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How Many People Fail Background Checks?

Dear Screen Test:

There are no national or official governmental statistics on the number of applicants who fail pre-employment background tests. However, various background firms maintain their own numbers. In addition, various organizations publish their annual criminal “hit rates,” showing how many applicants subject to background screening had criminal records or other discrepancies. Background firms obviously benefit by pointing out to employers the dangers and pitfalls of hiring without checking an applicant’s background.

On the one hand, these figures confirm why background checks may be critical to certain employers. Without a system of pre-employment screening, it is almost a statistical certainty that an employer will at some point hire someone who brings serious baggage and the potential to create a legal and financial nightmare.

On the other hand, as with all statistics, these reports should be carefully reviewed. For example: One common statistic notes that a large percentage of applications contain material fraud, omissions or misrepresentations. However, it is usually a judgment call to decide where to draw the line between applicants putting themselves in the best possible light, as opposed to actual fraud.

Another area that requires a closer look is criminal hits. First, not all criminal records come as a surprise to employers. Many employers are still willing to hire someone for an appropriate position, providing the applicant was not dishonest during the application process. In fact, certain industries by nature of their workforce are more likely to draw upon a pool of potential applicants who may tend to have higher levels of past criminal conduct. Examples might be construction or firms that provide employment for entry-level workers.

As a result, employers need to carefully define what they mean by “failing” a background check. For example, just because a criminal record is found does not mean the applicant hid it or failed a background check. An applicant may well have self-revealed the criminal record already and the purpose of a background check is to merely confirm what the applicant reported.

In addition, not all criminal records are so serious that it would necessarily affect job consideration. Another issue is whether the “failure to pass” is, in fact, a failure. For example, a person may have been a victim of identity theft—thus, even though a crime is committed in the person’s name, the person in fact did not have a criminal conviction.

The rate of failing background checks may also depend upon the industry as well. Certain industries may have a higher rate of “hits” on criminal searches than others, by virtue of the nature of the job, the pay scale and the available population to fill the job. If you are experiencing a 97 percent pass rate and suspect it is too good to be true, consider these possibilities:

  • You could be utilizing a number of best practices that tend to discourage applicants with something to hide, such as a very well-thought-out pre-hiring process that eliminates potential applicants with problems. Employers who utilize certain best practices, such as a careful application review, good interview techniques and calling past employers, often find that they encounter fewer problems when performing background checks.
  • Second, the particular workforce may statistically be less likely to encounter problems. For example, a biotech firm hiring those with doctorates may well find that it has a lower rate of criminal hits compared with a firm that hires a more general workforce.
  • Third, you may need to examine if the screening process is effective at obtaining the necessary information and that you are not receiving “false negatives” (i.e., applicants with criminal records being reported as clear). If that is a concern, the best approach is to reinvestigate a random sample of applicants with another firm. As in any outsourced HR service, it can be useful to occasionally audit the efficiency of a service provider.

It is difficult to draw firm conclusions from the statistics without knowing the search methodology. Depending on how the searches were conducted, it is possible in fact that such annual statistics may even understate the number of criminal records applicants had. The most accurate criminal-record searches are done by accessing information directly from the county courthouse level, either by going to the court, or by use of the court computer system that is the functional equivalent of going to the courthouse. Databases on the other hand, although much wider in scope, are not nearly as accurate, do not have all courts or jurisdictions, may not be up to date or may contain insufficient identifiers. To the extent any searching was done by the use of databases, the numbers could potentially be understated.

The bottom line: Statistics on criminal “hits” and failed background checks are an excellent reminder that employers need to be careful in hiring. However, as with most statistics, there is more to the story.

SOURCE: Les Rosen, Employment Screening Resources, Novato, California

LEARN MORE: Employers are conducting fewer credit and criminal background checks on prospective employees now compared with two years ago, according to a survey by the Society for Human Resource Management.

The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion. Also remember that state laws may differ from the federal law.

