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Spokeo Decision Saves Another Employer

Recently, a federal judge in Minnesota dismissed a class action lawsuit against Beverly Health and Rehabilitation Services citing Supreme Court ruling in Spokeo v. Robins. The plaintiff filed suit claiming she was not told the company was conducting a background check, she was not given information about who was running the check, and that there was no clear and conspicuous disclosure as is required by FCRA. The company did ask her to complete a background check authorization form, which asked for the usual information and if she had a criminal history, they did, in fact, offer her a conditional job offer. The judge pointed to the Spokeo decision to say the plaintiff could not show sufficient concrete injury and the case was dismissed.

The company did ask her to complete a background check authorization form, which asked for the usual information and if she had a criminal history, they did, in fact, offer her a conditional job offer. The judge pointed to the Spokeo decision to say the plaintiff could not show sufficient concrete injury and the case was dismissed.

While the judge ruled for the employer, it provides another example of a company being sued for not following guidelines provided by FCRA. Remember, an employee must be notified that a background screening will be conducted and there must be a clear and conspicuous disclosure form. If you have any questions about how to remain compliant as you screen applicants and employees, give us a call at 800.230.2991

Sexual Abuse in USA Gymnastics

Over the past year, I’ve written several posts about sexual abuse in schools.  There’s no reason a school should hire someone who hasn’t had their background screened, to work with children. The same goes for anyone, in any industry, who works with kids. Giving someone that kind of responsibility, with that kind of authority, requires vetting. This includes any organization charged with the care of children.

In late winter, the story broke about how young gymnasts were abused by a USA Gymnastics doctor, Dr. Larry Nassar. Since the first story was published, hundreds of young women have come forward to claim sexual abuse since Nassar joined the sports governing body in 1996. The President of USA Gymnastics has since resigned and Dr. Nassar is now in jail facing criminal charges. Another institution that was charged with shaping children has fallen from grace.

Background checks can’t always prevent the first instance of abuse, but screening can certainly prevent someone with a history of abuse, of any kind, from having access to a group of children. As I’ve written before, the stakes are too high to not take every measure to prevent this kind of thing in your school, church, sports league or extracurricular activity.

Read the lastest story regarding USA Gymnastics in People Magazine. 

If you’d like to find out more about background screening for your organization, please give us a call at 800.230.2991.

Sexual Misconduct: Stop “Passing the Trash”

For decades, when teachers were removed from schools for sexual misconduct they were allowed to quietly move on to the next school and resume their teaching careers. It is a practice so common it was referred to as “passing the trash.”

This month Choate Rosemary Hall, an elite Connecticut boarding school, released a report that described how men at the school who were accused of sexually abusing students were allowed to continue teaching at the school. Two men may have abused students at other schools.

This report comes after articles have appeared all over the world documenting cases where teachers have abused students and then moved on to do the same elsewhere. How do we stop this from happening? One of the best ways is background screening. It doesn’t stop the first case, but it can make the first case, the last case.

Every teacher, administrator, coach, and volunteer should be screened for previous criminal or sexual misconduct. The screen should be based on real-time data and not only national and local criminal records, but international records as well. It bears repeating often that caring for someone else’s children is a huge responsibility and must not be taken lightly.

WOLFE has experience helping schools create a safe learning environment for students. If you have questions, give us a call at 800.230.2991.

Read more about the Choate report and “Passing the Trash” in the New York Times here.

Your Applicant’s Resume: Fact or Fiction?

Recently a group of reporters and editors from the student newspaper at a Pittsburgh high school in Kansas, found the credentials of their new high school’s head principal weren’t up to par. Their weeks-long investigation has earned the students praise in the national media and has caused the hiring committee some embarrassment.

In the student’s research, they discovered the facts in the new principal’s background didn’t quite add up. The biggest red flag, the website for Corllins University where she had earned both her master’s and doctorate degrees years ago didn’t work. The students found no evidence it was an accredited university. In fact, several articles suggested that Corllins University is a diploma mill.

