Important Takeaways from the 2018 NAPBS Annual Conference
Employers Choice Screening had the opportunity to attend the 2018 NAPBS Annual Conference held in Baltimore, Maryland (MD) this week. The event hosted over 1,000 attendees and more than 45 exhibitors providing services to complement solutions to consumer reporting agencies (CRA).
The theme for the 2018 NAPBS Annual Conference was “Passport to the World,” which addresses the shift in employers’ need to screen applicants on a global level.
It is important to highlight not only the importance of global screening, but also highlight additional themes communicated by the presenters at the 2018 NAPBS Annual Conference.
What Consumer Reporting Agencies and Employers Can Do to Avoid a Lawsuit
This topic seems to dominate most HR conferences our team has attended for the past few years. Due to the Human Resources industry constantly changing and evolving, end-users along with their consumer reporting agencies (CRA) vendor must be aware of these changes in order to provide compliant background checks. Compliance is what ultimately decreases an organization’s exposure to liability.
Three main areas that employers and CRAs are being sued by plaintiff attorneys for:
1.) Non-Compliant Disclosure and Authorization Forms
Non-compliant disclosure and authorization forms still remains the number one reason why employers are being sued. In today’s day and age, it is shocking that there are still employers that do not prioritize getting their disclosure and authorization forms in compliance with federal regulators.
Current law states that the disclosure and authorization form must be a standalone document separate from any internal application and/or on-boarding forms. Furthermore, the disclosure must be separate from the authorization. This essentially makes the form two-pages in length.
Secondly, if the disclosure has extraneous information such as a release from liability for example, that confuses the applicant. As a result of this, the end-user and CRA can be held liable for violating the Fair Credit Reporting Act (FCRA).
Lastly, residents in the state of California (CA), Oklahoma (OK), and Maine (MN) are eligible to a receive a copy of their background check report every time an employer makes a request; therefore, organizations are required to have a check box on their disclosure form that allow residents from those states to indicate whether they wish to receive a copy of their background screening report.
2.) Employers Not Using Accurate Information
Employers and CRAs have a duty to ensure maximum possible accuracy when reporting and utilizing public record information. This means that they must report the most up-to-date information from courts, data providers, and other furnishers of information in order to make well-informed hiring decisions.
If employers are receiving non-conviction information (arrest, pending, expunged, or dismissed), they are potentially setting themselves up for a lawsuit because the majority of new Ban-the-Box and Fair Chance Act laws require employers to only use convictions when making an employment decision.
3.) Not Providing Consumers the Opportunity to Dispute Findings Background Checks
One of the main protections provided to consumers by the FCRA is the opportunity to dispute any adverse information on their report with the consumer reporting agency that procured the background check.
Once an employer elects to not hire an applicant based on the results of a background checks, they must follow the pre-adverse and adverse action process. In a nutshell, the employer is required to provide a copy of the background screening report and contact information of the CRA to the subject of the report, allowing them to identify any inaccuracies reported.
If it is determined after five business days that the report contained accurate and up-to-date information, the adverse action letter must be sent notifying the applicant that they will no longer be considered for employment.
Global Screening is on the Rise
The 2018 NAPBS Annual Conference added an additional emphasis for organizations to conduct background checks internationally. All attendees walking through the exhibition hall would have noticed an increased presence from international CRAs covering countries such as India, Philippines, UK, and Canada. These data providers are physically located in these countries and have built relationships to both streamline and automate international screening.
With new data protection laws being issued by the European Union General Data Protection Regulation (GDPR) and Canada’s new data breach laws, organizations and CRAs that conduct business outside of the United State must ensure compliance with new regulations when handling personal identifiable information.
The European Commission has determined the following to be considered personal identifiable infoFmation:
- Home Address
- Email Address
- Bank Details
- Social Media Posts
- Medical Information
- Computer IP Address
Similar to regulations in the United States, employers must certify a permissible purpose for collecting consumer data information.
Investing in Integrations with Applicant Tracking Systems
Due to the advent of technology and human resources software, almost all different types and sizes of employers are using some form of an Applicant Tracking System (ATS). These systems help to consolidate the majority of the traditional HR functions into one platform.
This allows for data providers such as consumer reporting agencies, training organizations, and insurance organizations to integrate their software with the ATS. Establishing an integration with an ATS is not as easy as one would think.
The first issue is the upfront cost to build an integration with the end-users ATS, which can range from $1,000 to $15,000 in setup costs on average in addition to annual fees, maintenance, and upgrades, which are generally not included. In most cases, the CRA would pass these fees onto the employer, which could be a deal breaker based on the discrepancy between the grand total and the initially quoted cost.
The big question is how a CRA may stay competitive with these types of engagements when the cost is astronomical. A simple answer is to invest in these integrations because their technology is here to stay.
Another solutions is to reevaluate the CRA’s current platform or portal to gauge if it is a Software as a Service (SaaS) model or proprietary. If the CRA utilizes a SaaS solution, it is crucial for them to have open communication with their vendor to explore these integrations and potential shared the costs.
Proprietary systems have more flexibility in the fact that they own their portal and have internal developers dedicated to facilitating these types of engagements in-house.
The most important takeaway gathered from the 2018 NAPBS Annual Conference is to “invest in your future by investing in integrations.”