The Responsibilities and Regulations of Background Checks

Crafting a hiring policy today can be an intimidating task. Any policy that integrates background checks of any kind needs to be vigilant about compliance with any number of federal, state, and local regulations; these laws are constantly changing and being updated, and the nuances need to be thoroughly understood.

Many states are implementing “ban the box” laws which prohibit an employer from asking about an applicant’s criminal history on the application. Similarly, bright line rules or exclusionary offenses (“we never hire anyone with a drug conviction”) can be challenged. Earlier this year, the Hawaii State Supreme Court held that an employer that denied employment to an applicant based on his drug conviction had failed to establish a rational relationship between the demands of the position and the past drug offense. So what can you ask, and when?

First, define what you need to know for each position, as your focus might be different for each position. The American Staffing Association suggests establishing a hiring matrix: for each position you are filling, determine what it is you truly need to know about each candidate. For example, a driving history might be mandatory for a school bus driver, but not a machinist.

Once you have these defined, do them as late in the hiring process as possible, and make sure you know any state and local laws regulating when you’re able to do so, and what information you’re allowed to use once you’ve done them. It is advisable to work with a background screening company, which can help with these questions while taking care of the time-consuming task of putting together a comprehensive and accurate report. However, as a company, you are still responsible for knowing your legal responsibilities and obligations, which begin before the background check is initiated.

The Fair Credit Reporting Act (FCRA) helps protect candidates from being denied employment opportunities due to incorrect or incomplete information on consumer reports. Your hiring policy must ensure that an applicant knows and consents to a background check being consulted, with full knowledge that the information obtained could impact your hiring decision. If you do receive information back that adversely affects your hiring decision, some states require a waiting period of up to 10 days for the candidate to appeal the decision. It is a good idea to give the candidate time to speak their piece about the information you’ve received, because anything from identity theft to human error could account for adverse information.

If a criminal background check returns information, you will also want to consider the EEOC’s Enforcement Guidance of Arrest and Conviction Records in Employment Decisions. Take the time to consider the nature and gravity of the offense, the amount of time that has passed since conviction or completion of the sentence, as well as whether the offense is one that is relevant to the position you are filling.

It is recommended that you seek legal advice if you are in any doubt of your rights and responsibilities in hiring employees in your particular area.

Insight’s integrity tests, because they return information about an applicant’s current behavior, and are worded in such a way to elicit an applicant’s voluntary admission, can be critical to gaining insight into a candidate before they get to the background check stage where you are faced with so many legal landmines. They are psychologically designed and legally validated as pre-hire assessments, and therefore allow you to identify and screen candidates with ongoing issues that might not even show up on a criminal background check, all before they even enter your hiring process. For more information on how they work and can help you streamline your policy and avoid some of the more daunting aspects of recruitment, please contact us.

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