US Pharm. 2007;32(3)(student suppl):8-14.
In the past, hiring employees was based on an application and a "gut feeling" on the part of the employer. In recent years, however, the background check has become a staple in the employment process for reasons including employee theft and applicants with a criminal history. Because it is generally assumed that an employee's past is the best predictor of his or her future behavior, background checks are considered necessary.
If all employees were completely honest, however, the background check might not be required. But 33% of employees have admitted to stealing a product or money from their employer within the last three years. 1 In fact, the U.S. Chamber of Commerce estimates that employee dishonesty costs 1% to 2% of gross sales and that nearly a third of business failures are directly related to employee theft.2
According to the U.S. Department of Justice (DOJ), one in every 32 adults has a criminal record.3 Many individuals try to hide a criminal past. In fact, 30% to 40% of all job applications and resumes include some inaccurate information.4 These figures have made employers more cautious about accepting an applicant's word at face value.
Since September 11, 2001, job candidates as well as long-time employees are being examined from a new perspective. Hiring without a background check is dangerous when attempting to preserve a safe working environment. It is also problematic in terms of avoiding negligent hiring claims.
Pharmacy employees are not exempt from checks into their professional and private lives. These checks should be conducted for all levels of employment, including corporate executives, directors of pharmacy, and staff pharmacists, as well as technicians and clerks. Background checks are considered good business practice and a critical component of a quality hiring program.
The Application and Interview
The background check is initiated when an individual completes an application and/or submits a resume, enabling the interviewer to become familiar with the applicant's work history. During their meeting, the interviewer engages the applicant in a thorough discussion to verify the accuracy of this information.
While many questions are prohibited during an interview because of their discriminatory nature, inquiring whether an applicant has ever been arrested may be permitted, depending on state law. For example, in California, an application may include "job-related questions about convictions, except those that have been sealed, expunged, or statutorily eradicated," but applications cannot include "general questions regarding an arrest."5
Applicants concerned about a "mistake" from their youth that may still be on public record are justifiably concerned about answering questions about their past. Employers usually ask prospective employees if they have ever been convicted of a crime, felony, or misdemeanor. Typically, applications indicate that the individual does not have to divulge a case that was expunged or dismissed or that was classified as a minor traffic violation. It is important to note that a conviction for driving under the influence (DUI) or driving while intoxicated (DWI) is not considered a minor traffic infraction. Applicants with a DUI or DWI who have not checked "yes" on a job application may be denied employment for falsifying the form--even if the offense occurred many years ago. The employer could perceive this as dishonesty, even if the applicant was simply confused by the question.
Applicants may be asked to complete and sign an authorization for a preemployment criminal background investigation. This authorization permits the employer to review documentation from any state, governmental, or other reporting agency, without fear of a potential invasion of privacy claim by applicants.
Former Employer Checks
A prospective employer often contacts the applicant's previous employers, although many human resource managers are reluctant to provide useful information. In fact, some states prohibit employers from intentionally interfering with their former employees' attempts to find jobs by providing false or misleading references.6 Legally, a former boss can say anything truthful about a previous employee's performance. However, many employers are willing to confirm only dates of employment, final salary, and other limited information.
Legal Requirements for Background Checks
There are many practical reasons for a pharmacy employer to perform a background check; more importantly, federal law requires it. This legal requirement, although not specifically mentioned in any statute or regulation, is countenanced by an obligation on the part of the pharmacy registrant not to employ any person who has been convicted of a felony relating to controlled dangerous substances (CDS) in a position that provides access to CDS.7 (A pharmacy registrant is defined as an individual who registers with the Drug Enforcement Administration [DEA] or the corporation that owns the pharmacy.) A thorough background check is the most practical way to determine whether an applicant has a delinquent past. The DEA requirement also stipulates that those individuals who have had an application for DEA registration denied, revoked, or surrendered at any time cannot work for a pharmacy registrant.
Pharmacies wanting to hire an individual who meets the definition of a pharmacy registrant may request an exception to this requirement from the DEA.8 To do so, the pharmacy employer must have a waiver approved prior to hiring the applicant. Some states also have a waiver requirement. This may mean that two waivers must be received by the pharmacy registrant from the appropriate agencies prior to hire. In order for the waiver to be granted, certain factors are considered by the DEA.
