Hiring someone is a decision that should not be based solely on the person’s ability to handle the job. While skills required to conduct the job are necessary, one cannot rule out threats caused by an employee with a checkered past (or present). Someone with a criminal record or someone who isn’t who they say they are can potentially cause significant damage to the welfare of the company and its staff. This webinar, led by one of the country’s premier background check and drug screening companies and a key partner of AlphaStaff, will highlight the need, the process and the advantages of proper pre-employment screenings. Presented by Sterling Infosystems.

1. 800 Corporate Drive, Ste 600 Ft. Lauderdale, FL 33334 | 888.335.9545 Toll-Free | alphastaff.com
2013 Webinar Series:
Importance of Drug &
Background Screening
April 18, 2013
Presented by:
Richard Seldon
President

2. Simplifying business. Benefiting people.
AlphaStaff Welcomes Our Premier Partner
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Richard
Seldon

3. The Importance of Background Checks
& Drug Screening
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4. Simplifying business. Benefiting people.
 According to the Workplace Violence Research Institute, negligent hiring
costs U.S. businesses in excess of $18 billion annually
 Workplace violence is the foremost concern of corporate security
directors at Fortune 1000 companies
 About 8% of the job applicants that Sterling screens have a criminal record
 About 9% of job applicants falsely claim they have a college degree, list
false employers, or identify jobs that don't exist
 The Wall Street Journal reports that approximately one third of all job
applications contain lies regarding experience, education, and the ability
to perform essential functions of the job.
Industry Facts

5. Simplifying business. Benefiting people.
 Confirm that the applicant is accurately representing him / herself
 Higher quality applicant pool
 Ensure that the person is really qualified for and can perform the job
 Lower turnover and recruiting costs
 Ensure the person does not pose a threat of harm to co-workers and the public
 Reduce theft and embezzlement
 Reduce workplace violence and the resulting liability
 Reduce legal exposure for negligent hiring and retention
If Background Checking Is Not Required By Law,
Why Do It?

6. Simplifying business. Benefiting people.
 Negligent hiring: the failure to properly screen employees, resulting in the hiring of
someone that has a history of violent or criminal acts.
 Negligent retention: retaining an employee after the employer became aware of the
employee's unsuitability, thereby failing to act on that knowledge
1. A taxicab company was held liable for negligence in hiring a criminally violent driver who
raped and robbed a woman in the presence of her two young children.
2. A nursing home was found liable for $235K for the negligent hiring of an unlicensed nurse
with numerous prior criminal convictions who assaulted an 80 year old visitor.
3. A security company was liable for the negligent hiring, training, supervision, and
assignment of a security guard who aided outside confederates in the theft of $200,000
worth of gold certificates.
4. A furniture company was found liable for $2.5 million for negligent hiring and retention of
a deliveryman who savagely attacked a woman customer in her home.
Negligent Hiring / Retention

7. Simplifying business. Benefiting people.
 Resume / Cover Letter
 Employment Application Form
 Interview
 Conditional Offer of Employment
 Drug Test/Background Check
Background Checking should be narrowly tailored to obtain
job-related information with respect to the position at issue.
Employment Application Process

8. Simplifying business. Benefiting people.
 The Society for Human Resource Management states 45%
of all resumes contain one major fabrication
 A high degree of misinformation involves past
employment and the educational background.
Resume / Cover Letter

9. Simplifying business. Benefiting people.
 Review for legal compliance (e.g., question regarding criminal
convictions)
 Look for Red Flags in the application process and follow-up on them,
e. g., gaps in employment
 Have good disclaimer language, including language that false or
misleading information constitutes grounds for immediate
termination.
 Require applicant to complete entire form, and sign and date it (don’t
just allow applicants to attach their resume or leave sections blank).
Employment Application Form

10. Simplifying business. Benefiting people.
 If you offer a position, make sure it is conditional on the
successful completion of a background check.
 Conduct a drug test and thorough background check
tailored to the particular position.
Conditional Offer of Employment

11. Simplifying business. Benefiting people.
 The job relatedness of the crime
 The seriousness of the offense
 The date the offense occurred
 The person’s age at the time of the offense
 Evidence of successful rehabilitation
Factors to Review Before Denying Employment
Criminal Conviction Information

