By William J. Judge, JD, LL.M.
Drug Screening Compliance Institute
Drug testing can make you money. I have said this for years and people usually look at me as if I’ve been smoking something. What they don’t realize is that if they explore the state financial opportunities that exist, they can see a significant return on their money. However, in order to do so, compliance with the state’s rules, including the filing of paperwork, is necessary. Two recent cases, one in Florida and the other in Tennessee, make this evident. Before we get into the details of the two cases, let’s set the stage.
Today, nineteen states provide some form of a rebuttable presumption of intoxication defense to a workers’ compensation claim. Seen on the map below, the states highlighted in green offer a rebuttable presumption of intoxication. However, the cause must be established. The states highlighted in blue provide a rebuttable presumption of both intoxication and cause. In those states, the burden then shifts to the employee to show that she or he was not intoxicated and/or that something other than intoxication caused his or her injuries.
If the employee is unable to rebut the presumption, the claim is denied. Some states require paying for the medical care that the injured employee received and, in a few states, the presumption is unavailable if the injured employee died. If you are operating in one of these states, you should seriously consider complying with the financial opportunity that is available to you. If you don’t utilize this defense, you are leaving cash on the table.
Another cash opportunity, also involving workers’ compensation, can be found in the twelve states highlighted in yellow below.
These states offer a discount on your workers’ compensation premiums annually (usually ~5%) if you voluntarily comply with the rigid rules detailed in most of the state’s statutes and regulations.
As seen in the following two cases, if you fail to comply with the rules in either of these financial opportunities, you may not receive the benefits available.
On April 18, 2018, a Florida Court of Appeals reversed a lower court’s decision to deny death benefits to the spouse of a man struck and killed by a vehicle while walking from a bar along the road. The employee, a construction helper assigned to an out-of-town job, was returning to his hotel. Surveillance video showed the employee “weaving in and out of the road” shortly before the accident, but the actual accident was not seen.
The employer raised the rebuttable presumption of intoxication defense available in Florida (sec. 440.09(3) and 440.09(7)(b)). The Court of Appeals found that the employer and carrier were not entitled to the defense “due to their non-compliance with…the procedures set forth in the administrative rules.” Without the presumption, the employer/carrier had to show “by the greater weight of the evidence, that the work-related injury was occasioned primarily by the intoxication of the employee.”
The Court of Appeals concluded that the employer/carrier failed to meet that burden. The potential cost to the employer/carrier was up to $150,000 in compensation and up to $7,500 in funeral expenses.
On February 8, 2018, the Tennessee Bureau of Workers’ Compensation Appeal Board (“Board”) found that an employer that had participated in the State’s Drug-Free Workplace program in the past was not entitled to the presumption available in that program because they hadn’t filed the required paperwork with the State to cover the time period of the accident. Had they filed the application for participation in the program they could have raised the rebuttable presumption that the injured employee’s drug use (marijuana) was the proximate cause of her injuries she sustained in an automobile accident while at work. The employer asserted that it’s past participation in the program and its “substantial compliance with the statutory requirements” should entitle it to the program’s benefits.
The Board disagreed indicating that not only had the General Assembly imposed certain program requirements, but it also required that “substantial compliance in completing and filing the [application] form shall create the rebuttable presumption” that the employer had established the required program.
Because the employer here had not filed the application (even though it had been filled out) it was not entitled to the presumption.
Lesson: State benefits can save substantial amounts of money, but only if you comply with the rules set out by the state legislature and agency that enforces the law.
 In most of these states, there are detailed rules that must be met. An explanation of those details is beyond the scope of this article.
 Inmon v. Convergence Employee Leasing III, Inc., et al, No. 1D17-0815, (1st Dist. Ct. of App. (4-18-18)).
 Sec. 440.16.
 Bowlin v. Servall, LLC, et al, Docket No. 2017-07-0224, (2-08-18).
When it comes to background screening, drug testing, and employment verification, human resource professionals, employers, business owners, and employment attorneys must keep informed of the ever-changing rules, regulations, laws, and court decisions.
What are the trends facing the industry for 2018? Of those, what will have the greatest impact on the practice of human resources related to background screening?
Here are Hire Image’s 2018 Top 10 predictions for what’s “hot” and why. These are topics that are sure to demand attention in 2018.
