Although background screening is an indispensable part of the hiring process, employers must remain aware of the complex legal and ethical responsibilities that apply when conducting these checks and verifications. From federal laws like the Fair Credit Reporting Act (FCRA) to state-level “ban the box” legislation and guidelines regarding non-discriminatory hiring, organizations across industries must ensure legal compliance and fairness to avoid penalties, reputational damage, and practice fairness when evaluating applicants, new hires, and existing employees.
Here we’ll explore the full range of legal responsibilities and ethical considerations employers should keep in mind when implementing background check best practices, and how The Orsus Group can support thorough, expedient, and legally compliant screening.
Legal Considerations When Conducting Background Screening
To fulfill background check responsibilities and guarantee legal compliance in hiring, employers must be aware of all of the laws and guidelines that apply to their organization based on its size, operational jurisdiction(s), industry, workforce configuration, and more. Laws that regulate employee background screening vary significantly by state and municipality, which is why it’s essential to work with a background screening provider like The Orsus Group, which leverages real-time compliance monitoring adapted to meet the needs of your organization’s hiring process.
Here are some of the federal regulations that employers must abide by when implementing background screening for their organization:
Fair Credit Reporting Act (FCRA)
FCRA regulations require that employers notify and acquire written consent from any applicant or employee before initiating a background screening. Candidates or employees are entitled to review these results and contest/correct any report inaccuracies if any of the gathered information could lead to an adverse action, including denial of employment.
Although the FCRA permits credit report searches, employers should be aware that some municipalities and states prevent an employer’s ability to gather or use credit report information (regarding bankruptcy, accounts in collection, and other scenarios). California, as just one example, has passed two credit report-related acts that place more stringent limitations on employer access to applicant credit information, legal methods for acquiring consent, and other steps in the screening process.
Ban the Box Legislation
State and local “ban the box” laws limit employers’ ability to inquire about or consider an applicant’s criminal history, especially in the pre-employment stage. These laws vary greatly and affect when (if at all) an employer can ask about criminal history, which information can be legally gathered, and how criminal history information may be used. In most cases, states and municipalities have implemented ban the box legislation to eliminate the practice of automatically disqualifying any candidate with a criminal record. Some major companies operating outside of jurisdictions where ban the box laws are in place have implemented a ban the box policy as part of their own company policy, favoring more individualized assessments of criminal history that limit the prospect of discrimination or unfair adverse action, considering the recency of any offense, efforts towards rehabilitation, etc.
Explore where ban the box laws are currently in place and how regulations differ based on company size, private vs. public employment, and other factors.
EEOC, ADA, and Title VII of the Civil Rights Act
Whether it’s guidelines from the Equal Employment Opportunity Commission (EEOC), or other protections against discrimination from the American with Disabilities Act (ADA) and Title VII of the Civil Rights Act, employers must implement fair and compliant hiring practices that align with the stated requirements of each act or governing body while prioritizing the public safety of existing employees and work sites.
As just one example, the ADA bars employers with 15 or more employees from considering medical information or past worker’s compensation claim(s) as the basis for a hiring decision. However, employers may ask an employee about their ability to perform a crucial and specific job task or request a post-employment physical if a job offer has already been made. Similarly, employers that operate within (or outside of) a jurisdiction with ban the box laws may still inadvertently violate Title VII of the Civil Rights Act if they implement a uniform ban on hiring employees with criminal history rather than adopting a policy of personalized assessment that examines evidence of criminal history on a case-by-case basis, limiting the likelihood of discrimination.
Addressing Ethical Concerns and Implementing Best Practices in Background Screening
The federal, state, and municipal legislation we’ve explored accounts for just a portion of the laws that could apply to your business as it implements fair and responsible background screening protocols. Of course, employers should be aware of further ethical considerations that impact company reputation, employee experience, and the potential for lawsuits resulting from claims of discrimination, privacy violation, or bias during the hiring phase or beyond.
Below, we’ll outline best practices for implementing a background screening process that is fair, accurate, legally compliant, and designed to ensure public safety.
* Formulate an Organizational Policy on Background Screening – Although employers should be compliant with any strictly mandated hiring protocols in their jurisdiction(s), it’s also essential to develop a background screening policy that aligns with the values of the organization itself. This could mean implementing protocols that extend beyond baseline legal requirements, banning salary inquiries, or emphasizing more individualized assessments in the applicant review process.
* Rely on Case-by-Case Assessments of Candidates & Consider Job Key Responsibilities – A number of factors impact a hiring decision, but when a background screening reveals a candidate’s criminal history, it’s critical to take steps to avoid bias, consider the relevance/recency of any offenses, review efforts towards rehabilitation, and determine how key job responsibilities relate do or do not relate to any past criminal history.
* Strike a Balance Between Public Safety and Rights of Applicants/Employees – Employers should strive to sustain the health and safety of their workforce while ensuring that the individual rights of candidates are honored in the background screening process. This further highlights the need for making distinct assessments of individual candidates based on the job responsibilities of the position they seek, including when technology like applicant tracking systems (ATS) is used to expedite the hiring process.
* Emphasize Diligent Recordkeeping – Certain pieces of local, state, and federal legislation require long-term recordkeeping regarding hiring decisions, written consent, adverse actions, and more. This information should be retained in the event of a legal dispute so any hiring decision can be fully accounted for, increasing the likelihood that it is regarded as a justifiable action and can serve as proof that a candidate’s rights have been maintained in the process.
* Provide Training on Fair & Ethical Hiring – All of your employees, including those only nominally involved in the hiring process, should have a clear understanding of company policy and compliance considerations that affect the organization. Training is also an opportunity to clearly articulate and encourage adoption of the principles and values of the organization.
Responsible and Compliant Background Screening with The Orsus Group
Staying up to date with the latest regulatory changes that impact hiring and background screening is challenging enough. Designing and concretely implementing background screening practices that are streamlined, accurate, ethical, and legally compliant can be even more daunting.
The Orsus Group adapts to the specific needs of your organization to support fair hiring, workplace safety, and thorough screening & verification services to help you make timely and informed hiring decisions. Ready to enjoy lasting peace of mind about compliance and responsible hiring? Start the process today.