What to Do if a Candidate Disputes Their Background Check

Receiving notice that a failed background check cost a candidate a promising new job is tough to handle. Sometimes, candidates can see challenging information coming down the background check pipe, and sometimes, it comes as a complete surprise. 

In either case, it’s not uncommon for candidates to dispute the findings of a particular background check or the entire screening. Once a dispute is lodged, you must take appropriate action. 

Learn how to handle failed background check disputes swiftly, confidently, and with the utmost respect for the candidate’s integrity — all the while following company policy and federal law.

Why Would a Candidate Dispute Their Background Check?

Nobody wants a background check to turn up adverse or incriminating results. It’s devastating for candidates who had their hearts set on a job they were fully qualified for, and it sets hiring processes back on the company side by days, weeks, and even months. 

The process required to hire a new candidate can be very costly. For this reason, accurate and reliable background checks are vital. 

It’s essential for hiring teams to understand what a background check consists of, what to do if a candidate disputes a screening, and why an individual might take pains to lodge a dispute.

These are the main reasons why a job candidate may dispute the findings of a background check. 

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Incorrect Data From Screening Sources

The likelihood is low that records culled from an agency like the Department of Motor Vehicles or an organization like a university would be incorrect. However, errors can occur when requesting records from a previous employer, for example, or from any less highly regulated organization.

Human Error in the Background Screening Process

Just as rarely, background screening servicers commit errors when compiling reports. These are, more often than not, simple human errors. The wrong name was searched, the wrong individual’s records were pulled, data was input incorrectly, and so on. 

If such a mistake occurs, candidates may find these errors and understandably decide to dispute them.

Candidate Disputes Timeliness of Findings

Another common reason for dispute is the timeliness of results. Criminal charges that have been atoned for and even expunged can be retrieved by background checks. A candidate may dispute adverse action taken on account of outdated records as a means of requesting their side of the story be told in more than numbers and records.

Sealed Documents Were Retrieved in Error

The proceedings of confidential court sessions or disciplinary hearings should be subject to request. But sometimes seals are inadvertently broken, and employers aren’t any the wiser when they take action as a result. Candidates have the right to dispute the legality and ethics of such action.

It’s a Candidate’s Legal Right to Dispute

There are many reasons why a candidate may fail an employee background check. However, it’s important to remember that the Federal Trade Commission (FTC) and Fair Credit Reporting Act (FCRA) mandate the right of every job seeker to dispute information on a background screening report that’s deemed inaccurate or incomplete.

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How to Manage Disputed Background Check Results

If you issued an adverse action notice to a job candidate based on the findings of a background check and received in response a motion to dispute, follow this process to the letter:

1. Document Every Step of the Process

Documenting every action that’s taken when a candidate fails a background check is just as important as documenting every action taken should that candidate file a dispute. You should have a clear and organized record of the long, sometimes winding path of the dispute resolution process in case any company actions come under question.

2. Follow the Fair Credit Reporting Act Adverse Action Process

The FTC and FCRA require that specific steps be taken by employers before and after taking adverse action. Make sure to review their requirements carefully to be in compliance.

3. Keep the Position Open While You Allow the Candidate Time to Respond

Don’t take any action on the vacant role while you’re mediating the dispute. Give the candidate the time they need to review the background screening report and gather supporting information for their case. 

While the candidate formulates their response, it’s best that you leave the position open. Consult with company policy to determine an appropriate amount of time to wait so that it doesn’t create a financial strain on the part of the company or the candidate. 

4. Inform the Background Screening Provider

As you wait for the candidate to respond to the materials regarding the adverse action intended to be taken, inform the background screening provider you used. Like the candidate, they’ll be able to gather helpful information regarding the process used to obtain the information contained in the report, how the report was created, and any additional information not included in the report.

If you inform your background screening provider right away of the dispute, they may be able to provide you with updated information that resolves it in a more timely manner.

5. Carefully Consider All New Information

Once you’ve received the candidate’s response to the background check and notice of adverse action, as well as the follow-up report from your background screening provider, take your time assessing this new information. New revelations and clarification on information obtained earlier may lead to a swift resolution. 

As you prepare to take final action, your case should feel airtight and built upon a solid foundation of evidence-based fact.

6. Consult Legal Counsel, Then Take Final Action

Before you officially take action on the candidate’s dispute, consult in-house legal counsel. You need to stay compliant with both company policy and federal guidelines around background check disputes. Once you’re ready, it’s time to send your final adverse action notice.

Final Thoughts

There are several reasons why a job prospect may dispute adverse background check findings. These reasons range from inaccuracies in the background check results to sealed documents retrieved in error. 

For these reasons and even more, you might find yourself dealing with a disputed background check. Whatever the case, the candidate has a right to dispute information on a background screening that’s deemed incomplete or inaccurate. 

Once the dispute process kicks into action, certain steps must be taken. You must document everything, be in compliance with the FCRA, keep the position open, inform the background screening provider, and – once new information is obtained – consider the new information and consult legal counsel before taking final action. 

Above all else, incorrect and unreliable background check results should be avoided. This helps to prevent these disputes from happening in the first place, making things easier for everyone involved. 

Discover our background check services at ScoutLogic and learn how fair, honest, comprehensive, and expedient background screening services can be! 

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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.