What Does the Supreme Court ruling in NASA v Nelson Say About Employment Background Checks?

A unanimous ruling in the privacy rights case brought by JPL scientists and researchers says background checks conducted by NASA are appropriate.

Announced earlier this month, the case of NASA v Nelson resulted in a unanimous decision by the Supreme Court to allow the standard federal employment background check – typically the National Agency Check with Inquiries (NACI) — to continue. Twenty-eight respondents, who are workers at NASA’s Jet Propulsion Laboratory (JPL), had challenged a section of a form questionnaire that asks employees about treatment or counseling for recent illegal-drug use. They also objected to certain open-ended questions on a form sent to employees’ designated references.

“Ridiculous.”

We found Justice Scalia’s written opinion of the case to sum up the court’s decision succinctly and somewhat humorously. He writes,

“Respondents claim that even though they are Government contractor employees, and even though they are working with highly expensive scientific equipment, and even though the Government is seeking only information about drug treatment and information from third parties that is standard in background checks, and even though the Government is liable for damages if that information is ever revealed, and even though NASA’s Privacy Act regulations are very protective of private information, NASA’s background checks are unconstitutional. Ridiculous. In carefully citing all of these factors as the basis for its decision, the Court makes the distinguishing of this case simple as pie.”

There are several factors in this case that are worth exploring further. If you follow our blog you’ll recognize these as factors we discuss consistently when we talk about the appropriate use of employment background checks:

1. The Nature of the Job
2. The Nature of the Check
3. Employees vs Contractors
4. Implications for Private Employers

(The following summaries and our resulting takeaways and opinions stem from the Syllabus and Opinion of the Court in this case.)

The Nature of the Job

With any employee background check, assessing the nature of the job is the first order of business. Employers must assess the role an individual will play within the organization and determine the potential risks associated with that role. In the case of NASA v Nelson, one must consider the nature of NASA’s work, and in particular, the work of scientists and researchers at NASA’s JPL.

The National Aeronautics and Space Administration (NASA) is an independent federal agency that plans and conducts space activities on behalf of the Government. NASA’s JPL is the agency’s lead center for deep-space robotics and communications and most of the nation’s unmanned space missions, including the Explorer 1 satellite in 1958 and the Mars Rovers of today. It is noted that the scientists of JPL add to NASA’s earth-observation and technology-development projects and many also take on research projects on topics such as star formation and properties of quantum fluids. NASA owns JPL, but the California Institute of Technology operates it under a Government contract. As such, JPL is staffed exclusively by contractors, rather than “employees” (civil servants) of the agency (we’ll discuss the implication of this later).

“Who’s Minding the Store?”

The 28 scientists and researchers who brought the case against NASA work at JPL and are engaged in the work described above. At JPL, in particular, the work that contract employees perform is described by the Court as being “critical to NASA’s mission.”

In particular, the respondents in this case reportedly include the lead trouble-shooter for the $568 million Kepler space observatory, the leader of the program that tests all new technology that NASA will use in space, and one of the lead trajectory designers for the Galileo Project and the Apollo Moon landings. The Court opinion states,

“This is important work, and all of it is funded with a multibillion dollar investment from the American taxpayer. The Government has a strong interest in conducting basic background checks into the contract employees minding the store at JPL.”

The nature of the work performed at JPL says a lot about the significance of the background check one would reasonably perform when hiring and retaining the individuals in these roles.

The Nature of the Check

The type of background check an employer performs must always be tied to the nature of the job. This not only makes logical sense, it makes good legal sense as well when you consider EEOC guidelines and other regulations surrounding fair employment and anti-discrimination. Failure to link the nature of the check to the nature of the job potentially runs afoul of the EEOC and puts employers at risk of claims of negligent hiring.

The respondents in the case of NASA v Nelson challenged the nature of the background check on the grounds that it violated their privacy rights under the constitution. Specifically, they challenged inquiry into treatment or counseling for recent illegal-drug use and certain open-ended questions asked of employees’ designated references.

In its Opinion, the Court described the questions being challenged as “part of a standard background check of the sort used by millions of private employers.”

The Government has maintained an interest in performing basic background checks designed to ensure the security of its facilities and to build a workforce of competent and reliable people to carry out its work. In fact, employment investigations have been performed by the Government since the earliest days of our history, and since 1871 the President has had statutory authority to assess an applicant’s aptness for civil service. Standard background checks, similar to those being challenged by the JPL respondents, became mandatory for federal civil-service candidates in 1953. The respondents brought challenge to the background checks only after these checks were extended to require both employees and contractors (JPL employees are all contractors) to adhere to the NACI background checks.

Here’s how the Court describes the NACI background check process:

The NACI process has long been the standard background investigation for prospective civil servants. The process begins when the applicant or employee fills out a form questionnaire. Employees who work in “nonsensitive” positions (as all respondents here do) complete Standard Form 85 (SF–85).