Furthermore, several states have enacted laws requiring background checks for pharmacy-related personnel. Arkansas, for example, has a provision that states:
Prior to or contemporaneously with filing an application form for the applicable license or registration, each applicant for a new intern or pharmacist license, or a new or reinstated registration as a pharmacy technician issued by the Board, except as explicitly provided herein, shall apply, using forms furnished by and pursuant to instructions provided by the Board, for state and national criminal background checks, to be conducted by the Arkansas State Police Identification Bureau and the Federal Bureau of Investigation.9
The regulation further states:
(a) The Board shall not issue an initial license/registration or reinstate a license/registration until the state and federal criminal background checks conducted by the Arkansas State Police Identification Bureau and the Federal Bureau of Investigation have been completed.
(b) The Board may issue a provisional license or registration to applicants for a new pharmacist or intern license or for a new or reinstated pharmacy technician registration as provided in this Regulation.10
Although a provisional license or registration may be obtained, a pharmacist, intern, or pharmacy technician who has pled guilty or nolo contendere (a plea of no contest) or who has been convicted of a felony or other offense, such as theft, fraud, or a pharmacy-related offense, is not eligible for licensure or registration. Note: Individuals applying for licensure or registration may appeal their conviction to the pharmacy board and may have the conviction overturned for purposes of gaining licensure. However, it is up to the discretion of the pharmacy board whether to grant this appeal.
While the Joint Commission on Accreditation of Healthcare Organizations (JCAHO) does not impose a legal requirement to conduct a background check, current standards suggest that inquiries are to be considered. Under the Human Resources standards, JCAHO requires accredited organizations to comply with state laws, regulations, or even self-imposed hospital policies regarding background checks.11 Organizations may also check backgrounds because professional licensure does not necessarily guarantee a criminal-free background. Further, an organization's internal background investigation may be more comprehensive than an inquiry conducted by the state board licensing agency.
Understanding and Using Databases
The Internet enables employers to examine many public databases, which may provide valuable information about prospective employees. Notably, there is little uniformity in information regarding state, county, or city databases. The usefulness of these databases strictly depends on the particular reporting agency's ability to convey accurate and timely information to a database repository that is accessible to the public. Although it seems appropriate and necessary to have a national database that documents criminal activity, no such database is available for public review. The Federal Bureau of Investigation database, while national in scale, is unavailable to the general public.
In locating an appropriate database, employers may consider information regarding professional licensing, educational background, criminal past, credit history, and driving records of prospective employees. Employers may also consider databases containing bankruptcy proceedings, military records, and workers' compensation records.
Professional Licensure Verification and Review: Every state pharmacy board is required to make certain records available as directed by state law. These laws, known as Open Records Acts, allow the board to inform inquiring individuals as to whether a pharmacist or technician has had a disciplinary action taken against him or her. The laws also permit the board to disclose the status of current professional licensure, including dates of issue, renewal, and expiration.
On the National Association of Boards of Pharmacy Web site, a national database provides information regarding individuals who have been disciplined by a pharmacy board. This database is free and easily accessible to anyone and allows users to check the status of licenses and permits. Applicants may have this background check completed prior to employment.
Education Verification: Education verification is recommended for all prospective pharmacy positions. While the federal Family Education Rights and Privacy Act prevents a university from disclosing an applicant's grades, most universities are permitted to declare certain "directory information," which can include dates attended, date of graduation, and degrees granted, unless the student has given written notice otherwise.12 The employer may require the applicant to provide a transcript that indicates coursework completed and degree(s) received. Current security techniques, including security paper, are employed by universities to keep individuals from changing grades, adding degrees, or altering transcripts in other ways.
Health Care Fraud, Abuse, and Malpractice Checks: Practitioners involved in health care fraud and abuse and malpractice actions can cost an organization millions of dollars, in addition to injuring patients and damaging organizational goodwill. Two databases provide information addressing these issues: the National Practitioner Data Bank (NPDB) and the Healthcare Integrity and Protection Data Bank (HIPDB). The NPDB reports practitioner malpractice actions, whereas the HIPDB is a flagging system that identifies health care practitioners, providers, and suppliers involved in health care fraud and abuse. Information in the HIPDB report alerts organizations to practitioners who may warrant closer investigation.