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Can You Hear Me Now? Employer Cannot Reject Disabled Employee Without Individualized Inquiry of the Ability to Do the Job

Nicholas Keith has been deaf since birth. He is also, apparently, a pretty good swimmer. He successfully completed the Oakland County, Michigan, lifeguard training course with the assistance of sign language interpreter to communicate instructions. The county rescinded its conditional job offer for a lifeguard position after Keith’s pre-employment physical. The examining doctor approved Keith’s employment as a lifeguard if his deafness was “constantly accommodated.” Without any consultation with Keith, the county unsuccessfully brainstormed possible accommodations, and, ultimately, rescinded the job offer.

In Keith v. Oakland County (1/10/13) [pdf], the 6th Circuit reversed the district court’s order dismissing Keith’s disability discrimination lawsuit. The court relied upon the ADA’s requirement for an “individualized inquiry in determining whether an [employee’s or applicant’s] disability or other condition disqualifies him from a particular position.”

In this case, the county made no individualized inquiry.

After Dr. Work entered the examination room and briefly reviewed Keith’s file, he declared, “He’s deaf; he can’t be a lifeguard.” Dr. Work made no effort to determine whether, despite his deafness, Keith could nonetheless perform the essential functions of the position, either with or without reasonable accommodation. Indeed, Dr. Work has no education, training, or experience in assessing the ability of deaf individuals to work as lifeguards. Dr. Work’s cursory medical examination is precisely the type that the ADA was designed to prohibit.

What is the takeaway for employers? If you are dealing with disabled applicants or employees, you cannot make the employment decision in a vacuum. You must act based on the actual disability and its effect on the particular individual’s ability to perform the job. You should consider:

  • the individual’s personal characteristics;
  • the actual medical condition; and
  • the effect, if any, the condition may have on the ability to perform the specific job in question.

Most importantly, you should include the individual in the assessment. No one is a better judge of one’s real-world abilities and limitations than the individual himself or herself.

If you failing to engage in this individualized inquiry, it will look like you are making the employment decision based on stereotypes and generalizations, which the ADA is supposed to rid from the workplace. That perception will not bode well for your defense of an ADA lawsuit.

Written by Jon Hyman, a partner in the Labor & Employment group of Kohrman Jackson & Krantz. For more information, contact Jon at (216) 736-7226 or jth@kjk.com.

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Basic American Foods Feeds Skilled Development-Focused Culture

Headquartered in California, Basic American Foods (BAF) is an innovator in convenience and refrigerated foods. The company continues to grow, staying customer focused. BAF knows the key ingredient to its success is its employees and their continued development. To ensure that the organization is doing all it can to develop its employees; BAF has adopted Halogen Software’s talent management solutions. The organization’s investment in Halogen eAppraisal and e360 Mutlirater has enabled it to:

  • Generate a complete picture of employee performance
  • Increase employee engagement and satisfaction with the process
  • Hold employees accountable to Lean principles, and
  • Create a feedback rich culture, focused on development

Register now to download this free white paper titled Basic American Foods feeds skilled development-focused culture, sponsored by Halogen Software.

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When HR and Legal Worlds Collide

Quick! Between your human resource and legal advisers, which group is more likely to say, “It looks like we’re in pretty good shape. Nothing’s ever perfect, but claims are way down. We don’t have many lawsuits, and the ones we have we think we can settle reasonably— or, if need be, win. Everyone has signed off on our policies. All of our training has been completed. We could get a claim, but if we do, we should be in good shape to defend it. We can prove everyone got our policies and everyone attended our classes.”

Of the two groups, lawyers are generally more likely to see the state of the workplace landscape this way. These statements focus on legal risk, because that’s what lawyers do. What can be disconcerting is to have human resource professionals review the same facts and take a completely different position. They might say, “We have a workplace laden with risk. There are problems all over the place. This place has disaster written all over it. We’re facing a stack of challenges.”

If these two groups are looking at the same situation, which one should we believe? Whose views should govern what we do? The answer is that both may be right. What’s present here is an occupational difference in focus and perspective.

Lawyers tend to concentrate on legal risk — in many organizations, that’s the key element of their jobs. Conversely, human resource professionals look at an overlapping but different range of people issues and the impact on the workplace environment. HR professionals will examine engagement surveys, internal and external complaints, exit interviews, retention rates, safety records, and other data. They may see signs of internal turmoil, abusive leadership, or declining productivity that are all matters for concern but offer no obvious indicators of ongoing or imminent illegal acts or practices.

