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.

3 Steps Toward a Complete LinkedIn Profile

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Signing up for a LinkedIn Profile requires only a few simple pieces of information. However, the more complete your profile is, the more opportunities will likely open up for you.

According to LinkedIn, a "100% complete profile" includes the following items:

  • Industry and postal code
  • A current position with description
  • Two more positions
  • Education
  • At least 5 skills
  • Profile photo
  • At least 50 connections
  • A summary

In this article, we'll discuss 3 of these items that will be valuable additions toward a more complete profile.

Add at least three positions with descriptions

Likely one of the first things you'll do is add your current position. If you've gotten that far, you're off to a great start. But having a more complete employment history provide several benefits for you:

  • Connect with past co-workers - Adding employment history with past employers will allow you to reconnect with past co-workers, potentially opening the door for networking opportunities, partnerships with your current employer or simply reconnecting with an old friend.
  • Demonstrate experience - By adding multiple work experiences, you're demonstrating your experience with different employers in different positions with different job roles. You may also be able to show career progression as you move from one position to another.

Add previous education

Just as adding employment history gives you the ability to re-connect with past colleagues, adding education history allows you to reconnect with former classmates. It also shows relevant education as it pertains to your job or career.

  • Add relevant coursework - Be sure to add your concentration/major if you're adding a post-secondary education, but also include any relevant coursework to assemble a thorough education history.
  • Add activities and societies - This is another easy way to connect with people of similar backgrounds. You may find that you have a closer connection with some of your existing business relationships through past activities or societies.

Add a summary

A summary acts as your personal branding boilerplate. If you were in an elevator with your dream employer (which may be your current employer) and had to summarize your career, experience and expertise on the way up, what would you say? Luckily here, you have more than an elevator ride's amount of time to craft your summary.

  • Think in keywords - What are they keywords that you want people to associate you with? If you're a job seeker, you might use terms like "action-oriented" or "goals-driven." If you're looking to connect with other professionals in your industry, write in terms of tasks or responsibilities.
  • Share relevant extracurriculars - Are you affiliated with an industry association? Do you volunteer with a prominent group that may boost your credentials? Be sure to add that here.
  • Be concise - This isn't the place to write your life story. Try to use short sentences, bulleted lists and no more than a paragraph or two.

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

The Best Solution to Managing Salary Costs

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Like most employers, you’ve probably been faced with the challenge of how to manage rising salary increase budgets, reward high performers, and sustain your organization’s financial health by meeting and exceeding margins achieved in past years. How do you manage these critically important yet competing demands? The best solution is to develop a variable pay program.

Variable pay: A solution to base pay management

Variable pay is one of the best solutions to confronting the problem of base salary increases. It is much less expensive to manage than annual base pay merit increases, doesn’t compound salaries over time, and can deliver meaningful rewards and additional compensation to employees without long-term hits to your margins.

Generally, it takes approximately $5 of variable pay to deliver the same financial effect of a one dollar salary increase. Additionally, base compensation costs account for about 20-25% of your revenue, whereas variable pay costs account for about 3-4% of your revenue (on average). As a result, variable pay can be a huge savings for any employer.

Executing variable pay: Paying for performance

Fundamental to variable pay is the issue of pay for performance. Variable pay requires differentiating pay by some factor, usually individual and/or company performance.

This means differentiating pay by performance and allocating all (or most) of your organization’s pay rewards to your highest performers and reducing rewards for your average or bottom performers. It also means that additional pay is entirely dependent on how your organization performs, which can ensure that your organization’s financials remain healthy and that financial performance targets are met year over year.

The trouble with pay for performance is in the execution. For it to work, you need a culture that rewards high performance; standard performance management systems which give employees the insights, tools, support, and clarity they need to reach their goals and managers the tools to evaluate and objectively compare performance; as well as meaningful payouts.

Here are proven best-practices for executing variable pay when it comes to managing these issues related to culture, performance, and payouts:

Culture

  • Types of variable pay offered match the culture. For example, strong emphasis on teamwork = team-oriented variable pay.
  • Leaders support a performance-oriented workplace and encourage rewarding “A-players.”
  • Tenure, attendance, and other non-performance related factors are not considered when making decisions about pay, rewards, or promotions.
  • Pay for performance is widespread. Everyone has the opportunity to earn more pay based on their performance – not just execs, managers, and sales staff.

Performance management

  • Goals are clear and achievable. Employees understand how to accomplish their targets.
  • A manageable number of targets are given – ideally 1 to 3 important goals.
  • Accurate measures of performance are intact and not subject to extraneous factors.
  • Performance is regularly tracked, monitored, and well-documented.
  • Performance is well-managed. Employees are coaching, re-directed, and assisted in reaching targets.

Payout

  • Payouts are substantial enough to be perceived as beneficial, motivating rewards.
  • Differentiation of pay and/or rewards is enough to be meaningful for high performers. Strive for 2 times the average payout to reward your highest performers.
  • Tiers for payouts are set to reward employees for meeting minimum goals as well as stretch goals.
  • Minimum and maximum thresholds for targets and payouts are provided.

Variable pay programs are promising and highly effective. If your organization is challenged in sustaining its annual merit increase program and controlling base pay costs, variable pay can be an advantageous solution. Just keep these best practices in mind before designing a variable pay program to ensure that the program is successful and delivers results.

Additional Resources

Performance Management Services ERC can support performance management initiatives through performance management system development, performance review form development, competency development, consulting on performance management issues, performance management/goal-setting training for employees and supervisors, and more. 

