Hotel Business

February 7th, 2020
Hotel Business

NATIONAL REPORT — When it comes down to it, the hospitality business is all about people—from guests to employees—and the safety of those people should be of the utmost importance.

Like many other businesses, one way that hotel owners and managers are working to keep their guests and employees safe is by conducting background checks on their employees to make sure that it is appropriate for them to be in guest-facing situations.

Local governments, including Nassau County in New York, are considering making employee background checks mandatory in the hospitality industry. While it is not currently mandatory in any municipalities, a number of companies do require background checks for employment.

“Ultimately, when you talk about the hospitality industry, there are very personal connections, and often, these personal connections become very private when you talk about the cleaning staff that comes into your room or the bellhop that brings your bag up to your room,” said Ken Schnee, GM of hospitality at Sterling, an employment background screening solutions company. “Guests are often left in situations where there is an aroma of trust between you and the employee. Ensuring that the company has gone through the entire due diligence process is really what I believe is driving governments to say, ‘Listen, we want to make sure that we’re putting people in the safest position possible.'”

Jackie C. Collins, senior director/VP, real estate & hospitality practice, with brokerage and risk management services firm Arthur J. Gallagher & Co., has seen the importance of conducting background checks on potential job candidates. “It is very important, as you may prevent a number of incidents by having this information,” she said. “I once had a situation involving alleged abuse of a young guest that could have been prevented had a background check been obtained on the involved employee prior to employment.”

Schnee said he has witnessed firsthand the stakes involved with background checks. “We work with some major hospitality brands today that when we first started doing business with them, their programs were very trim and slim. They were considering cost against risk,” he said. “But, the purpose of the background check is to uncover as much as possible and reduce your risk to the furthest degree possible. While cost is important, it shouldn’t be the No. 1 driver of why you are doing the background check. It should be to do the most comprehensive and intuitive background check possible.”

Employers should be aware of a number of things before conducting a background check for a potential employee. “The background screening industry is driven by the FCRA [Fair Credit Reporting Act from the Federal Trade Commission],” he said. “That is the federal agency that handles the guiding laws behind background screenings. State by state, there are also limitations to the amount of time that you can go back. There are laws that limit what you can do. However, a good, well-rounded screening company is already accustomed to those laws and builds the program to extend as far into those laws as possible.”

What happens if a background check finds a potential issue that would prevent employment? “Often, you will make an offer contingent on a background check,” said Schnee. “This is basically saying that, so long as you pass the criteria set forth in the background check, you will be hired. If that candidate doesn’t then pass that background check, it is a requirement by law to launch them into a process called adverse action.”

In the adverse action process, the candidate is sent a letter by mail or email that dictates to them exactly why they are not being selected, and it shows them the potential adverse information. “That candidate then has the ability to contest that, and within the allotted period set by the FCRA, if they don’t respond to the first letter, a second letter goes out,” he said. “If they don’t respond to that second letter, then the organization is at-will to pass on that employee. But you do give them that period of time to contest the data that was found against them.”

Schnee said that the time period allotted for a hospitality company is about seven days. “It is important to find an organization that is able to work with your candidate in a very fast manner, because if you end up finding a false hit and it takes you four days to confirm that with the candidate, they might move on to another hotel or another company at that point,” he said.

While a background check can help weed out potential candidates who may not be a good hire, there are some reasons why employers may not choose to conduct them. “Although this information is important, not all hospitality companies obtain background checks as they are expensive,” said Collins. “I have had some hoteliers state they do not run reports as it reduces an already limited workforce.”

Collins said there are other pre-employment screenings that companies are taking. “Employers should always obtain an updated motor vehicle report and confirm each potential driver meets the qualifications to be included on the corporate insurance program as outlined by each particular insurance company,” she said. “These requirements generally address the age of the driver, number of years of experience, as well as number of offenses shown on the motor vehicle report. Applicants who are found to have a DUI/DWI and/or careless/reckless driving will be denied coverage.”

Employers are also requiring personality screenings. “These screenings have been found to reduce the amount of turnover and are often more cost effective than background checks,” she said. HB

Reprinted with permission of

Sterling is not a law firm. This publication is for informational purposes only and nothing contained in it should be construed as legal advice. We expressly disclaim any warranty or responsibility for damages arising out this information. We encourage you to consult with legal counsel regarding your specific needs. We do not undertake any duty to update previously posted materials.

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