PRESENTED BY! Phone: (866) ! Brian Chapman - CEO! Jolene Chullen - EVP!

Transcription

1 Brian Chapman - CEO bchapman@mbiworldwide.com (Ext 112) 1 PRESENTED BY Founder of National Association of Professional Background Screeners (NAPBS) Board Member - Background Screeners Credentialing Council (BSCC - NAPBS) FCRA Basic Certification Jolene Chullen - EVP jchullen@mbiworldwide.com (Ext 102) Phone: (866) NAPBS Education Committee FCRA Advanced Certification Consumer Data Industry FCRA Certified Compliance Manager Copyright 2014

2 LOTS OF CHANGES IN 2013: 2 Topics we re covering today: President Obama has expanded the Second Chance Act Legislative changes pushing for equal treatment of past criminals during the application process 01. CONSUMER FINANCIAL PROTECTION BUREAU CHANGES 03. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION CHANGES 02. FEDERAL TRADE COMMISSION CHANGES 04.CLASS ACTION AND CIVIL REMEDIES BY PRIVATE ATTORNEYS Copyright 2014

3 3 Consumer Financial Protection Bureau (CFPB) {Regulation of the FCRA} The Fair Credit Reporting Act (FCRA) is no longer the responsibility of FTC CFPB is now aggressively enforcing FCRA and it now has primary rule making authority over FCRA Copyright 2014

4 4 Consumer Financial Protection Bureau (CFPB) {Enforcing} Enforces FCRA Investigates businesses and can issue fines and civil penalties Investigates Consumer Reporting Agencies (CRA) Turf war between CFPB and EEOC Copyright 2014

5 5 Consumer Financial Protection Bureau (CFPB) {Hot Topics} Adverse Action of Applicants Documentation Copyright 2014

6 6 CFPB continued {Adverse Action} Administered by you or your Consumer Reporting Agency Legal Requirements Procedure of the Process Obligations: New verbiage required on consent forms. Jan 1, 2013 is the deadline for the required update Pre Adverse Action Notice Summary of Rights Notice Copy of Report 5 days for applicant to give rebuttal Adverse Action Notice End User Documents Contact info for Consumer Reporting Agency: MBI or other Suggest having a written policy Have Review Team before Adv. Action is sent Copyright 2014

7 7 Equal Employment Opportunity Commission (EEOC) {Hot Topics} Everything that negatively impacts an applicant or employee. Copyright 2014

8 Equal Employment Opportunity Commission 8 (EEOC): Guidance On April 25, 2012 the EEOC issued its Enforcement Guideline EEOC took very little advice from SHRM and NAPBS EEOC cited recent studies that found: Some consumer databases may have incomplete records. Some criminal records may have inaccurate information. i.e.: expunged, not reported or dismissed records. EEOC concerned with the use of screening for criminal records resulting in disparate impact. Some studies that show African-Americans and Hispanics are arrested in numbers disproportionate to their representation in the general population. Copyright 2014

9 Equal Employment Opportunity Commission 9 (EEOC): Blanket Policies Unlawful discrimination may occur if an employer s neutral policy has the effect of disproportionately screening out individuals based on race or national origin. Example: A policy with a blanket exclusion on hiring an individual with any criminal record is viewed by the EEOC as unlawful. 27% of American adults have a criminal record. Bright line rules are discriminatory, "We don't hire felons." EEOC recommends that employers not ask about convictions on job applications and, if and when they make such inquiries, the inquiries be limited to convictions that are job related for the position in question and consistent with business necessity. Copyright 2014

10 Equal Employment Opportunity Commission 1 0 (EEOC): Individualized Assessment Existing three-factor test: 1. The nature and gravity of the offense or conduct 2. The time that has passed since the offense and/or completion of the sentence 3. The nature of the job held or sought. Guidance adds new twist: takes position that an individualized assessment should be made before disqualifying an individual for employment based on past criminal conduct. EEOC recommendation: 1. Inform the applicant that he or she may be excluded based on the past criminal conduct 2. Provide an opportunity to the individual to establish that the exclusion should not apply 3. Consider whether the individual assessment shows that the policy should not be applied to the applicant. FCRA s pre-adverse action notice. Copyright 2014

11 ASKING THE RIGHT QUESTIONS Individualized Assessments: You have to know the right questions to ask 11 CATEGORIES Crimes Against Persons Crimes Against Property Crimes Against Society Copyright 2014

