Follow Up On Credit Background Checks

There is an ongoing controversy in several states about whether or not employers should run credit reports s part of the background checks they use in their preemployment screening programs.   I have posted some thoughts on this subject in a recent blog,  Controversy Over Credit Reports as Background Checks.

Some critics of the credit report as a background check contest that this is a draconian practice, as it inhibits many skilled and otherwise qualified employment candidates from finding jobs.  They contest that in this economic downturn where the job market is tight as it is, it is one more obstacle to finding employment they will often fail to hurdle.  They claim that job applicants are being penalized unnecessarily for personal misfortune in a  bad economy.     Some contest the practice of conducting practices is illegal, while others claim there is no evidence that discloses those with poor credit are a greater risk to embezzle or to commit some other form of office theft.

These are all valid points.   As one of my own recent critics contested, I am obviously advocating credit reports because Corra Group is just in it for the money.  Well, yes, but more significantly, we are determined to furnish the services requested from current and future clients.  These are employers.  Many have been in business for quite some time.  There is really no need to “sell,” them them employment credit reports as the great majority make the request of their own volition.   We will supply them with employment credit reports.

I admit there are no studies performed on the relation between credit reports and avoiding employee theft.   The evidence is empirical, meaning this is what employers have been telling us and other background searching agencies for quite some time.   This has been their standard practice for decades in some places.   Again,  we don’t need to sell this to them,  although we admittedly promote all of our products and services.   We are not shy about our marketing efforts or what we provide.

All this being said, I wanted to pass on to all potential employers and critics of this process comments that have arise unprompted from  two clients, recently.   Both claimed they have hired people,t hinking they were good candidates.  Neither client ran credit reports as part of their preemployment screening.   Both regretted that choice.  One citede potential theft, or more to the point, actual theft on the part of one employee with substance abuse habits and lousy credit.  He was to discover this later.  Both clients cited the time and effort thye had to spend answering phone calls form creditors for their bad credit employees.  They complained of the paperwork involved with dealing with wage garnishments and responded to lettersfrom creditors.   Took up their time, cost them manpower and extra money. They were not happy.

So no matter which way you come down on the argument about employment credit reports, if you believe the other side lacks valid points then you are sadly mistaken.   As an job candidate, you may feel slighted for being penalized for having bad credit.   As an employer, you may well believe you are in your rights to conduct credit checks on all potential hires.

Like most things in life, we would like to see it in simple terms.  It’s not.   And that is the only thing that is clear about the matter.

When Unemployment Slips You a Mickey…Mouse

It’s a tough job market and competition for what few jobs there are is fierce.   According to the Los Angeles Times, the different amusement parks around Southern California have had record turnouts at their job fairs.    This would  include such iconic amusement destinations as the Disney parks, Six Flags, and Universal Studios.

Thousand of job applicants have shown up in search of employment.  Usually these are students off for the summer or who have recently graduated and need a gig to tide them over.   But now the list of job applicants includes white collar workers, IT people,  construction guys.   With unemployment in California reaching more than 16% people need work.  And work is hard to come by in this rotten economy.

Since we are a nation where industry determines a job candidate’s qualities and eligibility for his position by judging his career track, one has to wonder what a job at, say, Disneyland would do.  Not an executive position, but a kid’s job.  How does that look on your background checks and preemployment screening report when the employment verification verifies that you spent a few months working as Minnie Mouse?   At a time when you can’t account for a couple of months of downtime it would have to be disturbing for the recruiter to gaze upon an executive level resume and see that you were Dopey  in the fireworks pageant.

It seems that we don’t make allowance for time off or time spent exploring other career opportunities, yet alone trying to survive when we are out of work.   There are times when putting food on the table, supplementing savings so your money doesn’t run out is more important than having a consistent career track.  Especially when that alleged career track has been abrogated by a nearly unprecedented economic downtown, and not only a shortage of job but a cycle when certain formerly high paying jobs are no longer relevant.  Or the industry has either obsolete or the remaining jobs have been relegated to Timbuktu.

