Screening & SelectionTalent Acquisition

Tough Calls

Transparency is key to successfully hiring in today’s economy.

By Russ Banham
In the still-volatile economy (will it ever again not be volatile?), hiring candidates with criminal backgrounds serves a societal purpose, but poses risk. The latter can be described for employers as the old, proverbial “stuck between a rock and a hard place.” While employers confront potential litigation for discriminatory hiring practices, they risk both litigation anda severe reputational damage if the hired individual commits a violent act at the workplace.
To strike a delicate balance in making this choice, savvy employers are turning to the background screening industry, outsourcing the assessment to companies that do far more than check for and provide criminal records. Each potential hire is evaluated in an individually-based assessment that takes into account a plethora of circumstances—the type of crime, when it happened, the person’s behavior since incarceration and, most importantly, the relationship of these various factors to the available job position. Everything but the actual employment decision is, in effect, outsourced.
Why is all this important? “Because if you have a bright-line policy where you do not hire anyone with a felony conviction, that bright-line policy will automatically discriminate against minorities because they have a much higher arrest and conviction rate,” explains Robert Capwell, chief knowledge officer at background screening firm Employment Background Investigations. “You’re automatically violating Title VII (of the Civil Rights Act of 1964) prohibiting hiring discrimination on the basis of race, color, religion, and other factors.”
Since the financial crisis reared in 2008 and spawned great numbers of unemployed people, the risk of making a wrong step hiring-wise has enlarged. In its aftermath are a rising number of rules designed, in part, to help everyone find work, and agencies to police enforcement of the regulations. In addition to Title VII are the Fair Credit Reporting Act (FCRA), the Equal Employment Opportunity Act (EEOC) and the newly formed Consumer Financial Protection Bureau, among others.
For instance, many U.S. cities, including Chicago, Jacksonville, Philadelphia, San Francisco, Memphis, and Baltimore, have joined the fray with the “ban the box” fair hiring practice, removing unjust barriers to employment of people with criminal records. The “box” is the question on hiring forms asking about previous criminal acts. Keep in mind the National Employment Law Project notes that 65 million Americans, or one in four adults, have a criminal record that may show up on a routine background check report.

The EEOC stands behind this growing policy, which seeks for workers to be judged on merits and not a prior, most-likely unrelated conviction. In April, the EEOC recommended as a best practice that “employers not ask about convictions on job applications and that, if and when they make such inquiries, the inquiries be limited to convictions for which exclusion would be job related for the position in question and consistent with business necessity.”
Technology to The Rescue
The revolutionary changes in compliance rules governing hiring practices is in tandem with the dramatic increase in the volume of employers over the past decade performing background checks on prospective job applicants. Ditto the capacity of different technology tools making electronic employment verification increasingly possible. Advancements like E-Verify and electronic Form I-9 solutions are enabling faster, more accurate, and more thorough background screening processes.
E-Verify is a free Internet-based program offered by the federal government that helps employers compare information from a job applicant’s Employment Eligibility Verification Form I-9 to data from U.S. government records. If the information matches, the person is eligible to work in the United States; if there’s a mismatch, E-Verify alerts the employer, and the candidate is allowed to work while he or she resolves the problem. No resolution, no more job.
These new tools are a godsend for both employers and background screening providers. “Technology might be the single most important element allowing companies our size to compete in this industry,” says Kevin Olson, chairman and CEO of Universal Background Screening. “It’s changed the way we do business, and the way our clients do business.”
The complex web of federal, state, and local compliance mandates is further changing the way employers acquire information on job applicants, compelling many to outsource screening and related assessment and compliance services to providers. The latter is increasingly vital from a litigation and regulatory standpoint. E-Verify laws, for instance, are different on a state-by-state basis, with regard to the size and types of companies that must comply with the rule.

