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Giving thanks
With Thanksgiving only a few days away, we want to extend a special thank you to all our clients. Your continued business and referrals have helped make SI a leader in our field. We recognize that our employees are also at the heart of our success and appreciate their hard work and dedication.
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Giving back
As a value and ethics driven company, we are committed to giving back to our community and society in ways that create meaningful rewards for years to come. We support many national and local organizations such as the Child and Family Guidance Center, Women At Risk, and the Valley Women's Center. This year, we have also undertaken the creation of a much-needed library for the Richard Merkin Middle School and Gertz-Ressler High School, located in an at-risk area of Los Angeles. This project is well underway and we welcome you to partner with us in obtaining funding and books for these deserving students. For more information or to make a donation, please click here. Together we can grow our businesses while also nurturing our communities.
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Tracking hot topics
Supreme Court ruling may ban consumer class-action lawsuits
A case heard November 9, 2010 before the U.S. Supreme Court, AT&T Mobility vs. Concepcion, may potentially ban consumers from filing class-action lawsuits. The basic question bein g decided is whether companies can bar class-actions in the fine print of their take-it-or-leave-it contracts. The U.S. District Court for the Southern District of California ruled that a class-action ban violates state law and is not preempted by federal law; the U.S. 9th Circuit Court of Appeals upheld the lower-court ruling last year. If a majority of the justices vote AT&T's way, any business that issues a contract to customers -- such as for credit cards, cell phones or cable TV -- would be able to prevent them from joining class-action lawsuits. And the banning of class-actions may potentially apply to employment agreements such as union contracts.
Massachusetts employers cannot ask about criminal records
Three provisions of a new law directly affect Massachusetts employers: 1) effective November 4, 2010, employers are prohibited from asking job applicants about criminal history on the initial application, except for positions for which federal or state laws, regulations or accreditations disqualify an applicant based on a conviction, or if the employer is obligated by laws or regulations not to employ individuals convicted of a crime; 2) effective February 6, 2012, an employer in possession of criminal record information must provide that information to the applicant prior to questioning about it, and similar to the requirements of the Fair Credit Reporting Act (FCRA), if an employer decides not to hire an applicant in whole or in part because of the criminal record, it must provide the applicant with a copy of the record, and 3) effective also in 2012, employers that conduct five or more criminal background investigations annually must implement and maintain a written criminal record information policy.
New York State imposes sales tax on information services
Information that comes from a public source which is or can be sold to multiple customers is now considered a "taxable information service" by the New York State Department of Taxation and Finance. Without the enactment of any legislation, in September 2010, the Department decided to expand its definition of "taxable information services" to include the sale of public documents by private entities, abstracts of title, and risk management analysis reports. These previously exempt services have been assessed a "destination tax" because the location where they are delivered controls whether or how much tax applies. The rate typically has two components: the state tax rate of 4% and the local rate that ranges from 7% to 8.875%. For more information, see the National Public Records Research Association (NPRRA) Web site.
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Pitfalls of national criminal databases in pre-employment investigations
According to a report on NBCMiami.com, a candidate running for Cooper City, FL commission named David Nall was falsely labeled a criminal after a national database check stated that he had been arrested for credit card fraud in 1987. By the time Nall, who had no criminal record in a subsequent Florida Department of Law Enforcement (FDLE) check, was made aware of the erroneous results, supporters of his opponents had already spread news of his supposedly crooked past. Nall told the South Florida Sun-Sentinel that even his ten-year-old daughter asked him if he was a criminal.
Embarrassment from such mistakes is not the biggest peril of these databases. Unless the search is performed by an FCRA-defined background investigations company a.k.a. consumer reporting agency (CRA) or an in-house user who understands its limitations, the employer may be exposed to significant legal and financial ramifications. Although there are no comprehensive statistics on how often inaccurate information turns up, a review of related litigation by ABC News in 2008 found dozens of lawsuits on behalf of hundreds of people filed against the major criminal database companies, alleging that background checks contained erroneous information.
Databases labeled as "national" or "nationwide" are compiled by private companies which purchase information from various sources including county and federal courts, state criminal record repositories, sex offender registries, prison systems and proprietary criminal data collections; however, the majority of the indices are incomplete, sporadic in coverage, outdated or inconsistently updated and provide limited or no identifying information, making common name "hits" almost impossible to identify with a subject.
Employers who directly accesses third-party private databases and obtain information that may bear upon an individuals character, general reputation, personal characteristics or mode of living are compiling a consumer credit report as defined by the FCRA, and thus cannot avoid its many requirements. Further, Equal Employment Opportunity rules and many state laws prohibit the automatic elimination of an applicant with a criminal conviction unless the employer can show a business justification. Also, several states regulate the records that an employer can and cannot obtain, such as an arrest not resulting in a conviction or using a conviction that had been expunged.
Whether the searches are conducted in-house or by a CRA, compliance with FCRA Section 613 which protects the applicant from adverse hiring decisions due to incomplete, inaccurate, impermissible or misidentified records is critical. And while such national databases are useful for reference purposes, any record found should be confirmed through manual searches and documentation from the official record keepers venue.
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