Information in the NPDB is available online to entities meeting the eligibility requirements as defined under the law and NPDB regulations.13 To access information, entities must first register with the data bank. Most hospitals, registered governmental agencies (e.g., the Veterans Administration and the Public Health Service), as well as state health care agencies, can obtain access to the database. NPDB information is not available to the general public.
While both independent and chain retail pharmacies do not have access to these banks, employers can require potential pharmacy employees to perform a self-inquiry (query) at the NPDB-HIPDB Web site. For a small fee, a report is generated that is returned to the pharmacist in about two weeks. The employer can then request that the employee provide a copy of the report to the employer.
State Criminal Background Check: Each state maintains a database of criminal convictions and activity, such as probation. For a fee, states typically conduct background searches on particular individuals. Some of these searches can be performed via the Internet, and the results can be obtained in a matter of seconds. The individual's name, date of birth and social security number may be required. The background search usually returns all felony and misdemeanor convictions. Some searches may be limited in scope, e.g., the length of time the search will cover. It is important to note that a state criminal background search reviews records only for that particular state. If an applicant has lived in other states, background searches in each of those states may also be conducted. Many states also maintain publicly accessible databases comprising court records of individuals involved at the trial court level. These district or superior court records may reveal not only criminal activity but also litigation activity, such as civil court judgments, divorce and protective orders, or other pending and past litigation.
Sexual Offender Search: With over 385,000 registered sex offenders in this country, any employment background check should include a review of criminal sexual activity.14 Searching for sexual offenders, since they are now required to be registered in the state in which they reside, has never been easier. The U.S. National Sex Offenders Public Registry is a cooperative effort between state agencies and the federal government that hosts public sex offender registries. The registry is coordinated by the Department of Justice, which implements a Web site search tool that allows users to submit a single query to obtain information about sex offenders throughout the U.S.
Incarceration Records: Individual states maintain Internet incarceration records, which include reasons why and when an individual was incarcerated in state prison, the date of release, and any current warrant information for parole violations. Many of these Web sites also provide photographic identification of the individual. Most of these sites are affiliated with the state department of corrections, but the Federal Bureau of Prisons also maintains a Web site that provides information regarding inmates.
Credit Report: Obviously, if employees are going to handle cash, it would be valuable to know if they have had any issues of concern regarding finances. Since few employees volunteer such information, employers may check their credit history to gauge an individual's level of responsibility. Some employers believe that if an individual is not reliable in paying bills, then he or she will not be a reliable employee.
The Fair Credit Reporting Act (FCRA), as amended by the Consumer Credit Reporting Reform Act of 1996, enables employers to access a consumer's credit report for employment purposes.15 As a result, an employment background check from one of the three major credit reporting agencies (Experian, TransUnion, and Equifax) provides a modified version of the credit report, called an employment report. An employment report includes information about credit-payment history and other credit habits that may be considered significant by a potential employer. However, a modified credit report does not include the credit score of the individual. Furthermore, this report does not place an "inquiry"on a credit file that may be seen by a company considering issuing the individual credit in the future. Such credit inquiries tend to lower an individual's credit score.
The FCRA requires that businesses certify to the credit reporting agency that:
• Prior to accessing a consumer report, the employer has provided a separate written document to the consumer/applicant, disclosing that a consumer report may be obtained for employment purposes, and that the employer has received written authorization from the consumer to pull his or her consumer report; and/or
• Prior to taking adverse action, based in whole or partly on the consumer report, the business will provide a copy of the consumer report to the consumer and a summary of the consumer's rights as indicated by the Federal Trade Commission ("Consumer Rights"); and
• The business will not use a consumer report in violation of any applicable federal or state equal employment opportunity law or regulation.16
Military Records: If military service is important to the position, verification of an applicant's military background can be valuable. Under the federal Privacy Act, service records are confidential and can be released only under limited circumstances. Inquiries that are not authorized by the subject of the records must be made under the Freedom of Information Act. Even without the applicant's consent, the military may release an applicant's name, rank, salary, duty assignments, awards, and duty status.17
Social Security Number Verification: Applications for employment will typically request a disclosure of the individual's social security number or portion thereof. The Social Security Administration (SSA) does provide a variety of methods where an employer can submit social security numbers to the SSA for verification. While an employer may want to verify that the applicant is who he or she claims to be, the service offered by the SSA can be used to verify only current or former employees and only for wage- reporting purposes. Requesting such information from the SSA prior to employment may be punishable by a fine, imprisonment, or both. Thus, in order to address the authenticity of the individual, employers may require the applicant to provide a social security card and/or birth certificate.
