Do’s and Don’ts of Employment Background Checks

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The "Do's"

DO: Obtain Applicant Consent. The first step in pre employment screening is to obtain applicant consent. This isn’t just good advice—it’s also the law, as outlined by the Fair Credit Reporting Act (FCRA). You must make applicants aware that they will be subject to a background check, and the candidate/employee must sign a written consent form before you conduct the screen.

DO: Make Sure the Background Check Relates to the Job. Establish a clear link between the items you’re screening for in the background check and the job duties. Understand what you “need to know” and what could potentially violate an individual’s privacy rights or cause unfair discrimination.

DO: Apply Your Criteria Consistently. Another way to help keep your company within legal grounds and promote fair hiring is to make sure you apply your policy in a consistent manner. For example, for a particular job category such as “Help Desk Support”  make sure you use the same type of background check on everyone in that job category and that you use the same criteria for assessing the results. You can vary your background checks to make sure they are relevant for the job – but do not vary them within the same job.

DO: Notify Your Applicant of Any Records Found. Before you take any action on the results of a background screen in hiring, promoting, or suspending an employee, make sure you’re aware of the Adverse Action requirements. These requirements are mandated by the FCRA and are very specific about how to notify an applicant of an adverse decision you’ve made concerning the results of their background check.

DO: Consider the Use of Employee Monitoring After Hire: Just because an applicant has cleared a background check, don’t assume that you will know if and when that person might get into trouble once they are in your employ. Monitoring your current employees to make sure you know if an arrest occurs is a growing best practice.

DO: Establish and Publish Your Background Screening Policy. Make clear—in writing—your background screening policy. Detail what types of screens you conduct, and the information for which you’re screening. Make sure you include federal, state and local laws in your guidelines. Additionally, make it clear how you’ll apply your background screening results.

The "Don'ts"

DON’T: Create a Blanket Policy. Fair employment laws require that you only make hiring decisions based on job-related capabilities. Therefore, avoid bright line “no criminal record” policies. Often, old and non-serious convictions have little or no bearing on a person’s ability to fulfill the job obligations.

DON’T: Rely Solely on National Criminal Database Searches. With today’s mobile workforce, it’s wise to conduct criminal searches on a national level to see if there are any criminal activities beyond where your applicant works or worked. But, always back up your national search with a local-level search to verify the results. Otherwise, you’ll risk making decisions on old or potentially inaccurate information.

DON’T: Forget to Screen Your Subcontractors & Temporary Workers. Everyone who works for your company should undergo a background screen. This includes contractors and vendors who are working for you. There is a large body of legal precedent that suggests you can be held liable for anyone who is paid by you; whether they are an employee or a subcontractor.

Percentage of Companies that do Background Checks

Eighty percent of U.S. companies ran criminal checks on job applicants in 2011, compared to about 50 percent of companies in 1996, according to a 2012 report from the Society for Human Resource Management.

What the New EEOC Guidance Means for You

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The Equal Employment Opportunity Commission’s (EEOC) 2012 guidance on background checks suggests that employers need to exercise more due diligence in their hiring practices. Its guidance on background check practices underscores the importance of five key practices in the hiring process.

1. Hiring policies should not exclude people from employment based on status.

Policies that automatically exclude people from employment based on only certain criteria (such as criminal status, age, disability, etc.) could pose liability. Employers should refrain from developing narrow policies of this nature to avoid potential legal issues.

2. Employers need to monitor adverse impact.

Hiring practices that result in adverse impact for a protected group are unlawful. If a hiring practice or selection method is adversely impacting a protected group, employers should not use it. This is true of any method used to base a hiring decision such as ability/personality assessments, drug tests, background checks, credit checks, etc.

3. Employers must hire based on the essential functions of the job.

The EEOC’s guidance suggests that employers must make hiring decisions based on whether candidates can do the essential job functions. Employers must identify those essential requirements in the hiring process and determine if a criminal record (for example) prevents a candidate from performing those functions.

4. Hiring criteria has to be job-related.

One of the most consistent trends in guidance provided by the government (and EEOC) on hiring practices is to keep all hiring decisions based on job-related criteria. If the criteria that employers are using to evaluate job candidates are not job-related, it will likely not hold up in court. For example, if an applicant's criminal offense is unrelated to the job, then you may not be able to exclude an applicant.

5. Employers must train decision-makers about employment discrimination.

The EEOC’s guidance emphasizes the importance of employers training both HR practitioners and managers on employment discrimination. Any individual who makes hiring decisions should understand employment law as it relates to recruitment and hiring.

While the EEOC only specifically addressed criminal background checks in its guidance, employers should be cautious with using any hiring practices, criteria and/or policies that are questionable against the guidelines provided.

