Background story: I've been employed in Australia full-time for 5+ years for a US-based financial company. Their HR now have the idee fixe to do a "background screening" for all employees. The rationale is allegedly a law in the US that requires financial institutions to do so.

Question number 1: Can someone from the US here confirm this? (I was unable to search for this, search results are spammed with BG screening providers.) It smells fishy to me: Certain three-letter agencies would be very interested in the personal data of the world's top financial institutions' staff.

I know that what they're trying to do is pretty much violating the AHRC Act as per this document:

  • Violation 1: Screenings should be pre-employment, not 5 years into the employment.
  • Violation 2: Screenings should be relevant to the position, job and tasks, not be performed broadly. My position is a coding monkey. Any scenario where I could use the data I see for fixing bugs for anything that harms the business in a way that is linked to a previous offence would be extensively construed. I also don't see the relevance of employment history, where I lived etc.
  • Violation 3: Scare tactics: We've been given less than a week to complete all forms. Normally, one would expect to have two weeks to dig out all files and get potential legal advise.
  • Violation 4: No transparency. The screening is performed by a third-party company based in the US. Besides the question what a US-based company has got to do with AU-based criminal records, they don't disclose what is being checked (criminal, financial, etc.?). This also means that rebuttals are impossible.
  • Violation 5: In accordance with violation 4, privacy breaches. We're forced to upload our most sensitive documents (passports, driver's licence) to a web page (based in the US). Our company proxy does forced SSL inspection, our browsers are rigged with their rogue certificates. Also, once the data is in the US, there's no way to remove it ever again form the systems of the third-party.

Question number 2: Has anyone made similar experiences, and if so, what have you done to possibly avoid the screening, perhaps with legal support (relevant sections of AHRC Act, Privacy Act, workplace-related laws etc.)?

Important fact: I've never had a criminal conviction.

Please no "What do have you got to hide?" answers.

PS: I'm not seeking legal advise beyond what would be commonly known by the community through experience.

Also, what I'm asking here wouldn't be company-specific. In would in fact apply to any scenario that is similar to this one. Not sure what's company-specific in my questions.

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    You need in-country expert legal advice to answer questions about this specific case. That isn't something we can do here – keshlam Aug 4 '16 at 12:41
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    This does sound like a question for a lawyer. But from a cursory look at the document, I'm not sure your interpretation is correct. On page 29 there is a section that seems to clearly allow background checks of current employees, if justified appropriately. – user45590 Aug 4 '16 at 12:44
  • I'm asking the community (which I believe includes Aussies) here 2 questions, and both are not eliciting legal advise. First questions: Is there such a law in the US. Second question: What's your experience, and how did you avoid it if you did so? @dan1111 I believe the check cannot be justified. The Act also states that any check must be relevant to the position and tasks. Clearly, this cannot be true if it's done for all employees. – Winston Smith Aug 4 '16 at 12:46
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    @WinstonSmith I wouldn't report it to a agency just yet. Instead I'd call a known contact at your company (ex your boss) and ask about it over the phone. Verify the request is legit and ask about why they are requesting it. – Dan Aug 4 '16 at 13:11
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    @WinstonSmith the company I worked for got hit by the Patriot Act for having a server in the wrong place. If you are a US based company and the federal government wants to flex it's muscles, they have no choice but to comply. That said, check with a lawyer in your country – Old_Lamplighter Aug 4 '16 at 13:19

Section 19 of the Federal Deposit Insurance Act prohibits any person who has been convicted of any criminal offense involving dishonesty or a breach of trust or money laundering, or has agreed to enter into a pretrial diversion or similar program in connection with a prosecution, from becoming or continuing as an institution-affiliated party; owning or controlling, directly or indirectly, an insured institution; or otherwise participating, directly or indirectly, in the conduct of the affairs of an insured institution without the prior written consent of the FDIC. Note that consultants who participate in the conduct of the affairs of an insured institution may be subject to Section 19.

There are really no US laws that prohibit a company from obtaining another background check on you. In fact, they are required to make sure that current employees also do not have any such problems as listed above. They are only required to make "reasonable" effort to do so. Some companies believe pre-employment screening is reasonable enough. Personally, I believe a check ever 5 years is very reasonable.

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  • That's the kind of answer to my first question. Thanks! As this whole thing is shrouded in secrecy, I have to way to verify that this is reason why they do it. I'll confront HR with this. Because the ramification of "reasonable" effort would be that if local law does not require such a check and even forbids it to this extend, all they need to do is ask for a check, and then check the tick box. As for the frequency: This is the first time they ask for a check. They haven't asked for one when I was hired. That's what bothers me. – Winston Smith Aug 7 '16 at 1:46

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