LA Bans the Box

On November 30th, 2016, the Los Angeles City Council passed the Fair Chance Initiative prohibiting most employers from inquiring about applicants’ criminal histories until a position at the company has been offered. The notion was approved by a 12-1 vote, making Los Angeles another of many to instill this new law.

The city’s ordinance will apply to all employers who have at least 10 or more employees on staff, with the exception of careers in fields like law enforcement and child care. The decision was made to join a growing movement in helping those with criminal records find suitable employment despite their pasts. There are now 24 states with over 150 cities who have adopted this bill.

The Fair Chance Initiative was started by the Los Angeles based organizations Homeboy Industries and All of Us or None. Both groups provide support to previously incarcerated persons, fighting for their rights to rejoin the workforce in the United States; a very applicable stance to the ‘ban the box’ law. According to the National Employment Law Project, a 2011 study discovered that reentering 100 formerly incarcerated people back in the working world would increase their lifetime earnings by $55 million. This would also save $2 million annually be keeping these employees out of the criminal justice system.

However, as mentioned in a previous blog of ours, these policies bring forth the risk of increasing discrimination, as employers who are not legally allowed to research an applicant’s criminal history may consider denying him or her because of ethnicity a loophole. This fallback on stereotyping can have an adverse affect on those seeking jobs following incarceration, but the question of morality remains. Implementing the ‘ban the box’ law has led to a large increase in the hiring of those with criminal records despite these claims.

Now that Los Angeles has joined many cities around the country in this movement, the City’s Office of Wage Standards is expected to enforce this ordinance. If any violation of the new bill is reported, the applicant filing the report may receive up to $500, so long as the allegations are upheld.

For more information on the rising ‘ban the box’ movement, visit the National Employment Law Project’s guide here.

Marijuana Legalization and its Effect on Your Drug Screening Policy

Whether you were a Trump supporter, Clinton supporter, or none of the above, the election is behind us. The results of the November ballots resulted not only in the election of Donald Trump as our president, but also the legalization of recreational marijuana use in four states in what the media is calling a big win for marijuana reform.

California, the United States’ most populous state, along with Massachusetts, Nevada, and Maine, approved the use of recreational marijuana on Tuesday, November 8^th. Overnight, the number of states permitting recreational use grew from four (Alaska, Colorado, Oregon, and Washington) to eight, doubling the amount of states in which use of marijuana is legal. So not only has the most populous state legalized marijuana, but the movement for reform has made its way out to the east coast.

Recreational use was not the only marijuana-related question on the ballot either. Medical marijuana usage was approved by three new states (Florida, North Dakota, and Arkansas), pushing the number up to a whopping 28 states. Nine different states had marijuana on the ballot, so we will talk about the impact these bills will have on your drug screening policy.

Whenever a new bill is passed relating to marijuana, we get questions about how that will impact your corporate drug screening policy. We’ve written about it in the past, and the answer remains the same as before. Until marijuana is removed from the list of Schedule I drugs under the federal Controlled Substances Act, employers should still be able to test for the substance as they see fit. That is because the states that have passed these laws permit taking adverse action if the employee is under the influence of marijuana at work.

Now some may ask, “Don’t these new laws prohibit adverse action (firing of an employee) for the off-duty use of marijuana?” The answer is yes, but determining whether it was used during work hours or after hours can be tricky. The problem lies in the testing methods used for marijuana. Unlike alcohol, there is no known threshold for impairment. Testing for marijuana, depending on the method, can detect use from as far back as 30 days. For hair tests, the window of detection is larger. Therefore, a positive result does not necessarily mean the applicant/employee is impaired. However, there is no way to be sure.

In conclusion, due to the limits of drug screening for marijuana and the drug’s inclusion in the list of Schedule I drugs under the federal Controlled Substances Act, employers can still take adverse action against employees and applicants for a positive drug test. So for now, employers can still maintain a zero-tolerance policy for the drug should they so choose. Whether the spread of this marijuana-related reform or the development of new drug screening tools will change this remains to be seen. We recommend that companies at the very least review their policies and, should they continue to enforce a zero-tolerance policy, communicate to their employees that marijuana use could still result in the termination of employment.

Separating Good Employees from Great Employees When Interviewing

The process of interviewing can become a monotonous task for employers in need of hiring, sifting through countless applications. To avoid falling into a generic routine comprised of run-of-the-mill interview questions and potentially hiring a damaging employee, take the following evaluations into consideration when interviewing in order to truly gauge an applicant’s worth.

What is their vision?

Asking an interviewee where they see themselves in 5 or 10 years leaves the door open for common, overused answers. Elaborate on this topic by asking what their professional vision within the company is. How can he or she contribute something that hasn’t been done before? An applicant who can quickly and thoroughly answer questions regarding their future, and what they can bring to the table is typically a visionary who can recognize his or her own value.

Why did they leave their previous job, and did they attempt to find a solution?

