Background checks have become an essential component of any hiring process. Implementing a consistent background policy will protect your company from hiring risks and liability issues, and your applicants from discriminatory hiring practices.

Companies have significant flexibility in how they approach the employee background check process, so it is important to understand the breadth of available options.

Employee background checks allow employers to verify the information offered by a candidate, often for safety reasons. According to the National Association of Professional Background Screeners, 96% of employers conduct background checks and cite public safety as their top concern.

These searches uncover any inconsistencies and potential concerns, ensuring applicants are who they claim to be. Resume falsification is on the rise; 85% of employers surveyed caught applicants lying. Give yourself peace of mind and protect your employees, your customers, and your assets by gaining reliable information about personnel.

Not All Background Checks Are Alike

Employment background checks afford businesses the confidence to hire talent they can trust and there are numerous types of background checks. The scope and depth of information will vary depending on the purpose of a background check. For example, a landlord may use a credit check to vet a future tenant, or a licensed arms dealer can run a universal check to see if someone is eligible to buy a firearm.

The most consistent component of any employment background check is the criminal background and credit report. However, an employment background check can include, but is not limited to, a candidate’s:

  • Employment, educational, financial, and medical history

  • Professional license or qualification verification

  • Driving and criminal record

  • Social media usage

  • Drug and alcohol screening

Depending on the nature of the position, employers can prioritize different aspects of the background check at the state and federal level. For example, a bank hiring a financial advisor may check an applicant’s financial history, whereas a public school hiring a teacher may put more emphasis on the candidate’s criminal and educational history.

Beyond a standard employment background check, employers may choose to run an “investigative report” for high profile and executive hires to gain a more detailed look into a candidate’s character. This report may include personal interviews detailing a candidate’s reputation, personality traits, and lifestyle choices. Before proceeding, discuss with your legal counsel--you will need to give notice to the applicant.

What you need for a background check

Many employers order background checks before offering a candidate a job. However, some employers make an offer to an applicant, contingent upon a clean background check, or conduct the screening during the 90-day probationary period. However your company chooses to structure their process, it is important to remain consistent in the treatment of all applicants.

The turnaround time of a background check depends on the type of service requested. Some results–such as an identity check–can be instant, while motor vehicle records can take anywhere from a few days to a few weeks.

To run an employment background check, you will need:

  • Applicant’s full name

  • Date of birth

  • Social security number or other tax-payer identification.

Asking the candidate to provide the relevant information upfront and cooperate with the screener will make the process run smoothly.

1. Understand The Laws For Compliance

When running an employment background check, businesses must comply with the Fair Credit Reporting Act (FCRA). This piece of legislation, enforced by the Federal Trade Commission (FTC), ensures fair, accurate, and private background checks. Different states have different laws regarding how employers can request, receive, and use background checks. Review the employment background checks of your state.

It is legal for an employer to inquire about an applicant’s past and require a background check as a condition of employment, with a few exceptions. To protect Americans from employment discrimination based on the results of genetic testing, the 2009 Genetic Information Nondiscrimination Act (GINA) was passed. The law bars employers from requesting genetic and family medical history---such as testing for a progressive, hereditary disease---that may impact their hiring decision.

Most importantly, employers must request background checks of all applicants, not just those they deem in need of vetting. Requesting background checks of only people of a certain race or national origin is evidence of discrimination.

Employers must request written permission from candidates before running a background check. This notice must be in stand-alone format, meaning it cannot be included in the employment application.

If a company plans to run background reports over the course of a person’s employment, they must indicate this clearly. In the event an applicant declines a background screening, an employer has the right to discontinue the hiring process.

If a company uses information gleaned in a background check to make a hiring decision, they must comply with statutes enforced by the Equal Employment Opportunity Commission (EEOC), a federal agency that protects applicants from discrimination. Employers cannot use information culled in a background check to make discriminatory hiring decisions.

While the laws surrounding background checks may seem difficult to navigate, accredited background screening companies can provide guidance to ensure you are FCRA compliant at every step of the process.

2. Choose A Trustworthy Screening Professional

Many companies hire third-party background check companies to streamline the process and access robust search tools. Running an in-house or DIY background check can be plagued by dead-end searches and outdated information.

Professional background companies employ data scientists and compliance experts side by side, granting companies the most accurate results available to make an informed hiring decision.

When choosing a background check company that is right for your business, consider the selection of background checks offered, the transparency of their methodology, and their track record of customer satisfaction. Prices vary widely depending on the package, from $25 to more than $100 per search. If you anticipate running many screenings, check for volume discounts.

The companies listed below have all been accredited by the Professional Background Screening Association (PBSA), a non-profit trade association to ensure the highest level of integrity and performance standards.

GoodHire is a data-powered company offering flexible solutions. There is a diverse range of packages and custom checks to suit a variety of small to large businesses, and the results are quick, accurate, and easy to interpret. GoodHire works directly with candidates, providing instant results and the opportunity to enter comments directly into the report.

HireRight was one of the first Internet-based background screening companies to hit the scene, and has set the standard for trustworthy, reliable, and global results. Services are bundled by industry and client satisfaction is of utmost important, with 50 years of proven success.

AccurateNow is a division of Accurate Background that offers automated background check solutions. There is no minimum order required, and the basic, standard, and premium plans are straightforward and convenient for very small businesses.

EBI Inc touts dependability, accuracy, and custom screening procedures tailored to your company’s needs. They emphasize customer support and ease of use, providing a single sign-on platform for employees and candidates.

3. Give Candidates A Chance To Respond

If a background report reveals adverse information, an employer must follow the adverse action process as ordered by the Fair Credit Reporting Act (FCRA). Employers should inform the candidates with a pre-adverse notice, which includes a copy of the consumer report and a summary of rights. This action allows applicants the opportunity to review the report, and respond to any negative information.

If an employer decides to reject the candidate based on the adverse information they must provide an adverse action notice, notifying the candidate that they were rejected due to information found in the report. The letter must include the name and contact information of the background report company, and notifies the candidate of their right to dispute the accuracy or completeness of the report.

Whether or not an applicant is hired, an employer must hold onto employment records for one year after the records or made or a personnel action was taken. Once this requirement has been satisfied, employers should dispose of this sensitive information reports securely.

Conclusion: Background Checks Provide Peace Of Mind

While companies are not required by law to run background checks on employees, background checks can provide protection and peace of mind for employers. Background checks must be applied to all employees consistently to avoid discrimination. Hire a PBSA-accredited background company that employs FCRA compliant practice, and understand your state laws. Always notify your candidate if you choose to conduct a background report, and give them the opportunity to respond to information.

  • How have employment background checks been useful for your business?

  • What has been your experience with background check vendors?

  • What other suggestions or tips would you add?