Building Proper Background Check Policies and Procedures

Any background screening companies (see also Consumer Reporting Agency, or CRA) worth their salt will have quality assurance measures in place to protect their clients. Perhaps the most important rule in the background screening industry is: once employers see the report, it can’t be unseen.

While researchers do their very best to cross-reference, filter-out, and otherwise check for any errors or prohibited information along the way, certain things still can (and do) slip through. There are plenty of resources in the background check community to help clients mitigate these risks, but it must be stressed: the choice to augment hiring policy with these practices comes down to each company’s internal structure.

That being said, there are definite constants to be found that automatically boost a company’s ability to handle the risks inherent in using background screening services. Each of these steps are equally important, and they build upon one another to help create a robust, complete, and durable structure within which companies can safely conduct comprehensive background checks.

Consent Forms Aren’t Optional

First and foremost, if a background screen is run on an employee—potential or otherwise—the individual must consent to this in writing before the report is run.

Also known as a Disclosure and Authorization form, gaining written consent is the first line of defense. Many employers don’t realize that these consent forms must be kept in a personnel file for the duration of the employee’s tenure AND for a set amount of time after the employee is no longer with the company. Each state differs in their requirement standards for keeping these records on file, so it falls to the employer and internal HR staff to follow these guidelines to the letter.

FCRA Rights, FCRA Rights, FCRA Rights

This second part ties directly into the consent form, and thankfully it’s the most low-maintenance portion of the entire process.

Simply supply every applicant and every employee subjected to an employment verification background check of any kind with the official FTC form called “A Summary of Your Rights Under the Fair Credit Reporting Act” when the consent form is signed. For further protection down the road, it is also recommended to have a section for applicants to initial on the consent form to acknowledge official receipt of the summary.

Don’t Overlook Pre Adverse and Adverse Action Procedures

With regards to FCRA compliant background checks, the national trend seems to be moving toward greater consequences for companies neglecting to follow FCRA guidelines.

If a decision is made to deny an applicant, to terminate an employee, or to make a negative decision based on information found in a comprehensive background check, companies are required by law to allow an applicant the opportunity to dispute the findings. This is done by first sending the applicant a Notice of Pre-Adverse Action, then following up with the Notice of Adverse Action.

Employers and their hiring teams are ultimately responsible for getting the Notice of Pre-adverse Action and follow-up Notice of Adverse Action sent out to applicants and employees.

1)  Individuals must be provided a reasonable amount of time after the Pre-adverse notice is first sent so they can get in contact with the CRA for any disputes (5 business days is suggested). This sets the stage for an employer’s due diligence before making the decision to reject and/or terminate an individual.

2)  If the applicant/employee does not dispute the information in the time allotted, the next step is to send out the official Notice of Adverse Action, which serves to solidify the non-hire and/or termination decision. Both notices must contain the appropriate cover letter, copy of the person’s report, and a copy of the FCRA rights summary.

3)  The timing on these is critical. Formal rejection and/or dismissal decisions must not be made prior to sending out these notices, as this is seen as a direct violation of FCRA law and will make an employer liable for prosecution.

4)   Thankfully, most CRAs offer this as a standard part of their employment background screening services, which frees clients up from dealing with the Adverse Action process.

Deal with disputes IMMEDIATELY

Emotions can run high when people first get wind that something negative came back on their background screening report. Things also tend to get exponentially worse in the event an applicant discovers their report contains information that isn’t theirs to begin with. Should this occur, it becomes an urgent priority for applicants to be directed back to the CRA. By law, steps must be taken by the CRA to either confirm or correct the information in question.

When conducting background checks, it pays to keep in mind that CRAs, HR personnel, and the majority of courts/records systems in the U.S. are all still maintained and disseminated by human operators, which can lead to mistakes. This is where watertight quality assurance programs on the background screening side of things, and the consent form / FCRA rights combination on the hiring side both come in handy.

CRAs can help avoid a majority of disputes right off the bat by double- and triple-checking throughout the entire reporting process. Employers can do their part by leveraging their procedures to be consistent with FCRA requirements, as both the consent form and the FCRA rights serve to inform applicants of how to go about correcting potential mistakes on their records.

Establish Solid Legal Precedent

Another proactive step for employers to take has everything to do with the access to professional legal counsel. It’s a good idea in general for companies to run their hiring and employee onboarding process through the proper legal channels, such as attorneys, professional HR companies, and experts in corporate insurance. By having their hiring policies approved by an objective third party, employers can rest easier knowing the bases are covered, and that there are self-sustaining systems and resources in place to stay up to speed with ongoing changes in hiring legislation.

Communication is key

CRAs have the unique opportunity to distinguish themselves as reliable resources through the establishment of solid customer service practices and the maintenance of a genuine, consistent culture of communication. Background screening companies have an essential responsibility to be a source of continuous education and support for their clients so that everybody wins.

As a leading background screening company, NationSearch takes that responsibility seriously. We encourage you to subscribe to our background check blog for valuable tips to improve your hiring process, and the latest background screening news, including legislative changes affecting the background screening industry.

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