Employer Gets Ten Year Prison Sentence for Hiring Undocumented Workers

We have been warning employers about hiring undocumented workers for a couple of years now.  Hiring workers you may suspect as being illegal or undocumented, choose your own preferential language, can lead expensive fines, business shutdowns and public embarrassment.  There are more than a few examples out there.

I have blogged about this before.  For one such blog, see Arizona Sues First Employer for Hiring Undocumented Workers.

But here is a case where the employer was just sentenced to ten years imprisonment for hiring illegal workers.  Ten years.  You may think of it as justice, you may think of it as unfair.  But the main thing to think about is that it doesn’t happen to you.    According to BusinessBrief.com, , a federal appeals court has affirmed the sentencing of Richard Rosenbaum to ten years in jail.  Rosenbaum was convicted of knowingly hiring undocumented workers and in the course of doing so,  he defrauded the government by not paying his Social Security benefits and Medicare benefits.   The feds claim that Rosenbaum and his company cheated the IRS out of $16million.

Look, this is a lousy economy and there are plenty of documented workers out there who are in need of a job.    Maybe they weren’t willing to work for less wages or to perform menial work before.  But with this economic meltdown, my how things have changed.  People are without jobs and need to find something.

If you, the employer, thinks you are getting away cheap by hiring undocumented workers, think again.   Massive fines, business closures.  And a prison sentence.   Realize the IRs is now getting into the act, as they are cracking down on those who defy the law and try to cheat on paying employment taxes.

So  run background checks.  Check out your employment candidates.  Run the E-Verify, the I-9.   Conduct a Social Security Trace to verify that your job candidate is working under a valid social security number.  His social security number.  In short, check them out, before you hire.

Drug Tests for Older Employees

All right, so this is really tongue in cheek.  Well, sort of.   Having recently read an article on Yahoo News, entitled Marijuana Use By Seniors Goes Up As Boomers Age,  I couldn’t help but wonder what most employers would do if they find out through preemployment drug tests that their more senior executives are huffing on the bong, after work.   Does it matter?   And if so, how do you deal with it?  Do you deal with it the same way as you would deal with a younger job candidate?

Imagine as an employer thinking to yourself, “well he brought in umpteen millions of business, is highly respected in this industry, but he smokes pot when he gets home.”  So what do you do?

Suppose there is a zero tolerance drug policy.  Do you let your Senior Vice President go for smoking marijuana on his or her on time?  Interesting questions.   As more employers are instituting drug tests as part of their preemployment screening program, this may actually become an issue.   I write this of course with the assumption that your senior job applicant his past all other background checks and has neither state criminal records or federal criminal records, largely white collar criminal records in his history.

I wrote this also with the understanding that your senior executives are sharing doobies with the younger members of the staff, during the work hours.   I guess the interesting question is does pot use matter all that much?  And to whom?   I have had one staffing group in the healthcare industry tell me of all the background checks they run on nurses and healthcare workers, the one they care about the least is where is shows positive on the drug test for marijuana.   The one client said to me, “if I had to eliminate all the nurses smoking pot, I wouldn’t have enough job candidates to staff a small medical office yet alone a hospital.”  This may be hyperbole, but certainly he was making a point.

And then what happens in a state like California where pot is all but legal.  At least if your job candidate has a legal permit allowing him to smoke marijuana for medical reasons, then can the employer fire him if he drug test shows positive for marijuana.   Hard to say.  Whenever I have asked the question, people seem to hem and haw, but no one really seems to know the answer.  At least with regard to the people I spoke to about it.

Meanwhile, as the economy attempts to turn around and more boomers remain in the workforce for longer periods, either because they don’t want to retire or can’t afford to retire, then the drug habits most picked up on the sixties are posing whole new issues about drug tests.  I would think.