EMPLOYMENT AND CREDIT-EMPLOYEE

Credit Worthiness is an important business and personal asset each person has to manage. I mean this is an asset which could make or break business relationships and interestingly in some cases personal relationships. This is a complex abstract thing that is evaluated in many ways by different entities. What factors contribute to the credit worthiness is really dependent on the case for which this is evaluated. Mostly for small debts or purchases the credit worthiness is just a credit card reference, but for larger one it starts with that but really ends with a personal visit by evaluators. The typical purchases where your credit worthiness dictates your payment terms are credit cards, real estate purchases, business credit, and any type of loans. This is also used to judge the qualification of foster parents, just to mention a diverse application of the concept. Given that the number of factors that contribute to this worthiness, it is worth noting the few important ones. And try to make sure your credit worthiness is in the positive side. Employers can also look at an applicant's credit score, which is an assessment of future credit risk. However, the job applicant has to provide written consent before the employer can request the credit report from a background checking company. You need to hire capable, honest and loyal employees; hiring the best Consumer Reporting Agency (“CRA”) to perform your pre-employment background investigations ensures the best results.

A Consumer Report (background investigative report) is furnished by a CRA to an employer for the purpose of assessing a candidate for employment, promotion, reassignment or retention as an employee.

CRA—CONSUMER REPORTING AGENCY—EMPLOYERS (WHAT TO KNOW)

The Wall Street Journal reports that 34% of all job applications contain lies regarding experience, education, and the ability to perform essential functions of the job. The Society for Human Resource Management states that 45% of all resumes contain one major fabrication.

Employee fraud costs companies more than $400 billion dollars annually.

There are several important factors to consider when retaining a CRA:

• 1. Do they adhere to the law and Fair Credit Reporting Act (FCRA) guidelines?
• 2. Is the CRA a member of the National Association of Professional Background Screeners (NAPBS, the largest
  and most reputable trade association in the industry)?
• 3. Can they provide references?
• 4. Do they have a business license?
• 5. Are they bonded and insured?
• 6. Do they charge sign-up fees?
• 7. Do they require a contract?
• 8. Will they hold you to monthly minimums?
• 9. Do you know exactly what to do if you decide not to hire someone based on the background investigation?

Your company is only as good as its people. By hiring a recognized and competent employee, you’re protected from costly mistakes that could lead to civil litigation. You see, when an employer decides not to hire an applicant based on the results of their background check, certain protocols have to be met to ensure you and your CRA are following federally mandated FCRA guidelines. All CRA’s must comply with the FCRA, the federal guidelines that control the acquisition and distribution of consumer credit information; the FCRA dictates how consumer credit information may be used. Here is how it works: When applicants apply for employment, promotion, or reassignment, they sign releases authorizing the employer to conduct background investigations and to obtain investigative consumer reports and/or consumer credit reports. The language in the authorization form explains the information will only be used for employment purposes, to determine if the applicants possesses the minimum qualifications and background necessary for the positions for which they are applying. The authorization form makes it clear that an investigative consumer report may include information about the applicant’s character, general reputation, personal characteristics, mode of living, credit worthiness, credit standing, and/or credit capacity.

If the applicants pass the background check and the employer decides to hire, promote, or retain them, then the process is over. However, if something is found in an applicant’s background (for example, a felony, misdemeanor or D.U.I. conviction the applicant didn’t disclose), then the employer is responsible for providing the applicant a Pre-Adverse Action” letter if the employer decides to not hire, promote or reassign the applicant/employee. The purpose of this letter is to inform the applicant that specific information in the consumer report may cause disqualification from possible employment or promotion. The applicant then has five business days to dispute the information contained in their report. If it is discovered that the CRA is at fault, having provided erroneous information, then the CRA must correct any errors or falsely reported information found in the applicant’s background. If the negative information cannot be proven erroneous, the employer must than issue a second and final “Adverse Action” letter explaining that the applicant is no longer in consideration for employment, and the employer’s decision was based upon information provided by the CRA. The CRA’s name, address, and phone number must be disclosed on the Pre-Adverse and Adverse Action letters. These guidelines have been put in place by the Federal government to protect consumers and ensure they have the ability to remove any false and erroneous information that could possibly deny them employment. Following FCRA guidelines will safeguard your organization; hiring the cheapest online database background company may not. To be safe from very expensive litigation, use a real investigation agency that specializes in doing this job to the highest professional standards, and one which abides by the letter of the applicable Federal statutes. Did you know the results of a database background search (going online and using a credit card to get access to immediate name database searches) are not permissible for employment purposes? Therefore, if you base a hiring decision on the results of a database background search, you’re opening yourself up to potential civil litigation. The Internet-based companies sell information which can be obtained instantly, but at the grave cost of accuracy and relevancy. The “instant” data in their databases is in actuality comprised of free public records, which they simply organize and sell to consumers at relatively inexpensive rates. Did you ever hear, “You get what you pay for”? The companies that sell “instant information” are almost never legitimate, licensed private investigators and cannot provide you the dependability and accuracy you need for such important employment decisions. Oftentimes, they are not licensed to access the data that matters the most: accurate real-time information on your potential employee.

The major selling point for the majority of online background screening companies is that their records can be “instantly” accessed. Remember, just because the results are instant, does not mean they are accurate! Additionally, instant background companies often require signup fees, contracts and monthly minimum orders of their customers. Reputable Consumer Reporting Agencies are committed to providing accurate, verifiable real-time information from sources that require strict standards of operation. When it comes to legitimate Consumer Reporting Agencies, there are many qualified service providers like www.EmployersChoiceOnline.com who require no sign-up fees, no monthly minimums, and have a fast (24 to 72 hours) turnaround time. Don’t leave your most important decisions to chance. Go with leaders in the field of background investigations and take comfort in the fact that you’re in the best position to make the safest and most informed decisions regarding the most valuable of all company assets: your people.