MAY 2023 NEWSLETTER

Message from the Editor:

Welcome to another edition of ‘Inside Background Screening’ our new newsletter. Our goal is to bring to you cutting edge news and information about what is happening in the background screening world to help keep you informed and to position you to make the best possible hiring decisions.

We hope you enjoy ‘Inside Background Screening’ and that you will share your interest and thoughts with us.

Lorenzo
Lorenzo Pugliano CEO
Lpugliano@nsshire.com

EMPLOYMENT SCREENING NEWS

DHL Will Pay $2.7M to Settle Class Action Challenging ‘Blanket Ban’ Criminal History Policy

A settlement has been reached in the amount of $2.7 million in the class-action lawsuit Pickett et al. v. Exel, Inc. In it, DHL Supply chain was accused of having a pre-hire criminal history screening policy that disproportionally affected Black and Hispanic applicants.

MARCH 2023 WEBRECON STATS: FCRA claims increase

	Current Month:	Previous Month:	Previous Year:		Year to Date:	Year to Date Comp:
	Mar 01, 2023 Mar 31, 2023	Feb 01, 2023 Feb 28, 2023	Mar 01, 2022 Mar 31, 2022		Jan 01, 2023 Mar 31, 2023	Jan 01, 2022 Mar 31, 2022
FCRA	474	392	20.9%	498	-4.8%		1308	1444	-9.4%

Columbus, Ohio, Bans Inquiries Into Applicants’ Salary History

The City of Columbus joins Toledo and Cincinnati as the latest Ohio city to prohibit employers from asking prospective employees about past compensation. Effective March 1, 2024, employers operating in Columbus may not ask about a prospective employee’s wage or salary history.

LEGAL ISSUES

What We Learned From 2022’s Top FCRA Developments

The Fair Credit Reporting Act saw no shortage of activity in 2022. That activity included judicial decisions, regulatory actions, and federal and state legislation. As we reflect on certain significant developments from the past year, FCRA litigants and practitioners should be prepared for a busy 2023.

Judge Denies Credit Reporting Agency’s Motions for Class Decertification and Summary Judgment in FCRA Case

The U.S. District Court for the Eastern District of Pennsylvania denied  a national credit reporting agency’s (CRA’s) motions for class decertification and summary judgment in a case involving allegations that the CRA willfully violated FCRA’s reinvestigation provision.

Pennsylvania Court Holds that It Is “High Time” Employers Reimburse Employees Who Use Medical Marijuana to Treat Work Related Injuries

On March 17, 2023, the Commonwealth Court of Pennsylvania issued a decision regarding employee use of medical marijuana in the workers’ compensation context. The decision in Fegley v. Firestone Tire & Rubber (Workers’ Comp. Appeal Bd.) addresses an issue of first impression. The court held that an employer’s failure to reimburse an employee’s out-of-pocket costs for medical marijuana to treat his work-related injury was a violation of the Pennsylvania Workers’ Compensation Act (“WC Act”). The decision is significant for Pennsylvania employers. Given this decision, Pennsylvania employers could be subject to penalties under the WC Act if they do not reimburse employees for medical marijuana use—even though marijuana is illegal under federal law and cannot be prescribed by any doctors.

2023 Challenges for Employer Background Screenings

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.

Weeding Out Employees: The Ups and Downs of Drug-Testing Manufacturing Workforce

Manufacturers should take a moment to re-evaluate whether their substance abuse prevention policy is compliant with federal, state and local regulations. They should start by ensuring their substance abuse prevention policy is clear, comprehensive, and effective. Employees should be aware of employer expectations, as well as the reasons for the policy. Prohibited conduct should be made clear.

Pre-Employment Cannabis Tests Could Be Banned in WA

Washington joins California and Nevada in banning pre-employment cannabis tests, aiming to eliminate discrimination against anyone using cannabis in legal and medically necessary manners. The purpose of Senate Bill 5123 is to create new opportunities to help fill unfilled positions.

Stay Current: Three Major Reports Reveal Disturbing Trend in Workplace Drug Abuse

Three reports provide valuable insights into the impact on the workplace of there being more drug users hired since the start pre-pandemic. Current Consulting Group has revealed that 87 percent of respondents conduct pre-employment testing and 70 percent perform post-hire testing. The First Advantage report shows that the drop in pre-employment drug testing means companies were likely hiring more drug users and pre-employment drug screening services as a deterrent for drug use. Finally, the Quest Drug Testing Index “urine positivity rates for post-accident testing increased at a greater rate than pre-employment testing over five years…”

Delaware Legalizes Recreational Marijuana

Delaware became the latest state to legalize recreational marijuana on April 23, 2023.  Individuals who are 21 years of age and older may possess and use up to one ounce of marijuana.  It will be taxed in a manner similar to alcohol.

The law provides that nothing in the law is “intended to impact or impose any requirement or restriction on employers with respect to terms and conditions of employment including but not limited to accommodation, policies or discipline.”  This means that employers in Delaware do not have to permit marijuana use at work or during work time and still may drug test for marijuana and take disciplinary action for positive test results. 