When looked at retrospectively, it’s rare that violations spring from out of the blue with no hint or danger signals. As an example, consider harassment resulting in sexual or racial misconduct. Long before there is a visible event that could lead to a charge or lawsuit, there might be signals: perhaps high employee turnover via resignations or transfers as vacancies emerge. Such legal hazards might not be raised by internal complaints or external charges in today’s workplaces. As jobs remain scarce, employees often choose not to speak up rather than chance overt or subtle retaliation.

The most effective way to manage all risk, legal and other, is to integrate what both legal and HR professionals advise: Look at legal risk and “non-legal” indicators that may be the bellwether for upcoming claims. This is the type of “combined” thinking and planning that best conserves organizational resources and minimizes liability. In other words, don’t be satisfied even when all is going “legally well.”

Finally, organizations work best when legal and human resource professionals work together. That’s how to prevent the legal and HR worlds from colliding. And along the way, you’ll build a more productive, engaged workplace.

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Be Careful What You Bring Upon Yourself When Suing an Ex-Employee

Last week—in Quicken Loans,Inc. (1/8/13) [pdf]—an NLRB administrative law judge invalidated the confidentiality and non-disparagement provisions in an employment agreement between Quicken Loans an an ex-mortgage banker, Lydia Garza. This decision continues the NLRB’s march towards the overly broad expansion of the definition of protected concerted activity. Molly DiBianca, at her Delaware Employment Law Blog, sums up the decision thusly:

Admittedly, the ALJ’s conclusion that an employer is not free to contract with its highly compensated professional employees that those individuals will not disparage their employer or steal its confidential and proprietary information is a bit depressing. But keep in mind the remedy, friends. Having found that the provisions violated the NLRA, the remedy ordered by the ALJ was that the provisions be revised. Or, if the employer didn’t want to go to the trouble of reprinting new agreements for all of its highly compensated brokers, it could simply provide a single-page addendum, notifying those highly paid employees that the two provisions were rescinded.

I want to focus on another business lesson from the decision—why the employee filed the case in the first place. Here’s the ALJ’s summary of the charging party’s motivation for filing the charge with the NLRB.

Garza testified that shortly after she left the Respondent’s employ, she and five other former employees of the Respondent were sued by the Respondent for an alleged violation of the no contact/no raiding and the non-compete provisions of the Agreement.

I’m fairly certain that Garza never even thought filing a challenge to her employment agreement with the NLRB until she got sued and had to hire a lawyer, who, in turn, reviewed the agreement and saw an opening.

If you are going to sue an employee, current or former, make sure you do your diligence of your own potential liabilities. If you uncover something that can come back and bite you, make sure it is a claim with which you can live. Depending on what you unearth, leaving well enough alone with your employee may be the most prudent course of action.

Written by Jon Hyman, a partner in the Labor & Employment group of Kohrman Jackson & Krantz. For more information, contact Jon at (216) 736-7226 or jth@kjk.com.

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Firing of ‘Irresistible’ Employee Does Not Equal Sex Discrimination?

Every now and again an employer wins a case that offends my sensibilities as an advocate for employers’ rights. This is one of those stories.

By now, you’ve likely read about the employee fired because her boss found her too attractive. You’ve also probably read how the Iowa Supreme Court concluded that an employee fired under these circumstances cannot pursue a claim for sex discrimination under that state’s civil rights laws.

Melissa Nelson worked as a dental hygienist for Dr. James Knight for 10 1/2 years. Knight terminated Nelson at his wife’s request. Nelson never flirted with Knight or sought an intimate or sexual relationship with him. Knight, however, was attracted to her, and made several comments to her about the tightness of her clothes, and their effect on the tightness of a certain area of his clothes.

Following Nelson’s termination, Knight replaced her with another female. In fact, every hygienist who ever worked for Knight was female.

In Nelson v. Knight (12/21/12), the Iowa Supreme Court concluded that Nelson had not presented a sex discrimination claim.

So the question we must answer is … whether an employee who has not engaged in flirtatious conduct may be lawfully terminated simply because the boss views the employee as an irresistible attraction….