“These laws can be incredibly confusing,” says Raymond Conrad, owner and CEO of General Information Services, Inc. (GIS).
“Companies come to us because we offer as much guidance as legally possible on their legal requirements.”
Olson’s firm also provides compliance advice and educational services. “We offer training about the various compliance obligations, educating clients about their responsibilities under FCRA, for instance,” he says. The law regulates the collection, dissemination and use of consumer information, obligating employers to provide prospective employees with a written notice and copy of any hiring concerns before taking adverse actions like not hiring or rescinding a job offer.
“Especially with the growing prevalence of identity theft, common names and redacted identifiers in court records, this notice and waiting period provides the applicant time to exercise his or her right to review the report and dispute any information, before any adverse action occurs,” Olson explains. “Screening companies such as ours take our responsibility in this area very seriously; we have specific procedures in place to be sure these disputes are re-investigated properly and in a timely manner.”
He adds that the firm’s ability to perform a re-investigation “is predicated on everyone involved in the transaction, from information providers to employers to the consumer, being aware of the dispute process and fully complying with FCRA when disputes arise.”
Indeed, compliance with the growing panoply of oft-conflicting rules has become the bread and butter for many screening firms. “What companies like ours do is continuously monitor changes in regulation at the state, federal and city level, and then build a process for our clients to comply with these ever-shifting rules,” says Laura Ransazzo, vice president of compliance at Oracle Reports. (Both Randazzo and Capwell are past chairs of the National Association of Professional Background Screeners.)
More than just criminal records are screened—providers also routinely access and assess applicant references and credit. But, as Capwell points out, the big risk for employers is hiring someone on the wrong side of a criminal conviction. “From a societal standpoint, someone convicted of dealing drugs who has served his time and needs a job will do what if he can’t find one?” he explains. “He’ll likely go back to selling drugs. This is unfortunate since the person is theoretically reformed and should be able to find work.”
Sifting through an applicant’s criminal history is a major consideration, and this is where screening firms can serve the societal benefit Capwell describes. “Employers need to take a look at the circumstances surrounding the crime,” he asserts. “What was the crime and how long ago was it? Did the applicant get caught smoking marijuana in college 20 years ago? How long as he or she been clean? Most importantly, what is the nexus between the crime and the position the person is applying for?”
Others agree with these recommendations. “You want to match the person to the position—hence someone convicted of being a pedophile is not going to be right for a job in a daycare,” says Randazzo. She adds that employers require a wealth of data on a job applicant, including possible gaps in employment that beg an explanation and education records that don’t check out. “You need to look at the whole picture when making a decision, which will help you discern the better choice, say, of two people with criminal records. When we sit down with clients, we always say `don’t just eliminate them, ask for additional information.’ You want to see more than just one side of the story.”
Another vexing issue for employers is data accuracy. “You can’t just pull something from a database that hasn’t been completely vetted and hand it over,” Capwell says. “”If John Jones applies for a job, well, there are thousands of other John Joneses out there. You find a conviction for John Jones, but does this conviction match up with the applicant’s birth date, social security number, and so on? You need all the pieces of the puzzle to report something accurately.”
Yet another concern is an applicant’s residency. “Let’s face it, ICE (U.S. Immigration and Customs Enforcement) is out there looking for violations of immigration, making the hiring of illegal immigrants a huge issue for employers,” Capwell says. “Fortunately, E-Verify and electronic I-9 forms make this easier to ensure compliance, which background screening firms can then stay on top of for clients.”

Tomorrow’s Screeners Today
The new and expanding hiring compliance regime has fostered a very different background screening industry, one in which providers offer system-to-system integrated hiring solutions to prospective clients dovetailing with both applicant tracking systems and traditional HR systems. In fact, several screening providers commented that the industry no longer sells a commodity and is more of a consulting-type business.
“We’re all about ensuring that employers do things properly,” says Brandon G. Phillips, president and CEO of Global HR Research, a background screening firm. “This is not just about offering data on a person’s criminal record. It’s about consulting on the entire hiring process on a vertical-by-vertical basis. For instance, there are different federal and state employment rules for different verticals like healthcare and energy.”
Going to a provider for the lowest price—the commodity approach in past—no longer cuts the mustard, he maintains. In agreement is Greg Dubecky, president of Corporate Screening Services, Inc. “When technology tools made it easier to quickly screen someone’s criminal or credit history, the industry grabbed onto this and we became a commoditized business,” Dubecky explains. “Employers were buying criminal histories like they were buying widgets. But, as technology evolved, we realized we could do deeper dives on applicants and then integrate the background screening processes with clients’ applicant tracking systems. This evolution has pushed forward to where we’ve now become one-stop shops working with HR and staffing professionals.”
He adds, “We’ve become specialists.”
Others echo this sentiment. “Before it was criminal background checks and drug tests,” Bill Tate, president of screening firm HR Plus chimes in. “Now it’s more of a consultative approach.”
This approach extends beyond vetting prospective employees for criminal backgrounds. “More than employees can create a violent situation at work,” Tate explains. “We’ve been brought in to screen external janitorial staff coming through the door, and even consultants. We’re also providing occupational health services, testing individuals for tuberculosis or nicotine in situations where someone says they do not smoke.”
With regard to integrating background screening with applicant tracking and HR systems, Capwell says the value extends to both outsourcing providers and buyers. “The onboarding process needs to be as paperless as possible,” he explains. “We’re getting into a world where an applicant may not even go in for an interview, possibly doing it from home. He or she fills out an online application, which is electronically kicked to the screening firm through a secure portal for the background check. Forms for compliance are also online. All this integration makes our job faster, easier and more efficient.”
As Randazzo puts it, “Days and days are being eliminated getting the individual onboarded via an integrated technology solution.”
Ryan Krostue, chief operating officer at Universal Background Screening, says integrated background screening solutions are more popular with his clients, insofar as the companies’ end-to-end talent acquisition goals. “Clients that have deployed integrated solutions have reported a more efficient, accurate and timely screening process,” he explains.
While some screening firms have invested in their own in-house talent acquisition software products, Universal’s approach is to partner with talent acquisition technology providers in offering an end-to-end solution. “With so many applicant tracking solutions available in the market today, and many of them tailored to the particular needs of the employer based on size or industry, we have found the partnership approach to be successful for us, our clients and the talent acquisition software providers,” Krostue says.
Russ Banham is a contributing writer to HRO Today. He can be reached at

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