As we dash into the lucrative holiday shopping season, employers are scrambling to hire temporary workers to extend their ranks. And, by all accounts, the season is expected to be a busy one as companies announce big plans to hire more workers — and fast.
In recent weeks, Target announced it was bringing on more than 130,000 seasonal workers to fill positions at its stores and distribution centers, up slightly from 127,500 in 2018. Amazon has plans to hire “tens of thousands.”
But as headcounts grow during this merriest time of the year, hiring managers of companies big and small should heed this warning: Beware the Grinches — the seasonal employees who come on board and wreak holiday havoc, from simply turning shoppers away with bad service to hacking into customers’ financial accounts.
They’re why, even when hiring is at a frenzied pitch, employers can’t scrimp on their usual background checks and vetting procedures when they bring on temporary workers.
Employers must ensure they’re meeting the standards set in the Fair Credit Reporting Act (FCRA), which regulates employment screenings, and new state and local laws across the country that tackle issues of pay equity and the hiring of ex-offenders. And they need to carefully avoid setting themselves up for negligent hiring lawsuits.
Screening for temporary hires declines
A bad hire, according to a CareerBuilder survey, can cost employers an average of $15,000 as they soak up the price of a less productive employee, poor work quality and lost time to recruit and train another worker.
Employers can easily prevent some of these headaches by conducting comprehensive pre-employment screenings to check up on candidates’ employment history, education claims, criminal records, and possible drug use.
Simply put, screenings work. According to the 2019 HireRight Employment Screening Benchmark Report, 34% of survey respondents said that screening prospective temporary and contract workers uncovered issues that a company wouldn’t have otherwise discovered.
Yet when it comes to verifying job candidates’ experience and abilities, more employers are forgoing pre-employment screenings when hiring temporary workers such as holiday help. According to HireRight’s report, respondents reported a 13% decrease since 2018 in companies that conduct checks on temporary or contingent workers. Only 68% of temporary or contingent workers are subject to background screens.
A rush to add workers ahead of the holidays may be one reason why employers are skipping the all-important background check. But bringing on unqualified or unscrupulous employees with access to customer accounts and company data, even for a few months, can expose a company to serious risks and strike a damaging blow to a brand’s reputation.
Here’s what employers need to keep in mind as they build up their labor force to support holiday shoppers.
Get consent, provide certification
When using third-party credit reporting agencies to conduct background checks, employers can’t simply start screening a potential employee without meeting certain criteria.
The FCRA, which dictates how employers can secure and use consumer reports, requires that companies get a job candidate’s consent to a pre-employment screening before they begin. Disclosure forms should be easy to understand, identify the purpose of the background check, and exclude any extraneous information, like liability waivers.
Companies also must certify that they will be conducting the background check for employment permissible purposes under the FCRA and agree to follow all applicable federal and state laws.
Be mindful of new laws
Across the country, legislators are passing new rules that are forcing big changes to long-standing hiring practices. In some states and communities, officials have approved a growing number of “ban-the-box” measures, which prevent employers from asking a candidate about their former criminal history until later in the hiring process such as after the initial application or after a conditional offer of employment has been made to the candidate.
Lawmakers also are enacting pay equity laws and salary history bans, which dictate if and when employers can ask a job seeker about their compensation history. Even as they hire temporary workers, employers must adjust their policies to comply with new laws like these.
Avoid negligent hiring claims
Employers who fail to screen temporary workers just as they would a permanent employee could trigger legal claims of negligent hiring. If standard industry practice is to conduct a criminal record check of all employees and an organization falls below that standard and doesn’t verify the backgrounds of temporary workers, then the company could be considered negligent in its hiring practices. For example, if an individual recently convicted of a violent crime comes on board and injures a shopper or co-worker a claim could be made that the employer is negligent because they should have reasonably known about the individual’s violent background which indicated a potential harm to others.
Follow pre-adverse and adverse action processes
If a background check returns any history of a potential holiday worker that may sway an organization from hiring the individual, the employer must follow the pre-adverse and adverse actions processes as spelled out in the FCRA, and any additional measures as required by applicable ban the box jurisdictions.
The pre-adverse process mandates that employers give the individual a copy of the report, a summary of their rights under the law and any applicable state notices. They also must provide the job seeker with the ability to dispute the accuracy or completeness of the background report directly with the consumer reporting agency that supplied it. What’s more, the company must keep the position open — generally for a minimum of five business days, or longer in some jurisdictions — so the candidate has the opportunity to dispute the report.
Finally, if an employer opts to take adverse action, they must notify the individual that they will not be brought on-board based, in whole or in part, on the findings of the background report, and that the decision is that of the employer, not the background check company that supplied the report. They must also inform the applicant that they have 60 days from the time of the company’s decision to dispute the consumer reporting agency’s findings and to get a free copy of their full report from the agency.
Considering the time crunch to bring holiday hires on board, it might be tempting to bypass standard background checks. But to avoid legal ramifications, organizations must be mindful not only of the time-to-hire but also of their compliance responsibilities. After all, if temporary employees aren’t properly screened, companies could face costly legal consequences that could put more than their jolly holiday season in jeopardy.