The civil rights laws seek to insure that employees are treated the same regardless of their sex or other protected status. Yet … Dr. Knight’s unfair decision to terminate Nelson … does not jeopardize that goal. This is illustrated by the fact that Dr. Knight hired a female replacement for Nelson….

Nelson raises a legitimate concern about a slippery slope. What if Dr. Knight had fired several female employees because he was concerned about being attracted to them? Or what if Ms. Knight demanded out of jealousy that her spouse terminate the employment of several women? The short answer is that those would be different cases. If an employer repeatedly took adverse employment actions against persons of a particular gender because of alleged personal relationship issues, it might well be possible to infer that gender and not the relationship was a motivating factor.

It is likewise true that a decision based on a gender stereotype can amount to unlawful sex discrimination…. If Nelson could show that she had been terminated because she did not conform to a particular stereotype, this might be a different case. But the record here does not support that conclusion. It is undisputed, rather, that Nelson was fired because Knight, unfairly or not, viewed her as a threat to her marriage.

The media has heavily criticized this decision. That criticism is warranted. Yes, Knight only employs female hygienists, and replaced Nelson with another female. One could also argue that the doctor only fired Nelson because of her looks, not because of her gender. Those arguments, though, ignore the fact that if she was a he, her looks would not have been an issue in her employment at all. The sex discrimination laws are supposed to insulate employees from employment decisions based on sex-based stereotypes, not protect the employers who make those decisions.

Nelson, a ten-plus-year employee, should not have to look for a new job merely because her boss might not be able to control himself around her. If the sex discrimination laws do not protect an employee like Nelson, then I fear we are taking a huge civil rights step backwards.

Written by Jon Hyman, a partner in the Labor & Employment group of Kohrman Jackson & Krantz. For more information, contact Jon at (216) 736-7226 or jth@kjk.com.

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Abraham Lincoln: Listener-in-Chief

Seven score and eight years ago, one of our country’s iconic leaders did something extraordinary.

Fearing that the Emancipation Proclamation would not hold after the Civil War ended, the 16th president signed into law the 13th Amendment to the Constitution, which outlawed slavery. But it wasn’t easy. The story of Abraham Lincoln’s efforts to get the necessary two-thirds majority for the amendment to pass the House of Representatives is detailed in Steven Spielberg’s latest film, which is simply called Lincoln. Starring Daniel Day-Lewis in an Oscar-nominated performance, the movie focuses on the last part of Lincoln’s life, and it’s a compelling tale even if the film takes license at times.

Something that struck me in the film was how Lincoln, a president who was trying to end the bloodshed caused by the Civil War and get a controversial amendment passed, took the time to listen to citizens. While one biographer told the Chicago Tribune that it is unlikely that Lincoln would have met with soldiers on the street as he does in the movie, “Honest Abe” did hold what were essentially “office hours” at the White House. Yes, the “Great Emancipator” held office hours—at 1600 Pennsylvania Ave. nonetheless. In one scene in the film, a couple from Jefferson City, Missouri, calls on the president to help them settle a tollbooth dispute back home. Lincoln, in turn, asks the citizens to contact their congressman and tell him that he should support the 13th Amendment.

It occurred to me that many leaders, especially at large companies, do not make themselves all that accessible to their workers. Wouldn’t it be great if the Big Cheese opened the door for an hour or two each week to hear from employees? I know, there’s no time for that, right? Well, as John Ryan argues in an article on Forbes.com, to be a successful CEO, one must become a “chief listening officer.” I couldn’t agree more.

Imagine what ideas could be shared, what questions could be answered and what morale could be boosted. For employees, it would be intimidating at first, but if a CEO were committed to it, that fear would surely dissipate. I understand there are protocols and today’s CEO is often on the go much more than Lincoln was, but an open ear to fresh ideas should be welcomed. HCL Technologies, a Noida, India-based information technology company, tried the strategy a few years ago to much success.

Perhaps a conversation could take place that helps put the wheels in motion for a new project or innovation.

As Lincoln said, “Whatever you are, be a good one.” In terms of leadership, it seems like he came up with the perfect blueprint.

