3 Things You Need To Know About Employee Background Checks

When hiring new employees, it's better to be safe than sorry

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More and more businesses are using background checks during the hiring process to help ensure they aren’t bringing someone into the workplace that may be dangerous or dishonest. Recent research from the Society for Human Resource Management found that nearly 70% of employers conduct criminal background checks on all of their job candidates, while 47% conduct credit checks.

According to Lester Rosen, founder and CEO of Employment Screening Resources, businesses that don’t use background checks when hiring are putting their business at risk. When a new employee who hasn’t been properly vetted is hired, employers are basically welcoming a stranger into their business.

Employment background checks generally include three main aspects: criminal record checks, employment history and education verification. The Fair Credit Reporting Act mandates that employers must get written authorization from job applicants before conducting a background check and once it’s completed let the candidate know if anything harmful was found in their search.

Not following background check laws can cause employers some serious grief. The two biggest negative consequences are being sued by a job applicant or employee, and being investigated and possibly fined by a government agency such as the Equal Employment Opportunity Commission or National Labor Relations Board. Defending against a government investigation or lawsuit is time-consuming and expensive.

To avoid lawsuits and government investigations, here are three tips:

1. Use a background check services vendor with a good reputation that provides you with clear, accurate and complete written reports. Many do-it-yourself Internet background search engines produce reports that are filled with duplicate and irrelevant information, which can be worse than having no background check at all. Also, if something with the hiring decision goes awry in the future, you will want to show exactly what information you reviewed and when. Getting a solid written report from a professional background check company is a great way to do that.

2. Have specific reasons for wanting to know certain information to make a hiring decision, which should be tailored for each type of job, and limit the scope of the background check to only that information. For example, you would want to know if a delivery driver candidate has a lot of speeding tickets, and you would want to confirm whether a person applying for a lawyer job graduated from college and law school, but you should not be checking every job-seeker’s driving record or educational background.

3. Background check reports contain a lot of personal and potentially embarrassing information, so you should keep them in a secure place at your company and limit who can read them. Like most circumstances in life, you should treat others as you would like to be treated. Even if you have no empathy for the job candidates, you should keep background check reports close to the vest because your potential liability increases with each person who reads them.

Even though there is some cost associated with conducting background checks, it is a lot cheaper than hiring an employee who steals or hurts somebody. “Most of the time, most of the people pass the background check,” Rosen noted. “But if you get someone who has a problem, you will be very happy you dodged a bullet and didn’t bring someone into the workplace who is dangerous, unfit, dishonest or unqualified.”

A version of this article first appeared in Business News Daily, to read more click here.

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  • Rick S. Geiger

    A few other things of which employers should be aware, and that employees must be careful of:

    1. Social media is now used extensively in background checks and every company should have a social media policy. I practice in this area and teach a class on Social Media and the Law and I will you that companies without a well vetted social media policy are looking for trouble, and prospective employees that have all sorts of social media information about them out there should know that whether acknowledged or not, it is very likely the employer will look at it.

    2. Some states have outlawed using criminal background checks and some states have extensive limitations on criminal background checks. Both as an employer and and employee you should be aware of the law in your state.

    3. Using a third party company to do the employee background check will not absolve an employer of liability for the misuse of information in the employment process

    4. The National Labor Relations Board, which most people think only applies to union shops, actually applies to all business and categories of employees, wage, exempt and professional. The NLRB has an excellent website that employers should use.

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