Rules When Running Criminal Background Checks

criminal background checks

The use of employee criminal background checks is becoming more common across many companies in the United States. These background checks can tell the employer tons of important information, some of which may be required in certain industries. For instance, employers hiring drivers may need to know about past driving convictions because hiring the wrong person could endanger the public.

Despite these benefits, employers conducting criminal background checks need to do them legally. And there is a myriad of federal, state, and local laws that have to be followed. Because state and local laws can vary greatly, it’s easy to become confused. The information below focuses on federal rules and laws. Still, employers will want to research applicable state and local laws for more information before conducting background checks on prospective or current employees.

From a federal perspective, there are a couple of laws that come into play with background checks, including:

  • The Fair Credit Reporting Act (FCRA): This law requires employers to notify employees or applicants of the specific type of information they are compiling and that it may be used in making an employment determination. The employer must gain written consent before getting a report. Suppose the employer takes an ‘adverse action’ (such as removing a contingent job offer). In that case, they must provide a copy of the report to the individual, a copy of the Summary of Your Rights Under the Fair Credit Reporting Act, and the opportunity for the individual to dispute the information. When discussing the FCRA, it’s also important to understand that there is no federal regulation that limits the time in which a criminal background check can extend. Despite the lack of federal guidance, many states have imposed a time restriction of seven years. Before conducting a criminal background check, employers should know whether they can look back only seven years or retrieve a complete criminal history.
  • Equal Employment Opportunity Laws: The Equal Employment Opportunity Commission (EEOC) regulates employers to prevent discrimination based on race, color, national origin, sex, religion, disability, genetic information (including family medical history), and age for those 40 and older. When conducting background checks, employers are legally required to apply the same standards to everyone without discrimination to any of the protected classes listed above. For example, employers cannot pull a criminal record for one ethnicity of applicants and not the other. Employers must also be cautious when they encounter information in a criminal background check.

The EEOC has published guidance that employers have to make individualized assessments of each job candidate rather than applying blanket rules, such as not hiring any felon for any position. Rather, the EEOC states that the employer should consider the nature and gravity of the offense, the time that has passed since the offense or completion of a sentence, and the nature of the job the candidate is seeking.

  • Fair and Accurate Credit Transaction Act: This federal law was created to enhance consumer protection and reduce identity theft risk. For employers conducting criminal background checks, this law regulates the way in which the information must be secured and disposed of after the employer has used it for their purposes. Individuals undergoing background checks still have the right to expect privacy and confidentiality related to the information found in their criminal background checks, and employers must follow the laws guiding how this information is handled and disposed of.

When conducting a criminal background check, employers may seek out many types of information. Some of this information is legal to pursue entirely (such as any information found on an online search). And some of it is not. An overview of legal concerns by type of information includes:

  • Credit Checks: These are legal provided that the individual has consented. Despite federal legality, some states have additional restrictions. Jobs in finance and banking also have additional restrictions.
  • Drug Use: Drug testing is legal in some states while not in others. There is no federal policy, so employers must understand state laws related to drug testing.
  • Medical Records: Medical history should not be a part of a criminal background check unless it may impact the candidate’s ability to complete job duties.

To say the laws governing criminal background checks are complex is an understatement. Unfortunately, if employers do not understand them fully and inadvertently break the law, they are still liable for any legal ramifications. For this reason, many employers turn to trusted experts in conducting background checks. USAFact is an industry leader in criminal background checks that can help employers in all industries understand the laws and ensure compliance when conducting background checks.