This wasn’t the only indication of falsehood. In a conference call, the applicant had presented conflicting dates, incomplete answers, and inconsistencies in her responses. Her degrees and much of her work as an education consultant, it turns out, were pure fiction.

Some Candidates Lie

This doesn’t surprise anyone in the HR world. We’ve referenced, more than once, a CareerBuilder Survey of more than 2,500 hiring managers. It showed 56% of them have caught job candidates lying on their resumes. Those are just the ones that got caught. I’m sure many of you have similar stories.

WOLFE’s investigative verification team has assisted clients dozens of times in finding falsified or forged diploma’s. Make sure the company you hire to investigate candidates has the experience to verify past employment and education. For starters, ask the company what their verification rate is. Ours is 95%.  Mush lower and many credentials and past employers may remain question marks long into employment. It’s an expensive mistake to make. If you have questions about verification, criminal history or any aspect of the background screening process, call us at 800.230.2991. We’re happy to help.

Do Your Hiring Guidelines Violate the Age Discrimination in Employment Act?

Discrimination against older workers is illegal.  Including an age range or discouraging older workers in a job posting is blatant discrimination and I doubt any of you would do that. Yet there are companies that use hiring guidelines that show a clear preference for younger candidates and these too can be considered a violation of the Age Discrimination in Employment Act. 

R.J. Reynolds is a good example. The company faces a lawsuit for proving recruiters with guidelines for a regional sales job, stating ideal candidates are two to three years out of college and suggested applicants with eight to ten years of experience be avoided.

A recruiter gave documents with these hiring guidelines to lawyers at the San Francisco firm Altshuler Berzon, which specializes in employment law. Before long, other rejected applicants joined the suit. This case has bounced around the lower courts and is now waiting to be taken up by the Supreme Court. With people living longer lives and expecting to work later in life, this issue isn’t going away anytime soon. Until then, make sure you aren’t using discriminatory language in your onboarding process.

Are You Mishandling Consumer Information?


Have you heard of the Disposal Rule? If you handle applicant data, especially consumer reports from background screens, you should know that how you dispose of such information matters…a lot. If you handle sensitive information, it’s your responsibility to protect the privacy of the applicant and reduce the risk of fraud and identity theft.

The Disposal Rule

Enforced by the Federal Trade Commission, the rule requires the proper disposal of information in consumer reports and data to protect against “unauthorized access to or use of the information.”

However, the Rule does not spell out how such information should be disposed of.  Rather, it allows people who handle the information to choose the best method based on cost, effectiveness, and the sensitivity of the information. Reasonable methods include:

  • burning, pulverizing, or shredding papers containing consumer report information so that the information cannot be read or reconstructed;
  • destroying or erasing electronic files or media containing consumer report information so that the information cannot be read or reconstructed;
  • hiring a document destruction contractor to dispose of material specifically identified as consumer report information consistent with the Rule.

If you hire a document company, your due diligence should include:

  • reviewing an independent audit of a disposal company’s operations and/or its compliance with the Rule;
  • obtaining information about the disposal company from several references;
  • requiring that the disposal company be certified by a recognized trade association;
  • reviewing and evaluating the disposal company’s information security policies or procedures.

The FTC’s Disposal Rule became effective June 1, 2005. It was published in the Federal Register on November 24, 2004 [69 Fed. Reg. 68,690], and is available at ftc.gov/os/2004/11/041118disposalfrn.pdf. Read more about the Disposal Rule here.

Still confused about the Disposal Rule?

Wolfe Background Screening experts are happy to answer your questions about handling consumer information. Give them a call at 800.230.2991.

