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The Perils, Potential Pitfalls, and Possibilities of Background Screening

Date Published: May 24, 2022 | Last Updated:September 15, 2023 | By Linda Pophal
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Background checks have long been a critical part of the talent acquisition process. Employers want to make sure employees have the background and credentials they claim to ensure they can do their jobs effectively. Employers also want assurance that employees won’t represent a potential risk to the company and its key stakeholders. There is both great reward and great risk at stake, particularly in an increasingly remote work world.

When conducting background checks, employers must ensure that they are following all relevant federal, state, and local regulations; that they are appropriately informing and gaining permission from employees to conduct these searches; that they are using the information they obtain appropriately; and that they are allowing potential and existing employees an opportunity to respond to any negative information that may be unearthed.

Today, of course, there are additional thorny issues that can complicate the process—like social media, the legalization of marijuana in several states, ban the box laws, and more.

Importantly, conducting background checks appropriately and following all applicable laws, rules, and guidelines is important for all employers. It doesn’t matter if you have 5 or 500,000 employees. The rules — and the risks — are relevant to you!

Types of Background Checks

There are a variety of different types of background checks that a company might conduct depending on the type of work it does and the role that is being filled. These range from criminal history information from both federal and state courts, as well as from various databases. There are various verifications around education, work history, and licensure. And there are other areas of exploration that might include credit reports, driving records, or drug tests.

Regulatory Issues

Background screening is heavily regulated. Employers must follow the requirements of the Fair Credit Reporting Act (FCRA) as well as the EEOC, and … there are also state laws that must be followed.

You must document why you’re screening — whether it’s a federal or state mandate, whether it’s related to the need to keep your key stakeholders and your workplace safe.

Obtaining Permissions

But background checks aren’t something that is done in a covert way. Employers are required to obtain consent from employees. For instance, the Fair Credit Reporting Act requires disclosure that is clear and conspicuous. Disclosure is a critical part of the background screening process, and there is a lot of litigation around this issue when not done—or when not done correctly.

In addition, these disclosures aren’t solely around what you’re doing, but in some cases why. And employers need to be very clear of the implications of not passing the background check—e.g., the contingency that they need to pass the background check or an employment offer will not be made.

This leads to another important point—not all types of information attained may apply to all types of positions.

Using Information Appropriately

For instance, if a candidate has multiple speeding tickets or a DUI is that relevant when they’re applying for a remote position as a data entry clerk? Or, if someone has had an incident of theft in their background but they’ll never be unsupervised with access to company or customer property or personal information?

It’s important for employers to understand what is, and is not appropriate for consideration based on both EEOC guidance and Ban the Box laws that exist at the state and local levels.

Employees should also be informed of any harmful information that has been unearthed about them and have an opportunity to explain or append to that information.

Thorny Issues

When it comes to looking up employee information on the various social media channels, the best advice to employers and their HR and hiring managers is: don’t! Do not go on Facebook, or Instagram, or TikTok, or even LinkedIn and look at the profiles or posts of candidates yourself. You need to engage with a professional organization that will do this in a manner that is consistent with EEOC guidelines and that will apply the rules consistently across candidates to ensure you’re shielded from any sort of discrimination-related impacts. There may be relevant information out there that could impact your hiring decisions — but you, your HR staff, or your hiring managers should not be accessing this information on your own.

Another murky issue in recent years is the growing number of states where marijuana use is now legal where emerging state laws impact whether employers can test for marijuana pre-employment—or whether they can use a positive test result in an employment-related decision. There are a couple of important considerations here.

First, just because marijuana use may be legal in a particular state doesn’t mean that your ability—in fact, requirement—to test would not still be in force. There are some federal laws that apply to certain types of industries or roles that would apply. For instance, the Nuclear Regulatory Commission, Department of Defense and Department of Transportation have requirements that relate to roles like truck drivers, or bus drivers, pilots, pipeline operators, etc.

Second, as is the case with alcohol, just because a substance is legal doesn’t mean that an employee can be under the influence of that substance in the workplace.

In a remote work environment, in particular, it’s especially important to ensure that the people you have hired who will be generally unsupervised are representing your company and its interests appropriately.

Background screening is a critically important part of the talent acquisition process. It’s also an increasingly complex and risk-fraught part of the process with many moving parts and many variations between state and local jurisdictions. Don’t take a chance on missing critical information that could help you hire an exceptional candidate—or help you avoid hiring a candidate who may represent risk to your organization. Learn more about some do’s and don’ts of effective background screening in this recent TalentCulture #WorkTrends podcast featuring Accurate.

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