Eddy’s HR Mavericks Encyclopedia
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Employee Background Check
We've all heard horror stories of extreme employee misbehavior. When hiring to fill an open position, you actively recruit the best possible talent. Once a potential hire is lined up, background checks help mitigate risks to your workforce, customers and business model.
What Is an Employee Background Check?
An employee background check confirms information in their application and/or is a record of an individual's criminal record on the county, state, and federal levels. Other options include professional background checks like confirming educational degrees or licenses. Background checks may be accomplished in-house or through third-party providers. Some types of background checks are regulated, so it is important to understand all state and federal protections for job candidates.
Why Are Employee Background Checks Important for Employers?
It is difficult for employers to get a complete understanding of job candidates solely from resumes, interviews, and reference checks. Employers performing background checks make more informed hiring decisions. Here are a few examples of how background checks can mitigate business risk.
- Protecting customers and coworkers. Serious criminal convictions can create hostile or dangerous workplaces. Not having properly educated, trained or certified employees may significantly damage the reputation of a company when customers post public reviews about their experience.
- Mitigating business risks. One of the functions of HR is to protect the business from internal and external risk, and background checks are part of that function. For example, employers would not want to provide unrestricted access to their bank accounts to an accountant with a proven history of corporate embezzlement. In a less obvious example, a college may avoid hiring someone with a history of inappropriate professional relationships to a position requiring frequent exposure to investing alumni.
- Hedge against legal risks. Special attention should be given to employees who work in positions with access to sensitive information or scenarios. A simple example is making sure that school teachers have no history of crimes against adolescents. If a teacher were to act in a way that caused legal actions to be taken by a student’s family, the school could be held liable, since they either did not know or willingly created a scenario of harm.
What’s Required to Run an Employee Background Check?
Employers cannot run background checks without some essential elements to their process.
Avoid Adverse Action as Defined by the EEOC
The U.S. Equal Employment Opportunity Commission regulates how an employer conducts and determines candidate eligibility. If an employer screens candidates based on protected demographics such as age, race, gender, or national origin, they are in violation of Title VII, which can result in lawsuits based on discriminatory hiring practices. Employers should have a consistent process that applies to all candidates, including the denial of an offered position due to background check results.
Software System or Provider
Employers often use third-party specific software or websites such as SterlingONE or Checkr to complete background checks. Additionally, some employers are required to use state or federal programs depending on legal requirements. These employers include those under government contracts or private companies that are heavily regulated, such as residential treatment centers. The system must be able to intake essential demographic information to accurately search records such as criminal background and education transcripts.
Employee Consent
An employer cannot run a criminal background check without the recorded consent of the individual. It is now common for consent to be provided via email or similar electronic delivery. When checking employer and education backgrounds, employees do not have to consent to an employer’s verification attempt, but it is a good practice to inform the employee that you will be communicating with former employers and schools.
Proper Timing and Method
State and federal requirements vary depending on employers, so you need to be aware of laws that apply to them. Reliable resources include websites ending in .gov, such as Utah Background Checks, which uses the Direct Access Clearance System (DACS). Some states do not allow employers to run background checks on potential employees until after a job offer has been extended. Other states limit how far into the past background checks are allowed to search.
How to Conduct an Employee Background Check
Several steps are needed to properly conduct an employee background check.
Step 1: Choose Your Method
The first step is to decide whether to run the checks yourself, which involves learning how to do so, or find a provider that can complete requests within your timeframe and budget. Consider your budget to run checks, estimated completion time, and federal/state requirements.
Step 2: Submit Request and Obtain Consent
It is best practice to make job offers contingent on passing a background check rather than allowing the employee to start work before running the checks. If you are using a provider, you will enter the contact information of the employee. The employee receives an electronic request to complete additional identifying information that allows the request to be completed. Once they return the request providing their consent, the background check is run. If you are running the checks, you will need to acquire signed consent directly.
Step 3: Create a Matrix for Results
Depending on the nature of the work, results can affect the candidacy in different ways. For example, a truck driver position may not allow an employee to have five or more moving violations within the last year. That same individual may qualify for an accounting position that does not require them to drive company vehicles. Work together with legal counsel to decide risk mitigation strategies for each position in the company.
Step 4: Communicate to the Individual
If a job offer is contingent on passing a background check, the check should be completed before the employee’s first day. If the results allow the employee to start work without delay, communicate that as soon as possible. If the results do not allow the employee to start work, communicate the specific reasons why and whether there is a time frame that allows them to start on a later date. For example, if a job requirement indicates a certain level of education is required and the candidate does not have the needed degree, an employer can invite the candidate to apply again once the degree is earned.
Employee Background Check Red Flags
Red flags on background checks vary from employer to employer. The following are general issues that may or may not prompt you to reconsider your candidate.