1. Increased Attention to Data Security
One of the biggest lessons we learned in 2017 is that our personal information may not be as safe as we had hoped. There were breaches at many companies and financial institutions throughout the year, culminating with the major Equifax data breach that captured headlines in the fall. This breach was staggering not only because of the over 145 million people it affected, but also because of the extremely sensitive information, such as social security numbers, that was compromised.
As our banking, business, and overall online transactions continue to skyrocket, the amount of personal information captured and stored by businesses will continue to grow in 2018. With an increase in information comes an increase in concern over the security of that information. Securely maintaining and disposing of records that contain sensitive information will continue to be a top priority for every business owner.
The Federal Trade Commission (FTC) is charged with the regulation and oversight of business privacy laws and policies in the U.S. that impact consumers, including the Fair Credit Reporting Act, which governs background checks and provides guidance on best practices businesses should follow to keep data secure.
In addition to following the FTC’s guidance on the proper data security practices, businesses that utilize a consumer reporting agency for their background screening services should be sure to partner with one that has achieved accreditation with the National Association of Background Screeners (NAPBS) Background Screening Credentialing Council (BSCC). The Background Screening Agency Accreditation Program (BSAAP) standard, policies and procedures, and measurements are available at http://www.napbs.com/
2. Increased Misunderstandings Surrounding Drug Testing in “Marijuana-Friendly” States
Marijuana remains a Schedule I substance under the Controlled Substance Act, which makes it illegal for any reason under federal law. However, more than half of the states have now legalized marijuana for either medical or, the more expansive, recreational use. This inconsistency among states and, more specifically, between states and the federal government leaves many employers wondering what the changing laws mean for their existing drug screening policies. This issue was further complicated just last week by the Memorandum on Marijuana Enforcement issued by the Department of Justice, making it easier for U.S. prosecutors to enforce federal marijuana laws in states that have legalized it.
Throughout the cases that have been decided (and are in no doubt just scratching the surface of this issue), one thing is clear–employers still have the right to maintain a drug-free workplace. States are beginning to step in to help define the rights of employers as they pertain to the changing drug laws. Additionally, when medical marijuana is involved, employers must also remember the Americans with Disabilities Act, which prohibits discrimination against someone with a disability. For example, in Barbuto v. Advantage Sales & Marketing LLC et al, the Massachusetts Supreme Judicial Court ruled that an employee may proceed with a claim of handicap discrimination after being terminated from employment based on a positive workplace drug test result for her off-site use of medical marijuana.
Employers should also be aware that marijuana in the workforce, legal or otherwise, continues to rise. According to a study by Quest Diagnostics, the world’s leading provider of diagnostic information services, in oral fluid testing (detecting recent drug use), marijuana positivity increased from 5.1% in 2013 to 8.9% in 2016 in the general U.S. workforce, representing a nearly 75% increase.
It is important that employers recognize that every state has different requirements and update their policies for each state in which they do business. When updating, clear and distinct language should be used to ensure that employees have a firm understanding of what is expected of them and the ramifications of non-compliance.
3. Salary History Inquiries May Soon be History
2017 saw many gender equity issues come to the forefront and we expect this powerful trend to continue, including when it comes to salary history questions during the hiring process. Several jurisdictions have passed “pay equity” laws over the past couple of years to help close the gap on equal pay and strengthen protection against pay discrimination by employers. However, jurisdictions are now taking it a step further by enacting specific laws prohibiting employers from inquiring about salary history during the interview and screening process.
Massachusetts was the first state to pass legislation, in 2016, prohibiting employers from requiring salary history from applicants before receiving a formal job offer (the law actually goes into effect this year, on July 1, 2018). Last June, Oregon passed a law prohibiting employers from screening applicants based on salary history (effective January 1, 2019) and in October, California passed its own legislation (effective January 1, 2018).
In April of 2017, Philadelphia became the first city to prohibit employers from inquiring about an applicant’s wage history at any stage of the hiring process (note that this law has been enjoined and is not currently effective). New York City and San Francisco followed suit by enacting similar legislation in April and July of 2017, respectively.
Salary inquiry restrictions will impact many employers nationwide in 2018 and beyond as more jurisdictions look at enacting similar legislation. Employers should review their policies and practices regarding previous employment information and how employment verifications are handled. Pay equity laws could impact the screening process and policy changes may be required. Click here for a list of current Salary History laws.
