presents pre-employment background screening: leg al...

presents

Pre-Employment Background Screening: Legal Pitfalls

presents

gAvoiding Discrimination and Fair Credit Reporting Act Claims

A Live 90-Minute Teleconference/Webinar with Interactive Q&A

Today's panel features:Rod M. Fliegel, Shareholder, Littler Mendelson, San Francisco

Robert Pickell, Senior Vice President of Customer Solutions, HireRight, Inc., Irvine, Calif.Shawn Bushway Associate Professor University at Albany Albany N YShawn Bushway, Associate Professor, University at Albany, Albany, N.Y.

Wednesday, September 8, 2010

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Pre-Employment p yBackground September 8, 2010

ScreeningL l Pitf llLegal Pitfalls

4

Rod Fliegel, Esq. Littler Mendelson, P.C.

Robert PickellHireRight Inc HireRight, Inc., Irvine, CA

Prof. Shawn BushwayUniv. at Albany

September 8, 2010

5

AgendaAgenda

I t d ti t B k d R tIntroduction to Background Reports– Rob Pickell, HireRightg

Legal Overview– Rod Fliegel, Littler

Latest ScholarshipLatest Scholarship– Prof. Shawn Bushway

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Background ReportsBackground Reports

Rob Pickell, SVP Customer Solutions HireRightSolutions, HireRight

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A “Typical” Background ReportReport

Privileged and Confidential 8

Background Report OverviewBackground Report OverviewEach individual background report Sample Screening ServicesEach individual background report

is a factor of:• The specific details of the individual being

screened

Sample Screening Services• County, State & Federal criminal records

• National criminal database records

• International criminal records searches

S Off d R i t S h• The unique combination of services

requested for the screen

Services selection driven by

• Sex Offender Registry Searches

• Address History Search

• Social Security Number Validation

• Employment Verifications

• Education Verificationsspecific requirements

• Industry specific issues

• Position and compensation

Education Verifications

• Credit History

• Motor Vehicle Records Checks

• Commercial Drivers License Checks

• Professional License Verification

• Company policy

• Government regulations

• Geography

• Professional Credential Verification

• Professional Reference Checks

• Civil Court Records Searches

• Military Record Verification

Individual service results may vary based on supplier specific factors

• International Background Checks

• Drug and Health Screening

• National Theft Database 9

Producing a Background R p tReport

HireRightEnterprise™Enterprise™

HireRightExpress ™

Pre-IntegratedSolutionSolution

EmploymentApplication

SolutionSolution


Background Screening S l tiSolutions

HireRight Enterprise™• Unified solution for global organizations• Complete program visibility• Configurable to client-specific policies

HireRight Enterprise™

• Integration with HR applications• Extended workforce functionality • Comprehensive compliance features

• Easy-to-use solution for small businesses• Built around best practices and standards

HireRight Express™

• No configurability or customization• Pay as you go, credit card payment• Basic services and searches


2010 Screening Practicesg

HireRight produces annual benchmarking HireRight produces annual benchmarking report

Provides relevant information for comparing Provides relevant information for comparing policies, programs, and practices

– Helps organizations to advance their screening programs

• Identifies strengths and weaknesses

• Highlights process improvements

• Supports change management

– More than 1,800 persons from organizations of all sizes and industries participatedp p

– www.HireRight.com/benchmarking12

Almost All Respondents Screen p

J t th t f Just three percent of organizations continue to ignore screening

– 92 percent require background screening

– 73 percent require drug 73 pe ce equ e d ug or alcohol testing

– 28 percent utilize the DHS E-Verify systemy y

E-Verify is rapidly growing post-hire

screening practicescreening practice

*Source: 2010 HireRight Benchmarking Survey n=1800 13

Screening Coverage by Worker T pType

Almost all potential Almost all potential regular hires are screened

– Two-thirds of contingent works not screened

– Existing employee recurring screening holding steady at 16 percent

Large gaps still exist in screening program

coverage


Screening Policy Applied C i t tlConsistently

Organizations often screen their entire workforce similarlyy

– Some organizations vary their screening by role or other factor

– Becoming more important due to regulations

Job title & pay levels becoming factors in determining optionsdetermining options


Active Evolution of Screening PPrograms

Organizations regularly refine their screening programsp g

– Almost one in four frequently make refinements or improvements

– Only 1 in 20 report a static programp g

Frequent program modifications

becoming prevalentbecoming prevalent


Key Screening Program Challengesy g g g

F t l t d t d Factors related to speed are the most challenging aspects of screening