12 Burden of Proof Lies On The Employer 1 2 Are you using a solution that offers a targeted criminal records screen to effectively link specific criminal conduct, and its dangers, with the risks inherent in the duties of a particular position that the EEOC recommends? What does a targeted criminal records screen mean? EEOC recommends a targeted criminal records screen of applicants. Past crimes must pertain to job standards. Applicants with a criminal record are not automatically restricted from obtaining a job. The employer should weigh the relationship between certain convictions and the necessary job requirements. How is your staff evaluating who fits the standards? Do they go through each report and make a decision? Have your legal counsel review and make recommendations if appropriate. Copyright 2014

13 Equal Employment Opportunity Commission 1 3 (EEOC): Future Expectations Gearing up for 2014 The EEOC will continue aggressive action against what it perceives as discriminatory use of criminal history in hiring saw a decline in overall litigation brought by EEOC, but an increase in cases involving systemic discrimination. Class Action Copyright 2014

14 Equal Employment Opportunity Commission 14 EEOC Strategic Enforcement Plan for Eliminating Barriers in Recruitment and Hiring Protecting Immigrant, Migrant and Other Vulnerable Workers. Addressing Emerging and Developing Issues. Enforcing Equal Pay Laws. Preserving Access to the Legal System. Preventing Harassment Through Systemic Enforcement and Targeted Outreach. Copyright 2014

15 Equal Employment Opportunity Commission EEOC Guidelines What Should You Do Now? 1. The guidance on background checks discourages employers from using 1 5 blanket exclusions of individuals who have been convicted of crimes. Ban the Box effort 2. Employers should be consistent. For example, employers should consider whether they are ignoring drug convictions against young white job candidates, writing them off as youthful experimentation, but jumping to the conclusion that the drug convictions of young black job candidates suggest something more sinister, like drug dealing. Copyright 2014

16 Equal Employment Opportunity Commission 16 FCRA and Civil Litigation Private Attorneys FCRA is The New Market for class action suits Civil Action can be brought within 2 years after plaintiffs discovery of a violation or 5 years of the violation. Recent settlements in 2013: Local small Healthcare Facility - $22,000 National Retailer - $3 million National Pizza Delivery Chain - $2.5 million Trucking Company - $2.75 million Copyright 2014

17 THE EMPLOYER SHOULD WEIGH THE RELATIONSHIP 17 You need to review all applicants identically, and be able to document the process if asked. You need to implement a matrix requirement policy for each position, evaluating: The type of job The seriousness of the crime How much time has passed since the conviction When in doubt always reach out to your HR attorney. Copyright 2014

18 Review of current Federal and 1 8 State Legislation Ban the Box States: Hawaii, Massachusetts, Minnesota (Jan 2014), Rhode Island (Jan 2014) Local jurisdictions: Philadelphia, PA, Seattle, WA (Jan 2014), Buffalo, NY, Newark, NJ, Richmond, CA, San Francisco, CA (Aug 2014) Credit Reports 10 states has banned credit reports including Illinois and Indiana Marijuana laws Changes made in 2013 Pending changes for 2014 Copyright 2014

19 Recommendations for Employers for Employers should arrange for a review of their background check consent forms. A thorough review of these forms may help avoid the types of claims raised in an emerging line of cases, including electronic applications i.e. Applicant Tracking Systems. 2. Employers should implement procedures to help ensure that adverse action notices are sent at least five business days after the pre-adverse action notice. 3. Employers should also consider how to best record personnel decisions such that, if necessary, the employer can prove that the reason an applicant was rejected was because of a poor interview, failure to provide requested follow-up information, drug test failure, etc., rather than based even in part on the background report. 4. Review background screening policies with HR director, company counsel and your CRA (Background Provider). Copyright 2014

20 Conclusion 2 0 Even a cursory review of the class action filings from 2013 reveals that the storm clouds are gathering under the FCRA. Thus, the investment by employers in fortifying their FCRA compliance is likely to pay substantial dividends. Copyright 2014

21 THANK-YOU Brian Chapman - CEO bchapman@mbiworldwide.com (Ext 112) 2 1 FOR YOUR TIME Founder of National Association of Professional Background Screeners (NAPBS) Board Member - Background Screeners Credentialing Council (BSCC - NAPBS) FCRA Basic Certification Jolene Chullen - EVP jchullen@mbiworldwide.com (Ext 102) Find us on: Copyright 2014 Phone: (866) NAPBS Education Committee FCRA Advanced Certification Consumer Data Industry FCRA Certified Compliance Manager