Employers will likely experience various challenges in 2023 as they conduct background screenings for prospective employees. These challenges will arise from heightened government oversight of automated screening technology, laws limiting access to public records and criminal history, and expanded marijuana legalization.
Automated Screening Systems
Employers have long had to comply with the regulations and guidance of federal agencies such as the U.S. Equal Employment Opportunity Commission (EEOC), the Federal Trade Commission (FTC), and the Consumer Financial Protection Bureau (CFPB). These agencies are now focusing on automated methods of employment background screening and ensuring that the information they produce is accurate.
For instance, the CFPB has raised concerns about erroneous identity matching, has taken enforcement action against screeners, and is considering a rule to amend the Fair Credit Reporting Act (FCRA) to improve accurate screening. The EEOC has expressed similar concerns about employers using automated screening processes and artificial intelligence in selecting and hiring employees. New York City has even passed a law that requires bias audits of automated employment decision tools, which goes into effect in April 2023.
To stay abreast of any criticism in this area, employers should use reasonable procedures in their hiring decisions based on information that they obtain legally through verifiable sources. They should not make arbitrary decisions and make a good-faith effort to be consistent.
Laws Limiting Access to Public Records and Criminal History
Over the past decade, countless municipalities and states have passed “clean slate,” “fair chance,” and privacy laws that limit the ability of employers to look at applicants’ criminal histories as they make hiring decisions. These laws are designed to provide a fresh start to people with criminal histories by allowing them to access better jobs. Ten states have passed new laws that go into effect this year, and active campaigns in more states already exist. The patchwork of existing laws and the continually changing laws in different jurisdictions can make it challenging for employers to ensure full compliance in screening and hiring applicants.
To some degree, these laws make it easier for employers who may be struggling with considering applicants with criminal records on a case-by-case basis since they no longer will have those records to consider. From another perspective, employers may be able to avoid liability for negligent hiring if they did not know they hired someone with a criminal record.
State privacy laws also affect the ability of employers to screen job applicants. For example, California and Michigan have removed dates of birth as personal identifiers from public records, which screeners commonly used to conduct background checks.
This development can make it take longer to conduct background checks, especially when individuals have common names, which can harm job seekers. It also can make compiling accurate background checks on applicants much more challenging. In Michigan, the Professional Background Screening Association was able to resolve this issue by the state providing a registration process that allows them access to unredacted records.
Expanded Legalization of Marijuana
Although marijuana possession remains illegal under federal law, most states have legalized the substance for medicinal and/or recreational use. In addition, laws expunging marijuana convictions are also increasingly common. As a result, many employers are now considering whether to remove marijuana from pre-employment drug testing panels.
State laws typically do not protect employees impaired by or under the influence of marijuana while at work. Nonetheless, employers who conduct pre-employment drug screening or random drug screenings of employees will need to consider how to fairly treat employees who legally use marijuana outside of work hours. One major problem with marijuana is that there is no sound way to test for impairment to the extent that it causes a safety risk in the workplace.
Source: Hall Benefits Law