Whether or not candidates you are interviewing left their previous place of work due to inadequate pay, or problems with coworkers, asking if they’ve tried to rectify the issue at hand will allow them to show their problem solving abilities in situations that call for such skills. If the problem they faced led to them quitting the very next day, that may show their inability to cope with difficulties. However, if they are simply exploring their options within the working world, you do not want your business to be seen as a negotiation for higher pay, leveraging against their current position. Be sure applicant’s want to work for your company specifically, and are not merely weighing their odds in order to find any job they can.

What is something new they learned within the past month?

Questions pertaining to an interviewee’s self-development forces them to consider how aspects of their personal lives relate to their professional careers. Rather than listing bullets on their resumes one by one that relate only to their work history, candidates should be able to show an eagerness for growth outside of the office. Ask them to teach you something. As vague of a question as that is, it compels the interviewee to dive into their personal interests, showing their enthusiasm for learning. An applicant that takes ownership of his or her personal growth is typically one that can be trusted to successfully grow within your company.

Going above and beyond in the interviewing process can yield extremely beneficial results for employers looking to find their next great employee. Look to stray away from standard interview questions that almost all applicants can answer with ease. Candidates that can translate well to your business’s needs will manifest themselves through these unique questions by showcasing their skills and ability to think quickly on their feet.

EEOC Issues New Strategic Enforcement Plan

The Equal Employment Opportunity Commission (EEOC), an agency of the federal government created by the Civil Rights Act of 1964 to prevent discrimination, created an enforcement plan in December 2012 for years 2013 through 2016. This month, the EEOC has put together a strategic enforcement plan (SEP) for years 2017 through 2021. One of the ways the EEOC combats discrimination is targeting unfair, discriminatory recruitment and hiring policies. Employers with fifteen or more employees are subject to the guidelines of the EEOC. The guidelines for proper recruiting measures can be found here.

For 2017-2021, the EEOC will be focusing on class-based recruitment practices that discriminate against racial, ethnic, religious groups, older works, women, and those with disabilities. Due to an expanding temporary workforce, the EEOC has made it its priority to focus on temporary workers, staffing agencies, and independent contractor relationships.

EEOC Initiatives:

1. Eliminating Barriers in Recruitment and Hiring.
2. Protecting Vulnerable Workers, Including Immigrant and Migrant Workers, and Underserved Communities from Discrimination.
3. Addressing Selected Emerging and Developing Issues.
4. Ensuring Equal Pay Protections for All Workers.
5. Preserving Access to the Legal System.
6. Preventing Systemic Harassment.

As a 3^rd-party provider of background screening, we will be focusing on the first initiative. The EEOC means to target screening tools that disproportionately impact workers based on their protected status. They include pre-employment tests, background checks impacting African American and Latinos, date-of-birth inquiries that impact older workers, and medical questionnaires that impact individuals with disabilities.

The EEOC’s recommendations for proper use of background information:

• Apply the same standards to everyone, regardless of their race, national origin, color, sex, religion, disability, genetic information (including family medical history), or age (40 or older). For example, if you don't reject applicants of one ethnicity with certain financial histories or criminal records, you can't reject applicants of other ethnicities because they have the same or similar financial histories or criminal records.
• Take special care when basing employment decisions on background problems that may be more common among people of a certain race, color, national origin, sex, or religion; among people who have a disability; or among people age 40 or older. For example, employers should not use a policy or practice that excludes people with certain criminal records if the policy or practice significantly disadvantages individuals of a particular race, national origin, or another protected characteristic, and does not accurately predict who will be a responsible, reliable, or safe employee. In legal terms, the policy or practice has a "disparate impact" and is not "job related and consistent with business necessity."
• Be prepared to make exceptions for problems revealed during a background check that were caused by a disability. For example, if you are inclined not to hire a person because of a problem caused by a disability, you should allow the person to demonstrate his or her ability to do the job - despite the negative background information - unless doing so would cause significant financial or operational difficulty.

Make sure your company is not using date of birth for anything other than a criminal record search. Any other use of the date of birth could be construed as discrimination against older workers. Be certain any exclusions based on criminal history are relevant to the tasks required of the job and do not negatively impact a certain race exclusively. Lastly, give applicants with disabilities a chance to prove his/her capability to do the job at hand.

We recommend companies review their recruitment and hiring practices to ensure that they are in line with EEOC requirements.  To see the SEP in full, click here.

Screening Your Seasonal Workforce

October through January are big months for the retail industry in terms of sales volume. Unfortunately, the holiday season also accounts for about half of all annual shrinkage. Shrinkage is the loss of inventory that can be attributed to factors such as employee theft, shoplifting, administrative errors, vendor fraud, etc. The two biggest causes of retail shrinkage in the U.S. are employee theft at 43% and shoplifting at 32%.

Forty-three percent is an alarming number for employee theft. It is no coincidence that these four months require the hiring of seasonal workers to help with increased foot traffic and sales volume. With these appalling numbers in mind, how can retail companies combat this seasonal employee theft epidemic?

For starters, retail companies should be aware that cutting corners with their screening process will not save their business money in the long run. Shrinkage results in a loss of $42 billion for U.S. retailers annually. With almost half of the $42 billion in shrinkage occurring during the holidays, it is a no-brainer to require the same background screening standards to seasonal workers as full-time employee. However Holding seasonal workers to the same standards as full-time employees means nothing if you are conducting a bare-bones background check on full-time employees. Reducing shrinkage requires a background check that is comprehensive in scope.