3 Reasons You Need to be on LinkedIn

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We've all been there. You're at a meeting or a networking event and you meet another professional. Within the next couple days you search for that person through Google or directly through LinkedIn to learn more about them and possibly even connect. And odds are if you don't do that, the other person does.

Social networks have become engrained in the fabric of contemporary networking, and LinkedIn is the network of choice for the business crowd. Having a LinkedIn profile is a necessity for every working professional. Here's why:

1. Control of Your "Personal Brand"

Businesspeople are expected to be on LinkedIn, and a lack of a profile can be an indication of an out-of-date or inaccessible professional. Your profile acts an extension of your business card, showcasing who you are, where you work and what your expertise is.

Quick tip: Don't use Facebook for business networking.*
*unless you feel 100% comfortable with your peers seeing that picture of you from the Bahamas two years ago

Here are three things you can do right away to make sure you're controlling your personal brand on LinkedIn:

  • Get a profile - This is a no-brainer. If you're not on LinkedIn, plan to set up a profile. LinkedIn offers several great tutorials on how to do this.
  • The basics - If you do nothing else, add your contact information and your current employer. This will drastically increase the ability for other people to find you on LinkedIn.
  • Keep adding - Once you've completed the basics:
    • add former employers (to connect with past colleagues)
    • add education (to connect with former classmates)
    • add a summary of your job and expertise (so people can learn more about you).

2. Organize Relationships

Increasing the size of your professional network, whether offline or online, should be an important component of any business professional's career. Having an extensive network comes in handy not only in career transition and advancement, but can be a great resource for sharing ideas and seeking support for issues related to your specific job function.

  • Staying in touch - Remember that person you met at the networking event mentioned above? Build that relationship by connecting with them on LinkedIn.
  • Staying current - LinkedIn provides you with constant updates about people you're connected to, including job transitions, promotions, shared content and more.
  • Staying in the loop - LinkedIn makes it incredibly easy to pose questions to your network and receive nearly instant feedback, making it a powerful tool for getting answers to your job-specific questions.

3. Finding Information & Answers

While LinkedIn is primarily a networking tool, it's become a great research tool for crowdsourcing ideas and information among similar groups of people. Here's how:

  • Your own audience - LinkedIn gives you the ability to ask your own audience a question and receive answers quickly, either through your status message or through a group discussion board.
  • The power of the Group - If you're not using Groups in LinkedIn, you're missing out on an opportunity to listen in on many of the discussions that your peers are having right now. Join a group or two to start, and simply read some of the discussion topics. You're bound to gain something insightful within the first week.

How to Prevent a Retaliation Claim

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Over the past several years, charges of retaliation filed with the Equal Employment Opportunity Commission (EEOC) have significantly increased, making retaliation a major legal risk that employers face. Here are several ways that employers can prevent retaliation.

Know what employment actions are considered "adverse."

An employee can sue for retaliation if they suffer a tangible, adverse employment action - such as loss of income or employment as a result of engaging in a protected activity. They must prove that there is a connection between their protected activity and the employment action they received. Examples of adverse employment actions could be a demotion, termination, or pay cut. A negative performance review may or may not be considered adverse depending on the circumstances.

Be aware that perception is reality when it comes to retaliation.

You may not intend to hurt an employee, but an action can still be perceived as retaliatory if an employee sees it as such. For example, reassigning or transferring an employee to another location, shift, or role or even separating employees from one another can be perceived as an adverse action if the action results in an outcome that is less desirable to the employee.

Address complaints promptly and respectfully.

Take complaints seriously and treat them with respect and care - they are indicators of dissatisfaction and usually precursors to a lawsuit. Start by establishing a policy against retaliation which communicates that your organization does not tolerate retaliation and explains the steps employees should take if they have complaints. Research complaints thoroughly and document the actions you take to address them.

Make and maintain a list of protections.

Create and maintain a list of all protections under law and distribute it to decision-makers, including supervisors and managers. These protections should include employees requesting FMLA, reasonable accommodations, and those employees in protected classes (race, national origin, religion, etc.). Make sure that decision-makers are aware of the types of activities which are protected under law.

Time your decisions accordingly.

Timing is one of the most important pieces of evidence that usually supports a retaliation claim. The longer the timeframe between the protected activity and adverse employment action, the more often courts have dismissed such claims. Refrain from taking adverse employment actions close to a complaint or protected activity.

Channel major employment decisions through HR.

Require a trained HR professional to be involved in any employment decisions, particularly those that negatively affect an employee. Conduct a thorough HR review before proceeding with a disciplinary action (i.e. warning, suspension, termination, etc.) for any employee who engages in a protected action and make sure that you have plenty of documentation to back up your decision.

Train and educate supervisors.

Supervisors can be major culprits of retaliatory decisions and it's important to make sure they are not making any decisions that could be unlawful. While they may feel so inclined to "get back" at an employee, the risks of doing so often far outweigh any benefit. Share specific examples of retaliation by supervisors, common scenarios, and procedures they must follow to avoid retaliation.

On a final note, when it comes to preventing retaliation in the workplace, it's best to consult case law, your attorney, and the EEOC's website for more guidance on the subject.

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

Supervisor & Manager Training: Employment Law

In this series, supervisors and managers learn about potential legal issues such as workplace discrimination and harassment, managing employee leaves of absence, and employee performance issues. Supervisory Series is offered in AM or PM sessions.

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?

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