Courses you might be interested in: Working with the Data Protection Act or  HIPAA: Your Obligations Under the Privacy Rule

How a Hiring Technicality Can Land Companies in Court

A slew of lawsuits has been filed lately against companies accused of violating FCRA in their hiring processes. The most recent company to join that list is Starbucks Corp. for a violation in its adverse action process. A Colorado man named Jonathan Rosario filed a class action lawsuit against Starbucks after being denied a job based on an inaccurate background screening report. According to Rosario, the report contained felony and misdemeanor criminal records from Pennsylvania. Rosario, it turns out, has never even visited Pennsylvania.

As a background screening partner, we see not one but two problems with Starbucks’ background screening process. The first is, Starbucks was making a hiring decision based on records that weren’t accurate.  A good background screening provider verifies every record to make sure a criminal or disqualifying record isn’t a case of mistaken identity. Both the company and the client have a stake in making sure all background information is accurate.

The second problem is in the company’s Adverse Action process. Rosario received a letter stating that his background report had eliminated him from consideration, but he had already been disqualified from the employment process.

When Rosario used the Starbucks’ dispute system to provide a corrected report, the company refused to revisit the decision. FCRA is clear on this issue: A candidate must be given time to correct any inaccurate information before they are disqualified from a job. 

The Fair Credit Reporting Act (FCRA) was originally enacted in 1970 to protect the privacy of individuals’ personal information. Only recently have so many employers been hit with lawsuits for allegedly violating the act. It’s usually a hiring technicality, often in the background screen, that lands these big companies in court. Whole Foods, Dollar General, and Panera Bread have all been sued for violating FCRA.

Some things to remember about FCRA:

  • An employer must give notice that an applicant’s background will be investigated and ask for authorization in a way that’s “clear and conspicuous” so it stands out from the rest of a job application. In fact, an online application that is one document, without a separate notice and authorization, is illegal. The notice and authorization must stand out from the rest of the application.
  • An employer must notify a candidate if something in their background is considered “disqualifying” before actually disqualifying them. The applicant should be given time to fix any errors in their consumer report before they are officially disqualified.

Companies are Vulnerable and the Penalties Can be Steep

Though the FCRA guidelines are nothing new, there is a recent trend for lawsuits against companies for violating the guidelines. Here are ways for employers to mitigate the risks:

Hand-Vetted Records

This is important and should not be overlooked. Wolfe screeners verify every record to make sure it doesn’t belong to someone else with the same name, as was the case with Rosario. We can also take on all the adverse action paperwork to make sure every step of the background screening process is compliant with FCRA.

Wolfe’s Adverse Action Service for Peace of Mind

Many background screening clients hire us to handle their adverse action program too. It works like this: Once a client notifies us that there is disqualifying information in the background screening report, we verify that it does indeed belong to the applicant.  We then send an Adverse Action letter by email and snail mail, giving the applicant the legally recommended time to correct or dispute any errors. Clients are kept in the loop on any disputes that arise.

If you have questions about background screening or would like to add Adverse Action to your current service, give us a call at 800.230.2991 or fill out our contact form and we’ll get back to you. 

 
 

Is Drug Addiction and Abuse Effecting Your Bottom Line?

What are Illicit Drugs

It’s one of those “ticking time bombs.” If you have substance abusers in your employ, it truly is only a matter of time before you see the impact on your business. And it’s not as uncommon as you might think – 70% of illicit drug users are holding down a full-time job. Additionally, an even higher percentage of alcoholics and binge drinkers are on someone’s payroll. Substance abuse is not always easy to detect and, unfortunately, oftentimes when it is, the issue is ignored due to lack of expertise in how to deal with it.

The most commonly used illicit drugs by workers on the job are marijuana and cocaine. In recent years, the abuse of prescription drugs such as Xanax, Adderall, and Oxycodone is also on the rise (we’ll revisit this growing trend in a future post). Most people recognize that cocaine is highly addictive and dangerous in the workplace, but marijuana, often viewed as a “safe” drug, still presents significant liabilities for employers. Emergency room visits related to marijuana use increased 59% between 2006 and 2010 and are second only to cocaine among accidents involving individuals abusing illicit drugs. Truth is, there is no safe drug use in the workplace. Any substance that impairs judgment or alters perception increases risk of injury, decreased production and loss of revenue.

