Four Best Practices for Building a Background Screening Program to Comply With a Myriad of Federal and State Laws

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by Paul H. Kehoe and Pamela Quigley Devata, attorneys with Seyfarth Shaw LLP

It is critical for businesses to provide a safe environment for their employees and customers, and to protect the company’s interests.

Whether you are hiring employees, working with independent contractors, or engaging volunteers, background checks can help make sure you have the right people — and having the right people can impact your organization’s success and the safety of your communities.

Ultimately, background checks help you screen out dangerous individuals, and assist your business in retaining the best possible candidates.

In recent years, the legal landscape regarding employers’ background check procedures has shifted dramatically. When it comes to how employers properly obtain criminal background history in the U.S., the Fair Credit Reporting Act applies.

Additionally, as it relates to when employers can ask candidates or employees about their criminal backgrounds, state and local ban the box laws may apply. Finally, the EEOC’s criminal history guidance analyzing Title VII of the Civil Rights Act of 1964, and some state laws, apply when determining how employers can actually use the criminal history information returned by a background check.

As a result, employers face significant confusion when it comes to properly implementing a criminal background check process. Especially for small or medium businesses, where decisions are made on short timeframes, making the right hiring decision is vital to success. So, where do you begin?

Here are four best practices that can help you get started.

  1. First, employers must decide whether to review an applicant’s criminal history and then create a written policy documenting their process for assessing criminal history.This analysis includes determining what convictions are relevant to what positions, and for how long — meaning a one size fits all policy for an entire company may not be wise.During this time, employers should consider whether to use a hiring matrix as a guide for screening out candidates, what type of individualized assessment process to implement, and how to analyze pending arrests (as non-pending arrests that did not result in a conviction may be viewed by the EEOC as a violation of Title VII).
  2. Second, employers should engage a background screening company.A background check should be accurate, comprehensive, consistent, timely and, of course, legal. If you rely on a third party to run your background checks, then you must comply with the federal Fair Credit Reporting Act (FCRA) and applicable state consumer reporting laws.
  3. Third, under the FCRA, companies must ensure that, in part, before running a criminal background check they have a permissible purpose and that, a candidate (i) knows that a background check is being conducted, (ii) consents to having a background check conducted, and (iii) is provided notification that information contained in the background check report may result in an adverse employment decision.After receiving the criminal background check results, if adverse information is returned, an employer must provide a pre-adverse action notice to the candidate, with certain documents included (a copy of their report and a summary of the candidate’s rights under the FCRA and any applicable state law notices), to the candidate and wait a certain period of time, preferably 5 business days at minimum, so that the candidate can dispute the accuracy or completeness of the report as needed with the background screening company before taking an adverse action, and then follow up with an adverse action notification if applicable.
  4. Finally, a trend that is gaining momentum across the country is to prohibit employers from asking about a candidate’s criminal history on an employment application.As a result, employers must comply with state and local ban the box laws, which govern when employers can ask about criminal history, and sometimes, how the information can be used. For example, an employer in Hawaii, Washington, DC, Baltimore, MD and Newark, NJ cannot inquire about criminal history until after it has extended a conditional employment offer to the candidate.Moreover, the ban the box laws may only apply to employers of a certain size — and those thresholds differ by state.

Given the myriad of applicable federal and state laws, employers should consult their attorneys to review their background screening processes and procedures.

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HireRight is a leading provider of on-demand employment background checks, drug and health screening, and electronic Form I-9 and E-Verify solutions that help employers automate, manage and control background screening and related programs.

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The HireRight Blog is provided for informational purposes only. It is not intended to be comprehensive, and is not a substitute for and should not be construed as legal advice. HireRight does not warrant any statements in the HireRight Blog. Any statutes or laws cited herein should be read in their entirety. You should direct to your own experienced legal counsel questions involving your organization’s compliance with or interpretation or application of laws or regulations and any additional legal requirements that may apply.