Please note that by providing you with research information that may be contained in this article, ERC is not providing a qualified legal opinion. As such, research information that ERC provides to its members should not be relied upon or considered a substitute for legal advice. The information that we provide is for general employer use and not necessarily for individual application.

Additional Resources

Save on Background Check Services!ERC’s Preferred Partner Corporate Screening Services, Inc. offers ERC members discounts averaging over 20% off standard background screening products. 

Behavioral Interviewing
This workshop gives participants the skills they need to effectively plan for and conduct an effective behavioral-based interview. It also guides participants through effectively evaluating candidates so they can hire the best candidate. Emphasis will be placed on the selection process, including legal issues facing interviewers.

An Important Enrollment

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By Pat Perry

Next week, the Ohio Bureau of Workers’ Compensation is providing a one month open enrollment for employers relative to selecting a Managed Care Organization (MCO). MCOs are a key player for many organizations in keeping their workers’ comp costs in control through proactive case management and a solid transitional work program. Employers pleased with their MCO do not need to take any action. Employers seeking a new MCO can do so at no cost and it only takes about 5 minutes.

There is plenty of information about MCOs at the Bureau’s web site and more data about Ohio MCOs will become abundant starting next week. If you do not know your company’s MCO, you can simply click here to find the MCO assigned to your organization.

Over the next several weeks, ERC will be providing information about the MCO selection process and other critical data to provide organizations facts upon which to make an informed decision. As this open enrollment only occurs every two years, this decision is extremely important.

Since the MCO Open Enrollment period starts April 30 and ends May 25, we will continue to provide you with information throughout to assist you in your choice of a MCO.

14 Tips to Drive Revenue in HR

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14 Tips to Drive Revenue in HR

HR may not always be able to directly contribute to the bottom line, but there are a number of impactful ways that it can help drive revenue. Here is a list of 14 things your HR department can do to drive revenue at your organization.

  1. Win over talent from your competitors. Win over the best talent with better compensation, benefits, opportunities, and a more attractive workplace.
  2. Retain your top producers. Figure out what will make top performers stay and create a strategy to keep them at your organization.
  3. Pay for performance. Create an incentive program directly tied to profitability. Whether that's a bonus program or profit sharing program, it should produce performance gains.
  4. Be selective. Be choosy with your benefits offerings. Select benefits that matter most to your top talent. You may administer 20 different benefits when just 5 are used and valued.
  5. Incorporate drivers of revenue into performance management. Understand the drivers of revenue in your organization and make sure those are measured in the performance evaluation process.
  6. Train smarter. Conduct a training needs assessment to prioritize and identify critical training needs across the organization. Use high quality training methods that lead to behavior change.
  7. Track ROI. Link wellness to health insurance usage; training to performance improvement; engagement to profitability gains. Showing ROI helps build a business case for HR and reinforces its value.
  8. Improve medical and leave management. Administering employee leave more efficiently and choosing an effective Managed Care Organization (MCO) are ways that you can help employees get back to work in less time and reduce the drain of medical leave and workers compensation costs.
  9. Measure what matters. Measure HR cost factors (i.e. compensation cost, benefits cost) and revenue per employee. Know what your top HR costs are and how those compare to other organizations.
  10. Implement time-saving systems. Digitize HR data and record retention. Make it easy for employees and managers to access and use the information you collect so that they can focus on producing results.
  11. Identify obstacles to revenue generation. Lead performance improvement efforts, suggestion and feedback programs, and other means to help identify opportunities to increase revenue.
  12. Plan your workforce. Understand your organization's areas of growth and ensure that you are stacking those areas with top talent. Workplace planning prioritizes hiring needs.
  13. Reduce legal fees. By choosing inexpensive legal resources and assistance, obtaining legal knowledge, and keeping your organization compliant, you can significantly reduce legal fees.
  14. Save on staffing. Hiring is arguably one of your most expensive HR areas. Reduce your cost per hire by taking advantage of staffing service discounts and using creative, inexpensive sourcing methods.

HR departments that drive revenue and results in their organizations take advantage of opportunities to save their organizations money wherever possible, identify opportunities to build up their top revenue producers, and simply manage HR smarter and more efficiently.

HR Project Support: Job Descriptions and Onsite HR Audit

Bandwidth Battles: Streaming Content Takes a Hit

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As the mid-afternoon lull sets in, you decide to check in with a few folks. When you poke your head in and say hello, you get no response. With their headphones in and Pandora buried beneath a cascade of windows on their desktop, you can see that this employee is clearly focused on the task at hand. You move on to the next cube over- headphones again. Oh well, you can stop by again tomorrow, besides there’s a new Pandora station you’ve been meaning to try.

