How to Conduct an Employee Background Check In 5 Steps

How to Conduct an Employee Background Check In 5 Steps

Hiring new employees can be a long and tedious process. Not only do employers have to sift through endless numbers of applications, but they have to decide how genuine the candidates are about their credentials. Conducting an employee background check is one-way employers can sort through applications to find the best employee to hire.

To avoid having the wool pulled over their eyes, employers often perform background checks on people applying to work for their company. Performing an employee background check can be a daunting task for employers, so we broke the process down into five easy steps. But let’s start with the basics:

What Is A Background Check?

An employee background check is a review of a potential new employee’s commercial, career, criminal, and financial records. Usually, these background checks are outsourced. This means that another company that specializes in finding information can do all the work for you.

These companies that perform background checks can help you to find any cobwebs potential employees are hiding. Employment background checks bring up any red flags in people’s personal and professional history to make sure that the organization isn’t hiring someone who could damage their reputation.

Keep in mind that there are restrictions about what information an employer can request in a background check. Each state has its own rules. Usually, these records include criminal history, employment record, credit history, driving record, and even medical history. However, under the Equal Employment Opportunity Commission (EEOC), no employer can use these records in a discriminatory way to fire or refuse to hire an employee.

Why Employers Conduct Background Checks

Background checks are a crucial aspect of hiring new staff members. That’s because employers can use them to determine whether candidates are capable and trustworthy. It’s important to verify if potential employees don’t have any nasty skeletons hidden in the cupboard. Employers have the right to know if their potential employees are financially responsible, don’t have a criminal record, and are legally eligible to work in the United States.

With 85% of job applicants reportedly providing false information on their resumes, it’s understandable that organizations would like to confirm the data. Not vetting each candidate’s claims could result in the company hiring someone entirely unsuited for the role and missing out on a better option.

Performing employee background checks also protects employers from liability issues. If an employer doesn’t perform a background check and then an employee breaks the law while representing the company, the employer could be the one at fault. Therefore, companies need to ensure that candidates have a clean record, or they could find themselves in serious trouble later on.

benefits of employee background checks
Source: Software Testing Help

 

How To Conduct An Employee Background Check

Listed below are five steps one should follow when conducting an employee background check:

Step 1. Obtain Consent

Before any employer completes a background check on candidates, consent must be obtained. You must request permission in written form before you start undergoing any investigation. This law is upheld by the Federal Trade Commission (FTC) to protect employees.

Employers must have individual consent from candidates to look into each particular type of record: school records, medical records, and criminal history (after a specific timeframe). However, some information, such as someone’s military rank, salary, assignments, and awards, can be found without consent. Some information is also in public records, like whether your candidate has ever filed for bankruptcy.

If you decide not to hire someone based on what you find in a background check, you must provide a report explaining what stopped you from offering the position. No employers can use a background check to discriminate against potential employees. If an employer doesn’t wish to hire someone because of race, religion, national origin, sex, disability, genetic information, and age, the rejected candidate can contact the Equal Employment Opportunity Commission (EEOC) for help.

There are also time limits to certain background checks which employers need to be aware of. For example, you cannot access records of bankruptcies after ten years it occurred.

After seven years, an employer cannot look into civil suits and judgments, records of arrest, paid tax liens or accounts placed for collection. However, the government waives these restrictions if the position in consideration has an annual salary of at least $75,000.

Step 2. Job Applicant Credit Checks

Credit reports and scores hold information about an individual’s finances and let employers know which candidates are responsible when it comes to money. Doing a credit check on potential employees has become much more popular in recent years as ensuring someone has a good credit score can indicate their level of responsibility. Credit reports and scores are affected by what debts and loans an individual have. Low credit scores can highly affect your decision of hiring or not a candidate for a job, especially one in the financial industry.

Step 3. Drug and Alcohol Tests

Once you have an idea of your candidate’s financial responsibility, it’s a great idea to conduct a drug and alcohol test — depending on the position you’re hiring for. Drug and alcohol tests exist to help you to monitor potential employees’ behaviors. Hair, urine, mouth swab, breath, and blood are just some of the ways employers can test for illegal substances in an employee’s system.
Employers have the right to administer drug and alcohol tests in the workplace and fire any employees who are found to be taking illegal substances. However, if potential employees have medical certificates for certain substances, employers cannot discriminate against them unless it puts others in danger. With that, if a candidate doesn’t pass a drug and alcohol test, you can’t immediately count them out.

Step 4. Criminal Records and Background Checks

Verifying your candidate’s criminal records is another critical step when it comes to completing a background check. Checking an employee’s criminal records varies from state to state, so be sure to research the requirements for your specific region. For example, in some states, such as California, it’s illegal to request information about arrests or convictions after a particular timeframe. Other states, including Florida, only allow you to request information about arrests and convictions for certain positions. When it comes to criminal records and background checks, don’t get caught out by not understanding what you can and can’t dig into.

Step 5. Employment Verification

When employees apply for jobs in the United States, they must provide proof that they are legally allowed to work in the country. Before hiring any employee, organizations are required by law to verify the identities of candidates and ensure that they have eligibility to work in the US.

To obtain this information, employers must fill out an Employment Eligibility Verification form (I-9 Form) and then keep it on file for as long as the company employs the individual.

Doing Your Background Check vs. Hiring A Background Check Company

There are several things to consider when deciding whether you want to complete your employee background check or hire a background check company to do it for you.

When hiring a background check company, you are dealing with professionals. They have access to documents and reports that your organization wouldn’t usually be able to see. If you’re not sure whether hiring a background check company is necessary, you need to ask yourself how important it is to verify a candidate’s claims. Performing a thorough background check is vital for some job positions to avoid complications that will affect your company down the track.

If the position is less crucial to your company, or unlikely to result in dire consequences, performing the background check yourself should be sufficient. When companies conduct their background checks, they do not require consent from the individual. However, there is also less information available to them.

Therefore, hiring a background check company all depends on the importance of the position you are recruiting for.

The Takeaway

Employers looking to perform employee background checks should go through background check companies to ensure that they don’t receive any backlash. These background check companies know how the process works and can help point out any red flags to employers. They can also sort through candidates and inform you of which employees will engage with the new role.

Companies should also keep in mind that any information, even if coming from a specialist might be erroneous. Therefore, any individual not hired because of information found in their background check must be notified of the reason and have the right to dispute anything that is uncovered.