4. “Ban the Box” Initiatives will Continue
“Ban the Box” has been a popular subject for some time now, and while we have all discussed the ins and outs of the laws as they were intended, it appears that their adaptation and evolution will continue into 2018. As of January, 30 states and more than 150 counties and cities have now passed legislation removing criminal history questions from job applications.
As the “Ban the Box” movement has grown, many of the laws now go further than simply eliminating the question about criminal conviction history from the application. Requiring an employer to wait until after a conditional employment offer is made before inquiring about criminal history and limiting the type or age of conviction records an employer can use in considering employment are just a few ways that the laws have expanded. It is also expected that many established “Ban the Box” laws will be amended to include “Fair Chance” components. Spokane, Washington is the most recent city to pass legislation, which becomes effective May 28, 2018.
Employers should understand and comply with the laws in the states, counties, and cities in which they do business. Click here for a list of current “Ban the Box” laws.
5. Social Media Searches Will Increase
There is no doubt that both employers and prospective employees are using social media more and more when recruiting or looking for employment, respectively. A 2016 Career Builder Survey found that 60% of employers use social networking sites to research job applicants. This represents a significant increase from the 22% who did so in 2008. That increase in percentage, along with the increasing amount of Millennials entering the workforce demonstrates that the use of social media in the hiring process will continue to increase.
For the employer, it is a risk versus reward analysis. The reward is avoiding a potentially bad hire and the tremendous costs associated with such. However, in using social media, the employer runs the risk that he or she, even unintentionally, will come across protected classes of information and then use that information to make a hiring decision. Even the appearance of a decision not to hire someone based on a negative impression related to race, gender, religion, disability, or other protected classes could subject them to a discrimination lawsuit. There is also the risk of a lawsuit for using protected activity, such as the applicant complaining about a previous employer, as a basis for not hiring someone.
Other problems with the use of social media searches throughout the background screening process include the possibility of false positives or negatives. People use different names on their social media accounts and at least some information posted is usually incorrect. Employers run the risk of misidentifying someone or missing someone all together because of these inaccuracies.
Finally, employers need to be concerned with the applicant’s right to privacy. It should be noted that this does not apply if the applicant’s social media settings are set to public. That information is open and anyone can look at it, including potential future employers. However, if their profile is set to private, the employer cannot try to bypass those settings without risking exposure to potential liability down the road.
These concerns should be considered carefully in order to decide if this type of investigation is worth the effort and risk. Companies are encouraged to discuss these searches with their legal counsel and consider outsourcing this process to stay away from potential discrimination claims.
6. E-Verify Gets Closer to Becoming Mandatory
E-Verify is a fast and accurate web-based program that helps to ensure that jobs are only made available to those eligible to work in the country. It is currently being used by over 740,000 employers in the United States. Checking job applicant eligibility using E-Verify has been a voluntary process (except for certain employers with federal contracts) since it was created by the U.S. Citizenship and Immigration Services (USCIS) in 1996. However, the Legal Workforce Act introduced in Congress last year could change that.
The goal of the legislation is to make E-verify a mandatory requirement for all U.S. employers. Mandatory use was also included in the White House Fiscal Year 2018 Budget in an attempt to reduce illegal employment. According to the Society for Human Resource Management (SHRM), there is strong support for a mandatory system among U.S. employers.
A published Summary of the Act, demonstrates that the mandatory participation for new hires would be phased in gradually in six month increments, based on the number of people employed by a business, so that within 24 months, all businesses will be mandated to use E-Verify.
7. On-Demand, Extended Workforces and the Gig Economy Continue to Impact the Screening Process
There is no doubt that non-traditional staffing has been on the rise. A study by Intuit showed that there will be 7.6 million Americans working in some form of on-demand or freelance capacity by the year 2020. Both employers and employees tend to need more flexibility than ever. This has forced many industries to change the way they do business, while, at the same time, inspired new industries to emerge. Although not identified as employees, these contractors, freelancers, and consultants represent the companies they’re gigging for, and are often times the only “face” of the company the customer ever sees. In order to maintain the integrity of the “gig economy,” as well as the trust of their customer base, it’s up to the businesses who rely on a freelance workforce to properly vet those individuals, even when they are not defined as traditional employees.