Why Do Individuals use Illicit Drugs

The appeal of illicit drug use is for the physical and emotional reactions they deliver to the user. Feelings of happiness, mild hallucinations, euphoria, self-confidence and sociability are all effects chased by casual and frequent users of these drugs. At other times, drug abusers are trying to mask a deeper emotional void such as a feeling of emptiness or loneliness or to self-medicate as an escape from stress or anxiety. An individual’s reasons for using and abusing illicit drugs are their own. When done during work hours, however, those reasons become your concern.

Impact of Illicit Drug Abuse on the Workplace

Each year drug abuse and addiction cost American companies $81 billion. On average, substance abusers cost employers $13,000 a year. They are 3 times more likely to have an accident while at work and 5 times more likely to file a workers’ compensation claim. A national study on alcohol-related occupational injuries reported that about 16% of emergency room patients injured at work have alcohol in their system. The costs of having illicit drug users on your payroll are spread across the organization. Their related problem areas include:

* Chronic Absenteeism

* Loss of Production and Efficiency

* Poor Decision Making

* Impaired Judgement

* Theft

* Decreased Morale Among Co-Workers

* Higher Turnover / Cost of Replacement

* Conflict with Co-Workers and Supervisors

* Sale of Illegal Drugs to Other Employees

Industries with Highest Illicit Drug Use

With an estimated 14.8 million drug abusers (more than 10% of the US workforce) having full-time jobs, chances are high that someone in your organization has a drug problem. Substance abuse has no demographic boundaries and can affect individuals from the executive suite to the mailroom. The industries most commonly affected are listed in the table below:
Industry Current Illicit Drug Use % Current Heavy Alcohol Use %

Construction 11.6 16.5

Mining 5.0 17.5

Hospitality &

Food Service 19.1 11.8

Retail 10.3 9.0

Manufacturing 7.4 9.7

Utilities 6.1 10.3

Arts &

Entertainment 13.7 11.5

Real Estate 10.9 8.5


Industry Current Illicit Drug Use % Current Heavy Alcohol Use %
Construction 11.6 16.5
Mining 5.0 17.5
Hospitality & Food Service 19.1 11.8
Retail 10.3 9.0
Manufacturing 7.4 9.7
Utilities 6.1 10.3
Arts & Entertainment 13.7 11.5
Real Estate 10.9 8.5

Minimizing Your Risk

To protect your employees, your clients and your business, it is imperative to have a drug-free workplace policy and program in place. Such initiatives have proven to increase morale, reduce workplace accidents, injuries, and fatalities, lower employee theft rates, increase productivity and lower employee turnover. When designing and implementing a program for your business consider including these elements:

* A Drug-Free Workplace Policy: A written document distributed to all employees that sets the expectations and tone for your organization’s drug-free program.

* Employee Training: A recurring training program for both employees and supervisors to provide both knowledge and awareness of the risks, warning signs and company’s policies regarding substance abuse in the workplace.

* An Employee Assistance Program (EAP): An external resource made available for employees who test positively for drugs, ask for assistance or are referred by their manager for a possible problem with drugs or alcohol.

* Drug Testing: To identify drug users and deter “would-be” drug users among employees in the workplace.

Let us know how we can assist you with the development and implementation of your Drug-Free Workplace Program. From drug testing solutions to online training courses and build awareness, our resources can assist in minimizing your risk while taking a weight off your shoulders.

Course Links:

DOT Reasonable Suspicion Training

Drug-Free Workplace Employee Training

Substance Abuse in the Workplace: What Supervisors Need to Know

A New Study Suggests There is a Simple Answer to the Current Talent Shortage

A new Manpower study suggests the current labor pool often lacks the skills employers are seeking. Out of 42,000 employers that Manpower surveyed, 40 percent say they’ve struggled to fill roles.  Many complain that the world is changing so fast it’s hard for the labor pool to keep up.

