohibition on employment discrimination


BEST PRACTICES#6

Identify Prohibited Offenses

Identify the prohibited criminal offenses based on all available

evidenceDetermine Essential

Hiring CriteriaDetermine the specific

offenses that may demonstrate unfitness for performing such

jobs

Identify Essential Job Requirements

Identify essential job requirements and the actual circumstances under which

the jobs are performed


BEST PRACTICES#6

Document the Research

Note and keep a record of consultations and research considered in crafting the

policy and procedures

Document the AnalysisRecord the justification for the

policy and procedures

Determine Relevant Time Period

Determine the duration of exclusions for criminal conduct based on all available evidence


9

BEST PRACTICES#6

Training of StaffTrain managers, hiring officials, and decision-makers on how to implement the policy and procedures consistent with Title VII

Preserve Confidentiality of Applicant

Keep information about the criminal records of applicants and employees confidential (only use it for the purposes for which it was intended).

Inquiry Only About Relevant Criminal History

When asking questions about criminal records, limit inquiries to records for which exclusion would be job related

for the position in question and consistent with business necessity


SUMMARY OF EEOC

GUIDANCE


• Change Your Application And Inquiry • Review Your Authorization/Disclosure• Customize Your Screening Packages Based On

The Functions Of The Positions• Document Your Job Descriptions With Essential

Requirements • Document Your Individualized Assessment And

Decision-making• Support Your Decision/Matrix With

Cases/Science/Statistics• Adjust Decision Criteria• Develop Policy, Implement, Train And

Document


- FCRA Applies But In A Different Way

- EEOC Criminal Guidance Does Not Apply

- HUD Regulations Apply To Public Housing

- Civil Rights Apply To Private Housing

- Upcoming USSCT Cases Re: Disparate Impact

Relevance To Landlord-Tenant Screening


Relevance to Volunteer Screening Practices

- Still Subject to FCRA

- Risks and Damages are Slightly Different


• Risk of Damage to Person or Property (I.E. Sex Offender In Childcare, Fraud in Financial Office, Etc.)

• Resulting Damage to Mission/Brand/Reputation of the Organization

• Risk of Lost Opportunity and Financial Setback For The Organization

• Risk of Defamation, Slander About the Situation

Organizations Must Still Be Aware of and Concerned About:


Our Staff Has Received Training, We Have a Documented Policy and Practice and We

Actually are Satisfying Our Responsibilities Regarding Taking “Adverse Action” Based on

Information Contained In a “Background Check” (or Consumer Report).

ADVERSE ACTION#7"

"


Key Learning Point: Each Employer That Relies on a Consumer Report Issued by a Consumer Reporting Agency to Make an Employment-related Decision Has an Obligation to Notify a

Consumer Prior to Taking an Adverse Action (PRE) and Following Taking an Adverse Action (POST)

ADVERSE ACTION#7

What Is An Adverse Action?• Not Hiring an Applicant• Not Promoting an Employee• Reducing or Denying a Salary,

Title or Position • Terminating an Employee


Pre-Adverse Action• Distinct Procedures For PRE and POST• PRE-ADVERSE ACTION - Before You Take the Adverse

Action, You Must Give The Individual a Disclosure That Includes– Individual's Consumer Report– "A Summary of Your Rights Under the Fair Credit

Reporting Act" (Note: FTC Says This Does Apply to Volunteers)

ADVERSE ACTION#7


How “PRE” Does It Need To Be?

• The FCRA Does Not Specify How Long an Employer Must Wait After The Pre-adverse Action Notice Before Actually Taking Adverse Action.

• According To The FTC, Employers Should “…Keep In Mind The Clear Purpose of The Provision to Allow Consumers to Discuss Reports With Employers or Otherwise Respond Before Adverse Action Is Taken.”

• The Applicant Must Have a Meaningful Opportunity to Review The Information and to Respond.

ADVERSE ACTION#7


Post-Adverse Action• After you've taken an adverse action, you must give the individual

notice — orally, in writing, or electronically — that the action has been taken which includes:– The name, address, and phone number of the CRA that supplied the

report– A statement that the CRA that supplied the report did not make the

decision to take the adverse action and cannot give specific reasons for it

– A notice of the individual's right to dispute the accuracy or completeness of any information the agency furnished, and his or her right to an additional free consumer report from the agency upon request within 60 days.

