What Every Company Should Know About
Pre-Employment Screening and Background Checks
By: Sean Brune

Many companies are discovering during the interview process that potential employees have been dishonest about their pasts.

While it is not uncommon for people to overlook minor, former employment problems when searching a new job, the boldness still surprises many companies.  This is particularly surprising for companies who perform background checks for other employers throughout the nation.

If a potential hire lies to a company who performs background checks, what will that potential hire tell other companies?  Employers need to become more aware of the necessity of background checks.  No assumptions can be made when hiring employees.

Still, many companies insist that they know their hires especially when a candidate has been referred to them.  The assumption is that no background check is necessary. That can prove to be a dangerous policy.  Companies that perform background checks often receive negative feedback from hospitals, hotels and other institutions where security is a major issue.

Background checks are a good idea for all employees, including contractors, in order to provide a safe work environment.  For example, reports indicate that 20% of professional drivers checked do not have a valid license.
Recently, there is less resistance to understanding the value of background checks.  There has been a heightened interest in the last few years.

The cost of checking an employee’s criminal record or credit history has become less expensive due to the digital age and the background checks take less time.
Some checks can be as low as $10 and finished in one day.  It depends on the employer’s request and how much information is needed.

There are numerous tools available such as databases, network runners, who can search courthouse records for lawsuits, arrests, and convictions for new or existing employees.

Company expenses for hiring and training employees should send a message to employers that a background check is a one-time, good insurance policy before the final hire is made. Additionally, the number of cases of violence in the workplace, discrimination and sexual harassment lawsuits has pressured employers to ensure that no new liabilities will be added to the workplace.

Another newcomer in lawsuits involves “negligent hiring”.  If an offender had a history of similar problematic behavior in prior jobs, a company with a policy requiring a background check may benefit even after a suit has been filed.  The background check may disclose information that would have led the company to fire the employee.
Punitive damages may be reduced if jurors are convinced that the company has learned that a background check policy is a necessity.

The employer is not released from wrongdoing; however, it can lessen the damage.

An employer’s case can be damaged if the background check was not initially carried out.  The lack of the background check may indicate that the company did not take reasonable steps to prevent the negligent hiring claim. A plaintiff would take advantage of it.

Background checks require extreme due diligence.
Employees’ rights to privacy are protected by Federal law.  A company must not violate the many regulations that govern searches and how the information is used.  Otherwise, the company puts itself at serious legal risk.
The rules may depend on who is conducting the background check.  If it is a company’s human resources department, usually a signed authorization from the employee is required.

Human resources departments usually do not have the time or the expertise to perform the checks.  They prefer to hire a company such as ACS.  The laws do become tougher when a third party is hired to search for information.

The background check activity is governed by the Fair Credit Reporting Act of 1997.  More authorizations are required from the potential employee.  More importantly, the employer is required to notify the individual if any third party information impinged on the company’s decision not to hire.  The applicant can then communicate with the background checking company to challenge or clarify any information discovered during the check.

It’s a good idea for employers to include waivers in the beginning of employment even if there is no intent to perform an immediate background check.

Eventually, if there is suspicion of misconduct and the company wants to proceed with the background check, no further authorizations are required.

However, companies should not wait until there is a reasonable suspicion of criminal activity or misconduct.  The goal should be to avoid a wrongful hire.  Wrongful hires occur when time is not taken to ensure that the employee shares the company’s goals.

There is another side according to attorneys who deal with employee plaintiff suits.  More and more employees are complaining that searching their pasts has revealed false information from their previous managers.
Lawyers advise their clients that they can sue former employers if they are spreading incorrect information.  That, of course, is another important reason to perform the background checks.

Invasion of privacy must be avoided and information that does not have a specific connection to an employee’s job qualifications must not influence a hiring decision.

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