12. Simplifying business. Benefiting people.
Equal Employment Opportunity Commission
(EEOC)
• The United States Equal Employment Opportunity Commission (EEOC) has ruled that
discriminating against felons in the workplace has the same effect as discrimination against
blacks and Hispanics and is therefore illegal.
• The ruling means that the EEOC has decided that employers cannot have a blanket policy
stating they will not hire convicted felons.
• In September 2009, a class action lawsuit was filed against Freeman Companies, as the
EEOC claimed that Freeman used credit histories and criminal background checks to
unlawfully deprive blacks and Hispanic job applicants equal employment opportunities.
• In 2005, the EEOC issued informal guidance that said that an employer who uses a blanket
policy of not hiring any applicant with a history of arrest or conviction violates Title VII of
the Civil Rights Act because such a policy “disproportionately excludes members of certain
racial and ethnic groups, unless the employer can demonstrate a business need for use of
this criteria.”

13. Simplifying business. Benefiting people.
EEOC and PEPSI
• Pepsi Co. agreed to pay a $3.1 Million fine to the Equal Employment Opportunity Commission
(EEOC) after it was charged with using criminal background checks to discriminate against
potential job applicants.
• The EEOC’s investigation revealed that more than 300 African Americans were adversely
affected when Pepsi applied a criminal background check policy that disproportionately
excluded black applicants from permanent employment. Under Pepsi’s former policy, job
applicants who had been arrested pending prosecution were not hired for a permanent job
even if they had never been convicted of any offense.
• “Pepsi’s former policy also denied employment to applicants from employment who had been
arrested or convicted of certain minor offenses. The use of arrest and conviction records to
deny employment can be illegal under Title VII of the Civil Rights Act of 1964, when it is not
relevant for the job, because it can limit the employment opportunities of applicants or workers
based on their race or ethnicity.”
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14. Simplifying business. Benefiting people.
 Number and List of Accounts
 Number of Accounts with Negative Information
 Number and List of Accounts that have Placed the Applicant’s Account
for Collection
 Public Records, such as civil judgments
 Total Outstanding Balances
 Be Careful Regarding Job-Related Determination
 Do Not Use Bankruptcies
The type of information to consider:
Consumer Credit Reports

15. Simplifying business. Benefiting people.
 Current Status of License
 History of Speeding, Reckless Driving, Careless Driving, DUI, DWI,
etc.
 All Suspensions and Revocations
Department of Motor Vehicle Reports
The type of information to consider:

16. Simplifying business. Benefiting people.
Employment Verification
 Dates of Employment
 Position
Additional Questions:
 Was the employee honest?
 Was the employee excessively late or absent?
 Is the employee eligible for rehire?
 How was the employees overall performance?
 Was proper notice given?

17. Simplifying business. Benefiting people.
Education Verification
Verification of the applicant’s educational history
We recommend verifying the highest degree attained
Diploma mills – unaccredited institutions that grant illegitimate
degrees for a fee

18. Simplifying business. Benefiting people.
Sexual Offender Search
Offers an additional measure of protection beyond a criminal
conviction search as the offender’s state or county records may
be sealed, records may reside in family court, or the original
sexual offense may have been reduced to a lesser charge
State Registries

19. Office of Foreign Asset Control (OFAC)
This search identifies individuals and companies, owned, controlled by, or acting on
behalf of countries targeted by US foreign policy as terrorists and narcotics traffickers
through information provided by the US Treasury’s Office of Foreign Asset Control
(OFAC).
These Specially Designated Nationals (SDN) have had their assets blocked, and US
citizens are generally prohibited from dealing with them.
The OFAC search contains information from the below sources:
Bank of England Sanctions List, Canada OSFI List of Entities/Individuals
CIA Chiefs of State and Cabinet Members of Foreign Governments
EU Consolidated List of Persons, Groups and Entities, Interpol,
FBI Most Wanted Terrorist, OFAC Palestinian Legislative Council List
World Bank Debarred Parties And Others

20. Simplifying business. Benefiting people.
 Applicant’s Name
 Jurisdiction
 Docket Number
 Indictment Number
 Arrest Date
 Reason for Arrest
 Disposition Date
 Disposition
 Sentence
Criminal Conviction History Search

