Question

A financial services firm hires a trader who spent the last 4 years in state prison for committing a battery against a coworker. The financial services firm is in Wyoming, but the trader did his jail time in state prison in Arizona. In an effort to reduce costs, HR did a background check, but it was only for the state of Wyoming. How would you safeguard the company from any legal exposure in the future?

A. The company should adopt a policy of conducting complete background and reference checks, including a check of both state and FBI records, going forward.
B. The company should get all candidates' written consent before performing a background check going forward.
C. The company is guilty of negligent hiring and may be in violation of the Privacy Act of 1974 and should report the situation to the Department of Labor.
D. Place the employee on leave for not disclosing this information during the interview process, investigate, and determine if the employee should remain employed.

Answer 1

To safeguard the company from legal exposure, the company should conduct complete background checks and get candidates' written consent.

Step-by-step explanation:

To safeguard the company from any legal exposure in the future, it is recommended that the company adopt a policy of conducting complete background and reference checks, including a check of both state and FBI records, for all candidates going forward. This will ensure that any potential red flags, such as a criminal record, are identified before hiring a candidate. Additionally, the company should get all candidates' written consent before performing a background check to comply with privacy laws.