15 Dos and Don’ts for Effective and Compliant Employment Screening

employment screening

A substantial percentage of employers routinely use background screening to assist them in finding the best employees. According to the U.S. Small Business Administration, every dollar invested in employment screening can result in a $5 – $16 return on investment, stemming from higher productivity, lower absenteeism, a decrease in turnover, and less risk of employer liability.

Our own study found that a mid-sized company with 10,000 employees and 500 annual hires can reduce their liability from $3,110 to just $300 per hire with a mere $50 investment in background screening.

The case for employment screening is strong. But the landscape has changed in recent years. Unsuspecting employers who think an “instant” background check can be their go-to defense against negligent hiring might actually be stepping into a minefield of trouble. New rules and regulations are surfacing that make it more important than ever to understand your rights and responsibilities as an employer when it comes to fairness and compliance in the hiring process.

Here are some of our top dos and don’ts for employers today:

Do: Obtain Applicant Consent

This is one piece of advice that stands the test of time. The first and most important step in employment screening is to obtain applicant or employee consent. This isn’t just our advice—it’s also the law, as outlined by the Fair Credit Reporting Act (FCRA). You must make applicants aware that they will be subject to an employment background check, and the candidate/employee must sign a written consent form before you conduct the research.

Don’t: Establish Blanket Policies

Fair employment laws require that you only make hiring decisions based on role-related and business-necessity criteria. Therefore, you should avoid bright line policies, such as refusing to hire anyone with any type of criminal record. Often, older and non-serious convictions have little or no bearing on a person’s ability to fulfill the job obligations. Plus, such policies are very likely to get you in trouble with the EEOC and others.

Do: Perform Individualized Assessments

Did you know approximately one in four Americans has a criminal background of some kind? Given this reality, it is certain that you will come across applicants whose criminal records you’ll have to consider. If you decide to exclude an applicant because of a criminal background check, the EEOC has established that the right approach is to take into account individual circumstances through the practice of individualized assessments.

Don’t: Neglect Your Local ‘Ban the Box’ Law

Ban the Box laws are popping up all over the country. The common element of these laws is that they contain a prohibition against asking about criminal background at the application stage of hiring, and then using the answer to determine whether to exclude an applicant. The laws acknowledge that employers have the right to conduct criminal background screening on applicants and employees, but limit the timing of the background research in the hiring process. Beyond this basic element, the laws vary greatly from place to place. The onus is on you to know if you are covered by a Ban the Box statute.

The landscape is changing fast but here is a useful map provided by the National Employment Law Project that might help you determine if you are covered by one (or more!) of these laws.

Do: Connect the Right Background Check to the Job

Employers have an obligation under EEOC guidelines to ensure the type of background check they use matches the risk and responsibilities of the position and that the factors used to judge the results of a background check take into account the likelihood that what’s found will impact the applicant’s performance on the job. So the point is, establish a clear link between the items you’re screening for in the background check and the job duties. Understand what you “need to know” and what could potentially violate an individual’s privacy rights or cause unfair discrimination.

Don’t: Rely Solely on a National Criminal Database Searches

It is wise to conduct criminal searches on a national level and now it’s easier than ever before through instant databases. But make no mistake, you cannot depend on database searches alone. Every search that uses information from these databases should be verified against authoritative source records at the state and local courts. Your background screening company should be willing and able to supply all this information to you. Limiting your search to a database exposes you to several sources of error.

Do: Establish and Publish Your Background Screening Policy

Make your background screening policy clear–in writing. Detail the types of background checks you regularly conduct and how, and the type of information you’re screening for. Make sure you include federal, state, and local laws in your guidelines. Additionally, make it clear how you’ll apply your background screening results.

Don’t: Take a Haphazard Approach

It can sometimes be tempting to let an individual slide by without a complete background check, or to overlook a certain aspect of an applicant’s background due to your “gut feeling” that they are a good person or due to pressure to onboard a new employee more quickly. But this is exactly the type of practice that gets employers in trouble. Apply your background screening policy consistency. For example, for individuals applying to the same position, make sure you use the same type of background check on everyone and that you use the same criteria across the board when evaluating the results.

