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Employee Background Checks: The Importance of Doing Them Right

Many of us know the name Edward Snowden. He is the Computer specialist accused of espionage and theft of government property. He allegedly revealed large-scale domestic spying efforts conducted by the United States and British governments. As a former contractor with access to highly sensitive information, his actions caused international scandal, a manhunt, and general animosity toward the United States and its secret, sanctioned invasion of the rights of its citizens.

This past June, the government Office of Personnel Management noted that Mr. Snowden's pre-employment background check may have been done incorrectly. This revelation - and the security breach resulting from the employment of Mr. Snowden - highlight the need for businesses of all sizes to perform proper background checks on prospective employees.

There is no federal or Ohio law requiring pre-employment background checks in the vast majority of private sector industries. However, there are plenty of good reasons to do them. Having an employee with an undesirable background, criminal record or falsified credentials can carry enormous economic and legal consequences for an employer if the employee later causes harm to the company (theft), fellow employees (workplace violence), or third parties (tort liability for negligent hiring/retention/supervision).

However, be mindful of the applicable laws. Title VII of the Civil Rights Act (governing employment discrimination) and the Fair Credit Reporting Act (mandating certain notices and other requirements) apply and create liability for non-complying employers.

Currently, Ohio allows employers to review credit information when considering the application of a potential employee. Yet, be cautious in obtaining and reviewing the report. A low credit rating may be the result of a job lost due to the recent economic downturn, high medical costs or other issues, rather than a lack of financial responsibility.

Recent guidance from the Equal Employment Opportunity Commission emphasizes the need to evaluate each applicant's background information on an individual, case-by-case basis. Rather than using an across the board exclusion for certain categories of criminal offenses, employers should consider several factors in determining whether a conviction excludes an applicant from employment - including the nature of the job for which the employee is applying, his/her age at the time of conviction, and the length of time elapsed without further convictions. If you perform background checks, be sure your methods are consistent for all potential employees to avoid accusations of employment discrimination.

The take away is this: it is important to perform background checks but be careful with the information once received. While certain personal information may make a candidate unappealing for hire, most personal information fills in gray areas to help you decide whether - or not - to give a job candidate a chance with your company.

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