Secondly, it is important to remember that if an individual has stolen from their employer, they are more likely to repeat that offense. Bolster your employment verification process by requiring a reference from the individual’s last employer. While the applicant may not have been convicted of theft, their employment may have been terminated for deceitful practices such as: entering refunds or discounts, cancelling transactions, or modifying prices at the cash register. A lot of theft is the result of dishonest practices at the cash register.

If your company is in the retail industry, take a look at your background screening procedure. Are you doing the bare minimum? If your background check consists only of a national database search, you are more likely to hire someone who has committed theft in the past. If you have any questions about fortifying your background screening process, please feel free to use the comments section or contact S2Verify at 1 855 671 1933. 

FTC Issues Guidance to Landlords for the Use of Consumer Reports

The FTC has issued a publication that helps landlords understand the proper steps to take when using background checks.  Much like its guidance, Background Checks: What Employers Need to Know, this publication details the obligations of users of consumer reports under the Fair Credit Reporting Act (FCRA). The guidance details what a consumer report is, what is required before the use of a consumer report, and the proper adverse action steps.

The FTC defines a Consumer Report as any information about a person’s credit characteristics, rental history, or criminal history. These reports include:

•          A credit report from a credit bureau, such as Trans Union, Experian, and Equifax or an affiliate company;
•          A report from a tenant screening service that describes the applicant’s rental history based on reports from previous landlords or housing court records;
•          A report from a tenant screening service that describes the applicant’s rental history, and also includes a credit report the service got from a credit bureau;
•          A report from a reference checking service that contacts previous landlords or other parties listed on the rental application on behalf of the rental property owner; and
•          A report from a background check company about an applicant or tenant’s criminal history.

Before Getting a Consumer Report

The guidance puts an emphasis on permissible purpose. Permissible purpose means that landlords have a legitimate business need that requires a background check. In the case of landlords, they must only use consumer report information for the purpose of screening applicants and/or tenants who apply for rental housing or renew a lease. While written consent is not required from applicants, it is a great way for landlords to prove they have permissible purpose for the use of a consumer report.

The FTC notes that landlords should avoid a blanket policy of refusing to rent to anyone with a criminal history, as it may violate the Fair Housing Act.

Adverse Action

It is important to note that adverse action does not only consist of the denial of an application. Adverse action also includes:

•          The necessity for a cosigner on a lease if an applicant does not meet the income requirements;
•         The requirement of a deposit that would not be required for another applicant;
•         The requirement of a larger deposit than might be require for another applicant; and
•         Raising the rent to a higher amount than for another applicant.

Whether an employer or a landlord, one thing remains constant. You must provide the applicant notice that you are taking adverse action (any of the measures listed above) and the reasons for the action. While the notice can be given orally, in writing, or electronically, we recommend that the notice is given in writing for auditing purposes. Please note that an adverse action notice is required even if the consumer report wasn’t the primary reason for the decision. If the consumer report played any part in the decision making process, the applicant/tenant must be notified.

The Adverse Action Notice must include:

• the name, address, and phone number of the consumer reporting company that supplied the report;
• a statement that the company that supplied the report did not make the decision to take the unfavorable action and can't give specific reasons for it; and
• a notice of the person's right to dispute the accuracy or completeness of any information the consumer reporting company furnished, and to get a free report from the company if the person asks for it within 60 days.

To view the guidance in full, click here.

California Assembly Bill 1289: Mandatory Background Checks for TNC Drivers

Assembly Bill 1289, passed on September 28^th, has made background checks mandatory for drivers working for a Transportation Network Company (TNC) in California. This bill applies to both employees and independent contractors.

What is a TNC?

TNCs are organizations that connect paying passengers with drivers who provide transportation using their own non-commercial vehicles. All parties connect to the service via website and mobile apps. These are companies like Uber and Lyft.

Background check requirements for TNCs:

•         A multi-state and multi-jurisdiction criminal records locator or other similar commercial nationwide database with validation; and
•         A search of the United States Department of Justice (USDOJ) National Sex Offender Public website

A TNC shall not contract with, employ, or retain a driver if he/she meets the following criteria:

•         Is currently registered on the USDOJ National Sex Offender public website
•         Has been convicted of a violent felony
•         Has been in violation of Section 11413, 11418, 11418.5 or 11419 of the Penal Code

A TNC shall not contract with, employ, or retain a driver if he/she has been convicted of any of the following offenses in the last seven years:

•         Misdemeanor assault or battery
•         Domestic violence offence
•         Driving under the influence of alcohol or drugs
•         A felony violation of Section 18540 of the Elections Code

Assembly Bill 1289 goes into effect on January 1, 2017. We recommend that each Transportation Network Company review their background screening procedure to ensure compliance with the new bill as well as the Fair Credit Reporting Act and other local laws. Each violation of the new law will result in fines between one and five thousand dollars per incident.

To view Assembly Bill 1289 in full, click here.