10 Background Check Best Practices

From work history to skill assessment, there are a lot of boxes to be checked in the hiring process to feel confident that you’ve found the right person to fill a vacant job position. 

One of the final steps of the screening process is perhaps the most important – the background check. 

A bad hire could be a costly mistake in terms of money and time.

In this post, you’ll learn 10 background check best practices to help ensure your chosen candidate is a good fit for your organization and is qualified for the job. 

1. Run a Wide Variety of Background Checks 

As an employer, you want to gather as much information as possible on your candidate. Doing so ensures you can make informed decisions and help choose the right person for the job. 

Depending on the role, there may be certain background checks that are more important than others. For example, a job in the financial industry may prioritize criminal checks and credit report searches. On the other hand, in the medical field, they may verify professional licenses and job history.

Depending on the duties and nature you’re recruiting for, consider running the following checks: 

• Employment history
• Criminal searches
• Drug test results
• Education verification
• Social media
• Occupational health
• Civil records
• Driving records
• Employment eligibility verification

It helps to have a complete picture of a candidate to determine their suitability for a role. It can help you confirm their reported information or find discrepancies against the applicant. 

2. Have a Written Policy

Every company should have a written policy that explains its screening process. Doing so prevents legal problems and helps candidates understand what to expect in the hiring process. 

The document should explain how the background checks are performed, what information is looked at, and what candidates need to do. If a company uses social media to screen candidates, they should also have a separate written policy for that.

3. Comply With Applicable Laws 

The Federal Trade Commission states that employers must notify candidates and receive their written permission before performing background checks. This notification must be in writing and separate from the job application. Employers are also required to inform applicants that information obtained through the search could be used in making hiring decisions.

Also, the employer must provide the applicant with a copy of the background check report and a summary of their rights under the Fair Credit Reporting Act (FCRA) if they decide not to hire the applicant based on the background check. 

Make sure to familiarize yourself with these and other applicable laws to ensure you’re in compliance when performing a background check.

4. Use a Reputable Background Check Service Provider 

One of the most common mistakes is running background checks in-house rather than hiring a reputable third-party service provider. Often, they believe it’ll save them money and give them more control over the process. 

Unfortunately, this is a bad idea. Great background service providers ensure each report contains verified, accurate, and relevant information. 

They also always comply with the applicable regulations and laws, helping you avoid potential legal trouble. The best companies have certifications to prove they follow the best practices. 

For example, ScoutLogic is a member of the Professional Background Screening Association, a widely respected symbol of approval, indicating that we’re committed to maintaining professional standards and accountability in our background screening. 

5. Allow Applicants the Opportunity to Clarify and Explain Negative Information 

If the search comes back with negative results, you may reject the applicant. Before you do so, give them a fair chance and let them clarify or explain themselves. Doing so helps protect your company from potential liability since making adverse hiring decisions based on the information from background checks without discussing it with the candidate can lead to lawsuits down the line. 

Also, the negative information may not always tell the whole story. For example, if the search reveals a criminal record, the candidate can explain the circumstances surrounding the offense. Perhaps they took steps to try to avoid the situation, or they’ve taken actions to rehabilitate from their offense. 

The additional context gives a complete understanding of the situation and lets the employer decide whether they’ve shown enough personal growth to be awarded the position. 

6. Evaluate Criminal History on a Case-By-Case Basis

You never want to automatically dismiss all employees with criminal records since it can lead to unlawful discrimination. 

The US Equal Employment Opportunity Commission (EEOC) states that the employer must show that the decision to deny the candidate based on their criminal past relates to the job. For example, it must link their specific criminal offense and how it can pose a risk to the company or the duties of the specific role. Therefore, you want to treat each criminal record you find on a case-by-case basis. 

In some states, various restrictions may limit how you can use criminal searches during the hiring process. While you can still conduct background checks in places where the Ban the Box laws exist, you may need to wait until further in the hiring process. 

Typically, employers must wait until after an initial interview or a conditional job offer prior to asking about a candidate’s criminal history. This delay allows them to showcase their abilities before their criminal record is discussed. 

7. Understand the Limits on Credit Inquiries 

Employers might run a credit check to verify a candidate’s identity, find out how responsible they are, and look for any red flags. For example, if an employer is looking to fill a financial position in their company, some potential red flags are significant debt, bankruptcies, and a history of missed payments. 

It’s important to understand and comply with all applicable laws. For example, the Fair Credit Reporting Act has certain restrictions regarding credit checks that employers must follow. 

Additional laws and restrictions may also be in place. In fact, some states have strict rules about how credit reports can be obtained and used. 

As a result, you can’t just use credit reports for every applicant across the board. Before using credit reports, make sure you’re aware of the rules in your state and that you’re following them.

States like California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maryland, Nevada, Oregon, Vermont, and Washington have restrictions for employers using credit information in employment. 

8. Keep Your Screening Process Consistent 

Make sure to apply the screening process consistently to all candidates. If you require background checks for certain individuals while exempting others, you’re setting your company up for potential discrimination-related legal issues, especially if your reasoning for singling out specific applicants is related to factors like gender, age, race, disability, or religion. 

It’s essential to treat all job applicants fairly and equally by keeping the screening process consistent. Doing so helps you steer clear of violating federal non-discrimination regulations. 

However, you can adjust the scope of background searches based on the job position. For roles that might pose a greater risk to the company, it’s reasonable to conduct a more comprehensive background check.

9. Avoid Using National Databases

National checks aren’t always the most accurate. While you may think checking a national database is the best way to discover a person’s criminal history, this may not be the case.

Often, criminal records can be found in specific counties or state records. Their region-specific records may show different information than the national databases. Sometimes, the national database may miss important details.

10. Avoid Asking For Candidate’s Medical Records

Under federal law, employers can’t inquire about medical, disability-rated, or genetic questions when considering hiring someone. You can only ask about their experience, skills, and qualifications to do the job due to the Americans with Disabilities Act (ADA), which prohibits employers from discriminating against people with disabilities and places restrictions on when and how to ask about an applicant’s medical history. 

Make sure you familiarize yourself with the laws regarding what you can and can’t ask to stay on the right side of the law.

Final Thoughts

You can no longer hire based on trust. Unfortunately, anyone can embellish work history or lie about qualifications. Some may even try to sweep important red flags under the rug, such as any alarming criminal history. 

That said, you need to conduct background checks the right way. Otherwise, your company could be in some serious legal trouble. If caught violating fairness and equal opportunity employment laws, employers can face fines and legal penalties. 

Now, all that’s left is to find the right background check provider. ScoutLogic can offer you a free, no-commitment, assessment of your current process to check for compliance, cost savings, and more. Get a free assessment today.

At ScoutLogic, we help you improve compliance, provide a range of search types, and return checks faster. Join the thousands of recruiters who rely on us to make background checks easier so you can focus on bringing in great talent!

David Garcia

David Garcia, co-founder and CEO of Scout Logic, is an industry leader in the bulk background check world. With his strategic acumen and expertise in the HR sphere, specifically in hiring, recruiting, legal compliance, background checks, and resume screening, he’s an invaluable asset and consultant.

David's counsel extends across the boards of ScoutLogic, YipitData, and Supplier.io, drawing from his impactful stints on the boards of Infutor and Avetta. With an extensive 25-year journey, he champions unparalleled B2B commercial leadership within data & analytics, significantly shaping the HR landscape.