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Where The Law Stands On Employee Background Checks

[ 0 ] Jul. 30, 2012 | SBO Editor

By Caron Beesley

You’ve probably heard about the controversy surrounding employers asking job applicants for their Facebook user names and passwords as part of the background check process. It sounds shocking, but it happens – particularly among law enforcement entities – but even among private sector employers who feel they have a reason to go that extra step to weed out potentially undesirable employees.

Unethical as it may seem, what does the law say about this?

Led by the state of Maryland, which became the first state to ban employers from asking for social media passwords,  several other state legislatures are pressing for laws that prohibit this extreme form of background check.

At the federal level there is no law prohibiting employers from soliciting social media login information. However, the Department of Justice considers it a crime to violate social media terms of service. Check out Facebook’s Terms of Service and you’ll find it stated explicitly that users consent not to share their login information, solicit login information, or access the account of another Facebook user. So employers and applicants clearly need to tread carefully.

At the end of the day, asking a job applicant for their social media login is unethical and an invasion of privacy at the very least. It also exposes employers to discrimination lawsuits if an applicant can prove that information about their religious, political or sexual views on their social media profile was used to discriminate against them.

Background checks have their place, but what are your options as a potential employer?

You can use several different types of background checks to build a profile of an employee, but the law varies on what information you can ask for, what you can do with it and when consent is required. If you run a criminal background check on an employee, for example, different states have different rules on how you can use that information. Also, if you are seeking to hire someone who will have fiscal oversight in your business, you opt for credit score check. By law, this requires the applicant’s consent.

To read more about the types of checks you can legally conduct, refer to SBA’s Guide to Employee Background Checks. In most instances, the following checks are worth considering:

  • Credit checks (currently used by 60 percent of employers, but remember that you must get the applicants consent according to the Fair Credit Reporting Act)
  • Drug tests
  • Past employment
  • Criminal background (check with your lawyer so you are compliant with state laws)
  • Driving records (if the job demands this skill)

For many small businesses, this scope of testing is downright time-consuming. If you feel you need to go beyond what’s on an applicant’s resume or contained in their letters of reference, consider hiring a private screening firm. Not only will they do the legwork for you, they’ll also ensure any checks are done within the law.

The Bottom Line

The turnover costs of replacing an experienced worker who doesn’t work out can be 50 percent or more of that individual’s annual salary; more if you are seeking specialized skills, high qualifications, and experience. (Source: AARP).

BIO:Caron Beesley is a small business owner, a writer, and marketing communications consultant. Caron works with the SBA.gov team to promote essential government resources that help entrepreneurs and small business owners start-up, grow and succeed.

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Category: Features