21. Simplifying business. Benefiting people.
 Social Security Trace / Address History
 Criminal Conviction History Search – Federal, State, County
 Consumer Credit Reports
 Motor Vehicle Reports
 Employment Verification
 Education Verification
 Sexual Offender Search
 Office of Foreign Asset Control (OFAC)
 ArrestDirect
Background Checking Options

22. Simplifying business. Benefiting people.
Criminal Conviction Searches
• At this time, about 30% of Americans have been arrested by age
23 at least once for something other than a traffic violation.
• In 1965, about 22% of Americans had been apprehended at
least once by age 23
• By age 18, about 16% to 27% of teens have been arrested at
least once
* Source: Journal of Pediatrics
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23. Simplifying business. Benefiting people.
International Background Checks
• Every country around the globe has laws and rules that regulate
drug testing and background checks
• Drug testing and background checks are becoming more
acceptable around the world
• However, the services available are still more limited than in the
United States
• The cost is much greater to do drug tests and background
checks
• The turnaround time to complete the work is much slower than
in the United States
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24. Simplifying business. Benefiting people.
 The Fair Credit Reporting Act (FCRA) directly affects an employer’s ability
to obtain background information on applicants and current employees
through contracts with third-party Consumer Reporting Agencies (CRA)
 Organizations such as Sterling that conduct background checks are
Consumer Reporting Agencies
 The FCRA regulates the circumstances under which employers can use
CRAs to obtain background information and to rely on that information to
make employment decisions
If you use an outside vendor, you must comply with
the Fair Credit Reporting Act

25. FCRA and Compliance Procedures
Required By FCRA For Users Of Reports
Consent And Disclosure
Pre-Adverse Action
Adverse Action

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All State
Consent and
Disclosure

27. Simplifying business. Benefiting people.
In the Pre-Adverse Action Notice, the employer must reveal
the disqualifying information received from the Consumer
Reporting Agency.
Include with this notice a copy of the report and notice of
rights as required by Fair Credit Reporting Act.
Give a short but reasonable period of time to provide
information that would explain the discrepancy, omission or
misrepresentation.
If the employee is unable to do so, take adverse action.
Pre and Post Adverse Action

28. Simplifying business. Benefiting people.
 Some states have fair credit reporting laws that have
more stringent requirements than the FCRA (e.g.,
California).
 States have other laws that also limit the use of
information you can obtain and how to use it once it is
obtained (e.g., New York, criminal convictions and
arrest records)
State Laws Create Additional Compliance Issues

29.  More than three-quarters (76.4%) of all illicit drug users 18 and
older are employed full or part time… that's approximately
16% of the working population (full- and part-time workers
combined).
 The federal government reported that drug abusing
employees, when compared to non-using workers, are:
1. More likely to change jobs frequently
2. More likely to be absent from work
3. More likely to be involved in a workplace accident
Drug Testing

30. Simplifying business. Benefiting people.
Why Enforce a Drug Free Workplace?
About 3% of the drug tests that Sterling administers for their
clients are positive
1 out of 12 US households surveyed admit to using illegal
drugs in the past 30 days
20.2 million Americans over the age of 18 use illicit drugs
Prescription drugs are abused by 7.0 million Americans
Marijuana is abused by 17.4 million Americans
Cocaine is abused by 1.5 million Americans
Drug testing is a deterrent – fewer drug users apply at
companies with a drug testing program

31. Simplifying business. Benefiting people.
 Cannabinoids (THC)
 Cocaine
 Amphetamines
 Opiates
 Phencyclidine (PCP)
 Barbiturates
 Benzodiazepines
 Methadone
 Propoxyphene
Most Drug Tests Screen for the Following Drugs:
Pre-Employment Substance Abuse Testing

32. Simplifying business. Benefiting people.
Conclusion
Questions?
Thoughts?
Napping?
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33. Simplifying business. Benefiting people.
Contact Us !
• .
Copies of the presentation
hrsc@alphstaff.com
888-335-9545 (Option 8)

34. Upcoming AlphaStaff Webinars
Please mark your calendars !!!
Date: Thursday, May 16, 2013
Topic: Worker's Comp. Claims Reporting
Date: Thursday, May 30, 2013
Topic: Recent NLRB Rulings and Their
Impact on Non-Union Employers
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Thank you for your time!
Questions?