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Failure to background check bad for business
May 24 2013

Federal, state and local laws make it harder and harder for hoteliers to conduct criminal background checks.

Highlights

HR directors must be careful when conducting background checks and providing references for past employees.
Lawsuits challenging criminal background checks have been on the rise for several years.
It is estimated by ADP and the Society of Human Resource Managers that about 46% of résumés include false claims.

A recent headline in the Arizona Republic read, “Hotel chains sued over alleged rapes of guests.”

This would catch the eye of almost anyone skimming the paper. As someone who consults to hotels and to human-resource professionals on almost a daily basis, I found the article riveting. So did countless others. The news report went viral and was carried in a number of publications late last month.

To summarize, two hotels are being sued in Maricopa County Superior Court for allegedly failing to conduct criminal background checks for the same nightshift front-desk clerk who had worked at both hotels at different times during 2011 and in 2012 and allegedly raped two women in separate attacks. In both instances, the clerk used a master key to enter the rooms late at night. In one instance, he was caught on the hotel’s video camera opening the door with the key.

Randy Pullen
 

The alleged rapes were reported to management and to the authorities by the victims. The clerk was terminated by both hotels. In neither case was the individual arrested and held on rape charges with the police citing a lack of probable cause, although the police department finally did recommended filing charges last December. The twist in the story is that the 40-year-old clerk was a known level-three sex offender.

The question that immediately popped into my head was why neither hotel property management conducted a criminal background check. The response of one manager was he does not do criminal background checks on front-desk agents. He might have checked with the prior employer but apparently did not get a report of termination for cause. How could this happen?

The answer is a lot simpler than you think. As most HR directors at hotels know, you must be careful when conducting background checks and in providing references for past employees. Lawsuits challenging criminal background checks have been on the rise for several years. They stem from a statement made by the Equal Employment Opportunity Commission that “an absolute bar to employment based on the mere fact that an individual has a conviction record is unlawful under Title VII.”

There you have it—another federal agency exercising oversight and issuing rules that only your lawyer could begin to understand.

As government becomes less and less employer-friendly, HR departments begin to take on the role of an insurance policy—limiting risk by making sure company policies and procedures are consistent with federal and local labor laws and regulations, and that they are carefully followed, documented and ready for audit. If done correctly, your HR directors can save your hotel thousands of dollars in costs per employee.

The cost savings or cost avoidance associated with having rock-solid employment procedures and documentation has been demonstrated again and again. How would you like to be one of the two Arizona hotels being sued for not conducting proper background checks?

In today’s legal environment most employers conduct background checks, known as pre-employment screening, for two reasons:

1) A large percentage of job applicants provide false information on their applications. It is estimated by Automatic Data Processing and the Society of Human Resource Managers in a study conducted last July that about 46% of résumés include false claims; and
2) to prevent “negligent hiring,” which might be brought by an injured employee if the employer hires a new employee that he or she should have known was predisposed to commit a violent act.

There are all kinds of dos and don’ts with regard to what you can and cannot ask or research about a job applicant. A good summary is provided here. Of course, it depends on which state you are conducting business as to how the local laws are enforced.

Some states are much tougher about it than others, and you need to know the local laws.

For instances, in Illinois or California, you cannot use arrest records—only actual convictions. Even if convicted, you need to evaluate the relevance of the crime to the job requirements. How do you know if the conviction disqualifies the applicant from employment? Consult your local labor attorney and hope there is already case law to support your policies and procedures.

If you discover later that false information was provided and if it is likely the employee would not have been hired if the correct information had been provided, you have a strong case for termination.

In summary, in the eyes of federal, state and local government bureaucrats, employers are the bad guys. There are indeed unscrupulous employers that need to be disciplined and held legally responsible for their actions, but I am willing to bet that 46% of employers do not lie to their employees or job applicants regarding the job description, requirements and working environment.

Last century, the poor treatment of workers was a serious issue in the U.S. and gave rise to many labor laws to protect workers’ rights. Now, the pendulum has swung too far the other way and government is abusing employers and holding them guilty until proven innocent for alleged crimes.

Think I am overstating the case? If you have not yet had the pleasure, then you need to attend an employment hearing in front of an EEOC administrative judge. After that, you might think differently about employer rights.

Randall Pullen is President and CEO of WageWatch, Inc., which he founded in 1999 to design and implement Web-based wage and benefit surveys. Mr. Pullen‘s work experience includes over 30 years of software development and consulting to the hotel industry. Mr. Pullen is a certified public accountant and a member of the AICPA. He earned a Bachelor’s Degree in mathematics and an MBA from Arizona State University. He serves on the boards of a number of companies and associations, and is currently the Treasurer of the Arizona Housing Finance Authority.

The opinions expressed in this column do not necessarily reflect the opinions of HotelNewsNow.com or its parent company, STR and its affiliated companies. Columnists published on this site are given the freedom to express views that may be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to comment or contact an editor with any questions or concerns.
 

COMMENTS   Show All
Anonymous
8/19/2013 5:27:00 PM
Very biased, and made as a result to get something in return.
Mark Spitz
6/13/2013 7:38:00 PM
Contrary to Dr. Adams, I think this a great article as the failure to do background checks on staff can be costly to a business in the long run so it no shock that a lot of companies of a smaller stature are turning to websites like backgroundchecks.com.
Dr. Jay Adams
5/24/2013 9:05:00 AM
Oh my! What a biased, fear-mongering, anti-employee diatribe! You have done nothing but a disservice to your intended customer base.
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