Corra Daily Planet » 2010 » August

Employee Background Checks May Help With Training Efforts

Tue, August 31st, 2010 - 6:03 am - By Gordon Basichis

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Here and there you get the story that is funny at the outset but upon further review it is no laughing matter.  As I am an author and was in show business for a fair number of years, I do know a thing or two about dark humor.   I also realize that dark or gallows humor is typically based on some grisly reality that we only laugh at the avoid some of the pain.

CNN reported the case where a security card was suspended from a Hollywood Department store for taking his job much too seriously.  What did he do?  Well, apparently a deaf customer walked out of the story with what might have been an article he hadn’t paid for.  At least the alarm went off, which indicates that the person did have in his possession good that were not accounted for by the cashier.   However, the suspected shoplifter, being deaf, didn’t hear the alarm.  He kept right on walking.

Until an overzealous guard tackled the suspected shoplifter and put him to the ground, applying a stranglehold.   The incident was captured by video cellphone.  The suspected shoplifter’s lawyer is threatening to sue Forever 21 for excessive force.   Now bear in mind that the suspected shoplifter, Alejandro Rea ,was convicted twice before on misdemeanor petty theft charges, in 2002 and 2008, according to the Los Angeles District Attorney’s office said.  And now because he resisted, Rea faces he faces felony second-degree robbery.  His alleged violent resistance to the security guard and his prior arrest record apparently played a role in the more serious charge, the lawyer said.

So what a mess.   Now perhaps there is an issue of training here.  Perhaps before tapping the suspected shoplifter, the security guard could have tapped him on his shoulder to get his attention.   Perhaps it terms of the security guard or security forces in general, besides the usual background checks it is necessary to provide sensitivity training, aptitude and psychological testing and other reports that would help employers best determine how well their candidates are fit for the job.  Granted, most security guards are in law paying positions, and often they have maybe a high school diploma.  So it would make sense the additional training would be helpful if not necesssary.

Now the store faces possible litigation if Rea’s attorney does move forward with a lawsuit contending that the guard used excessive force that was disproportionate to any shoplifting issues.    The offset cost of one successful lawsuit may go a long way toward conducting additional background checks on job applicants, in terms of criminal records, psychological testing, and sensitivity training.   Otherwise, an incident like this makes for embarrassing headlines and the possibility that someone  in the melee could have caused another physical harm.

Like I said, it’s almost funny for a moment.  But in a situation like this, nobody wins in the end.  Check them out before you hire.

Background Checks and the Great Pizza Employee Theft Caper

Mon, August 30th, 2010 - 5:46 am - By Gordon Basichis

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Freddie Wehbe, owner of Gator Domino;s,  was  gutsy enough to be forthright about employees stealing from him.  As the owner of eight Domino Pizza Franchises for Wehbe it can be difficult on the best of days figuring out if employees are stealing from him, which ones, and how much they are taking from the till.

In this case, according to the article on Gainesville.Com, Wehbe declared that one employee has stolen $10,000, having figured out a way to manipulate the pizza inventory and the sales receipts.   In short,  the thieving employee  was skimming but apparently was original in the way he plotted it out.     As the economic downturn continues, this would not be the first person to engage in employee theft.   Stats for employee theft have been increasing as more financially pressed employees turn to desperate moves.

The FBI considers employee theft as the fastest growing crime in America. The Association of Certified Fraud Examiners has determined that seven percent of a business’ gross sales revenue is lost to internal theft or shrinkage.  The typical business can average losses more of $9 a day per employee due to fraud and abuse.

As for Wehbe, his Gator Domino’s now mandates background checks and drug tests on every employee.  I would also suggest the Motor Vehicle Driving Records, or MVRs as the driving reports can be great indicators of substance abuse issues and desultory behavior.   With drug tests, an employer is vetting those job applicants with substance abuse issues. Drug Tests an an increasingly significant part of an preemployment screening program.   More employers are resorting to these just to see what trouble they may be putting into the workplace.  Substance abuse, besides the on-the-job safety risks,  can indicate poor production and possible workplace violence.

Criminal background checks are obvious in vetting out the thieves with prior convictions.  but not all workplace thieves have prior criminal records, so it is increasingly important to utilize other background checks for an overall preemployment screening program.   As Freddie Wehbe learned, check them out before you hire.

New Credit Report Statutes Affect Employment Background Checks

Fri, August 27th, 2010 - 6:22 am - By Gordon Basichis


Of all the background checks we conduct at Corra Group none are more controversial than the employment credit report.    I have posted on this a number of times, one such report was entitled,  Follow Up on Credit Background Checks, discussed the ongoing issues of a tough economy and the attempt to limit employer usage of credit reports as part of their preemployment screening program.

When I have posted such articles about the benefits and pitfalls, I have often received negative emails regarding the fact that no studies have ever been conducted where poor  employee credit reports indicate whether or not an employee will have a propensity to steal.  Others claim it is unfair to pick on the less fortunate who have lost their jobs and suffered financial decline in the economic downturn.    some comments have excoriating us for promoting employment credit reports because we are only in it for the money.