The SSA is currently planning to provide a consent-based social security number verification. Before the employer enrolls in this program and pays a fee, the employer has to obtain the written consent of the number holder. The SSA will then verify the name and social security number combination of the prospective employee as being correct or incorrect.
Employers can review certain SSA information regarding numbers, such as where the number was issued. Since 1973, social security numbers have been issued by the central SSA office. The first three digits of a person's social security number are determined by the zip code of the mailing address shown on the application for a social security number. (More information on this topic may be found at www.ssa.gov/employer/stateweb.html.)
Motor Vehicle Driving Records: Every state has some form of motor vehicle department. Obtaining information from these agencies verifies the specified state operator license, as well as the previous state of issue, violations, points, and current license status. While this check may be considered unnecessary, it may provide information regarding an individual's willingness to comply with pharmacy laws and regulations, as well as state-directed motor vehicle requirements. A motor vehicle report (driving record) is inexpensive and recommended for every search, because it can reveal information that may not be uncovered in a criminal search and could reflect an individual's character. The driving record will report a DUI, accidents, tickets, drug possession, current warrants, and failures to appear in court, and it can be used to confirm the subject's date of birth. Many states require an applicant's "consent to release" before the motor vehicle department can release the records.
Web-Based Searches: By typing an individual's name in the search engine Google, information may be found regarding an applicant. However, any potential employer should carefully ensure that the information is truly representative of the prospective employee. Employers may also search such sites as WhitePages or Facebook, which are common Web sites that can reveal significant personal data regarding an individual.
Workers' Compensation Check: In most states, when an employee's claim goes through the state workers' compensation system, the case becomes public record. An employer may use this information only if an injury might interfere with a person's ability to perform required duties. Under the Americans with Disabilities Act, employers cannot use medical information, or the fact that an applicant filed a workers' compensation claim, to discriminate against applicants.18 In some states, employers may access workers' compensation records after making an offer of employment. To gain access, employers may have to register with the workers' compensation agency and confirm that the records are being accessed for legitimate purposes. Generally, a consumer reporting agency that does a background check for an employer may not reveal medical information, and the employer typically does not rescind an offer due to a workers' compensation claim. However, if an employer discovers that an applicant has not revealed a previous employer where a workers' compensation claim had been filed, the employer may terminate the new hire due to falsified application.
Inadequacies of Background Checks
The two key components of any background check are accuracy and completeness. Although it is evident that many sources of information are available, data obtained by a Web-based search are only as reliable as the information contained in the database, whether private or public. If, for example, a county court does not forward criminal convictions to the state criminal database system, a criminal record check is incomplete.
Some employers, including pharmacy employers, have used other techniques to perform background checks, such as polygraphs or drug testing. While both of these techniques may be legally permissible, the accuracy and/or reliability of these tests is inadequate when used alone. Polygraphs, although considered by polygraph examiners as extremely reliable, measure physiological responses that can be manipulated by some examinees and do not tell a complete story. Similarly, drug testing paints a picture only of an applicant's current drug use. When used in conjunction with a thorough background check, these methods may be helpful in verifying certain activities.
Databases can provide valuable information, but only if that information is solidly connected to the employee. Some prospective employees not only lie about their work experience, degree received, and social security number but also about who they are. Fingerprints are the most reliable assurance of an individual's identity, and photo identification is the next best source. A government-issued identification should be the most trusted, considering there are many photo-identification mills that create identification without verification of identity.
Negligent Hiring Claims
One of the most significant consequences of not performing a background check is a potential negligent hiring claim. Employers across the country have been under attack for these claims for years. The claim is based on a theory of negligence, that the employer failed to check references, criminal records, or general background information, which resulted in conduct that injured a consumer or another employee. Generally speaking, employers have a duty to conduct a reasonable investigation into a prospective employee's past. The Fourth Circuit Court of Appeals determined an employer can be liable for the acts of an employee on a theory of negligence when:
An employer in placing a person with known propensities, or propensities which should have been discovered by reasonable investigation, in an employment position in which, because of the circumstances of the employment, it should have been foreseeable that the hired individual posed a threat of injury to others.19
While there are no set rules regarding what must be checked, documentation of a background check is prudent before hiring an applicant.