But what if Pandora wasn’t an option anymore? What about YouTube, ESPN.com, or any other site containing streaming audio or video? Employees all across the country are finding out as more and more employers are unable to keep up these bandwidth hogs.

CNN cited Proctor & Gamble as yet another prominent example of an organization forced to make the decision to block certain sites with streaming content. For P&G employees, Pandora and Netflix are now a thing of the past, but interestingly, both YouTube and Facebook remain accessible.

Their decision to block some but not all streaming content sites reflects yet another challenge that organizations are facing related to streaming content. Even as they ban some sites, organizations must balance their need to preserve network bandwidth, while still retaining access to sites that employees utilize for job related activities, such as marketing or professional networking.

So where does your workplace fall on this continuum from total restriction to total access of streaming content? Has the ongoing struggle for sufficient bandwidth forced your organization to block streaming content? Is bandwidth capacity the issue or is the ban more closely related to questions about employee productivity or other factors?

For more news like this, sign up to receive our weekly newsletters here.

What is the Difference Between an MCO and a TPA?

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If you are responsible for your workers’ compensation program, it is important to have a fundamental understanding of the roles of a MCO and a Workers’ Compensation Third Party Administrator (TPA). MCOs and TPAs play unique roles in helping employers control workers’ compensation costs.

What is a MCO?

Under Ohio's Health Partnership Program, MCOs are responsible for the medical management of Ohio employers’ work-related injuries and illnesses. Every employer in Ohio must have a MCO, which is paid for directly by the Bureau of Worker's Compensation.

The core MCO functions include:

  • Collecting initial injury reports and transmitting to BWC;
  • Management and authorization of medical treatment to be received by an injured worker;
  • Medical review and bill payment processing;
  • Maintaining a network of BWC-certified healthcare providers;
  • Return to work services;
  • Utilization review;
  • Providing Peer Reviews as necessary for treatment decisions;
  • Processing treatment appeals through the Alternative Dispute Resolution (ADR) process; and
  • Training and education.

Further, MCO associates are medical professionals and their processes are clinically focused. They work diligently to help employers avoid the most costly of claims, i.e. lost time claims – when an injured worker is off work for eight or more consecutive days. With clinicians managing the medical care and transitioning injured workers back to gainful employment, employers are better able to manage their long term insurance premiums.

What is a TPA?

A Third Party Administrator (TPA) assists employers in the administrative and financial aspects of a claim.

The core TPA responsibilities include:

  • Providing risk management consulting to employers;
  • Administering compensation group rating savings programs and other discount program consulting;
  • Pertinent claims investigation;
  • Claims administration;
  • Industrial Commission hearing attendance;
  • Evaluation of claims for workers' compensation coverage; and
  • Assisting employers in the development of workers' compensation cost control strategies.

 

TPA staff typically consists of claim representatives, account representatives, and other workers' compensation professionals. 

ERC is proud to endorse CareWorks as the preferred workers’ compensation Managed Care Organization (MCO) for members. For more information, click here.

6 Ways to Help Employees Get Along

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6 Ways to Help Employees Get Along

Sometimes employees don't get along and these conflicts and office disagreements can dampen productivity, waste time, reduce a team's performance, make the work environment tense and uncomfortable, and increase stress in work groups - none of which are beneficial to your business. Here are a few ways managers can help reduce conflict on their teams.

1. Set the tone

Managers and leaders set the tone for team interactions by what they say or do when conflict or problems emerge between their employees, how they manage conflict with their own peers, and what behavior they tolerate. If managers act passive-aggressive, disrespect fellow employees, or do not directly deal with conflict, employees will follow their lead.

2. Hire team-players

Hiring employees who have strong interpersonal, team-building, and internal customer service skills can decrease the likelihood of conflicts. While it's tough to predict how well a candidate will interact with your team, a solid personality or style assessment and behavioral interview as well as asking for references can help.  

3. Don't ignore conflicts

Managers have a tendency to ignore problems with poor team-players or team conflicts until they escalate. Instead they should encourage employees to collaborate on a solution and seek coaching and/or training for current employees who argue with coworkers, don't provide good internal service, or are overly critical or judgmental of others. It's critical to not let conflict spiral out of control.

4. Educate on styles and generational differences

Great teams are melting pots of different generations and backgrounds. Each employee brings a different personality and style to the table. Most conflict stems from not fully appreciating who another person is, their background, and the strengths of their individual style. Spend time educating your team on style and generational differences.