With a high turnover rate and a need for quick, efficient background checks, companies rooted in the gig economy should be prepared to adopt clear background screening protocols with a willingness to adapt the policies as local and national laws change. Employers could have the same exposure as with traditional employees and should screen them just as if they were so.
8. FCRA-Related Lawsuits Remain a Threat to Employers
2018 will likely see the continued trend of class action lawsuits brought against employers for alleged violations under the Fair Credit Reporting Act (FCRA). Employers should not let down their guard when it comes to FCRA-related lawsuits, as plaintiffs’ attorneys will continue to creatively bring suits to show the “concrete injury” requirement established in Spokeo, Inc. v. Robins, Inc. in 2016.
Last year saw cases involving Avis (paying a $2.7 million settlement in a class action lawsuit), Postmates (paying a $2.5 million settlement), and Home Depot (on the opposite side, dismissing the case for lack of “concrete injury”), among many others.
Although most class action lawsuits that wind up in the news involve large, recognizable companies, employers of any size are at risk and should frequently review their forms and processes to ensure that they are in compliance with the FCRA. Employers should also review the laws in the states and cities in which they do business to ensure compliance with local laws.
9. Access to Criminal Data Information will be Limited
In addition to the restrictions placed on the type of record or age of information that employers can consider when reviewing an applicant’s criminal history, a new obstacle for background screening appears to be on the horizon. Turnaround times for obtaining information have increased substantially, as many courts no longer have the resources to help with public research.
Additionally, several states are considering proposals that, if passed, would further restrict access to criminal records by imposing new rules about who can have access to court records and what information those records will contain. Under many of the proposals, date of birth will no longer display in records, thereby eliminating a key element that allows background screening agencies to validate that the criminal record belongs to the applicant in question, and making it more difficult to ensure maximum possible accuracy.
10. Drug Screening Panels will be Added in Response to the Country’s Drug Crisis
According to an analysis of over 10 million drug tests, Quest Diagnostics recently found that the American workforce reached the highest positivity rate for drug use in over a decade. Barry Sample, Senior Director, Science and Technology at Quest said, “[t]his year’s findings are remarkable because they show increased rates of drug positivity for the most common illicit drugs across virtually all drug test specimen types and in all testing populations.”
Poison control centers and hospital emergency rooms have reported increasing instances of abuse and overdose of synthetic (also called designer) drugs, which are not approved by the FDA. Synthetic drugs have constantly changing compounds, so that testing becomes increasingly difficult. As such, it is imperative to stay one step ahead in new drug-test development.
Drug screening panels will need to be added or changed in order to keep up with the increased use of various drugs. Both the Department of Health and Human Services (HHS) Mandatory Guidelines and the Department of Transportation’s rules reflect this trend by clarifying existing drug testing program provisions and adding certain semi-synthetic opioids including hydrocodone, oxycodone, hydromorphone, and oxymorphone, commonly referred to as OxyContin®, Percodan®, Percocet®, Vicodin®, Lortab®, Norco®, Dilaudid®, and Exalgo® to the drug testing panel in response to the increasing concern over opioid abuse in this country.
It is clear from all that is happening in our industry that the year 2018 will be a busy one in the background screening, human resources, and employment law fields. Hire Image will continue to monitor legal and regulatory developments in federal, state, and local jurisdictions and timely share those changes that impact the process of background screening.
It is undisputed how valuable background screenings are in the hiring process. They not only provide a tremendous amount of information about job applicants, they also save a company time and money by reducing the risks of a bad hire, workplace safety issues, and even workplace crime. Although everyone agrees how important they are, questions arise as to their timing. Specifically, whether they can or should be completed before or after an offer of employment is made.
There are currently no federal laws restricting the timing of background or drug screening (other than occupational health screenings which may fall under the Americans with Disabilities Act). State and local laws are really where the timing issue arises. Some state, city, and county laws have restrictions in that you either are not allowed to conduct one at all prior to an offer of employment or where you can conduct one, but certain information is limited. There are also Ban the Box laws limiting inquiries into criminal history at various times during the hiring process, which may include post application, post initial interview, or after conditional offer is made. The laws vary greatly between jurisdictions and it is important to understand how those laws impact the timing in each jurisdiction where you are considered an employer. For a complete ban the box resource guide, click here.