Right now laws are being passed limited employer access to credit reports for job applicants.  Recently in Illinois, a new law was passed that was designed to limit employer use of credit reports to only those where the report would be relevant to the job itself.    Washington State, Hawaii, and Oregon, have similar laws on the books.   Here is a synopsis of the bill  known as IL-Public Act  96-1426, the Employee Credit Privacy Act.

“Synopsis As Introduced

Creates the Employee Credit Privacy Act. Prohibits employers from inquiring about or using an employee’s or prospective employee’s credit history as a basis for employment, recruitment, discharge, or compensation with some exceptions. Prohibits an employer from retaliating or discriminating against a person who files a complaint under the Act, participates in an investigation, proceeding, or action concerning a violation of the Act, or opposes a violation of the Act. Contains provisions concerning waiver and remedies.”

However, IL-96-1426 does stipulate the following–

As an exception, the Act allows employers to use credit information where such information is related to a “bona fide occupational requirement” for a particular position or group of employees. The bona fide occupational qualification applies generally to those positions involving money-handling or other confidential job duties. For example, employers may use credit information for employees whose duties require bonding under state or federal law; have unsupervised access to cash or certain assets valued at $2500 or more; or involve access to confidential information, financial information, or trade secrets.

Okay, so now that we know that employers cannot use credit reports to discriminate against job applicants or employees, unless the credit report would somehow show relevance to the position itself, then there are obviously still a good many areas where the credit report would apply.  Any employee in the financial area, or anyone with access to sensitive data or proprietary information could be subjected to a credit report as part of the series of background checks being conducted on that candidate.   Those aware of corporate secrets, presumably in research and development or attached to special projects could be subjected to the credit report as part of their background check.    Employees with access to inventory, warhouse workers, truckers and such, it would seem would also be open to consideration.

So who really do these laws eliminate from the process?  There are some employees, surely.   There are stock people, clerks, perhaps, certain IT people, service and maintenance personnel.   Maybe I am mistaken here, but overall I can’t see where the law is very limiting.  Frankly, I believe this is a good thing.  Many employers have spoken to me, complaining that they have had to spend undesired time on the phone, talking to creditors trying to secure payments from loans in default or outstanding debt from different personnel.  There are the persistent phone calls where credits wish to garnish wages and the paperwork that entails.    Bookkeepers and payroll personnel must address issues of garnishment.

This is a very tough economy.   Employers must focus first on keeping their business afloat.  Otherwise, nobody will be working there, good credit, bad credit, or no credit.

These are demanding economic times for just about every business.   As such the focus must be on moving the business forward rather than addressing employee or job applicants’ financial troubles and lousy credit.   It is a shame that people are in dire straits and personal credit ratings, overall, have been reduced substantially.  Nevertheless, in this economy, especially, that is how it it.   No changing that around.

There is also the issue of an employer’s rights.   It is one thing where employer’s must be equal opportunity employers when it comes to such considerations as ethnic background, sexual preference, or gender.   It is one thing to perhaps not deny a handicapped worker a position.  But every employer is still welcome to make its hiring decisions on the merits of the employment candidate.

They will consider school sets, education history, what school the applicant attended, for what companies they worked for, previously.  Were the prestigious companies?  Did they go to the better schools?

These are all concerns for any employer.  Even one’s social networking profile is being considered as part of the preemployment screening program.  So what not credit?   What would make credit reports so special that they would show discrimination.

As for studies as to whether employees with bad credit  or have a greater propensity to steal, no there are not studies.   But then there are no studies for a great many things.  There are, however, common beliefs, which can even be referred to as common wisdom.  No one sees it as anything remarkable that employee theft has increased with the tougher economic times.  These are not people out of work, but working people who are stealing from the job.   So if in tough times employee theft is on the increase, there is a certain logic regarding bad credit, financial ruin and the increased probability of theft.    Maybe this is delusional, but a great many employers don’t seem to think so.   Which is why, among other reasons, they utilize employee credit reports as part of their background checking process.

As for what is and what isn’t salient where an employment credit report  can be ordered on a potential employee, I am sure this will eventually go through the courts.   It has to.  Someone will challenge it.   It’s the logical choice.

Delays in the Illinois State Police Criminal Background Check

Thu, August 26th, 2010 - 5:54 am - By Gordon Basichis

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For those who conduct the Illinois State Criminal Non-Database Search as part of your preemployment background checks, we want to alert you that there will be a significant delay in the turnaround time.   The Illinois State Police, Bureau of Identification today that their server had a major crash on Saturday, August 21, 2010.     It will take a week at least to install a new server.    Until they can return searches that are backlogged in the system, it will take even longer still

So, all in all, it will be some time before the Illinois State Criminal records will be returned to full service.  For those employers in need of conducting background checks in Illinois for the time being you may want to consider running County Criminal Records Checks.    The County Criminal Records have not been affected by the server crash.

In the meantime, we will let you know when full service for the Illinois State Criminal Records has been restored.

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