What New York Employers Need to Know About Marijuana Two Years After Legalization

It’s been two years since the Marijuana Regulation and Taxation Act legalized marijuana in New York State on March 31, 2021 and prohibited employers from drug testing for marijuana (for tests that are not federally-mandated).  Because many employers still are confused about what New York law requires, here is a recap: All Off-Duty Use of Marijuana Is Protected; Drug Testing For Marijuana Is Prohibited; Employers May Prohibit On-Duty Use of Marijuana as well as Impairment at Work and there are no exceptions For Safety-Sensitive Jobs.

The Psychedelic Dilemma: Balancing Therapeutic Benefits with Workplace Safety

Although they potentially offer therapeutic benefits, the use of psychedelics in the workplace can pose significant risks to both employees and employers. Their use could lead to safety hazards, decreased productivity, interpersonal conflict, decreased decision-making ability and risk of job loss. Read more

DATA PROTECTION & PRIVACY

Colorado Finalizes its Privacy Act Rules.

On March 15, 2023, the Colorado Attorney General’s office finalized its Colorado Privacy Act (CPA) Rules  making Colorado the third state, after California and Virginia, to enact a general state privacy law and the second to draft related rules. The Rules clarify an entity’s obligations to comply with the CPA enacted in 2021. The Rules regulate the processes and disclosures of data controllers and their processors, including expectations for notices and consumers’ data rights. Specifically, the Rules detail obligations and expectations for consumer disclosures (Part 3), consumer personal data rights (Part 4), universal opt-out mechanisms (Part 5), duties of controllers (Part 6), consumer consent (Part 7), data protection assessments (Part 8), and consumer profiling (Part 9). Both the CPA and Rules will go into effect on July 1, 2023.

Iowa Is the Sixth U.S. State That Enacts Data Privacy Law

Signed by Gov. Kim Reynolds (R), Senate File 262 was unanimously passed by the Iowa Senate and House. The law will go into effect on January 1, 2025. Iowa’s data privacy law applies to companies that (1) control or process data of at least 100,000 Iowa consumers, or (2) control or process data of at least 25,000 Iowa consumers and derive 50% of their revenue from the sale of personal data. 

Notably, Iowa joins the other five states (i.e. California, Colorado, Connecticut, Utah, and Virginia) by exempting data regulated by the Fair Credit Reporting Act (FCRA).

DEPARTMENT OF TRANSPORTATION

FMCSA Regulations for Hotel-Related Transportation

Unless exempted, companies transporting passengers in commercial motor vehicles must comply with FMCSA safety regulations.

To most, it’s very clear that property-carrying commercial motor vehicles (CMVs) such as

tractor-trailers and waste management trucks are regulated by the Federal Motor Carrier Safety Administration (FMCSA), but what about passenger-carrying vehicles, such as hotel shuttle buses?

Generally, FMCSA safety regulations apply to companies with drivers who operate CMVs in interstate commerce, which involves crossing state lines. To find out if these regulations apply to your hotel shuttle business, you need to determine if your shuttles are considered CMVs and if your operations are for-hire.

What About the Robots That Are Already Here? New York City to Begin Enforcement of Artificial Intelligence Applications Related to Applicants and Employees Through the NYC Automated Employment Decision Tools Law on July 5, 2023

On January 1, 2023, New York City became the first jurisdiction in the United

States to regulate employers’ use of automated employment decision tools

(AEDTs) in the hiring and promotion process. Local Law 144  (the NYC AEDT Law), which requires anyone who uses (or wants to use) an AEDT to first conduct a bias audit and notify job candidates, is set to be enforced starting July 5, 2023.

As companies increasingly rely on automated tools to assist in the employment process and sort through large volumes of job applicants, New York City employers will now be forced to determine whether those tools constitute an AEDT and, if so, secure the required bias audit from its AEDT vendors or conduct one themselves.

DHS Ending Flexibilities that Permit Employers to Remotely Verify Documentation for New Hires

U.S. Citizenship and Immigration Services (USCIS) has announced that employers will have 30 days to reach compliance with Form I-9 requirements after the COVID-19 flexibilities sunset on July 31, 2023.

Since March 20, 2020, ICE has deferred the requirement for employers to inspect documentation in the presence of the employee that proves their identity and work authorization. ICE’s announcement that it is ending these flexibilities clarifies for employers that they have until August 30, 2023 to perform all required physical examination of identity and employment eligibility documents for those individuals hired on or after March 20, 2020, and who have only received a virtual or remote examination. Click here to read the announcement.

Disclaimer: All information presented is for information purposes only and is not intended to provide professional or legal advice regarding actions to take in any situation. Nationwide Screening Services makes no representations for any products or services that are mentioned and accepts no responsibility for any actions or consequences taken without the guidance of a licensed attorney or professional consultant.

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