Legal question on employee privacy.
 

Someone I know works for a glass company that does custom high end installs. They are signing an agreement to do exclusive sales and installs for one of the big home improvement stores. The big home improvement store apparently wants all the subcontracting companies employees to submit for full credit/background checks. They have already done this for their present employer and are all insured and bonded. A few of the guys are refusing to sign for this additional check.

The company they work for faxed a threatening memo to these guys regarding their value to the company if they refuse to sign.

I give no opinion on this, so as not to jade any responses. Is it normal, acceptable and/or legal for the primary employer to require this and or threaten termination for non compliance?

Thanks.

Unless other factors such as union contracts come into play, in general terms it is legal. I can't say exactly how common it is, but it is at least not unusual. It is getting much more common in the situation you describe where the large general contractor is worried about the quality of the subs they hire.

Nope, no union or other abnormal factors. Thanks for your response.

Edit:

One other oddity is that the release for the credit/background check is actually an authorization for another third party company working for the home improvement company...though I doubt that matters.

I am going to say the employees don't have to sign since it wasn't a condition upon being employed, however, most likely the employees are employees at will and can be terminated for other reasons made up or not. As the home improvement store will be sending these people into customers homes they are trying to protect themselves and their customers. If I am the employer and the employee says no I would ask where he is going to work tomorrow.

Exactly, company requiring the check has a resposibility to protect its customers.

Has the rationale been explained to the employees who are resisiting?

I did some consulting for a Fortune 500 with a huge campus.

They did extensive credit/background checks. On campus they had a daycare facility, 400+ kids in it. They wanted to make sure they knew who was on the grounds at all times.

The reasons for the check were not comunicated well, but I agree with you guys. I didn't want to jade your answers with my opinion upfront. Like Wayne said, they don't have to sign it. but they don't have to work there either.

I am sure the employer has little recourse with the bigbox and they feel this is a huge opportunity for them. One or two guys are not going to stop them.

Thanks.

Let's see if I understand....This company will become a subcontractor working at customer's sites installing products, right? In that case they represent the big box. If the big box wants to keep its reputation clean and reduce the possibility that the subcontractor might have someone on their payroll that could prove an embarassement or worse. The customer does not "see" the subcontractor; they "see" the big box name. After all, it is the "big box" with whom they contracted the work....

Is this the way you guys see it?

I think it's more of a legal protection issue than public/customer image.

I think legal at the bigbox told them they need to be able to demonstrate extreme diligence as to the competence/credulity of their subs in case of lord-knows-what.

Recent news story

Last summer I contracted with Home Depot to remodel my kitchen. I'm happy with the end results. I didn't have a say in the people that did the work and I think this is the issue being discussed here. What I like about the process is that Home Depot inspected anything and everything but without my inspection and signature the subs don't get paid until a certain level of satisfaction is reached.
Most importantly, before I signed on the bottom line Home Depot guarantees quality workmanship and materials and this can only be achieved through thorough background information and credit checks on the persons performing the services.
The type of person that objects to this type of scrutiny should be eliminated from consideration because they have something to hide. It's as simple as that, or face the reality of lawsuits and negative publicity associated with poor performance.

Yes. There is little if any barrier to this glass company terminating the folks who refuse to submit. That glass company can make the workers all wear orange sneakers and beenie hats with propellers on top, or terminate them. As long as the termination does not amount to a human rights violation. You can't fire someone because they are black or Jewish. You can terminate them because they drive a Porsche, or just because you're in a bad mood.

We had to submit to background checks to service our vending machines at a Saginaw semi-conductor facility. ANYONE that would be on site at ANYTIME had to go through it. A third party ran the checks and then forwarded the results to our client who then issues badges. We had to pay $110.00 for each employee. Our union people put up a fight but we told them we had no choice and there was nothing we could do. This is becoing very common in today's service/repair industry. Look at Stanley Steemer, they say right in their commercials that the employees have background checks done. I suspect some ofit probably comes from the illegal immigrant problem as well. Joel, we have a similar situation in our part of Michigan with the "seasonal" workers who come in during the summer. I know the blueberry farms over near South Haven run about the same way.

Thanks guys. I printed out that article (thanks btw) and gave it to him. I think it helped him understand why they do this.

I have a related experience. I hired a cleaning contractor to do after-hours maintenence at our clinic. It is just a small home-based business but it was important for us to know that the contractor was bonded and licensed. She assured us that she was. However it turns out that she is hiring (subcontracting) other employees that she did no criminal check on and allowing them to enter our clinic unsupervised. I have not taken action on this discovery yet, but the employers' assertion that all their employees have been thoroughly checked is no guarantee.

There is no such thing as employee privacy(on this issue). Nor is there a concept of right to work or job.

You are correct in thinking an employer has the right to request this info.

I totally understand and support a background check for criminal records and INS status, but is a credit check really necessary?

For the protection of the customer? No, statistically they are more than covered. This is about lawsuits, welcome to Rodeo's America:D

I don't have a problem with credit checks. It's simple logic. A person with poor credit at some point, may or may not, break under pressure and any one of us could end up being the next victim. Most notable employers are including credit checks as part of their background check on potential new hires. I'm okay with this even if it sounds intrusive which is but not unlawful.

[hijack] If I needed some nails, and Home Depot had the last nails on earth.. Id learn how to make my own nails before I bought them from Home Despot..[/hijack]

I hired Home Depot and I'm happy with the results. You hired Hilary Clinton to represent you in the US Senate and wont buy nails from Home Depot? Go figure....