This is a summary of one of many aspects of employment regulation in the United States and its territories. Employers should consult an attorney who specializes in labor and employment law about questions applicable to your specific industry. 

Last reviewed: November 10, 2007

BACKGROUND CHECKS

As many as one third of all applicant claims of higher education are false. Always verify resumes that list "big name" universities. An applicant who lists experience as self-employed, family-owned business, or an employer who is now out of business can conceal employment gaps. Get a specific chronology. Demand specific information -- from the applicant and from an objective third party.

If you are hiring for jobs involving physical customer contact, safety/security positions, financial or management personnel, ALWAYS investigate the applicant.

Failure to do a background check can bring you a "negligent hiring/retention" lawsuit if you hire someone with an easy-to-verify record of serious crime. Stockholders have held CEOs personally accountable for embezzlement committed by an employee with a record of similar theft.

A rape victim can end up owning the company if she was attacked at work by a co-worker with a record of violent sex crimes you could have discovered with a simple background check. 

One of your relatives or a friends has applied? All the more reason to check!

POLICE CLEARANCES
are WORTHLESS!

We know people who can get you a "clean" Police Clearance on any of the current inmates at the prison in Mangilao.

These forms cover arrests, but do not always include prosecutions or convictions...what you should demand are COURT RECORDS from both Superior Court and from the U.S. District Court.

There are fees applicants must pay for these clearances. You may reimburse them after they are hired, but you are not required to do so.

Arrests and Convictions: You may not ask job applicants about arrest records, but you may ask about convictions.  Never rely on a "police clearance" -- require applicants to present court records that will indicate a record of convictions (but not arrests -- many people are arrested and later charges are dropped or there is no prosecution). 

Bankruptcy: You may not decline to hire, take disciplinary action or otherwise discriminate against an applicant or employee who has filed for bankruptcy.

Credit Reports: Notify applicants if you routinely collect credit and other personal financial reports as part of job screening. You must notify the applicant of the scope of any report requested and the name and address of the reporting agency.

Since 1997, screening companies contribute to an annual Hiring Index run by ADP. The index evaluates hiring trends and issues that employers need to be aware of. Based on calculations of the 2.6 million background verifications ADP conducted during CY 2001 the  Hiring Index indicates that employers would be wise to ensure that thorough background and reference checks are conducted as part of the hiring process.

44% of employment records showed differences between the information reported on resumes and the information given by past employers. Of these differences, 13% involved negative remarks made by former employers concerning the applicants' work habits, attendance, behavior, termination, or other unfavorable conduct. Other findings included:

* 23% of credential records showed a difference between information provided by the applicant and that reported by the credential provider. Of these, 4% were received with negative remarks from the credential provider regarding disciplinary actions or complaints.

* 41% of education records showed a difference between information provided by the applicant and that reported by the educational institution.

* 11% of employers contacted for references reported applicants as being ineligible for rehire.

After 9/11, employers decided to really get to know who works -- or wants to work -- for them.  Services that conduct background checks have seen a surge in business -- from employers who want to re-screen current employees, to those that had been lax about checking new hires.  Using an outside firm to conduct background checks mean that the Federal Fair Credit Reporting Act (FCRA) comes into play.

Follow these tips to stay in compliance with the FCRA:

1.  Give applicants/employees a separate written notice that you intend to conduct background checks.

2.  Get their written authorization prior to conduct the review.

3.  If you intend to take an adverse action against an applicant or employee based on an investigative report, give them a copy of the report--before taking the adverse action--and include their rights to contact and to dispute information in the report.

Also see: FACTA

Last reviewed: November 10, 2007