What is a background check?

A background check is a vetting process for prospective employees, where an employer or third-party service investigates a job candidate’s past. The areas of inquiry differ from job role to job role and industry to industry, but they may include criminal history, education history and financial status.

Once a candidate has been advanced through the initial screening and interview(s), they will have been evaluated by the employer based on information they provided on their application or resume, as well as their performance during the interview and other interactions.

Background screenings, along with reference checks, enable the hiring team to gather information about a candidate from people or institutions outside of the applicant.

The employer or third-party background check service may contact the candidate’s former employers, managers, and educational institutions. The background check will include employment history, education (including the validity of claimed degrees, licenses and certifications), criminal records, credit history, motor vehicle history and drivers license records.

Employers conduct background checks to ensure that an applicant:

  • Is qualified for the position
  • Did not lie on his/her application, resume and during the interview.
  • Isn’t concealing serious wrongdoing including theft, fraud, harassment, violence, or negligence

Does the employer have to obtain the candidate’s consent to perform a background check?

In order to protect applicants, employers must provide applicants with a formal written disclosure and obtain consent before requesting a background check. The disclosure and consent form must be a separate document and can’t be included in the application. The employer must disclose that the information may be used to influence the hiring decision.

If a third-party service is used, after the employer obtains consent from the applicant, they must inform the background check company that they notified the candidate and obtained their consent. The employer must also verify that they complied with FCRA anti-discrimination provisions discussed below.

Laws that Regulate Background Checks

The Fair Credit Reporting Act (FCRA) regulates the use of consumer credit reports and other investigative reports by employers who hire third-party service agencies. The Federal Trade Commission (FTC) enforces the FCRA.

When a third party performs background checks, it may obtain information called “investigative reporting”, in which information about the job candidate may contain subjective judgment about a candidate.

How does the FTC define a “report”?

A report need not always be in written form. For example, a report could refer to information obtained in a short phone call that is communicated orally to the hiring manager in another short phone call.

An FCRA consumer report is “Any written, oral or other communication of any information by a consumer-reporting agency bearing on a consumer’s credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics or mode of living. In the employment context, this definition may, for example, include credit reports, criminal history reports, driving records and other background check reports created by a third party, such as drug tests.” Society for Human Resource Management

If you are requesting an investigative report on a person, you must also inform the applicant or employee of his or her right to a description of the nature and scope of the investigation. EEOC

Background screenings:

  • Protect employees from violence or harassment
  • Protect customers from theft or harassment
  • Protect the business from fraud, theft, a tarnished reputation or legal liability

Background checks are an important part of an employer’s due diligence when evaluating job applicants. Thorough background checks protect the business, the employees, the customers and the public at large.

See also

Additional resources

Court Cano
Latest posts by Court Cano (see all)