Who Performs Background Checks?
There are six large national firms, known as consumer reporting agencies (CRAs), that perform background checks, and at least 300 smaller firms that provide these services locally to businesses. Finding one of these online companies is as simple as using an Internet search engine to find Web sites specializing in background checks. Employers should be wary of companies that advertise that they can "find everything about anyone." Employers should also use caution in signing an agreement that relieves the CRA of liability for negligent reporting.
If a third party performs a credit check, the FCRA requires the applicant's consent and that the applicant be provided with the results.20 The FCRA generally requires that the CRA not disclose public records of arrest, indictment, conviction, civil judicial action, tax lien, or outstanding judgment, unless the agency has verified the accuracy of the information during the 30-day period ending on the date when the report was furnished. Such a rule provides the employer with a statutory requirement that accurate information be provided by a CRA. In some ways, the FCRA restricts a CRA from obtaining and disclosing certain information regarding applicants, such as interviews with neighbors, friends, or associates of the consumer/applicant. A self-conducted employer background check does not have the same restrictions.
Employers must protect their company and employees from the harm of hiring a person unsuitable for the position. Thus, it is incumbent upon every organization--whether large or small, public or private, for profit or nonprofit--to refrain from hiring a new employee who has not been thoroughly screened. The risks to current employees and the organization outweigh the cost of such a background check, including the employee time and an outsourced company expense to perform the check. The financial concern can no longer be an excuse to avoid performing a background check, since many databases can be accessed for free and utilized to investigate the background of potential employees.
1. Alliance Worldwide Investigative Group LLC. Available at:www.allianceinvestigative.com /background.html. Accessed September 7, 2006.
2. Shaffer DJ, Schmidt RA. SHRM Legal Report, September-October 1999.
3. U.S. Department of Justice Bureau of Justice Statistics. Available at: www.ojp.usdoj.gov/bjs/pub/press/ppus02pr.htm. Accessed October 24, 2006.
4. Privacy Rights Clearinghouse Fact Sheet 16. Available at: www.privacyrights.org/fs. Accessed October 24, 2006.
5. California Department of Fair Employment and Housing Fact Sheet. Available at:www.dfeh.ca.gov/Publications/DFEH%20161.pdf. Accessed October 24, 2006.
6. California Labor Code §1050.
7. 21 CFR §1301.76.
8. 21 CFR §1307.03.
9. Arkansas State Board of Pharmacy Regulations, Regulation 11, Criminal Background Checks, 11-00-0003-APPLICATION PROCEDURE (a)(1).
10. Arkansas State Board of Pharmacy Regulations, Regulation 11, Criminal Background Checks, 11-00-0002-BACKGROUND CHECK REQUIRED (a), (b).
11. Joint Commission on Accreditation of Healthcare Organizations. Available at: www.jointcommission.org/ AccreditationPrograms/Hospitals/Standards/FAQs/Manage+Human+Res/Planning/background.htm. Accessed October 24, 2006.
12. 20 U.S.C. §1232g(a)(5)(A).
13. 42 U.S.C. §11101 et. seq, 45 CFR Subtitle A §60.11.
14. Nadell B. Sleuthing 101, Background Checks and the Law; 2005.
15. 15 CFR §604(a)(3)(B) [15 U.S.C. § 1681b].
16. 15 CRF §615(a) [15 U.S.C. § 1681m].
17. 5 U.C.S. §552, 552a.
18. 42 U.S.C. §12112(d)(1).
19. Blair v. Defender Services, 386 F.3d 623 (4th Cir., 2004).
20. 15 CFR §604(b)(2)(A)(i) [15 U.S.C. § 1681b], 15 CFR §606(d)(3) [15 U.S.C. § 1681d], 15 CRF §613(a)(1) [15 U.S.C. § 1681k].
21. U.S. Department of Justice Pharmacist's Manual. Available at:www.deadiversion.usdoj.gov/pubs/manuals/pharm2/pharm_content.htm#p6a). Accessed October 24, 2006.