James Tehrani is Workforce’s copy desk chief. Comment below or email editors@workforce.com.

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The 12 Days of Employment Law Christmas

Since the holidays are almost upon us, and the news is a little slow, I thought I’d have a little fun. So I wrote a song. For your listening pleasure (you have to sing yourself; trust me, there’s no pleasure if I do it for you), I present The 12 Days of Employment Law Christmas.

On the first day of Christmas,
my employment lawyer gave to me
a lawsuit for my company.

On the second day of Christmas,
my employment lawyer gave to me
2 trade secrets
and a lawsuit for my company.

On the third day of Christmas,
my employment lawyer gave to me
3 FMLA notices,
2 trade secrets,
and a lawsuit for my company.

On the fourth day of Christmas,
my employment lawyer gave to me
4 collective actions,
3 FMLA notices,
2 trade secrets,
and a lawsuit for my company.

On the fifth day of Christmas,
my employment lawyer gave to me
5 Facebook firings,
4 collective actions,
3 FMLA notices,
2 trade secrets,
and a lawsuit for my company.

On the sixth day of Christmas,
my employment lawyer gave to me
6 guys-a-lying,
5 Facebook firings,
4 collective actions,
3 FMLA notices,
2 trade secrets,
and a lawsuit for my company.

On the seventh day of Christmas,
my employment lawyer gave to me
7 sex harassers,
6 guys-a-lying,
5 Facebook firings,
4 collective actions,
3 FMLA notices,
2 trade secrets,
and a lawsuit for my company.

On the eighth day of Christmas,
my employment lawyer gave to me
8 discriminating managers,
7 sex harassers,
6 guys-a-lying,
5 Facebook firings,
4 collective actions,
3 FMLA notices,
2 trade secrets,
and a lawsuit for my company.

On the ninth day of Christmas,
my employment lawyer gave to me
9 ladies lactating,
8 discriminating managers,
7 sex harassers,
6 guys-a-lying,
5 Facebook firings,
4 collective actions,
3 FMLA notices,
2 trade secrets,
and a lawsuit for my company.

On the tenth day of Christmas,
my employment lawyer gave to me
10 labor campaigns,
9 ladies lactating,
8 discriminating managers,
7 sex harassers,
6 guys-a-lying,
5 Facebook firings,
4 collective actions,
3 FMLA notices,
2 trade secrets,
and a lawsuit for my company.

On the eleventh day of Christmas,
my employment lawyer gave to me
11 personnel manuals,
10 labor campaigns,
9 ladies lactating,
8 discriminating managers,
7 sex harassers,
6 guys-a-lying,
5 Facebook firings,
4 collective actions,
3 FMLA notices,
2 trade secrets,
and a lawsuit for my company.

On the twelfth day of Christmas,
my employment lawyer gave to me
12 disabled workers,
11 personnel manuals,
10 labor campaigns,
9 ladies lactating,
8 discriminating managers,
7 sex harassers,
6 guys-a-lying,
5 Facebook firings,
4 collective actions,
3 FMLA notices,
2 trade secrets,
and a lawsuit for my company.

Happy holidays!

Written by Jon Hyman, a partner in the Labor & Employment group of Kohrman Jackson & Krantz. For more information, contact Jon at (216) 736-7226 or jth@kjk.com.

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Talent Mobility

Does your organization have a strong internal mobility program in place? Without successful talent management tools, your company could see a lag in employee retention as well as employee engagement. Successful talent mobility programs yield substantial enterprise-wide benefits, including lower talent acquisition costs, stronger leadership teams, and better financial performance. Learn how internal mobility programs can help drive your greatest asset—your employees.

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An Overview of HCM Technology Deployment and Factors Influencing the Strategy

The contents of this white paper provide an overview of Human Capital Management (HCM) deployment and the results from HR.com’s HCM Technology Deployment Survey. Organizations were asked a series of questions about the technology application structure, technology deployment type, and other deployment considerations in use today and planned for the future. The main purpose of this survey was to determine if organizations using different HCM technology deployment types (e.g., On-Premise, SaaS, Home Grown, or Hosted) and various application structures have deployment strategies that meet business objectives.