Incarceration History
An individual’s history does not always dictate their future, but repeated offenses may indicate a pattern that exposes the employer to brand and operational risks. This idea is highlighted by 37 states and over 150 cities and counties implementing Ban-the-Box laws. This encourages companies to consider a candidates’ qualifications before weighing their background check results. While incarceration is not an automatic disqualifier, employers should consider the type of offense and timing of the crimes on record.
Recent Offenses
Recent offenses are more indicative of how the employee will perform on the job. For example, federal law prohibits anyone convicted of certain serious crimes in the last 10 years from working as a security screener or having unescorted access to secure areas of an airport. If there are significant recent offenses, an employer should consider how they may affect the success of the employee in that role. If the risk is too high, the offer of employment should be withdrawn. If the risk is within company guidelines, employment should be carefully managed to ensure there are no signs of similar behavior. If behavior arises, management should clearly explain the results of continued behavior up to and including termination.
Major Offenses
Major offenses may be indicated by sexual offender and national watchlist searches. Sexual offender searches can “quickly identify if someone is a risk to a vulnerable population and the general public, including employees and customers. The national watchlist searches include “several international, government and regulatory databases that identify individuals who are either prohibited from certain industries, such as healthcare and finance, or are on criminal lists.” When major offenses show up on background checks, employers should withdraw conditional offers of employment.
Odd Conversations or Inaccurate Data
Employees are not always honest regarding the references they provide for background checks. For example, when verifying a former employer, be sure you are talking to the person that was given for reference. The same goes for education or certification/licensing verifications; if schools or issuing bodies do not have a record of the information on the employee’s resume, this is a major red flag for continued employment.
Topics
Austin Morgan
Austin became the HR Manager at Nursa in 2022 where he is building a HR department in the company's second year of operation. Before that he worked as an HR Director at Discovery Connections and an Account Manager for a Section 125 benefits and COBRA administrator. He graduated from Brigham Young University with a Bachelor of Science (BS) in Exercise Science in 2019 and from Southern Utah University with a Masters of Business Administration (MBA) with an emphasis in Organizational Leadership in 2021. At the end of 2021, he became certified with SHRM-CP. Originally from Oklahoma, Austin enjoys trying new foods in new places he travels to, watching college football, and snowboarding at the local resorts in Utah. He has been married to his wife since 2019 and owns a cockapoo named Hershey.
Frequently asked questions
Other Related Terms
Eddy’s HR Mavericks Encyclopedia
Employee Background Check
We've all heard horror stories of extreme employee misbehavior. When hiring to fill an open position, you actively recruit the best possible talent. Once a potential hire is lined up, background checks help mitigate risks to your workforce, customers and business model.
What Is an Employee Background Check?
An employee background check confirms information in their application and/or is a record of an individual's criminal record on the county, state, and federal levels. Other options include professional background checks like confirming educational degrees or licenses. Background checks may be accomplished in-house or through third-party providers. Some types of background checks are regulated, so it is important to understand all state and federal protections for job candidates.
Why Are Employee Background Checks Important for Employers?
It is difficult for employers to get a complete understanding of job candidates solely from resumes, interviews, and reference checks. Employers performing background checks make more informed hiring decisions. Here are a few examples of how background checks can mitigate business risk.
- Protecting customers and coworkers. Serious criminal convictions can create hostile or dangerous workplaces. Not having properly educated, trained or certified employees may significantly damage the reputation of a company when customers post public reviews about their experience.
- Mitigating business risks. One of the functions of HR is to protect the business from internal and external risk, and background checks are part of that function. For example, employers would not want to provide unrestricted access to their bank accounts to an accountant with a proven history of corporate embezzlement. In a less obvious example, a college may avoid hiring someone with a history of inappropriate professional relationships to a position requiring frequent exposure to investing alumni.
- Hedge against legal risks. Special attention should be given to employees who work in positions with access to sensitive information or scenarios. A simple example is making sure that school teachers have no history of crimes against adolescents. If a teacher were to act in a way that caused legal actions to be taken by a student’s family, the school could be held liable, since they either did not know or willingly created a scenario of harm.
What’s Required to Run an Employee Background Check?
Employers cannot run background checks without some essential elements to their process.
Avoid Adverse Action as Defined by the EEOC
The U.S. Equal Employment Opportunity Commission regulates how an employer conducts and determines candidate eligibility. If an employer screens candidates based on protected demographics such as age, race, gender, or national origin, they are in violation of Title VII, which can result in lawsuits based on discriminatory hiring practices. Employers should have a consistent process that applies to all candidates, including the denial of an offered position due to background check results.
Software System or Provider
Employers often use third-party specific software or websites such as SterlingONE or Checkr to complete background checks. Additionally, some employers are required to use state or federal programs depending on legal requirements. These employers include those under government contracts or private companies that are heavily regulated, such as residential treatment centers. The system must be able to intake essential demographic information to accurately search records such as criminal background and education transcripts.
