What Should Employers Know about Laws Governing Background Checks?

During the pre-employment process there are few things more important than a background check on your applicants. Besides providing you a better glimpse and idea of whom you may be hiring, background checks also provide a greater sense of security for you and your employees while reducing the risk for any potential incidents as well as the liability of your business in the event of anything happening. However, there are important and strict legal stipulations regarding properly performing a background check and making sure that you stay within the letter of the law is vital to having a usable background check for each potential employee. These are just some of the most important things that each employer should know about legally conducting background checks before conducting any.

Things to know before conducting background check

• Employees Must Give Permission– Running a background check on an employee or potential employee can only be performed after the employer has received written permission from the subject. You must also provide them with a copy of their rights under the Fair Credit Report Act (FCRA) before you can check their credit.
• What is the FCRA?– The Fair Credit Report Act is a federal law that does not require employers to conduct background checks. It does however set a national standard that all employers must follow when conducting an employment screening. The FCRA may not give employees more rights than the state laws do, but the FCRA is an important standard to ensure each applicant receives a fair and legal background check.
• You Must Tell Them the Results– If the results of the background check lead to an employee not getting hired, you must give them a copy of the results along with time to respond and correct any misinformation. This also means that any potential employee has the right to contest any of the information that shows up on the background check should something be incorrect.
• Consistency is Essential– Every single applicant up for a position must be subjected to the exact same background check and screening process. There can’t be exceptions for certain candidates for any reason at all. Any failure to maintain consistency can lead to large issues with favoritism or unfairness should applicants be made aware of screening process differences.



• State Laws Vary– This is extremely important, as each state will have different rules and requirements regarding sensitive information. Knowing the requirements of your state prior to conducting background checks on applicants will help you avoid legal trouble and will make sure that you can make the necessary adjustments to the screening process.
• Stick to Information Only Permitted by Law– While on the topic of varying state laws, make sure that you only seek information that is legally allowed. Yes, states will have various laws and things that can be checked and records that employers are allowed to access, but things like medical records, genetic information and other sensitive information is not allowed. Should an employee be hired, then these things can be inquired about to determine if the employee needs any special accommodations due to disability, but that cannot be a determining factor on if an applicant is hired for a position.
• Using Social Media– A newer tool in the screening process, more employers are using social media to get additional information about applicants. This is a legal method though it’s important to continue to follow state and federal laws based on discrimination. Employers should be mindful of the risks of searching social media as legally, no one can be discriminated against based on religions beliefs, sexual orientation, marital status, race, age or political beliefs, making social media a slippery slope to consider.

Final words

Background checks are something that not every company is required to do though, the benefits of them have made it extremely common for almost every employer to utilize. However, before your business conducts any background checks on applicants for a given position, knowing the legal limits, restrictions and potential implications of an improper background check are vital. Knowing the applicants’ rights, each state’s rules and regulations for background checks and ensuring that you honor them will help avoid legal trouble and misconduct accusations while still helping you find a high quality employee for your business.

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