Pre-Employment Background Checks

When you are hiring employees, you might need more information on a candidate to make an informed decision.

The following list includes the types of information that employers often consult as part of a pre-employment check, and the laws governing access and use for making hiring decisions.

Credit Reports

Under the Fair Credit Reporting Act (FCRA), businesses must obtain an employee's written consent before seeking an employee's credit report. If you decide not to hire or promote someone based on information in the credit report, you must provide a copy of the report and let the applicant know of his or her right to challenge the report under the FCRA. Visit the FTC’s Bureau of Consumer Protection’s website for more information.

Criminal Records

To what extent a private employer may consider an applicant's criminal history in making hiring decisions varies from state to state. Because of this variation, you should consult with a lawyer or do further legal research on the laws of your state before exploring whether or not an applicant has a criminal past.

For Federal Bureau of Investigation (FBI) checks, consult these resources:

• FBI Services for Businesses
• FBI Criminal History Checks for Employment and Licensing
• FBI Checks on Employees of Banks and Related Entities

Lie Detector Tests

The Employee Polygraph Protection Act prohibits most private employers from using lie detector tests, either for pre-employment screening or during the course of employment. The law includes a list of exceptions that apply to businesses that provide armored car services, alarm or guard services, or those that manufacture, distribute, or dispense pharmaceuticals.

Even though there is no federal law specifically prohibiting you from using a written honesty test on job applicants, these tests frequently violate federal and state laws that protect against discrimination and violations of privacy.

Medical Records

Under the Americans with Disabilities Act, employers cannot discriminate based on a physical or mental impairment or request an employee's medical records. Businesses can, however, inquire about an applicant's ability to perform specific job duties. Some states also have stronger laws protecting the confidentiality of medical records.

Bankruptcies

Bankruptcies are a matter of public record and may appear on an individual's credit report. The Federal Bankruptcy Act prohibits employers from discriminating against applicants because they have filed for bankruptcy.

Military Service

Military service records may be released only under limited circumstances, and consent is generally required. The military may, however, disclose name, rank, salary, duty assignments, awards and duty status without the service member's consent.

School Records

Under the Family Educational Rights and Privacy Act and similar state laws, educational records such as transcripts, recommendations and financial information are confidential and will not be released by the school without a student's consent.

Workers' Compensation Records

Workers' compensation appeals are a matter of public record. Information from a workers' compensation appeal may be used in a hiring decision if the employer can show the applicant's injury might interfere with his ability perform required duties.

Author

The author of this article is the US Small Business Administration.

The U.S. Small Business Administration (SBA) was created in 1953 as an independent agency of the federal government to aid, counsel, assist and protect the interests of small business concerns, to preserve free competitive enterprise and to maintain and strengthen the overall economy of our nation. The SBA helps Americans start, build and grow businesses. Through an extensive network of field offices and partnerships with public and private organizations, SBA delivers its services to people throughout the United States, Puerto Rico, the U. S. Virgin Islands and Guam. The SBA provides assistances primarily through four programs:

• Business financing programs including debt, equity and micro lending
• Entrepreneurial development through education, information, technical assistance & training
• Promotes small business Federal Government contracting with subcontracting procurement opportunities, outreach programs, and training to help meet the 23% goal for small business contracting
• Advocacy and research on behalf of small businesses

Detailed information is available at the SBA website and a detailed Resource Guide is available in English and Spanish on the website.