Civil rights organizations, politicians and others are calling for the Equal Employment Opportunity Commission (EEOC) to prohibit employers from asking job seekers if they have a criminal record on employment applications.

Last summer, the EEOC held a hearing regarding a possible ban on criminal background checks for screening employees, but has not yet released its opinion. Some states are already eliminating the criminal record question for state job applicants.

Why are supporters calling for the “box ban?” Some say that it prevents applicants from getting a fair chance at a job, because they don’t have an opportunity to explain the circumstances if they don’t ever get an interview. They say that too often, employers automatically eliminate anyone with a criminal history during the application process.

Others say that in most cases, the conviction is not related or relevant to the position being filled. Still others say that the disproportionate number of people of color with criminal records means this is essentially a civil rights issue. Advocates say they are behind the ban in an effort to reduce discrimination and unfair barriers against people with felony and misdemeanor convictions—particularly those that occurred years or decades ago.

Some cities have enacted ordinances prohibiting employers from asking anything about criminal backgrounds until after an applicant’s first interview. In Seattle, Philadelphia, Chicago, San Francisco and Boston, criminal background checks are permitted after an interview, but requiring an applicant to reveal his or her criminal record on a job application is not.

Advocates say that employment is the way to a better life for individuals with criminal records, and that it levels the playing field by allowing everyone to be judged on qualifications and merit. But many employers are understandably hesitant to take that chance.

We’ll keep you posted on these possible changes, so you can make the best hiring decisions for your business.

Have you hired an employee with a criminal conviction? How did it work out?

California recently became the seventh state to prohibit credit checks in making employment decisions. Effective January 1, 2012, the law outlaws most employee credit checks. It states that employers may only use consumer credit reports when hiring for:

• Managerial positions
• Prospective law enforcement officers
• Jobs that provide access to consumer credit card applications
• Positions in the state Justice Department
• Jobs in which the employee would have access to confidential information
• Positions where the employee would be a signatory on a bank or credit card account
• Jobs in which the employee would have access to cash totaling $10,000 or more

The U.S. Equal Employment Opportunity Commission held hearings in October around the issue of employee credit checks, which some employers see as a signal that additional legislation could be coming.

One concern is that more people have experienced damaged credit ratings in the wake of the economic crisis. However, employers’ groups said that it is wrong for the government to infringe on the ability to screen out applicants who have the potential to damage or bankrupt a company.

In addition, the patchwork of statutes being enacted by various states makes it more difficult for national companies to stay in compliance, say employer representatives.

Experts say that it’s important for employers to be extremely consistent in how they apply employee credit screening policies. It’s also a good idea to talk to prospective employees about any problems revealed in credit reports.

The stories of trusted, long-term employees charged with embezzling money from their employers just keep coming:

• There’s the case of the bookkeeper who was charged with stealing over $100,000 from a concrete company. In a plea deal, she pleaded guilty to embezzling $5,000, got a 45-day sentence and was ordered to pay $50,000 in restitution. Then she went to work for a department store and stole $17,000 worth of merchandise and gift cards. Maybe that’s how she planned to pay the restitution.
• Another bookkeeper took trips, bought expensive cars and had plastic surgery – while making about $20,000 in salary. Still another worked for a couple for 30 years, taking money all the while. His $1 million theft was only found out when the business owners wanted to sell the company and retire.

Unfortunately, these types of fraudulent activities by employees are not unusual. We just don’t hear about the thousands of incidents that go away quietly. Many stories are never reported to the press, because they are not reported to the police. Whether out of embarrassment or fear of harming their business, many companies deal with these crimes on their own.

But the publicity can be helpful to other small businesses, since they are the most likely to be victimized. With one person responsible for writing checks, making bank deposits and reconciling statements, fraud is much more likely. Splitting these duties reduces the risk, but small companies often cannot afford the extra personnel. Hiring an outside bookkeeper is one way to alleviate the problem.

Why do employees steal? They usually have three traits: opportunity, need and rationalization. It could look like this: Your cashier figures out a way to take money that you’ll never notice. He’s behind on his rent and needs cash. And besides, he works really hard and you don’t pay him enough. He gets away with it, so he does it again. And again. And before you know it, you’ve lost $20,000. You never imagined this person would do anything like this. Chances are, he never has before.