Do: Screen Your Subcontractors and Temporary Workers

Studies have shown that a surprising majority of companies fail to uphold the same screening requirements of their contingent workers as they do of their traditional employees. According to some reports just 35% of companies require background checks of their temporary workforce.

Everyone who works for your company—and that means everyone – should undergo the same type of background check. Remember that you’re most likely to be held liable for anyone who is on your books whether they are an employee or a subcontractor. Especially when they do something wrong.

Don’t: Be Myopic

The key to gaining a complete picture of a candidate is to take a holistic view by conducting a background check that involves a number of different looks, rather than just one. For example, if you use criminal background checks, also consider adding employment verifications, reference checks, and possibly even credit checks, drug screening, or other job-related checks.

Do: The Adverse Action 2-Step

Before you take any action on the results of a background screen in hiring, promoting, or suspending an employee, make sure you’re aware of the Adverse Action requirements mandated by the FCRA—the laws are very specific about how and when you must notify an applicant of an adverse decision you’ve made concerning the results of their background check.

If you have conducted a background screening and an individualized assessment and still determine to exclude an applicant, make sure the adverse action is properly done. It should include two steps. First, notify the applicant that he or she is going to be excluded for that reason, and second, give him or her an opportunity to respond with mitigating information before making any adverse hiring decision based on the background check.

Don’t: Check Out Social Media without Understanding the Risks

It’s very tempting, and mostly legal, to use social media when investigating a candidate or employee. However, what you find and how you apply the information you uncover is what can get you in trouble.

Here’s what the Federal Trade Commission says about it:

Employment background checks can include information from a variety of sources: credit reports, employment and salary history, criminal records — and these days, even social media. But regardless of the type of information in a report you use when making hiring decisions, the rules are the same. Companies providing reports to employers and employers using reports must comply with the Fair Credit Reporting Act (FCRA).

Probably the best way to use social media screening safely and effectively is to hire a professional background screening company to do it. A professional firm will make sure the information is treated with the same due diligence applied to every other source, and guide employers to take the right steps in compliance with FCRA.

Do: Keep Your Applicant’s Information Onshore

Unfortunately, some background companies will do anything to cut costs—including outsourcing background screening to offshore companies. Once a person’s sensitive personal information leaves U.S. borders, however, you have no control of how the information is used. And that can bring you a world of trouble.

Don’t: Neglect FCRA, ADA, and All Other Applicable Laws

FCRA, ADA, and other employment laws are complex and specific, and to protect your company, you need to ensure you’re operating under full compliance. Always consult your employment attorney to ensure your processes are compliant and up-to-date.

Do: Hire an NAPBS Accredited Background Screening Company

A reputable, qualified background screening firm can help guide you through the logistics and complexities of background screening. Companies we work with have also found that the cost of working with an employment screening provider is less than or equal to the cost they would have to pay to have their staff do the work. But choosing the right provider is critical. This is where the National Association of Professional Background Screeners (NAPBS) accreditation program comes into play.

Governed by the Background Screening Agency Accreditation Program (BSAAP), the NAPBS accreditation program has become a widely-recognized seal of approval that confirms an organization’s commitment to excellence, accountability, high professional standards, and continued institutional improvement. When you choose an accredited provider, you can be more confident that the background screening results you receive are legally compliant and verifiably accurate.

We hope you’ve found some value in these dos and don’ts. There is definitely a lot more than meets the eye when it comes to employment screening but doing it right can yield better employees, less turnover, and an overall more productive workforce. With the right employment screening provider at your side, you can more easily navigate today’s increasingly complex legal landscape, protect your right to know before you hire, and deliver a fair hiring process for your candidates and employees.


best hiring practices

About MichaelGaul

Michael is a results-oriented marketing executive with over two decades of experience in employment screening, physical security, and business process management. Michael has deep experience in human capital risk management and a passion for educating business leaders and HR professionals on strategies that tangibly protect their interests. Michael serves on the Board of the Secure Cash and Transport Association (SCTA) and is a member of the Professional Background Screening Association (PBSA), and the American Society of Industrial Security (ASIS).
View all posts by MichaelGaul →