– Screening faces new challenges: furloughed courts, response time challenges for verifications

– Policy deployment and compliance management top issues after time-to-hire

Time-to-hire issues are top program challengeschallenges


Most Report Adverse Rates of <10%<10%

Adverse rates of <10% typical– Almost 30% report higher

adverse rates

– Nine percent average adverse rates reported on drug or alcohol tests

– Seven percent average adverse rates reported on employment eligibility verifications

Adverse rates reported consistent

with 2009with 2009


Candidate Misinformation Highf g

On average, 10% of applicants provide untruthful information

– 70% of resumes have misinformation (as reported by respondents)p )

– Employment and education validation clearly critical

Conflicting evidence on whether false

information increasing


Legal OverviewLegal Overview

Rod Fliegel, Shareholder, Littler

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The Legal LandscapeThe Legal Landscape

“I f t t L ”“Infrastructure Laws”(e.g., the Fair Credit Reporting Act or "FCRA")

“Decision Making Laws” Decision Making Laws (e.g., Title VII of the Civil Rights Act of 1964)1964)

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Summary of Key PointsSummary of Key Points

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Purpose of FCRA(15 U S C § 1681 t )(15 U.S.C. § 1681 et seq.)

Fi t d i 1970 i il t dd First passed in 1970 primarily to address issues involving credit

Regulates the activities of:1 "C R ti A i " (CRA )1. "Consumer Reporting Agencies" (CRAs)

2. "Users" (e.g., employers)

3. "Furnishers" of consumer information

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FCRA ComplianceFCRA Compliance

1 Obt i i f d t f th CBC 1. Obtain informed consent for the CBC from job applicants and employees

2. Issue "adverse action" letters if the CBC will result in disqualificationwill result in disqualification

3. Secure destruction of consumer information

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State Law 7-Year RulesState Law 7 Year Rules

A d d FCRA d t t i t CRA Amended FCRA does not restrict CRAs from reporting any conviction records

Various state FCRA laws prohibit CRAs from reporting even conviction records from reporting even conviction records that pre-date the background check report by more than 7 yearsreport by more than 7 years– State law prohibitions vary considerably

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Title VII(42 U S C § 2000 )(42 U.S.C. § 2000e)

P hibit i t ti l di i i tiProhibits intentional discrimination

Prohibits discrimination resulting from o b s d sc a o esu g o the effect of neutral policies or procedures ("disparate impact")procedures ( disparate impact )– Griggs v. Duke Power Co., 401 U.S. 424 (1971):

“Wh t C h d d i th t “What Congress has commanded is that any tests used must measure the person for the j b d t th i th b t t ” job and not the person in the abstract.”

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P hibit i t ti l di i i ti Prohibits intentional discrimination – EEOC takes the position that if an employer p p y

screens applicants based on criminal records, the employer must consistentlyapply its standards

• Courts give “deference” to but are not bound by g ythe EEOC’s position

• EEOC can initiate (and has initiated) lawsuits

27


EEOC has stated that conviction basedEEOC has stated that conviction-basedscreening policies disproportionately disadvantage minoritiesdisadvantage minorities– Blanket disqualification greatly disfavored– Must be supported by "Business Necessity"– Three factor focusThree factor focus

• Conviction type• Conviction date• Conviction date• Job duties 28


EEOC' d h i iEEOC's renewed emphasis in:– "Systemic Discrimination" Initiative

– "E-RACE" Initiative• E-RACE = Eradicating Racism And Colorism

from Employment

– EEOC’s Revised Compliance Manual (Race and Color Discrimination section)(Race and Color Discrimination section)

– New Enforcement Guidance: Pending

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i i i iCommission Meeting in 2008– Noted the need for updated enforcement guidance– Testimony from Prof. Deva Pager and others

• Some evidence that, after 6-8 years, risk young ex-offenders will be rearrested for a new crime similar to offenders will be rearrested for a new crime similar to risk of member of general public will be arrested

• Ex-offender half as likely to receive a call-back or a j b ff l ti t ll lifi d ff djob offer relative to an equally qualified non-offender

• Evidence that the effect of a criminal record was much larger for African Americansg

30

Disparate Impact Update

El SEPTA 479 F 3d 232 (3 d Ci 2007)