Employee Consent
An employer cannot run a criminal background check without the recorded consent of the individual. It is now common for consent to be provided via email or similar electronic delivery. When checking employer and education backgrounds, employees do not have to consent to an employer’s verification attempt, but it is a good practice to inform the employee that you will be communicating with former employers and schools.
Proper Timing and Method
State and federal requirements vary depending on employers, so you need to be aware of laws that apply to them. Reliable resources include websites ending in .gov, such as Utah Background Checks, which uses the Direct Access Clearance System (DACS). Some states do not allow employers to run background checks on potential employees until after a job offer has been extended. Other states limit how far into the past background checks are allowed to search.
How to Conduct an Employee Background Check
Several steps are needed to properly conduct an employee background check.
Step 1: Choose Your Method
The first step is to decide whether to run the checks yourself, which involves learning how to do so, or find a provider that can complete requests within your timeframe and budget. Consider your budget to run checks, estimated completion time, and federal/state requirements.
Step 2: Submit Request and Obtain Consent
It is best practice to make job offers contingent on passing a background check rather than allowing the employee to start work before running the checks. If you are using a provider, you will enter the contact information of the employee. The employee receives an electronic request to complete additional identifying information that allows the request to be completed. Once they return the request providing their consent, the background check is run. If you are running the checks, you will need to acquire signed consent directly.
Step 3: Create a Matrix for Results
Depending on the nature of the work, results can affect the candidacy in different ways. For example, a truck driver position may not allow an employee to have five or more moving violations within the last year. That same individual may qualify for an accounting position that does not require them to drive company vehicles. Work together with legal counsel to decide risk mitigation strategies for each position in the company.
Step 4: Communicate to the Individual
If a job offer is contingent on passing a background check, the check should be completed before the employee’s first day. If the results allow the employee to start work without delay, communicate that as soon as possible. If the results do not allow the employee to start work, communicate the specific reasons why and whether there is a time frame that allows them to start on a later date. For example, if a job requirement indicates a certain level of education is required and the candidate does not have the needed degree, an employer can invite the candidate to apply again once the degree is earned.
Employee Background Check Red Flags
Red flags on background checks vary from employer to employer. The following are general issues that may or may not prompt you to reconsider your candidate.
Incarceration History
An individual’s history does not always dictate their future, but repeated offenses may indicate a pattern that exposes the employer to brand and operational risks. This idea is highlighted by 37 states and over 150 cities and counties implementing Ban-the-Box laws. This encourages companies to consider a candidates’ qualifications before weighing their background check results. While incarceration is not an automatic disqualifier, employers should consider the type of offense and timing of the crimes on record.
Recent Offenses
Recent offenses are more indicative of how the employee will perform on the job. For example, federal law prohibits anyone convicted of certain serious crimes in the last 10 years from working as a security screener or having unescorted access to secure areas of an airport. If there are significant recent offenses, an employer should consider how they may affect the success of the employee in that role. If the risk is too high, the offer of employment should be withdrawn. If the risk is within company guidelines, employment should be carefully managed to ensure there are no signs of similar behavior. If behavior arises, management should clearly explain the results of continued behavior up to and including termination.
Major Offenses
Major offenses may be indicated by sexual offender and national watchlist searches. Sexual offender searches can “quickly identify if someone is a risk to a vulnerable population and the general public, including employees and customers. The national watchlist searches include “several international, government and regulatory databases that identify individuals who are either prohibited from certain industries, such as healthcare and finance, or are on criminal lists.” When major offenses show up on background checks, employers should withdraw conditional offers of employment.
Odd Conversations or Inaccurate Data
Employees are not always honest regarding the references they provide for background checks. For example, when verifying a former employer, be sure you are talking to the person that was given for reference. The same goes for education or certification/licensing verifications; if schools or issuing bodies do not have a record of the information on the employee’s resume, this is a major red flag for continued employment.
Topics
Austin Morgan
Austin became the HR Manager at Nursa in 2022 where he is building a HR department in the company's second year of operation. Before that he worked as an HR Director at Discovery Connections and an Account Manager for a Section 125 benefits and COBRA administrator. He graduated from Brigham Young University with a Bachelor of Science (BS) in Exercise Science in 2019 and from Southern Utah University with a Masters of Business Administration (MBA) with an emphasis in Organizational Leadership in 2021. At the end of 2021, he became certified with SHRM-CP. Originally from Oklahoma, Austin enjoys trying new foods in new places he travels to, watching college football, and snowboarding at the local resorts in Utah. He has been married to his wife since 2019 and owns a cockapoo named Hershey.
Frequently asked questions
Other Related Terms
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