By Jeffrey R. Smith ([email protected])
It’s important for employers to have an idea of the background of a job applicant to help them decide if the person is the right one for the job. Every job has its own requirements and employers can try to find out if someone meets these requirements through references and, in some cases, background checks. But how far can these background checks go?
Performing criminal records checks on prospective employees is fairly common and some employers are performing credit checks as well. However, they need to be very careful about what kind of information they are digging up as they could be walking a fine line between legitimate checking and invasion of privacy.
Mark’s Work Wearhouse ran into some trouble in Alberta over credit checks it was performing on applicants for sales associate positions. The retailer wanted to find out the credit history of these individuals because they would have certain financial responsibilities. The company wanted to know if anyone was a risk for fraud or in-store theft.
However, one applicant filed a complaint with Alberta’s privacy commissioner after being subjected to a pre-employment credit check. The commissioner’s office investigated and found the credit check wasn’t reasonably necessary. Though sales associates handled money, the investigator determined the store had enough other measures in place to prevent theft or fraud, such as security cameras and a requirement for managers to complete transactions. Mark’s also had a maximum amount of cash allowed in registers.
So, despite the fact Mark’s believe credit checks were a legitimate way of determining if it could trust someone to handle financial responsibilities, the privacy commissioner said no. A similar restriction can be applied to criminal records checks, as finding out any information that isn’t relevant to the job can be considered a violation of privacy. But they could get some valuable insight into the type of person they’re hiring, especially if it’s a position in which the employer must place a large amount of trust in the employee.
Employers have to ensure any information they find out about an employee is directly related to the job requirement. But how do they know where the line is drawn? In the case of Mark’s Work Wearhouse, the company thought credit checks were a legitimate way to find out if someone was trustworthy enough to be a sales associate. And in some cases it would probably be right if it weren’t for the other security measure it had in place. But how was it to know those measures ruled out credit checks? How much should an employer be allowed to dig?
Jeffrey R. Smith is the editor of Canadian Employment Law Today, a publication that looks at workplace law from a business perspective. For more information, visit www.employmentlawtoday.com.