Background checks help businesses and organizations make good decisions when it comes to HR and recruitment, but there are important rules and regulations to govern the process for employers and applicants. Whether your firm hires one person or thousands, it’s important to know your responsibilities. The Federal Trade Commission and the Fair Credit Reporting Act provide the framework for fair background checks and responsible use of this important hiring tool. Keep in mind that your state might have stricter rules than what’s laid out by federal authorities.
Although a typical background check relies partly on information in the public domain, HR professionals often require private or confidential information to make good decisions. The process of collecting and analyzing this data demands a high level of respect and professionalism. Certain information is prohibited from inclusion, and other details must be presented properly. Fairness and respect for privacy are “must-have” features of your background check process. Proper employment screening procedures will protect candidates’ rights and mitigate legal problems down the line.
The FRCA and other relevant state regulations lay out transparency rules for employers to follow. Whether you hire a candidate or not, you owe them a chance to correct possible errors in background reports. People with common names and other administrative errors are not uncommon, and you face penalties and other legal action if you fail to follow a transparent process. Depending on the state and your specific industry, these rules are crucial to a successful and smooth background check process.
Before you use poor results from a candidate’s background check to make a hiring decision, it’s important to know your responsibilities under federal and state regulations. In most cases, employers must give applicants a “pre-adverse action disclosure” with copies of the reports and an explanation of their rights under the FRCA. If you decide to use the services of a background check firm or third party investigator, you owe your candidate a disclosure. Often the law requires this disclosure on a separate page not included in the standard employment application.
Many US states, counties, and cities have so-called “ban the box” legislation that may affect your employments application and hiring process. The box is a reference to the traditional criminal history question found on many job applications. A simple “yes-or-no answer “about a candidate’s personal criminal history with broad language can create problems for employers and harm your candidate's’ right to privacy. If you live in a “ban the box” jurisdiction, you need to follow local guidelines for your employment applications and background checks.
No matter how big or small your organization may be, you need to be aware of the rules and regulations that govern background checks for your industry. Each case is unique, and you must follow all applicable laws and guidelines to ensure a smooth process without legal trouble.
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