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Due Diligence and Background Checks in the Age of Coronavirus

May 13, 2020 posted by Steve Brownstein

What is an Employer to do? Eight Frequently Discussed Issues
byLester Rosen
Even with the Coronavirus and the near-total shutdown of some sectors of the economy, there are still employers hiring. Certain sectors, such as anything related to healthcare, may see an increase in hiring. In addition, with many states starting to re-open, employers may be calling back previously laid-off workers.
The problem for these employers that are hiring—or are re-hiring workers who have been laid off is how to conduct due diligence and background checks when many courts, schools, and businesses are closed. That may result in the inalbity to obtain information from relvent courts, or in employers and educational institutions being unable to respond to verification requests. Many screening firms have been keeping their clients abreast of court closures and the procedures it will follow if an order cannot be fulfilled in a reasonable time. 
The question for employers is how to hire if a background check is not complete and what to do about employees that are called back?  Here a few ideas:
1.      Court Closures:   Make sure your screening firm is tracking what jurisdictions have delays due to court closures, and that they are regularly communicating that status to you.   
2.      Hiring despite Incomplete Criminal records: Even if a jurisdiction is closed, that does NOT mean you cannot make sound hiring decisions. Keep in mind that due diligence does not require a “complete” background check. Due diligence requires that an employer take reasonable steps to fulfill its duty of care. If a court is closed, or a past employer’s office is closed, that is totally beyond anyone’s control. Submitting the background check and then considering available results, even if limited, is all an employer can be expected to do before making the hiring decision under current circumstances. It would be prudent for employers to check with their employment law counsel regarding making an update to their background screening policy regarding obtaining and reviewing any information that was not available during the current and any future court, employer, and school closures. 
3.      Using what is available: Given the reality of court, business, and school closures, many firms will have decided to proceed with the hire using available information. As the old saying goes, “Desperate times call for desperate measures.” A firm needs to balance whatever risk there may be with the need to hire.  
4.      An additional benefit of screening if even if courts are closed: Just having a background screening process is of value to an employer because it puts applicants on notice that you conduct due diligence as part of your hiring process. Applicants still have an incentive to be truthful since the applicant may not know which courts are reporting and which courts are delayed. 
5.      Honesty clause in offer letter or application: To deal with an applicant that falsified information during the hiring process, which is discovered after courts re-open, it is essential that employers check their application form to ensure that there is an “honesty” clause. An honesty clause informs the applicant that any material misstatement or omission is grounds to terminate the hiring process or employment NO MATTER WHEN DISCOVERED. That language is needed to protect the employer and put an applicant on notice that if something is discovered later, it may adversely impact their employment.
Keep in mind however that if something potentially adverse is discovered post-hire, an employer is well-advised NOT to jump to any conclusion but to process the information in conformity with the federal Fair Credit Reporting Act (FCRA), the EEOC, and state requirements on the use of criminal records in employment.  
There may be a reasonable explanation as to why something was omitted. Trial court cases, for example, can be complicated, and it is not always clear to people involved in the court system precisely what happened leading to honest mistakes. 
Importantly, the newly discovered information may not apply to your employee if there is an identification issue. 
Even if the criminal record does belong to your applicant, an employer cannot assume the omission of the record indicates either dishonest or disqualifying behavior. The applicant/employee is still entitled to a pre and post adverse action notice under the FCRA, so if the employee feels that anything about the background report is incomplete or incorrect, it can be disputed. 
Under the 2012 EEOC Guidance on the Use of Criminal Records in Employment, and some state and local laws, the employee is entitled to an “Individualized Assessment.” This means they have the right to make the case and advance any information the employee believes is mitigating about the offense and evidence of post-offense rehabilitation, demonstrating that they may be qualified for the position. 
Employers must always remember the basic rule that a criminal matter cannot be the basis to automatically reject an applicant without further analysis to determine if there is a demonstrable risk to the business that justifies denying employment. 
6.      Use the totality of information you have on an applicant: Keep in mind that a background check is just one of many hiring tools. It typically occurs at the end of a process after an employer has decided to hire based upon interviews, assessments, or other means.  The fact that one county may be delayed due to closure may not be a deal-breaker, especially if an employer has an “honesty” clause.    
7.      Alternative sources of data: An employer may wish to contact their screening firm to determine if a court may have an electronic means to check records, or if statewide criminal records are maintained. A competent screening firm has a legal obligation to use reasonable procedures to obtain maximum possible accuracy. In some situations, a court may have some sort of publicly available record system that, although limited in some way, may at least give the employer some information. A good background firm, however, should not use sources of information that are known to be deficient or unreliable.  
8.      Should I re-screen employees who are called back: Many employers plan to call back workers who were let go once the economy re-opens. The advantage is the employer is bringing back a trained team known to the employer. The question we often hear is, should there be a new background check? 
The answer to that question is straightforward—there is no simple answer. It all comes down to risk management and the risk to an employer of bringing somewhat back without a new check. Here are some factors to keep in mind:
One of the primary justifications for an initial background check is that the employer is hiring a stranger. In the case of a returning worker, however, that person is no longer a stranger. The employer knows the person, which means a new background check is arguably less important.
In addition, if the person was off for a relatively short period, and they are able to return, it lessens the likelihood that they were arrested for some serious offense. It does not amount to a guarantee that there is nothing of concern that happened, but it’s a strong indicator.
 It also depends on the job. One of the main reasons to research criminal records is to minimize risk. If the worker coming back has access to vulnerable groups, such as working in people’s homes, or working with the young, the infirm, the challenged, or the elderly, an employer may be more risk-adverse.
If a background check seems worthwhile before bringing a worker back, an employer should make sure it is commensurate with the risk. It is likely not necessary to do an entire background check, but perhaps, a criminal check of the county or jurisdiction where the applicant resides or where the work is to be performed.
Keep in mind if a check is done, the FCRA, the EEOC, and any applicable Ban the Box or Fair Chance hiring laws apply regardless of whether the workers are new or returning. All forms, processes, and procedures must be followed.  
The good news for employers is that as the economy opens back up, courts re-open, and employers and schools resume more normal operations; these issues become self-solving. In the meantime, employers cannot stand still just because the system is less than perfect, and the “rule of reason” should apply when making these decisions. 

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