Most of the questions on SF–85 seek basic biographical information: name, address, prior residences, education, employment history, and personal and professional references. The form also asks about citizenship, selective service registration, and military service. The last question asks whether the employee has “used, possessed, supplied, or manufactured illegal drugs” in the last year. If the answer is yes, the employee must provide details, including information about “any treatment or counseling received.” A “truthful response,” the form notes, cannot be used as evidence against the employee in a criminal proceeding. The employee must certify that all responses on the form are true and must sign a release authorizing the Government to obtain personal information from schools, employers, and others during its investigation.

Once a completed SF–85 is on file, the “agency check” and “inquiries” begin. The Government runs the information provided by the employee through FBI and other federal-agency databases. It also sends out form questionnaires to the former employers, schools, landlords, and references listed on SF–85.The particular form at issue in this case—the Investigative Request for Personal Information, Form 42—goes to the employee’s former landlords and references.

About two months before the October 2007 deadline for completing the NACI, the respondents from JPL filed suit claiming that the background checks violate a constitutional right to informational privacy.

In Question: Drug Use and Treatment

JPL respondents in this case questioned the constitutionality of SF–85’s “treatment or counseling” question. This question is a follow up question to what the Court called a “reasonable inquiry about illegal-drug use.”

The Court’s opinion concerning this question sheds light on the reasons why any employer (as long as it’s job-related) would require drug testing and question illegal drug use by their employees. Recognizing that illegal-drug use is both a criminal and medical issue, the Government states that it “seeks to separate out those drug users who are taking steps to address and overcome their problems. Thus, it uses responses to the drug-treatment question as a mitigating factor in its contractor credentialing decisions.”

In its opinion, the Court also references a study by Breen & Matusitz that negatively correlates illicit drug use with workplace productivity as a rationale for the drug use inquiries. Also, it argues that the drug screening questions are part of the Government’s entitlement to staff reliable, law-abiding persons. Furthermore, the Court rejected the argument that the Government has a “constitutional burden” to prove that the questions asked in the employment check are either “necessary” or the least restrictive means of achieving its hiring goals.

Here’s what the Opinion states:

“Like any employer, the Government is entitled to have its projects staffed by reliable, law-abiding persons who will ‘efficiently and effectively’ discharge their duties.”

In Question: Open Ended Questions on the Background Check

The second part of the respondent’s case against NASA argues that Form 42’s open ended questions are a violation of their privacy rights. In rebuttal, the Court states that these questions are “reasonably aimed at identifying capable employees who will faithfully conduct the Government’s business.” Furthermore, “Asking an applicant’s designated references broad questions about job suitability is an appropriate tool for separating strong candidates from weak ones.”

The Court’s opinion even references the use of such open-ended questions in public and private sectors as rationale for their use on the Federal level. The opinion states:

“The reasonableness of such questions is illustrated by their pervasiveness in the public and private sectors.”

As for privacy violations, the Court notes that information gathered during the employment background checks is already substantially protected from public disclosure under The Privacy Act.

Employees and/or Contractors

The issue of employees and contractors is one that affects many employers. It is common practice in many organizations to supplement the work of traditional employees with that of outsourced contract workers. At NASA, tens of thousands of workers, many federal civil servants, comprise the Agency’s workforce, yet a substantial majority of these workers are employed directly by Government contractors – not directly by NASA.

The Supreme Court, in this case, recognized that NASA’s contract employees play an important role in the agency’s mission, and that the duties of contractors are functionally equal to those performed by civil servants (employees).

Specifically, the Court Opinion states:

“There are no meaningful distinctions in the duties of NASA’s civil-service and contractor employees, especially at JPL, where contract employees do work that is critical to NASA’s mission and that is funded with a multibillion dollar taxpayer investment.”

NASA’s JPL is staffed exclusively by contract employees.

What Can Private Employers Take Away From This Case?

We continue to believe that this case underscores the fact that all employers, whether private or public, must draw a clear corollary between the role-related risks of the job and the type of background check they’ll perform. The two need to match up. And this isn’t just our opinion. This is the guidance that has been handed down by the EEOC when it comes to anti-discrimination.

The dichotomy that employers must also contend with is this: do too much and you can get yourself in trouble with the EEOC and others. Do too little and you can get yourself in trouble from a negligent hiring standpoint. Striking the right balance is possible with the right background screening policy in place. Look to the experienced guidance of your background screening company and your legal counsel.

One last point: employers must always consider appropriate hiring strategies for both employees and contract workers, since the work performed by each may be substantially equal and therefore, equally risky and important.

What’s your take on all of this? Leave a comment and let’s discuss.

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Note: This content, as with all content on this website, is purely informational. It may not be construed as legal advice. Please direct legal questions to your legal counsel.

About Michael Gaul

A security industry professional since 1988, Michael has extensive expertise in the fields of human capital risk management, physical security, and background screening process management. Michael leads Proforma’s sales, marketing, and strategic customer relations efforts.


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