If your company is victimized by an employee, reporting the crime can protect other businesses. When employees are properly screened prior to being hired, a criminal background check will reveal any previous convictions. And when you’re ready to hire, make sure to run pre-employment background checks and credit checks—especially when you’re hiring a bookkeeper, cashier or any other position that has access to cash or bank information.

If you’re hiring, you’ll likely see all types of applicants. Some will be a good fit for your company, and some won’t. Some will help you weed them out with big red flags, like lying on their resumes, while others throw out little pink flags that are more difficult to spot. While they look great on paper and interview well, certain types of employees may prove to be more trouble than you expect. The impact can range from simple aggravation to permanent harm to your company, your reputation or your brand.

Three Types of Employees You Don’t Want to Hire

• The first type to avoid is the employee who performs at the “just enough” level. They do just enough work to get by. They come in exactly on time, and leave just when the clock says their shift is over. They contribute just enough to the company culture, share just enough ideas and give just enough of themselves to help out fellow employees. While one of these types on staff probably won’t hurt your company, can you imagine if you had an entire “just enough” team? Avoid hiring this type of person.
• Next, you might see the entitled type of employee. You might think you’re doing them a favor by hiring them, but their opinion is quite the opposite. They feel you owe them a job, and you’re the one who’s receiving the favor of them showing up for work. Soon, you’ll hear that they are not being paid enough, or that their job description doesn’t cover the tasks you’re asking them to perform. They may expect special treatment. Some view benefits like paid sick leave as just like vacation, and therefore theirs for the taking—whether they are sick or not.
• The constant complainer is another potentially burdensome employee. When interviewing, ask lots of questions about why the applicant left his or her previous job, what they liked and did not like about it, the company, their supervisor and fellow employees Look for clues, which might range from negative comments about a previous boss or company, or even “joking” about the dress code. And ask about how much interaction they had with customers. An interviewee who complains about customers has his or her priorities in the wrong order.

While you might not discover these toxic types of employees until after they’ve been hired, if you can avoid them, you’ll be glad you did. And remember, employee pre-screening is a must to uncover any credit issues, an undisclosed criminal background or discrepancies that can indicate a potential problem employee.

If you’re a business owner or hiring manager who’s getting ready to do some hiring, you may need to be aware of résumé fraud—especially if it’s been awhile since you last hired a new employee. As the recession drags on, every job opening has the potential to bring in more applicants than you might expect. Some could be long-unemployed applicants who desperately need work, while others could be gainfully employed and seeking new opportunities.

No matter what the applicants’ backgrounds, some could go beyond stretching the truth about their work or education history and fabricate some—or all—of their résumé. With every job desired by more applicants, some may venture beyond getting creative to stand out from the competition into fraudulent means to land a job.

Verifying Educational Credentials
These days, it’s not difficult to obtain a phony degree or diploma, or to create bogus college transcripts. Some applicants will go so far as to rent a mailbox and supply that address for a fake alma mater, so that any requests for verification come directly to him or her. They can then do whatever is needed to substantiate their claim of a degree.

Employers can thwart this scam by having a pre-employment screening firm verify educational credentials, including what schools an applicant attended, any degrees earned and even grade-point averages. Employers may also ask the applicant for written authorization to obtain transcripts directly from a college or university.

Verifying Employment History
Job applicants may have a long history of magically matching their work experience directly to a job description, but now things have gone beyond a bit of résumé fudging. Expanding on job duties, exaggerating dates of employment or creating past employers out of thin air are not unusual occurrences.

When you receive a résumé from an applicant, look for clues that he or she is either exaggerating skills or fabricating them completely. Some will use functional résumés, which offer a laundry list of job tasks performed, but don’t tie them to specific positions. This can hide any employment gaps or job-hopping.

Asking applicants to perform written or verbal tests that can verify job skills is a good way to weed out those who are unqualified. And pre-employment screening is a great way to verify that an applicant actually worked for an employer listed on his or her résumé.

Avoid Fake Résumés
Another good method of screening out fake résumés is to ask the candidate to complete a written job application that asks for the same information contained on a typical résumé. If you have an applicant who purchased a ready-made résumé online—a too-common practice—they may have not memorized its contents, and are u therefore nable to recreate it on the job application.

