Time to Rethink How to Respond to a Reference Check
As a result of the #MeToo movement, many employers are reviewing their longstanding employment practices. The de Blasio Administration’s recent hiring controversy suggests that it may be time to revisit how employers respond to reference and background checks, too.
Kevin O’Brien started working as Mayor de Blasio’s deputy chief of staff in January 2016. Before working at City Hall, O’Brien had been employed by the Democratic Governors Association (DGA). The de Blasio Administration called the DGA for a background check and, as is standard practice, the DGA responded by confirming O’Brien’s title and work dates and “no adverse information” about his employment. Yet O’Brien had been terminated from his employment with the governors association after a woman working with the association had accused O’Brien of sexual harassment. The investigation resulting from these claims substantiated her charges and O’Brien was dismissed.
The DGA’s response to City Hall when conducting O’Brien’s background check is all too common. Afraid of liability, companies routinely provide a limited response to background checks, confirming title and dates of employment and offering nothing further. But is that enough? Or are companies just passing the problem on to someone else, much like the Catholic Church did with priests accused of sexual assault? While the DGA acted swiftly against O’Brien, it didn’t take the next step: warning O’Brien’s future employers. Once in City Hall, O’Brien (unsurprisingly) engaged in harassment again. City Hall itself quickly investigated the charges and determined O’Brien had to go. But the office permitted him to resign without any disclosure of his misconduct, enabling him to quickly land a job with Hilltop Public Solutions. Yet again, no one saw fit to warn any future employer of his pattern of behavior.
As an excuse for the failure to alert Hilltop Public Solutions to O’Brien’s misconduct, City Hall has argued that it wanted to protect the confidentiality of the investigation and the complainants. But City Hall’s professed interest in the complainants rings hollow — companies can alert others to misconduct while protecting the identities of any victims.
These repeated failures to adequately disclose prior misconduct in response to reference checks have implications that go far beyond workplace safety. These claims have economic consequences, too. Recent reports show that directors and officers (not to mention investors) are coming to view sexual harassment claims as a distinct financial risk - one that is becoming the subject of due diligence in the context of mergers and acquisitions. So-called #MeToo clauses, representations that the company has no knowledge of sexual harassment claims against its directors and senior employees, are becoming increasingly common in merger agreements. In some cases, companies are also being asked to disclose settlements of claims involving sexual harassment. Andshareholders are currently suing Google for its failure to disclose large payouts to executives charged with sexual misconduct.
The #MeToo movement has exposed the dirty little secret that sexual harassment is all too common in the workplace. As a result, what used to be standard practices such as non-disclosure agreements and compulsory arbitration agreements are being revisited and, for some companies, even eliminated.
Perhaps it is time we also review what has been standard operating procedure for how background reference checks are done.