4 Things You Need to Know Before You Run a Background Check

Posted by on May 1, 2012 in Employee Background Checks [ 2 Comments ]

background check information for business startupSometimes, running a background check doesn’t necessarily insinuate that you suspect criminal activity. Though employee violence or theft are common reasons to run a background check, you may only need to understand an applicant’s driving history or credit reporting because its applicable to the position they apply for or responsibilities they carry out.

Here are the four things you need to know about performing a background check on a potential employee:

1. There’s a right way and a wrong way

When it comes to conducting employment screenings, become intimately familiar with the Fair Credit Reporting Act (FCRA). This document governs the rights and responsibilities you have as an employer to conduct searches on candidates. It is particularly important to adhere to the rules set forth in the FCRA if you plan to undertake the background check yourself.

The FCRA requires that you get written permission from the candidate before you investigate anything that may be part of what is called a “consumer report.” This information is gathered from credit reporting agencies, which are creditors (credit card companies, auto finance companies, banking institutions), employers, collection agencies, and state or municipal courts.

This act also spells out everything you must do if you come across any discrepancies when looking into your prospective employee’s references, employment history or criminal record.

2. What a background check will reveal

What does a background check include? The results may vary based on the position you’re hiring for as well as the industry you are in, but background checks could unveil a number of different facts and histories about a person:

  • Employment and credential verifications
  • Character references
  • Gaps in employment history
  • Credit history and bankruptcy
  • Criminal and court history
  • Drug test results
  • Driving records

Other searches that look into sex offender registries and Patriot Act searches are becoming more common as well.

3. Legal ramifications of receiving this information

It should go without saying, but these records — whether clean or not — are to remain confidential between you as the hiring manager, the candidate, and your human resources department.

If you uncover something that may give you reason not to employ someone, the FCRA requires you give notice to the applicant that their criminal report was reviewed, as well as a copy of the criminal report that cites the infraction.

From there, you must provide them with a copy of the FTC’s Summary of Rights Under the Fair Credit Reporting Act. This document informs the candidate of the following rights:

  • He or she must be told if the criminal record has been used to decide not to offer employment.
  • He or she has the right to know what’s in the file.
  • He or she can dispute incomplete or inaccurate information.

From there, you must also give this candidate any other government-provided information on their rights.

4. What you can and cannot do with this info

According to the Small Business Administration, “to what extent a private employer may consider an applicant’s criminal history in making hiring decisions varies from state to state.” It’s suggested that you consult with a lawyer in your state, or do further legal research on the laws of your state, before making a hiring decision.

Though you should certainly consult a lawyer if you find yourself in this position, you might want to refrain from making blanket hard-and-fast policies against hiring anyone with a criminal history. Doing so could set you up for legal trouble and accusations of discrimination if you adhere to such a policy. Evaluate the position carefully by considering the nature of the crime, the length of time since it occurred, and how it relates to the position.

Documentation is also vital in these instances. If you decide to reject an applicant because of something you found in their records, you should make note of the link between the conviction and the job. Or, if you decide to reject them for reasons other than a conviction, document that as well. If you choose not to hire them but they have a criminal history, and they believe you are discriminating, this little and seemingly-insignificant annotation could be the key to your future defense.

Photo source: joysjukejoint.blogspot.com

2 thoughts on “4 Things You Need to Know Before You Run a Background Check

  1. avatarDave Jordan

    With the new release of the EEOC guidelines on the use of criminal background checks, every single employer must be far more careful about how they go about dealing with criminal records when the come up. The Guidance recommends that employers take into consideration three factors prior to excluding an applicant from a job based on the results from a background check. Those considerations are:
    1) The nature and gravity of the offense or conduct.
    2) the time that has passed since the offense or conduct and/or completion of the sentence.
    3) The nature of the job held or sought .

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