What are these elusive skills, you ask? After a lack of applicants, employers listed a lack of both technical competencies and soft skills.

Luckily, companies have found a simple solution to this problem: training. It’s often more economical to train existing employees and it demonstrates your willingness to invest in the employees you already have.  Here at Wolfe, we practice what we preach. Many of our employees have been here over ten years and have been promoted several times.

The Most Important Skill: Learnability

According to Manpower, the number of employers training and developing existing employees to fill open positions has doubled from 1 in 5 to over half.  Now 53 percent offer training and development to existing staff. This makes the most important skill an employee can have, the ability to learn.

We have some great courses–to sharpen both technical and soft skills–on our eLearning platform. These are some of our favorites:

Business Writing for Supervisors and Managers

Conducting Effective Performace Appraisals
Managing the Impact of Social Media in the Workplace

Excel 2016: Complete Training
Google Apps
Project 2016

If you have questions about any of the courses or want to know how to manage eLearning for your employees, give Melissa a call at 828.771.3113.

 

Health Reimbursement Arrangements (HRAs) Are Back!

Last week the 21st Century Cures Act was signed into law and effective January 1, 2017. Among many things from a moonshot cure for cancer to funding for substance abuse, the Act allows small employers of less than 50 employees, and who do not offer a group heath care plan, to once again offer Health Reimbursement Arrangements (HRAs) to their employees.

The 21st Century Cures Act once again makes HRAs permissible for small employers, with some changes. These Q&A should help you decide:

Q. Who is a qualifying small employer?
An employer that has fewer than 50 full-time equivalent employees and does not offer a group health plan.

Q. Must all employees be eligible for the HRA?
No. However, only certain employees may be excluded. For example, the company can exclude employees who have been employed for less than 90 days, are under 25 years old, are part-time or seasonal, are covered by a collective bargaining agreement, or are resident aliens without U.S. source income.

Q. May the employee contribute to the HRA?
No. Salary reduction contributions are not permitted. The HRA must be funded only by the company.

Q. What expenses can be reimbursed by the HRA?
Expenses that constitute “medical care,” including health insurance premiums, incurred by the employee or one of the employee’s family members.

Q. Is there a maximum benefit?
Yes. The HRA may reimburse up to $4,950 per year for an employee with employee-only coverage, and up to $10,000 per year for an employee with coverage for the employee and at least one dependent. These amounts are pro-rated if the employee is not covered by the HRA for the entire year. (These amounts are indexed to inflation and will increase in future years.)

Q. Are the reimbursements taxable income to the employee?
No, provided that the employee is enrolled in minimum essential coverage. Reminder: “Minimum essential coverage” includes most individual and group health insurance, but does not include dental-only coverage, vision-only coverage, or coverage for a specified disease or illness.

Q. Must employees lose their unspent HRA balances at the end of year?
No. A company may design the HRA so that the year-end balance carries over, or not.
Q Is a notice required? Yes. Employees eligible for the HRA on the first day of a given year must be given notice at least 90 days before the first day of the year. However, notice will also be considered timely if it is given within 90 days after the 21st Century Cures Act was adopted.

Common Sense Counsel: so if you are one of the hundreds of employers who gave up on offering group health insurance under ObamaCare, you now have a chance to help your employees with an HRA. Time is critical because you must provide employee notice within 90 days of January 1, 2107 to offer this benefit in 2017.

Tommy Eden provides counsel and expertise for Wolfe inc. He is a partner working out of the Constangy, Brooks, Smith & Prophete, LLP offices in Opelika, AL and West Point, GA and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. He can be contacted at teden@constangy.com or 334-246-2901. Blog at www.alabamaatwork.com