5. Spend time interacting

Developing common ground is one of the most important ways to fend off conflict in the workplace and it's achieved in the simplest of ways: spending more time with one another. Informally interacting and talking is one of the best ways to get employees familiar with one another. When they eventually find common ground, magic happens.

6. Reward teamwork

Most managers want teamwork, but reward individual achievement. Recognizing and rewarding teamwork, collaboration, and supportive interactions and promoting or giving choice assignments to employees who act like team players helps promote and encourage a supportive work environment.

When conflict strikes in the workplace, your managers are the best people to nip it in the bud, deal with it, and prevent it.

Conflict Resolution & Mediation Training

Conflict Resolution & Mediation Training

The course demonstrates how constructive conflict resolution techniques can be useful.

Train Your Employees

4 Strategies to Combat Turnover

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Turnover is a reality for every business. It can be a warning sign that something is wrong with our workplace, managers, or teams that needs to be fixed. It can also signal that we might be hiring poor fits into the organization.

The problem of turnover demands that we understand why we are not able to retain some of our employees and fix it before the situation spirals and we lose many talented employees. Here are 4 strategies to combat turnover.

Step 1: Track it.

The first step to deal with turnover is to track and benchmark it. You must understand how your numbers compare to normal turnover for your industry and size and if the turnover you are experiencing is healthy or unhealthy for your business. For example, are your best employees leaving or are your new-hires leaving, and is turnover primarily voluntary or involuntary? At a minimum, track the following types of turnover:

  • Voluntary and involuntary turnover
  • All employee and top performer turnover
  • New-hire turnover at intervals (90 days, 180 days, and 1 year)

Step 2: Research the context.

The second step in combating turnover is to research the context of the termination, including the work area affected and characteristics of the employee. You'll also want to explore the former employee's reason for leaving as well as their supervisor's and coworkers' feedback on the termination. Turnover issues tend to follow a pattern so look for trends in the following:

  • Work area (location, division, department, team, and supervisor)
  • Individual characteristics (length of service, performance, type of job)
  • Reason for leaving (per exit interview/survey)
  • Supervisor and team feedback

Step 3: Identify critical incidences.

Turnover is generally not caused by a single workplace event. Research shows that turnover results from a process of progressive disengagement, which can take weeks, months, and sometimes even years to escalate to a final decision. Eventually, however, a critical incident causes an employee to decide to quit.

To understand the cause of turnover and fix it, you need to identify these critical turning points and causes of disengagement so that repeat scenarios with other employees are prevented. Examine what went wrong, what you could have done differently, and how you will approach a similar situation in the future.

Step 4: Implement interventions.

After determining the causes and context of turnover and putting together the pieces of each former employee's story, there are several major interventions that you can use to solve turnover problems. These include, but are not limited to:

  • Job design: changing a job's design, reducing workload, providing more training, or enhancing employees' skills
  • Management: training or developing a manager's skills, removing a manager from their position, improving performance management or feedback
  • Hiring and selection: making a change in the hiring or selection procedure, enhancing on-boarding
  • Communication: communicating changes and reasons for changes, being sensitive to and dealing with employee reactions, managing and mediating coworker conflict
  • Total rewards: making changes to pay and benefits, enhancing advancement opportunities, enhancing work/life benefits

Turnover is as critical to monitor and address as expenses in your organization. It is a lost investment in your business that can take significant time and money to recover, especially when you lose a high performer. While there’s no magic bullet solution to prevent it, your organization can better manage turnover by tracking it, better understanding why it happens, and implementing interventions that deal with it.

Additional Resources

2012 ERC Turnover & HR Department Practices Survey
This survey collected information from Northeast Ohio employers on voluntary and involuntary turnover of employees and new-hires as well as HR department practices including the role of HR, common HR metrics and benchmarks, and the use of technology and information systems within the HR department.

How to Build Your Own Great Workplace

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At ERC, we believe that creating a great workplace is about creating an environment and culture that supports the talent your organization needs to be and stay successful. It means creating a place in which great talent want to come work and where they want to stay and build their career. It’s about enabling superior performance and eliminating the policies, practices, and norms in your workplace that hinder your top people’s success, progress, and innovation.

If this sounds like something your organization wants to achieve, here are 5 steps we recommend for creating a great workplace.

1. Commit to creating a great workplace.

Making a true commitment to be an employer of choice is the first and hardest part of creating a great workplace. It requires getting your management team on-board with their support, securing and committing resources for the initiative, and creating a vision of where you see your workplace in the next 3-5 years. It also entails meeting regularly with your managers to talk about and identify ways to enhance your workplace. You can't create a great workplace without your leadership and managers on-board, the willingness to put resources behind the effort, and on-going discussion.

