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Alonzo Martinez. Courtesy photo.

Alonzo Martinez, associate counsel of compliance at HireRight, sits in a rather unique position—he’s an in-house lawyer who works for a company that provides services essential to other in-house lawyers.

Irvine, California-based HireRight provides employee background checks, background screenings and drug testing for companies around the world, helping many a legal and HR department decide who to hire and retain, while also remaining compliant with employment and privacy laws.

Martinez, who was formerly in-house at First Data Corp., recently shared some of his insights with Corporate Counsel on these evolving employment law regimes and how his own business has made adjustments along with these changes.  The conversation has been edited for clarity and length.

Corporate Counsel: I’ve heard a lot of talk with President Donald Trump taking office that we would be seeing less federal employment law action and therefore states would fill that legal void.

Alonzo Martinez: I would definitely say that the 2017 legislative season was absolutely a formidable year for employers from a compliance perspective. We most certainly saw states step in and create several new laws. But while a formidable year for employers, it was also a transformational year for candidates and employees with respect to their rights.  We’ve seen a completely new area of the law develop, which is pay equity law, salary history bans, something that hasn’t been considered before. It was brought up in 2017 and is by far the hottest topic in employment law at this point. And again, this is something that was accomplished at the state level and that really hasn’t been addressed at the federal level. Same is true with ”ban the box.”

CC: As for pay equity, there is a whole patchwork of recent state and local laws, some of which limit companies’ abilities to ask job candidates about past salary, often until very late in the hiring process. Has HireRight changed its approach to providing pre-employment screening services accordingly?

AM: HireRight very early on adopted a position with respect to pay equity. So in advance of the first pay equity law to go online in the United States, which was New York City’s law, which became effective Oct. 31, 2017, HireRight met with many of our clients in New York City, and roundtabled this concept of pay equity … And the overwhelming consensus from our clients was: there simply was no value to asking a candidate about their previous compensation history as part of the background check process.

So as a standard in advance of the New York City pay equity effective date, HireRight notified its clients that as a standard practice for clients using our background check program we were no longer going to ask candidates about their compensation history, nor were we going to validate or report on their candidates’ compensation history with their former employers. So we’ve done that across the board regardless of whether or not a jurisdiction has passed a pay equity measure.

Now for clients that do find it valuable to ask about compensation history for one reason or another, they can certainly ask that we enable that functionality for them, meaning that we will ask their candidates for their compensation history and we will validate their compensation history. But we will not do that in any jurisdiction that’s enacted a pay equity law.

CC: HireRight deals with employment screenings around the world and the varied legal regimes that go with that. I’m curious as to what U.S. rules around hiring look like as compared to other jurisdictions?

AM: In the U.S. we’re very lucky, I suppose, to have a very well-defined regulation. The Fair Credit Reporting Act defines “background screening” both for consumer reporting agencies like HireRight as well as for employers who engage consumer reporting agencies to provide information on their candidates. And the Fair Credit Reporting Act has been around for well more than 40 years and has well-established [Federal Trade Commission] opinions that provide guidance as well as case law that provides guidance. That doesn’t mean that it’s the easiest regulation to comply with, it certainly produces its own challenges for employers, but at least there is a regulation. Outside of the Untied States, background screening is not codified really in one particular source of law. So multinational employers have to look at patchwork of laws in determining what defines their background screening program.

CC: HireRight offers drug testing services. Have you seen the recent relaxation of state marijuana laws affecting companies and workplaces?

AM: We’re continuing to see clients express interest in drug testing. That certainly hasn’t slowed down despite the increased number of states and local municipalities that are passing either recreational or medicinal marijuana laws. I think that because there is such a myriad of laws out there and because we have Attorney General [Jeff] Sessions stating that the federal government isn’t going to back down on enforcement of marijuana laws, it really is important for employers at this point to simply know the marijuana laws that they are subject to and discuss those laws internally with their internal counsel and externally with their external counsel, as applicable.

Maine really throws a wrench into this entire thing, you know, what Maine has done is really just incredible … What they’ve done is they’ve shielded workers from adverse employment action based on their extracurricular use of marijuana, so an employer could not then either deny a candidate for hire or discipline an existing employee based on their extracurricular use. It’s the first time we’ve seen this in state law and it’s certainly a dramatic shift from every other state that has offered far more employer-friendly laws with respect to accommodation of marijuana.

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