Do not skip over these steps in the verification process, no matter how desperately you need to fill a position. You’ll almost never be sorry when you plan well advance and take your time. And once you’ve narrowed the field to a handful of candidates, conducting a thorough background check, credit check and employment verification through a trusted pre-employment screening service is your final step in hiring the right candidate that you will be able to trust.

Legal experts say that employers who perform Internet searches on employment candidates risk violating employment and privacy laws. At a recent conference, employment attorneys warned that Googling applicants is akin to interviewing them, and employers should avoid doing so.

Internet searches can lead to inappropriate or incorrect assumptions about a candidate. For example, seeing photos of an applicant in which she is drinking, attending a religious service, protesting for a cause or in a hospital bed can automatically bring about questions or judgments that have nothing to do with her skills or ability to do the job. You cannot ask her about her religion or health in an interview, so why would you subject the candidate to an online search of her personal life in which these topics come up?

In addition to jumping to conclusions, there is also the chance of mistaken identity. There are plenty of people who share names, but nothing else. One John Doe is a successful and respected business professional, while the next John Doe has an extensive criminal background. You can’t be 100% sure that you’re looking at your applicant’s profile unless he has given you access to it.

The attorneys advise that employers should obtain an applicant’s permission before conducting an Internet search, and then give them the opportunity to explain any questions that come up.

The conference attendees also heard advice about using caution when determining how employees can and should use social media. Policies should be established that set guidelines for employee use, to prevent them from harming the firm’s reputation or business.

In a related matter, employers should also review their liability insurance policies to be sure that they are covered in case of lawsuits stemming from employee or employment candidate use of social media.

Employers in every industry are vulnerable to sensitive data theft, financial losses, security breaches, and safety issues. Pre-employment credit checks and criminal background screening on all applicants can protect your company and your staff from possible harm.

Business owners and hiring managers usually stand in one of two groups when it comes to screening employees: either they are all for it and believe every single job candidate needs to be pre-screened prior to the job offer; or they make that decision on a case-by-case basis. Here are a few examples from the news this week that shed some light on why the latter is not such a great idea:

• An executive director of a non-profit, the West Wisconsin Land Trust, allegedly stole thousands of dollars from the organization by using its credit card to purchase things like nutritional supplements, coffee and hotel rooms. While this might not sound excessive, it is when you consider the nutritional supplement purchases totaled over $13,000 and the hotel was over $1,600. If you can’t trust the ED of a non profit, who can you trust?
• A non profit sled dog organization in Alaska realized too late that an employee had failed to pay $20,000 in gaming taxes, instead keeping $15,000 of it for herself. She was arrested and convicted of a felony.
• In California, a Macy’s employee was accused recently of stealing a whopping $60,000 in makeup over the course of a year. The stocker had access to storerooms where makeup was kept, and took bags of high-end merchandise out of the store in bags. He then sold the high-end makeup at street fairs.
• Even the federal government is not immune from employee theft. This week, a U.S. Forest Service employee was charged with stealing and pawning $4,500 worth of tools. The employee stole chainsaws, air compressors and generators. His thievery went unnoticed until a repairman noticed Forest Service numbers etched into a chain saw bought in to his shop.

Regardless of whether these four individuals had criminal records when they were hired, they do now. So if you’re a business owner or hiring manager who wants to avoid hiring people who steal from their employers, it’s always a good idea to run a pre-employment credit check and criminal background check.

The U.S. Supreme Court this week ruled that background checks of scientists by the National Aeronautics and Space Administration (NASA) did not violate their constitutional rights. In a unanimous decision, the Court backed up the Obama administration, which defended background security investigations they called “standard” for federal employees since 1953 and for contractors since 2005.

NASA instituted the background checks for every employee with access to the Jet Propulsion Laboratory in California beginning in 2007. 28 scientists, engineers and others challenged the depth of the background checks as needlessly intrusive, citing requests for information on medical treatment and counseling for drug use, and some sensitive matters. They challenged the potential loss of their jobs for refusing to undergo the investigation, and won in an appeals court.

The Supreme Court justices overturned that U.S. appeals court ruling that had blocked NASA from conducting the background checks. In its opinion, Justice Samuel Alito said that the questions being challenged were reasonable inquires that allow the government to properly manage internal operations. Further, the questions were found to be employment-related, and similar to those used by millions of private employers.

The justices rejected “the argument that the government, when it requests job-related personal information in an employment background check, has a constitutional burden to demonstrate that its questions are ‘necessary’ or the least restrictive means of furthering its interests.”

