In an ideal world, everyone would be truthful on a job application, but sadly, that’s not always the case. It’s not uncommon for applicants to misrepresent themselves in an interview or falsify a resume. To avoid hiring someone who isn’t qualified or poses a risk to their organization, employers regularly perform background screenings.

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What is background screening?

A background screening is the process of using third-parties (usually professional background screening providers) to properly vet candidates for career opportunities. Sources may include public records, law enforcement, credit bureaus and previous employers.

Why are pre-employment background checks important?

Without background checks, employers have only the information supplied by the applicant to form the basis of their hiring decision. Such details may not be accurate or complete. Background screenings allow employers to get a more complete picture of a candidate, which may help them:

  • Hire the most qualified people and improve productivity
  • Prevent instances of theft and other criminal behavior
  • Avoid workplace harassment and safety issues
  • Preserve company reputation and brand image

What information can background screening provide for the employer?

With some notable exceptions, a background check might reveal the following details:

  • Employment history
  • Education history
  • Criminal history
  • Credit reports
  • Driving records

Not all of this information may be permissible or even necessary for every role. For instance, driving records are typically not requested unless the employee will be operating a vehicle as part of their job. There are also various federal and state regulations that govern when an individual’s criminal history and credit report may be accessed.

How does a background check work?

Background screenings pose compliance risks if not done correctly. Here’s how smart employers typically vet potential new hires:

  1. Make an offer
    It’s generally best practice to not run a background check until after a candidate is offered conditional employment.
  2. Obtain consent
    The federal Fair Credit Reporting Act (FCRA) and similar state laws require employers to provide written notification to and obtain authorization from any individual subject to background checks performed by third parties, e.g., professional background screening providers.
  3. Explain the screening process
    Employers must notify the applicant or employee that they might use information from a background check to make employment-related decisions. This notice has to be in writing and in a stand-alone format. It cannot be part of an employment application. Some minor additional information can be included, such as a brief description of the nature of the background report, but only if it doesn’t confuse or detract from the notice itself.
  4. Apply screening policies consistently
    Running background checks on certain groups of people and not others may be considered discriminatory and illegal. The Equal Employment Opportunity Commission (EEOC) provides guidance on considering an individual’s criminal history when making employment decisions and, among other things, states that such decisions must be job-related and consistent with business necessity.
  5. Consult legal counsel if adverse action is warranted
    The FCRA requires employers to follow certain steps when taking adverse action against an individual (e.g., failing to hire) based on the results of a background check. Employers should consider consulting with counsel before proceeding further.

What to look for when choosing a background screening service

Reputable third-party providers that specialize in background screening services can help businesses save time and money and reduce the chance of error. When evaluating potential partners, employers tend to look for:

  • Support with federal, state and local regulatory compliance, including FCRA and EEOC guidelines
  • Integrations with top applicant tracking and recruitment management systems
  • Strict data privacy and security procedures
  • Customizations that help companies meet unique industry requirements or organizational hiring policies
  • All-inclusive pricing with no hidden fees

Frequently asked questions about background screenings

What causes a red flag on a background check?

Employers determine their own policies for whether or not an applicant meets their hiring standards. Typical items of concern that may return on a background check include, but are not limited to criminal convictions, failed drug tests, traffic violations, poor credit scores and inconsistencies in employment history. Any employment decision taken as a result of these concerns must be job-related and based on business necessity. Employers should consult with EEOC guidance on using criminal history information in making hiring decisions to help ensure they do not disproportionately screen out protected individuals.

How far back do background screenings look?

Pre-employment screenings generally cover seven years, though this can vary. Some states may permit longer lookback periods for certain types of records.

How long does a background check take?

The length of time for a background check typically ranges from as little as two days to as much as a week or longer. Court and agency backlogs, holidays and information requested from outside the United States may extend this timeline.

This article is intended to be used as a starting point in analyzing background screenings and is not a comprehensive resource of requirements. It offers practical information concerning the subject matter and is provided with the understanding that ADP is not rendering legal or tax advice or other professional services.