New software for small businesses will run background checks on employees. Privacy rights advocates worry about its potential misuse and application.
By TOM ZUCCO
Published March 22, 2004
The box is unassuming, about the size of a frozen dinner, and can be found stacked with all the other business software in the computer section of the Sam's Club store in Northdale. Inside is something that could change someone's life.
Access to their past.
If you have a business license and $39.77, it's yours.
And that has some people nervous.
Introduced late last year, the Employee Background Check is made by ChoicePoint Inc., an Alpharetta, Ga., data collection firm spun off from credit bureau giant Equifax Inc. In large letters, the box reads, "Make Better Hiring Decisions" and "Conduct Background Checks Quickly and Easily!"
The kit includes a CD-ROM that allows users to tap into ChoicePoint's extensive background search database. The software provides one 10-year background check of criminal convictions and employment and identity verification, and is designed for small business owners who want to do the same thing most large companies do - conduct background checks on potential employees. Or, if they choose, on current employees.
Computer background checks have been credited with identifying job candidates who have a criminal past and failed to disclose it on their applications. ChoicePoint officials say about 9 percent of people who fill out employment applications fail to disclose criminal convictions. But privacy advocates say the software could be misused and lead to unintended consequences for employees.
The ChoicePoint software is being test-marketed at about 40 Sam's Clubs in 26 cities, including Tampa. The software also is sold in Sam's Clubs in Pinellas Park, Bradenton, Fort Myers, Naples, Orlando and Pensacola, and is available online. ChoicePoint officials say sales have exceeded their expectations.
"Most small businesses fail because of employee theft or employee misconduct," said James Lee, ChoicePoint's chief marketing officer. "But small organizations are subject to the same risks as large organizations."
Employers can pay an outside company to do background checks or conduct their own, but the latter takes time. Court records would have to be requested from every jurisdiction where the applicant may have lived. In some jurisdictions, records are available directly from the court's Web site. But access to records via the Internet varies greatly.
The background check in a box offers a shortcut.
ChoicePoint requires a user supply the Social Security number and name of the person being checked, and it conducts random audits on users to make sure they have a valid business license. Company officials say an occupational license, if it confirms someone operates a business, also is acceptable.
The purchaser agrees to obtain written consent from the person undergoing the check and keep that record on file for at least seven years.
Those and other restrictions, say ChoicePoint officials, make it impossible to misuse the product.
"But one of the biggest structural weaknesses are that users are trusted too much," said Chris Hoofnagle, associate director of the not-for-profit Electronic Privacy Information Center in Washington, D.C.
"A lot of people who have a business license don't have a business. You can't just let any Tom, Dick and Harry get access to any database. You need to certify that you'll only use it for permissible purposes. It's not permissible to use it on your girlfriend or your neighbor."
While companies can be liable for negligent hiring, and it may come to a point where background checks are standard, Hoofnagle said the broader social issue is that the checks could prevent scores of honest people from doing their jobs.
"They (ChoicePoint) are making it much easier for a broader range of companies to run background checks," he said. "That's important because many of us have criminal records. You can start creating barriers to employment for people who are otherwise trustworthy.
"Some states, including Florida, make it real easy for private companies to get data. They have a lot of extra data on Floridians that they don't have on residents of other states. That's a competitive disadvantage for Florida residents."
Lee acknowledged the checks may not be all-encompassing, and a report could be incorrect.
"It's still a human process and there's opportunity for human error," he said. "But those are the exceptions. We do 6-million of these (pre-employment background checks) a year, and what we find is in less than 100 cases per year, we have to make some sort of change because there was an error in the record."
Richard Chador, owner of Earth's Treasures jewelry store in St. Petersburg, is just the kind of small business owner ChoicePoint would like to see use its product. But Chador, who employs three people, said he's reluctant to buy the software.
"I pay a background check company about $50 to run checks," he said, "and I'm really into letting the professionals do it because they can be held responsible to some extent.
"I want to engage in ongoing communication with someone other than a (software) support person, and I want to feel that I have someone responsible at the other end of the line."
To underscore his point, Chador said he spoke recently with a jeweler from Bradenton who told him that he caught a bookkeeper stealing from him. But the jeweler decided not to press charges.
"So if you look at just a criminal background check, you wouldn't find anything wrong," Chador said. "But if you took the time to call previous employers, they would disclose that she wouldn't be hired."
Some privacy advocates say extensive background checks, especially for jobs that don't involve security risks, may be a knee-jerk reaction to threats of terrorism. Beth Givens, director of the Privacy Rights Clearinghouse, a San Diego-based nonprofit consumer advocacy group, said her office was swamped with calls after Sept. 11 when people learned their employers were conducting background checks on them.
ChoicePoint officials say employers who fail to do background checks could put customers and co-workers at risk, leaving businesses open to lawsuits.
Earlier this month, the family of an Orange County woman who was raped and murdered in 2001 by an air-conditioning repairman under contract with Burdines settled a lawsuit with the department store and its former subcontractor for $9-million.
Neither Burdines nor the former subcontractor, Adler Services Inc., ran a criminal background check on Jeffrey Alan Hefling, the man convicted of the crime. Hefling had two prior rape convictions, was a registered sex offender in Central Florida and had been granted early release from prison.
Hefling, 41, also was listed as a sex offender on the Florida Department of Law Enforcement's Web site at the time he was hired.
Critics also raise the issue of the potential impact on people who committed relatively minor offenses years ago, paid their penalty and successfully moved on with their lives.
Or, as in Kimberly Kelly's case, they simply weren't aware they had done anything wrong.
In January 2002, her supervisor at the Eli Lilly & Co. plant in Indiana told her that the drug company had conducted a criminal background check as part of new post Sept. 11 security measures, the Wall Street Journal reported. They had decided to ban her and several other contract workers from the facilities.
What the 46-year-old single mother had done was bounce a $60 check to a refrigerator rental company two years earlier. Kelly, who was going through a divorce at the time, said she moved and closed her bank account without realizing the check hadn't cleared. Court records showed that when the appliance company couldn't locate her, it pressed charges. A judge found her guilty of check deception, a misdemeanor, and ordered her to pay $179.
On the day Kelly was fired, the Journal reported, four co-workers also were let go. One was arrested 6 years earlier on a misdemeanor battery charge that had been dismissed and he thought had been expunged. Another had been fined $250 and served 20 hours of community service 14 years earlier for misdemeanor marijuana possession.
The tests for Lilly were performed by ChoicePoint.
"You can get into a valid debate about how far should you go back," Lee said. "But what it comes down to is that the customer (employer) dictates both the criteria they use to hire someone, and what and how they use it. But they are subject to federal and state laws.
"In our experience," Lee added, "what leads many employers not to hire someone is not that they've had a criminal record, but that they didn't disclose it."
