Legal Questions about the Background Check and Employment Screening Process
Because hiring competent workers is always a challenge, pre-employment screening has become very important to employers. To effectively use pre-employment screening techniques, however, employers must be aware of their legal obligations and limitations.

1. Negligent Hire: Why it is Important to Conduct Background Checks
2. Avoiding Negligent Hire Liability
3. Use of Arrest and Conviction Records in Hiring Decisions
4. FCRA-Compliant - Guidelines for the Application and Screening Process

1. Negligent Hire: Why it is Important to Conduct Background Checks
Generally, an employer is not required as a matter of law to conduct an investigation into the criminal background of an applicant. However, the current trend is to hold an employer liable in tort if it has not made reasonable inquiries into the criminal background of the applicant. Generally, an employer will be held liable for negligent hiring if it is aware or has reason to believe that the employee is unfit or if the employer fails to use reasonable care to discover the employee's unfitness for the position and the plaintiff sustains injury as a result of the employer's negligence. The claim of negligent hire is different from the long-recognized tort theory of respondeat superior where an employer is liable for the negligence of its employees acting within the scope of their duties. In the case of negligent hire, an employer may be liable for acts that are outside the scope of employment. See Restatement (2d) of Torts § 317.

Some state legislatures have become involved in the negligent-hire arena. For example, a Florida state legislature created a statute-based presumption for employers in negligent hire cases. The statute provides that "the employer is presumed not to have been negligent in hiring if, before hiring the employee, the employer conducted a background investigation of the prospective employee and the investigation did not reveal any information that reasonably demonstrated the unsuitability of the prospective employee for the particular work to be performed or for the employment in general." Fla. Stat. Ch. 768.096 (1999).

The biggest problem for employers with the negligent hire cases is that typically the question of whether the employer should have known of the employee's dangerous propensities is often a question of fact to be decided by a jury. Therefore, a ruling based on the law is difficult to obtain. Although, ordinarily, the burden is on the plaintiff to first show that some evidence exists which would have put the employer on notice.

While many states have adopted a cause of action for negligent hiring, fewer states have recognized the tort of negligent retention and supervision. These cases arise when an employer becomes aware or should become aware of problems with an employee that indicates unfitness; the employer fails to take further action such as investigating, disciplining or discharging the employee and; the employee injures someone else.

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2. Avoiding Negligent Hire Liability

1. Obtain an authorization to release information from each applicant to protect your company background check provider and anyone your company contacts regarding references.
2. Carefully review all information on the applicant's employment application or resume.
3. Question the applicant about any gaps in employment.
4. Contact prior employers to verify the dates of employment, positions held, information about work performance, reliability, any violent behavior, insubordination or dishonesty.
5. Document information received from prior employers and references.
6. Document efforts to obtain information from prior employers and references, even if unsuccessful.
7. If the applicant does not consent to the contact of former employers, ask why.
8. Evaluate state laws to determine if there are restrictions on inquiries into an applicant's past criminal conviction records.
9. Evaluate the relationship between the applicant's criminal record and the job to ensure that inquiries are job-related.
10. If an applicant has a criminal history, determine the job-relatedness of the criminal background by analyzing the job and its duties.
11. Consider the time and nature and number of convictions, the circumstances under which the convictions occurred, the relationship between each conviction and the job, the time period between the conviction and the decision to hire the applicant, the applicant's employment before and after the conviction to determine the extent of rehabilitation, age at time of conviction, whether the conviction is relevant to the security and safety of property, other employees or third parties.
12. If hiring an applicant for a driving job, check the employee's driving record.
13. Provide on employment applications that omissions, misrepresentations or falsification of information will result in the rejection of the applicant, or termination of employment.
14. Evaluate the job and assess the risk associated with the position with regard to potential employer liability; for example, driving vehicles, handling dangerous equipment or machinery, selling guns, having access to money.

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3. Use of Arrest and Convicition Records in Hiring Decisions
State statutes may restrict the scope of background checks. Attached is a summary of the state laws that impact the information that may be taken into account by an employer in determining qualification for employment. The employer should not request (even if the employer arguably does not consider such information) data prohibited by state law to be considered. The employer also should not receive information on expunged or sealed arrest or conviction records.

In addition, the Equal Employment Opportunity Commission has ruled that the use of conviction and arrest records in employment practices may have a disparate impact on some races. For this reason, the information sought in an applicant's background should be jobrelated. Consequently, the background information received likely will be different depending on the job classification or category of job. The ideal would be for an assessment to be made (based, for example, on an ADA-compliant job duties description) to determine job-relatedness.

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4. FCRA-Compliant - Guidelines for the Application and Screening Process

• Disclose to applicant that a consumer report may be obtained.
• Make sure the applicant completes and signs all necessary forms, specifically including:
  • Application for employment
  • Consumer report authorization
  • Affirmative action questionnaire
• Limit questions to areas related to the position to be filled.
• Generally, do not ask about age, sex, race4, color, national origin, religion, citizenship, pregnancy, or disability.
• Should the consumer report indicate the applicant is not fit for employment, then prior to making the final decision denying the applicant employment, provide the applicant with:
  • A copy of the consumer report
  • A copy of the Summary of Consumer Rights notices
• At the time the applicant is informed of the final decision denying employment, notify the applicant that the decision has been made on whole or in part based on a consumer report, a copy of which has already been provided along with the Summary of Consumer Rights.

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