Recently, the Equal Employment Opportunity Commission (EEOC) and the U.S. Federal Trade Commission (FTC) joined forces to publish guideline documents to continue to educate employers regarding background checks and the applicable laws and regulations surrounding them. The information provided isn’t anything new but it serves as a good reminder for employers that currently are conducting background checks for employment purposes or those employers that may be planning on starting. Here are some of the highlights:
- Treat everyone equally – Do not check an applicant or employees’ background based on their race, national origin, color, sex, religion, disability, genetic information or age. It is an illegal practice.
- Follow the required procedures of the Fair Credit Reporting Act (FCRA) – The FCRA doesn’t apply to just credit/financial checks as indicated in the name. It applies to criminal history, character, general reputation, etc. Therefore, the procedures of the FCRA must be followed when conducting employment background checks. These include notifying the candidate/employee in a stand-alone document that the information from the background check may be used in the employment decision, notifying the candidate/employee of their rights under the FCRA as well as getting signed authorization from the applicant/candidate to conduct the background check. It’s important to note that the notice(s) must be separate from the application and cannot be in the application itself.
- Do not discriminate – When the background check results are available, use the same standards for everyone regardless of any of the factors noted above and be careful to not base employment decisions on issues within the background results that may be more common among people of a certain class (race, sex, age, etc. as noted above).
- Follow the FCRA requirements when taking an adverse action – When employers take adverse action (decide to not hire an applicant based on the results of the background check), they must complete a pre-adverse action notice and notify the person in advance with the required documents to allow them the opportunity to review the report and provide any explanation. After that process is completed, the adverse action notice must be processed in accordance with the requirements of the FCRA.
- Retain the information for a 1 year period – Whether the applicant was hired or not, the records associated with the applicant must be retained for a minimum of 1 year (2 years for certain employers). After the record retention requirement has been met, the documents can be disposed of but must be done so securely.
Running background checks on employees isn’t something companies should take lightly as there are a lot of regulations around it that employers must be aware of beyond the guidelines noted here. Although the document published by these two federal agencies provide a wealth of information about nondiscrimination laws and compliance with the Fair Credit Reporting Act (FCRA), there are also many state and municipality laws that employers must also consider when conducting employment background checks that fall along the lines of what employers can and cannot ask for as well as the use of the information received.
It is important for companies to have a solid written policy regarding background checks and that policy is followed consistently within the guidelines and regulations of federal and state law.
For more specific information about what is applicable to your company, please call me with any questions or follow this link directly to the EEOC website to read the published guidelines.