The government also has an interest in conducting background checks to ensure the security of its facilities and to deploy a competent, reliable workforce, the justices said in the ruling. Further, they stated there are sufficient protections in place to prevent disclosure of sensitive information to the public.

If your businesses not only made it through the recession, but is gearing up for higher sales or productions, congratulations! You’ll probably be venturing back into the hiring pool, too—and if it’s been a while since you’ve dipped a toe in it, this is a good time to re-think your previous strategies and try something new.

Hire for Good Fit and Train For the Job
Sure, experience counts for a great deal when you’re hiring a new employee. But for long-term success, a number of companies look at how well employees fit their culture, not how many years of experience they’ve gathered.

Zappos is an online mega-store, which started out selling shoes but now sells clothing and accessories, too. Zappos‘ employees work hard toward common business goals—and they think of themselves as a family. And when it comes to hiring new employees, Zappos’ carefully-crafted company culture rules. (You can’t let just anybody into your family.) They look for people who are “fun and a little weird.” Potential hires also must embrace the company’s nine other core values, including “be humble,” “do more with less” and “deliver WOW through service.”

Another example of success is Southwest Airlines—pretty much the only profitable airline around. Southwest hires for attitude and trains for skills. Their interview process includes group tasks, which help determine if an applicant has the right attitude and/or leadership abilities. They want more employees who have fun, don’t take themselves too seriously and are “passionate Teamplayers.” At Southwest, they know that “Happy Employees = Happy Customers. Happy Customers keep Southwest flying.”

If you’re going to be hiring employees soon, you might want to adopt some of these ideas as your own.

Tips For Hiring Employees Who Fit In

1. Look for passion: for your company, your product or service, and for life.
2. Find out if an applicant has the same values as your company: if fun is important in your company culture, a dour employee won’t be as successful as one that loves to have fun.
3. Embrace individuality. Don’t limit your hiring to clones of yourself or other employees.
4. Ask applicants to do something unusual: Like write an essay about their hobbies, goals or grandparents. Have them meet your team, send in a video, or list their top ten movies, books, or albums.

Remember, even if you think you’ve found a perfect-fit employee, it’s always smart to conduct a thorough pre-employment screening. Checking an employee’s background, including credit check and criminal records check, is the only way to know for sure that you’re making the best and safest hiring decision.

Last month the Equal Employment Opportunity Commission (EEOC) conducted a public hearing about employers’ use of credit history when making hiring decisions. The goal of the EEOC was to determine the extent of the practice, its effectiveness, and potential impact on various populations.

While some states have restricted use of credit reports in hiring decisions, most have not taken action against pre-employment credit checks. According to the EEOC Chair at the start of the hearing “questions have emerged about the fairness of the practice, whether the results…correlate to job performance and whether there are any adverse impacts.”

A representative from the Society for Human Resource Management (SHRM), a respected industry association, told the commission that the federal government should not eliminate an employer’s use of credit histories to make hiring decisions. Christine Walters said, “SHRM believes there is compelling public interest in enabling our nation’s employers…to assess the skills, abilities and work habits of potential hires.”

She also brought to the commission’s attention that employers typically do not conduct background checks and credit checks on employees until they are about the make a job offer. This contradicts the opposing belief that employee credit checks are discriminatory or represent a form of economic segregation.

SHRM Research on Employee Background Screening

• Recent data revealed that only 13 percent of organizations surveyed conducted credit checks on 100% of job candidates. 47 percent take the credit history of candidates for selected jobs into consideration.
• 91 percent of employers conduct credit checks only for jobs with financial or fiduciary responsibilities; 46 percent check the credit histories of senior executive candidates and 34 percent only check those who would have access to confidential employee information.
• Four out of 10 organizations do not conduct credit checks.
• Credit history ranked lowest on a list of criteria employers use in hiring decisions.
• Medical bills are not typically considered when scrutinizing employee candidates’ credit histories. And only 11 percent of respondents consider home foreclosures.
• The vast majority of employers—87percent—allow candidates the opportunity to explain their credit check report results.

Walters also told the EEOC that while employers typically don’t tell candidates they can’t work for them because they have bad credit, they want the option to use credit histories to help determine which candidate is the most qualified. The Commission did not disclose whether it will issue any guidance on the issue of employers’ use of credit histories.