ADVERSE ACTION#7


One Factor Among ManyIn Any Case Where Information In a Consumer Report Is a Factor In Your Decision — Even If The Report Information Is Not a Major Consideration — You Must Follow The Procedures Mandated By The FCRA

ADVERSE ACTION#7


We Understand The Criteria We Should Use To Evaluate Our Current Background Screening Provider And Our Current

Background Screening Products/Services We Are Receiving From That Provider.

EVALUATION CRITERIA#8


Consumer Reporting AgenciesKey Learning Point: Not All Providers Or Products Are Alike. Over 750 “Screening” Companies. Know The Difference. • Bust The Myth - No Single Source For Original Record Info• Membership Matters - National Association Of Professional Background Screeners (NAPBS), CDIA

Or NCRA Member• Control Matters – “Rent-a-platform And Product” Sales Shop Vs Proprietary Control And Ownership

Of Platform, Products, Operations, Sales, Service• Knowledge Matters - Accreditation /FCRA Certification/Experience• Information Matters - Instant Databases Vs Verified Reporting• Service Matters - Off-shore vs On-shore• Security Matters - Systems Certified? Onshore And Back-up Storage? Physical Buildings

Certified? Home-based Operations? • Compliance Matters - FCRA, EEOC Criminal Guidance, DPPA, State Laws, Etc.



CRA Risk of FCRA Non-Compliance

Main areas of risk for CRAs:

• Consumer dispute process • 613 consumer notice compliance• 604b compliance = “…reasonable

procedures to assure maximum possible accuracy…”


Significant Enforcement and Class Action Activity To date: • Enforced against CRAs who accept

but break the rules • Enforced against Websites and

Apps that (dis)claim the rules


Employer Risk of FCRA Non-compliance

EVALUATION CRITERIA#8FCRA Allows Individuals To

Sue Employers For Damages In Federal Court• Court Costs, Reasonable

Legal Fees• Punitive Damages For Willful

Violations

Federal Trade Commission, Other Federal Agencies,

And The States May Sue Employers For

Noncompliance


Litigation Trends


FCRA Class Action Lawsuits Vs. Employers

Domino’s Pizza - Adverse ActionK-mart – Disclosure/Authorization

Disney – Adverse Action

FTC/CFPB Enforcement Actions Vs. Employers

Quality Terminal And Rail TerminalServices - $77,000 (2009)

EEOC Enforcement Actions Vs. Employers

Pepsi Settlement $3.13 Million (Jan 2012)

Dollar General (Sept 2012)BMW (Sept 2012) – Pending


Litigation Trends (cont’d)EVALUATION CRITERIA#8

FTC/CFPB Warning Letters To Tenant Screeners

(April, 2013)

Blue Chip Group - Donotrento.ComM&R Rental PropertiesBadtenantlistings.Com

Landlord Protection Agency - Thelpa.Com

National Tenant Network - Ntnonline.Com123 Rent, Inc. -

Therentersblacklist.ComTenancy Bureau - Tenancybureau.Us

FTC/CFPB Enforcement Actions Vs. CRAs

(100 Cases With $30m+ In Settlements)Choicepoint, Inc. – 10m (2006)

Choicelevel /Filiquarian – Mobile Application For ScreeningHireright Solutions – 2.6m (August, 2012) – Multiple

FCRA ViolationsSpokeo – $800,000 (June, 2012) Failure To Comply With

FCRAEquifax - $1.6m (October 2012) Improperly Sold Lists Of

Late Mtg PayorsCertegy Check Services 3.5m (2013) FCRA Violations

Intellicorp Records Inc. And Insurance Information Exchange LLC (2013)

Verifications, Inc.


Additional State Law Considerations & FCRA Compliance


MichiganMinnesotaMontanaNevadaNew Hampshire

UtahVermontVirginiaWashingtonWisconsin

Rhode IslandKansasKentuckyMarylandMassachusetts

New MexicoNew YorkOklahomaOregonPennsylvania

CaliforniaConnecticutColoradoHawaiiIllinois


Take Away Points• Employee Screening Best Practices

- Review your compliance based on EEOC enforcement guidance

- Verified reports and quality dispute processing required from your CRA

- Review pre and post adverse action process

- Go beyond criminal records

- Consider probationary period pending screening

• Volunteer Screening Best Practices- Understand the risk of defamation, privacy claims

- Pre and post adverse action process applies

- Order hit verification upfront to increase accuracy and expedite hiring

- Go beyond sex offender registry


Coming Up Next…

Practical Tips for Background Screening

1.800.600.8999 www.trak-1.com

Contact Nancy Roberts directly or talk with Trak-1’s FCRA certified screening professionals and begin – Ruling In The Right People!

background screening: evaluating your screening program

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