Disparate Impact Update

El v. SEPTA, 479 F.3d 232 (3rd Cir. 2007):– Plaintiff sued for disparate impact

– Rejected based on violent conviction from 40 years ago

– Employer rejected all felons

– Trial court judge agreed policy had a disparate j g g p y pimpact, but still threw case out without a trial

– Circuit Court affirmed summary judgment for SEPTA

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Disparate Impact UpdateDisparate Impact Update

3 d Ci it' 2007 i i i El3rd Circuit's 2007 opinion in El:– First thorough analysis of the Business Necessity

defense in the context of conviction-based screening policies in years

– Circuit Court very skeptical that 40 year old conviction was a meaningful predictor of risk

L l t d d S i li t " t l " – Legal standard: Screening policy must "accurately" distinguish between job applicants who pose a risk and those who do not based on empirical evidenceand those who do not based on empirical evidence

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State EEO LawsState EEO Laws

State co nterparts to Title VIIState counterparts to Title VII

Specific ex-offender protections– Workplace posting and notice obligations

– Sequencing restrictions (when an employer can ask questions)

– Inquiry restrictions (what an employer cannot ask b t/ id )about/consider)

– Source restrictions (what an employer cannot access)

– "Job-relatedness" requirements (what discretion an employer has to screen out applicants) 33

General PrinciplesGeneral Principles

N li t hi i l i hi h thNegligent hiring claims hinge on whether:– The employer knew or should have known p y

that the ex-offender, if placed in the specific job, posed a foreseeable risk of harm to others based on his prior crimes

– The crime against the plaintiff was reasonably The crime against the plaintiff was reasonably foreseeable from the ex-offender's prior crimes

34

General PrinciplesGeneral Principles

The foreseeabilit of the harm anal sis looks to The foreseeability of the harm analysis looks to whether the current crime resembles the prior crime such that the employer was on notice of crime such that the employer was on notice of the potential risk based on the employee’s propensity for the particular type of criminal propensity for the particular type of criminal behavior

M t l i f bilit did t Most cases analyzing foreseeability did not consider at all the age of the conviction at the ti f hitime of hire

35

Barton v. Whataburger (TX, 2009)2009)

Emplo ee killed d ring botched robber b Employee killed during botched robbery by manager and co-conspirator

CBC on manager at time of hire– One-county search going back 7 years

CBC reported back “clear”

Manager had a 9 ear old felon con iction for Manager had a 9 year old felony conviction for dealing cocaine and a recent felony conviction for non payment of child supportfor non-payment of child support

36


Held no causation because the manager’s Held, no causation, because the manager’s participation in an aggravated robbery leading to murder was not reasonably foreseeable from his yprior crimes

– Selling cocaine and failing to pay child support do g gnot “inherently require” violence or theft, “essential ingredients of aggravated robbery

Noted that criminal courts have acknowledged the “street-level” connection between drugs, weapons and violence but rejected this “stereotypical connection” violence, but rejected this stereotypical connection as a basis for finding foreseeability 37


Interesting is the dissent from the order den ing Interesting is the dissent from the order denying en banc review– Emphasized testimony from the plaintiff’s expert that industry

standard required a CBC for all counties of residence

– Whataburger limited the CBC due to costWhataburger limited the CBC due to cost

– Whataburger’s supplier had earlier noted it could easily and cheaply expand the CBC

– Rejected description of the connection between drug dealing and crime as merely “stereotypical,” saying it is “quite real”

Reasonable to infer that drug dealer may be willing to commit – Reasonable to infer that drug dealer may be willing to commit other crimes for financial gain

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Summary of Key PointsSummary of Key Points

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Latest ScholarshipLatest Scholarship

Prof. Shawn Bushway,

Univ at AlbanyUniv. at Albany

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OverviewOverview

Ri k di ti i i i l Risk prediction common in criminal justice/criminology

New research responding to question of “time to redemption” for employerstime to redemption for employers

Ex-offenders do become redeemed– Research not refined enough to give

actuarial tablesac ua a ab es41

Social Science ResearchSocial Science Research

R idi i /D i t Recidivism/Desistance – Gendreau, Paul, Tracy Little, and Claire Goggin. 1996. A

meta-analysis of the predictors of adult offender recidivism: What works! Criminology 34:575-608.