If you are in a state where pre-offer background and drug screenings are allowed, there are some advantages to doing them early. For example, after a job fair for a large hiring initiative where starting the process early will assist you in having candidates available to work as soon as possible. The sooner you start, the faster you can learn if someone is not a good fit for the company and move on (after sending the required notifications). If you have to wait until after an offer has been made, you will have to start again from step one with someone else, which will increase the amount of time that position stays open. From the opposite perspective, when you find the right person early, he or she can have a faster start date after the offer is accepted, since the background screening is already completed. Additionally, some searches take more time than others. Starting early gives you adequate time to get the screening completed in its entirety.
Pre-offer background and drug screenings also have some disadvantages to consider. There is a higher cost associated with doing the screening for multiple applicants at the same time. This is especially true for industries with a high turnover rate, where costs can add up quickly. Depending on the need to have candidates ready to work as soon as possible and the speed in which the background and drug screens are completed, companies should analyze the cost benefit specific to their company.
Employers should not let a question of timing stop them from conducting a background screening. You should consult with your attorney to ensure you stay in compliance with your own state and local laws and remember that even if you are in a Ban the Box state, the provisions of your law may be vastly different from another. This is especially important for employers with multi-state operations. Once you ensure that you are compliant, it is important to stick with your company’s policy and stay consistent in terms of the timing of your background screening by location and by a certain position. Another option is to hire a third party to conduct your background screenings. Using a third-party background and drug screening vendor, such as Hire Image, can help you find accurate information on your candidates, as well as help you develop a process that works for your organization.
The controversy surrounding professional references is nothing new. In fact, the adage of a double-edged sword has never been more applicable. Prospective employers are concerned with thorough due diligence when hiring new employees to protect those in their workplace, while former employers are concerned with not violating a person’s right to privacy. If the new employer does not know of a previous problem, they risk hiring an incompetent or dishonest employee. If the previous employer is too forthcoming, they risk being sued by their former employee.
The topic is coming up more and more frequently. Steve Kirby, a former jazz professor at the University of Manitoba in Canada applied for a new position at the Berklee College of Music in Boston. Part of Berklee’s pre-employment screening process included professional references and background checks. As such, they reached out to the University of Manitoba, where they received positive references with regard to Mr. Kirby (although the Dean, Associate Dean, and the HR department at the University of Manitoba were unable to verify the source of such references).
Mr. Kirby had retired in June, following a six-month leave. The leave was pending an internal investigation after a group of students at the University filed sexual harassment complaints against Mr. Kirby in February. The investigation concluded that his conduct with a female student constituted “sexual harassment.” However, neither the allegations nor the investigation’s results were disclosed during the reference checks.
The students at University of Manitoba were outraged that Mr. Kirby could get another teaching job and demanded greater transparency. In response, representatives from the University of Manitoba claimed that they could not disclose a finding of sexual harassment due to privacy concerns and a lack of an applicant’s signed release.
This case also brought the attention of various women’s rights groups, who are demanding that privacy laws be re-evaluated. Their argument is clear–teachers should not be able to leave one school when something happens and move to another, free to do the same thing to someone else. The safety of students (and other workers, in other cases) must be a priority.
References and background checks also came up in another recent case where a former choir teacher was sentenced on October 4th to 20 years in prison for sexually abusing two young boys in Texas in 2012. In that case, the mother of one of the boys, who had welcomed the teacher into their home for lessons and trusted him, as a part of the school system, claims that the Victoria Independent School District should never have hired him in the first place and that her son’s pain could have been avoided.
In 2010, the teacher, Jaime Cuellar, had been reprimanded by the Edinburg Independent School District for sending inappropriate text messages to students. However, in hiring him, the Victoria School District claims that they were unaware of any inappropriate actions or disciplinary actions against him, as Mr. Cuellar passed their three-tiered screening process, including reference checks, criminal background checks, and fingerprint screening.
As these cases show, professional references can create potential for lawsuits and policy change. Some are now advising employers not to say anything, but then issues like these arise, where a lack of communication is potentially placing innocent students, children, and co-workers at risk. Where are their rights? Isn’t it time we start sharing information to protect people in the workplace?
Hire Image offers a variety of reference checks, including education, employment, and professional, and all of our searches require authorization. We understand the intricacies of this subject and will provide you with as much information as is allowable under the law to help guide your hiring decision.