abc franchise background check webinar

ABC FRANCHISEBACKGROUND CHECK

WEBINAR

Topics to Discuss

01 Agenda

02 What is a background Check

03 Why you MUST run background checks

04 Background check options

05 Background check pricing (OPTIONAL)

06 Legal requirements

07 Your questions

Disclaimer

DISCLAIMER

The information contained in this presentation is for general information purposes only and should not be seen as legal advice. The information is provided by U.S. Information Search and while we endeavor to keep the information up to date and correct, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, or suitability of the information. Before making any decisions you are advised to seek legal counsel.

What is a Background Check?

A background check is an investigation. It usually consists of one or more searches of public and/or proprietary data sources. The searches are then complied into a background check report.When a background check report is complied because an employer will make a decision related to hiring, promotion, reassignment, or retention, it is called a Consumer Report.

Why you MUST run background checks

? ? ???


Once an employee is hired they may

have access to your assets, money,

clients, employees, and reputation.

30% of all business failures are due to employee theft and related forms of dishonesty.

The direct and indirect cost of

employee turnover is equal to 150% percent of their

annual salary.

51% of all resumes, applications and references provided by applicants contain inaccurate information

7% of applicants have had a criminal record in

the last 7 years


88% of Employers found some degree of

inconsistencies in resumes

Negligent Hiring Lawsuit

All employers are required to do “due diligence.” This means they are responsible to take “reasonable actions” to protect their customers and employees.

When an employee harms a customer or co-worker the employer faces a potential Negligent Hiring Lawsuit

In court, the jury will be asked, "could this employer have known that someone was unsafe, dangerous, unfit, or dishonest?

You MUST run a background check to help prevent a Negligent Hiring

Lawsuit


“Employers have lost more than 79% of negligent hiring cases and the average settlement is nearly 1million dollars.

According to Human Resources Management - 2008

Employers are being hit with multi-million dollar

jury verdicts.

Example cases (2011) - Dunaway Timber Company

The family of an individual killed in an accident with a truck driver sued and won 7 million against the company. They said the company negligently hired the truck driver because the background check could have revealed his license was revoked twice and he had a history of unsafe driving. So if you have people who drive as part of their job, you need to check their driving records. Best practices is to check their license once a year. This way an employer makes an effort to make sure a drivers license is valid.



Another example case, is Smith v. Orkin Exterminating, Co (1989) This case was about claimed negligence related to fumigating a home rather than theft or an employee hurting a home owner. Yet, the conclusion by the court says it all. "Orkin is in a unique business that as a matter of course sends employees into the homes of its customers to perform services for which it charges and earns a profit. Orkin's place of business is essentially a customer's home. Because Orkin sends employees into homes, it is subjected to a higher standard of duty to protect against intentional torts than is a regular business. Orkin recognized this duty and provided measures to meet this requirement. The measures it chose were carried out in a negligent fashion.


Another example case, is Smith v. Orkin Exterminating, Co (1989) This negligent attempt at compliance with its duty constituted a breach which allowed the harm reasonably calculated to be within the risk attempted to be prevented by the duty. It was, therefore, the cause in fact of plaintiff's injuries. Because we believe that Orkin was negligent, we affirm. All costs of this appeal to be borne by the appellant.

The jury returned a verdict against the Orkin defendants awarding $800,000 in compensatory damages. There were further appeals and the victim ended up dying before the case was concluded, but this should give you an idea about how these cases occur.


The Answer

The answer of course is to run an inexpensive background check. Doing so shows that employers takes their responsibility seriously and makes efforts to make sure customers and other employees are safe.

BACKGROUND CHECK OPTIONS & PRICING

4 Steps to Background Check Compliance

Most lawsuits related to background checks have to do with violations of what is known as the Fair Credit Reporting Act. (FCRA).

There is a federal FCRA, that comes under the jurisdiction of the Consumer Financial Protection Bureau and many states have their own versions of the FCRA.

4 Steps to Background Check Compliance

Step 1Use a “stand-alone” background check

disclosure and authorization

Step 3 You must provide a Pre-

Adverse action notification

Step 2 No liability release

Step 4You must provide an

Adverse action notification

Before the Background Check

Applicant sign a disclosure and authorization form

Employee authorizes you to run the background check for a permissible

purposes

Step 1 - to Background Check Compliance

The background check disclosure and authorization form must be a separate document

A big reason for many lawsuits is that companies embed this document inside of their employment application

The background check authorization and disclosure must be a stand-alone document

Step 1

Use a “stand-alone” background check disclosure and authorization


The background check disclosure and authorization cannot release the employer from liability.

2 example cases. 2012 Singleton v. Domino’s Pizza. 2013 Reardon V. Closet Maid. Both cases court ruled NO WAIVER of LIABILITY.

Ruling is that this language is extraneous language and non-compliant.

Step 2

No liability release

Provide them with a specific letter that basically says due to what was found on their background check report, they may not be hired

Provide them with a copy of their report so they can see what was found

Provide them with a document from the Federal trade commission called A summary of your rights under the Fair Credit Reporting Act

Step 3

You must provide a Pre-Adverse Action Notification.



Step 4 says based on your report we are NOT going to hire you.

The adverse action letter is sent if they do not dispute the results or after an additional investigation is completed the results stand.

With the Adverse Action Letter send another copy of the report and another copy of their rights that under the fair credit reporting act.

Step 4

You must provide an Adverse Action Notification.

What is the time between

step 3 and step 4?

QUESTIONS

THANK YOU for more information visit

www.usinformationsearch.com

http://www.usinformationsearch.com/

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