D A Andrews James Bonta and J Stephen Wormith – D. A. Andrews, James Bonta, and J. Stephen Wormith (2006). The recent past and near future of risk and/or need assessment. Crime & Delinquency 52: 7-27.

– Committee on Community Supervision and Desistance from Crime, National Research Council (2007) Parole, D i t f C i d C it I t tiDesistance from Crime and Community Integration

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Key PredictorsKey Predictors

AAge– At time of most recent offense

– At time of first offense

C i i l i dCriminal History Record– Number of prior convictionsp

– Time since last conviction

– NOT crime type43

Age Crime Curve

44

Trajectories Not P d t i dPredetermined

D i f t ttDynamic factors can matter– Social control (John Laub, NIJ Director)( )

• Employment

• Marriage• Marriage

– Cognitive Behavioral • Pro-social orientation

• Perspective on future

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Social Science Meets E pl t S iEmployment Screening

Expert Testimony in El v. SEPTA (p.29)“it is impossible to predict with a reasonable it is impossible to predict with a reasonable

degree of accuracy which criminals will recidivate”recidivate

“ someone with a conviction for a violent crime is more likely than someone without one to is more likely than someone without one to commit a future violent crime irrespective of how remote in time the conviction is”how remote in time the conviction is

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Skeptical ResponseSkeptical Response

Thi i t t th t i d th t This is not to say that we are convinced that SEPTA’s expert reports are ironclad in the

b t t H d h (El) hi d t abstract. … Had he (El) hired an expert who testified that there is time at which a f i i l i l lik l former criminal is no longer any more likely to recidivate than the average person, then there would be a factual question for the jury to resolve (El v. Septa, 2007, p.34).”

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Question = ResearchQuestion Research

R h i C i i l J ti S tResearch in Criminal Justice System

What is “reasonable accuracy”?a s easo ab e accu acy ?– See also negligent hiring.

Short term – Langan P and D Levin (2002) Recidivism of Langan, P. and D. Levin (2002) Recidivism of

Prisoners Released in 1994.

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Research Post El v. SEPTAResearch Post El v. SEPTA

Kurlychek Megan C Robert Brame and Shawn D Bushway 2006 Kurlychek, Megan C., Robert Brame, and Shawn D. Bushway. 2006. Scarlet letters and recidivism: Does an old criminal record predict future offending? Criminology and Public Policy 5: 483-522.

Kurlychek, Megan C., Robert Brame, and Shawn D. Bushway. 2007. Enduring risk: Old criminal records and prediction of future criminal involvement. Crime and Delinquency 53:64-83.

Blumstein, Alfred and Kiminori Nakamura. 2009. Redemption in the presence of widespread criminal background checks. Criminology 47:327-36047:327-360.

Soothill, Keith, and Brian Francis. 2009. When do ex-offenders become like non-offenders? Howard Journal of Criminal Justice 48:373-387.

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Key Screening QuestionKey Screening Question

H f ff di d it How many years of non-offending does it take before an ex-offender looks like a non-offender in terms of risk of offending?– Hazard ratesHazard rates

Time to “Redemption” (Blumstein)

Should be “employment performance”?

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Conclusions From My ResearchConclusions From My Research

N ff d d t h i kNon offenders do not have zero risk

Time since last offense matters e s ce as o e se a e s

10 years of non offending is a meaningful i l b t d ti f fi t ti signal about redemption for first time

youthful offenders

Need more realistic/larger datasetsi ( )– See Blumstein and Nakamura (2009)

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Conclusions From Blumstein and N kNakamura

Data from Ne York State RepositorData from New York State Repository

Same basic pattern

Blumstein advocating for policy changes

But cutpoints varyBut cutpoints vary– No non-offender group

• Uses general population and those “first time arrests”

What about older/repeat offenders?

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Important CaveatsImportant Caveats

All h d ith fi t ti All research done with young, first time offenders

Preliminary research on Dutch dataC fi 7 10 d ti ti f – Confirm 7-10 year redemption times for young first time offenders

– Redemption time is less for older offenders

– Those with many offenses never convergeThose with many offenses never converge56

Wrap UpWrap Up

S th iSynthesis

SolutionsSo u o s

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Questions?Questions?

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THANK YOUTHANK YOURod Fliegel, Esq. Littler Mendelson, P.C.

Robert PickellHireRight Inc HireRight, Inc., Irvine, CA

Prof. Shawn BushwayUniv. at Albany

September 8 2010September 8, 2010

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