Top Ten Trends in the Pre-Employment Background Screening Industry for 2009
Employment Screening Resources (ESR), a leading national employment
screening background firm, released its "Second Annual Top Ten Trends
in the Pre-Employment Background Screening Industry" for 2009 today.
Although issues from 2008 remain on the list, the 2009 trends reflect
increasing concerns over the use of Facebook and similar sites,
lawsuits looming over inaccurate Background Screening reports,
increasing government scrutiny of the screening industry and privacy
and security issues.
"In the current legal environment,
businesses want to make sure they are not only exercising due diligence
but are also ahead of the curve on legal issues," said Lester S. Rosen,
attorney at law and founder of ESR and author of two books on
background screening. "The quickest way to get sued is to not
understand the legal environment and latest trends surrounding
background checks and employment."
Rosen believes that the
federal and state governments will require more background screening in
2009, especially in sensitive jobs, and that more businesses will make
Pre-Employment Background Screening a requirement for the job. The
increased use of Applicant Tracking Systems will lead to "one button"
clicks for background checks, he says.
"At the same time,
consumers are worried about their privacy. That’s why data protection
and accuracy have become so critical. The use of social networking
sites like Facebook and MySpace are another minefield for employers,"
says Rosen. "We have identified 10 Trends to help alert employers on
what to expect in 2009."
Hot topics for 2009 include tighter government regulation, privacy
concerns, and controversy over sending sensitive data offshore for
processing, increasing demand for accurate criminal record reporting,
and the probability of more lawsuits against both employers and
background screening firms. Not that the 2008 trends outlined in
January 2008 are no longer relevant, but a shifting world has
reshuffled the challenges facing employers, job applicants and
screening firms.
1. More Government Regulation: Likely to increase
in 2009 are the requirements by federal and state governments for more
background checks in sensitive industries – such as child care workers
and certain health workers. Another area where the government requires
checks is verification of the eligibility of a new hire to work by
using the E-verify program. Although litigation has been filed, the
announced rules require employers with certain federal government
contracts to utilize the E-verily program starting in 2009. Along with
the federal government, the states are becoming increasingly involved
in regulating screening.
2. Privacy and Accuracy: The subjects of privacy,
accuracy, and fairness will also be major issues for 2009. Privacy
Times newsletter, for example, led off its December 2008 issue with an
article criticizing the screening industry. The letter noted that a
coalition of legal aid groups has called on the Federal Trade
Commission to take enforcement actions against background screening
companies for “widespread noncompliance with the Fair Credit Reporting
Act’s requirements for accuracy and dispute investigations.”
The report was especially critical of the use of criminal databases
that can falsely accuse an innocent person of being a criminal, and the
failure of some screening firms “to take into account the fact that
criminal identity theft is unfairly tarring thousands of job
applicants.” A leading cause of inaccuracies is matching innocent job
applicants to criminal records based upon the same or similar name in a
database, without re-verification of the record at the courthouse. A
new organization called Concerned CRA’s has taken a stance against
utilizing such databases without taking proper measures to ensure
accuracy of criminal records.
3. Second chance for ex-offenders: Unless as a
society, we want to build more prisons than schools or hospitals,
something must be done to reduce recidivism and find employment for
applicants with criminal records. At the same time, placing the wrong
person in the wrong job can be a disaster and cause untold grief. As a
result of Title VII and notice from the EEOC, employers are well
advised to review their hiring practices to ensure that they are not
discriminating against members of protected classes by automatically
denying employment without considering whether there is a business
justification for disqualification based upon the crime and the job.
This will continue to be a developing area in 2009. One example are the
new laws passed by the State of New York that become effective this
year that place a greater emphasis on employers analyzing a past
criminal record to determine whether there is a business justification
not to hire a person. The New York law also requires that notice of
various rights be provided to job applicants (See an explanation of the
New York laws in the December, 2008 ESR Newsletter.
4. Consumer Protection Litigation: As the
screening industry matures, and applicants and their lawyers become
much more informed about their consumer rights, it is likely that there
will be an increase in litigation. The may include class action
lawsuits against screening firms, particularly when it comes to various
notices required under the federal Fair Credit Reporting Act, and
accuracy requirements in the federal law. Since database searches can
result in false negatives (meaning a criminal is missed) as well as
false positives (meaning an innocent person is labeled a criminal), it
is probable that employers and screening firms that rely upon databases
may be the subject of litigation where a database search failed to
locate a dangerous person.
5. Impact of the recession: As a result of the
recession and higher unemployment, it is likely that employers will
need to scrutinize applications even more carefully, to be on the watch
for fraudulent credentials, such as inflated or fictional employment
history or educational degrees. Another recession related trend may be
the increase in applicants who are willing to perform their own
background checks in order to present to employers a self-certification
that their credentials are for real. Since more temporary employees and
Independent Contractors are hired during a recession, the issue of
screening non-employees will continue to be important.
6. Data security and data breaches and Offshoring Data:
Since identity theft continues to be a national and international
problem, expect even more emphasis in 2009 on data security and
protection. Closely related is the continuing issue of employers and
screening firms offshoring consumer data to India or other similar
places for cost savings. Once data leaves the United States., it is
beyond U.S. privacy protections. A new organization called Concerned
CRA’s has taken a stance against offshoring such data without
notification to consumers. The use of home-operator networks also
presents an unnecessary risk to privacy as well. There is no
justification for personal information to be spread across kitchen
tables and dorm rooms across America.
7. Accreditation by the NAPBS: The non-profit
trade organization for the screening Industry, the National Association
of Professional Background Screeners has announced the introduction of
an accreditation program. NAPBS has gone through an exhaustive process
to develop “Best Practices” for the industry, and it is anticipated
that firms will start going through the process this year.
8. Social network sites: The use of social
networking sites as a pre-employment screening device will continue to
be a hot topic in 2009, as more recruiters and HR professionals go
online to satisfy their curiosity about candidates. The problem:
contrary to popular belief, just because it is online does not mean
that it’s a good idea to utilize it without developing policies and
procedures. Online material can be inaccurate, discriminatory, and
under certain circumstances, its use can be an invasion of privacy.
Stay tuned as more courts give their opinions on this issue.
9. Integration of services: With the advent of
“Web 2.0,” it is likely that technology will play an even bigger role
in the coming years. Seamless integrations with Applicant Tracking
Systems allow paperless background screening systems at the click of a
mouse.
10. International background checks: In 2008, we
observed that, “With mobility of workers across international borders,
due diligence is no longer limited to just what an applicant has done
in the United States. Although there are numerous practical and legal
challenges as well as data and privacy concerns, international
background checks are becoming very accessible to employers.” That will
continue to be the trend in 2009 as well.
