How an employee background check works
Below is a MRR and PLR article in category Reference Education -> subcategory Legal.
How Employee Background Checks Work
Introduction
In recent years, pre-employment background checks have become increasingly important for businesses of all sizes. These checks can be conducted internally or outsourced to specialized human resources firms.
Why Outsource Background Checks?
Conducting background checks involves a significant amount of paperwork, coordination, and follow-up. Many companies prefer outsourcing this task to agencies to ensure thorough and compliant execution. Background checks must comply with the Fair Credit Reporting Act (FCRA), which mandates that individuals earning less than $75,000 annually cannot have criminal acts older than seven years reported. Additionally, checks require the candidate's signed consent.
Importance of Transparency
Employers should make their background check policies clear to candidates. This transparency deters applicants with potentially undisclosed issues. If using an external agency, it's crucial to verify their familiarity with FCRA guidelines, relevant state and federal laws, and equal employment opportunity regulations. The sources of information must be reliable, usually coming from consumer reporting agencies that provide education, credit, and criminal records data.
Standard Components of a Background Check
A typical background check includes verification of:
- Driving and credit records
- Employment history
- Social Security Number
- Education
- Military background
Additional checks such as drug testing and reference verification may also be conducted, tailored to the job’s requirements. For instance, drivers often undergo stricter checks on their driving records, while accountants' credit histories are scrutinized more closely.
Engaging an External Agency
Before hiring an outside agency, determine the scope of the check, desired information, contact points, and who will assure information accuracy. Contracts should address privacy and discrimination laws, timeframes, indemnities, insurance against errors, and evidence of professional liability.
Cross-Verification Is Key
Employers should cross-verify data from various sources, ensuring consistency between an applicant's resume, job application, and interview responses. Commonly checked details include Social Security numbers, education credentials, and birth dates.
By conducting thorough and compliant background checks, employers can make informed hiring decisions, maintaining both legal compliance and workplace integrity.
You can find the original non-AI version of this article here: How an employee background check works.
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