Background checks are enormously important to today’s employers, playing a critical role in the interview and hiring process. Many employers are updating and refining their policies around background checks to better safeguard their businesses and maintain trust with clients, employees, business partners, and all company stakeholders.  

There’s a lot at stake today with so many new dynamics at play, from hybrid and remote workforces to increased automation and digital platforms. Electronic business interactions long ago surpassed critical mass.    

In this article, I’m sharing some best practices for background checks, how to conduct a background check – and why it’s so important in our current business environment. Companies are prioritizing background screening for these and other key reasons:  

1. Verifying credentials ensures that information provided by job candidates is accurate regarding education, work history, certifications, and other stated qualifications. 
2. It mitigates risk by reducing the possibility of hiring someone with a criminal history or stolen identity, especially for roles that involve sensitive information, roles in finance, and other positions that work with proprietary information. 
3. Workplace safety is a priority for employers to ensure a safe work environment by identifying any history of violent or dangerous behavior, drug or alcohol abuse, or other offensive behaviors. 
4. Compliance with regulations is mandatory in many industries, such as healthcare, finance, and education, where background checks are needed to comply with legal and regulatory requirements. 
5. Assessing trustworthiness is critical for employers needing to hire dependable candidates with a history of responsible behavior, especially for roles that handle money or sensitive data. 
6. Cultural fit for an organization can often be evaluated in background checks by revealing patterns that indicate whether a candidate aligns with an organization’s values and working culture.  

Types of background checks   

Employers conduct various types of background checks based on the responsibilities of a particular role, whether there are legal requirements that make background checks mandatory, and other types of checks at the discretion of the employer. These can include:  

• Eligibility to work in the United States: Candidate must provide proof of identity 

• Criminal record checks: Search of national, state, and county criminal databases  

• Employment history verification: Confirmation of past job titles, employment dates, and reasons for leaving  

• Education verification: Confirmation of educational institutions, degrees, diplomas, and attendance dates  

• Reference checks: Contacts provided to the employer by job candidates 

• Credit report checks: Review of credit history (mostly for financial and government positions)  

• Drug screening: Testing for use of illegal substances  

• Driving record: Normally used if a job involves driving and use of a company vehicle 

• Social media screening: Reviewing public social media profiles for red flags    

Best Practice: Know legal considerations and compliance laws  

Conducting background checks can be a complex undertaking unless an employer is knowledgeable about applicable laws and compliance regulations. These include the requirement to obtain written consent first, and just as important, what to do when adverse information surfaces in a background report on a candidate. The geographic location of an employer or where a candidate will be based are also relevant, and there are many other considerations.  

We highly recommend that employers periodically review current information about performing background checks from the Equal Employment Opportunity Commission (EEOC):  

Background Checks: What Employers Need to Know   

Here are several examples of what employers need to know:   

• Prior Written Consent: The Fair Credit Reporting Act (FCRA) requires employers to obtain written consent from a job applicant before conducting a background check and to follow specific procedures if considering adverse action based on the results.  

• Adverse Action: This term is mostly applied to the hiring process when an employer chooses not to hire someone due to negative findings discovered in an employment background check. In these instances, federal law requires that the employer send the applicant an adverse action notice or letter informing the applicant that they will not be hired. 

• Pre-Adverse Action Letter: If a candidate’s background check reveals information that may disqualify them for employment, the employer can provide the applicant with a pre-adverse action notice with a copy of the background check report and a summary of the applicant’s rights under the FCRA. This action allows a candidate the opportunity to dispute any errors before the employer makes a final hiring decision.  

• Ban the Box Laws: Many U.S. states and localities have Ban the Box laws prohibiting employers from asking job candidates about criminal history during the initial stages of the application process. The name of the law was derived from eliminating the ‘check box’ on employment applications that asks job seekers if they have ever been arrested or convicted of a crime. To date, 37 states and 100+ cities and counties have adopted official efforts to ban the box or eliminate questions regarding convictions and arrest records so that employers consider a job candidate’s qualifications first.   

Best Practice: Avoid these common mistakes     

• Conducting background checks too early in the interview process  

• Failing to get proper consent from job candidates 

• Improperly using social media information, such as making decisions based on a candidate’s protected characteristics  

• Inconsistently applying background check standards and procedures across candidates  

• Not providing adverse action notices when legally required  

Best Practice: Maintain a consistent policy for vetting all candidates   

For employers that conduct background checks, it’s important to use a consistent procedure for obtaining and evaluating results for all candidates. Here are associated considerations: 

• It’s best to conduct background checks at the end of the interview process and after performing reference checks. Background checks are a paid service and working in this order ensures this final step is reserved for candidates who meet all other criteria before receiving a job offer. 

• A company may decide to conduct background checks on all final candidates for full-time positions, but not for temporary or contract roles. Many, if not most, employers conduct background checks prior to extending job offers. Others extend job offers and even probationary work periods with official hiring being contingent on results of background checks. 

• Considerate employers let job seekers know up front how interviews for open positions are conducted, about how long the process takes (if possible), and at what point a background check will be conducted for the most qualified candidates. 

• An employer’s policy should outline which types of background checks are performed for which positions, and how results are evaluated and by whom. For example, instead of automatically disqualifying someone with a criminal record, consider the nature of the offense, how long ago it occurred, and its relevance to the job.

Best Practice: Consult with an expert talent acquisition firm  

There is so much to know about this step in the candidate interview and hiring process. Leading talent recruiting firms are a reliable source of current information surrounding background checks on prospective employees. Thoroughly vetting job candidates is a big part of what we do for clients, and we help remove the complexities.  

If you have questions or would like advice on this critical topic, please feel free to contact me for a complimentary consultation. I am a senior recruiting partner with Goodwin Recruiting and am happy to assist you. If you need to expand your access to exceptional candidates for key open roles, I can help you with that, too.