2. Identify your top performers.

Great workplaces are built from great people. This requires hiring the right people from your receptionist to line employees to managers to top leadership. Rarely do organizations have all the right people. This is why it is especially important to identify who your top performers are and define what attributes top performers have at your organization. Knowing which employees are successful and why they are effective will help you hire more of those people, create a workplace that meets their needs, and weed out the wrong fits.

3. Ask employees for their feedback.

Great workplaces have feedback-rich cultures that care about, appreciate, and use employees' input, ideas, and opinions. To create and maintain a great workplace, you need to know what engages your people, specifically what would make them stay, what would make them leave, and what is important to them. In our experience, the answers to these questions (though similar) vary by organization. Whether it's conducting one-on-ones, focus group discussions, or an engagement survey, start somewhere and invite employees to share their feedback.

4. Benchmark your practices.

Data and measurement are important parts of creating a great place to work. In order to create a great workplace, you must gauge how you stack up against other employers of choice – how your total rewards package, policies, culture, and results compare to the standards set by best-in-class organizations. This not only helps your organization determine what it takes to be a great place to work, but after determining where the gaps are, you can develop strategies to help build, change, and enhance your policies and practices.

5. Evaluate your progress.

Building a great place to work is an on-going endeavor – it never ends. It will require constant attention, changes, and improvements. It will also require that you monitor and evaluate your progress regularly to make sure that you are meeting your goals in becoming a great place to work.

If your organization is progressing towards becoming a great place to work, over time it will see its investments pay off. Attracting and hiring top talent gets easier, great talent sticks around, your workforce is more engaged and productive, and your workplace’s reputation improves. The road to a great workplace is undoubtedly a path that is worth pursuing if your organization wants to secure top talent to achieve long-term success.

Additional Resources

NorthCoast 99 – 99 Best Places to Work in Northeast Ohio If your organization is interested in being recognized as a best place to work and thinks it excels at attracting and retaining top talent, begin your application today!

Benchmark Reports Interested in targeted metrics for top performers and benchmarking how your organization's practices for attracting and retaining top talent compare to others in the region? Please take a look at our benchmark reports which provide tons of information on great workplaces and top performers.

Consulting & Project Assistance
ERC is a leading provider of quality, affordable human resources consulting services in Ohio. Our HR consulting services provide the crucial strategic and technical expertise needed to support your HR goals and workplace initiatives.

Travel Expense Practices Remain Stable, Despite Rising Costs

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The 2012 EAA National Sales Compensation & Practices Survey, which surveyed nearly 800 organizations throughout the United States, shows that employers are reimbursing sales employees for a number of different travel expenses.

  • Over 80% of employers pay for economical air fare and around 10% pay for business class air fare. Over 90% of employers allow employees to keep their air fare frequent flyer miles for personal use.
  • Over 85% of employers reimburse for most transportation-related expenses including bus and cab fares as well as parking and highway toll fees. Slightly fewer organizations reimburse for transportation-related gratuities.
  • Company cars are only provided by 32% of respondents, with most employers (over 80%) reimbursing for employees’ use of their personal cars. About two-thirds of employers reimburse via straight cents per mile (typically at the IRS rate) and 20% reimburse via a combination of straight cents per mile and a flat amount per month to cover general vehicle wear and tear.
  • The widespread majority of employers do not clearly define expense reimbursement practices pertaining to entertainment, lodging, and meals. Over 70% of employers indicate that they simply reimburse for reasonable expenses related to these.

The survey shows that travel expense reimbursement practices for sales professionals have remained relatively stable with little change over the past five years, except for a slight decline in the use of company cars, a slight increase in mileage reimbursement, and an uptick in the number of employers simplifying their reimbursement practices for entertainment, lodging, and meals.

As gas and transportation prices continue to rise, however, employers need to ensure that their travel reimbursement practices continue to keep pace in order to attract and retain top sales professionals whose work involves significant travel.

“We’ve found that travel expense reimbursement can sometimes be a retention issue for sales employees – especially when employees perceive expense reimbursement practices to be unfair or not in line with what is provided by other companies, or when the costs of paying for transportation begin to affect their compensation,” says an ERC HR Consultant. She explains, “To retain quality sales people, employers need to be mindful of how rising gas and transportation costs are impacting their sales employees’ take-home pay.”

For more information about our Compensation & Salary Surveys or to purchase them, please click here.

Additional Resources

Professional Travel

Benchmark your company’s travel practices and expenses with a complimentary review from ERC’s Preferred Partner Professional Travel. Most employers realize a savings of 12% to 17%! Learn more about the cost savings and employee safety benefits of having a managed travel program.