Common Background Screening Misconceptions

Background screening compliance practices can be downright terrifying for some employers. However, knowing how to apply them is essential for any company.  So, if you’re looking to face your compliance fears and indulge in scary topics such as adverse action, disclosure forms, and extraneous information, then this blog is for you!

Take a peek at InCheck’s list of common background screening misconceptions and best practices for employers.

Misconception: Combined disclosure and authorization forms are okay to provide to candidates.

Best Practice: The Fair Credit Reporting Act (FCRA) requires that prior to procuring a background check, “a clear and conspicuous disclosure” in writing be made to the consumer, or candidate, “in a document that consists solely of the disclosure.”  Therefore, industry best practice is for employers to provide separate disclosure and authorization forms to candidates.

Misconception: Employers may include waivers of liability in the disclosure form.

Best Practice: One of the most heavily litigated issues within the background screening industry is related to the disclosure form, in particular, that the disclosure form should not include extraneous information. Extraneous information is not defined under the FCRA; however, case law indicates that language such as waivers of liability and state-specific notices fall into the category of extraneous. Therefore, best practice is to avoid including waivers of liability, or other extraneous information, in the disclosure form.

Misconception: Employers may send the pre-adverse action notice to a candidate prior to the completion of the background report.

Best Practice: Under the FCRA, the pre-adverse action notice should only be sent after the report has been completed. While the FCRA does not state how long the waiting period should be prior to taking final adverse, it is best practice to wait 5 business days after the pre-adverse action notice has been sent. The 5-business day waiting period affords the candidate the opportunity to respond to the pre-adverse notice and file a dispute, if necessary. If the candidate does not respond during the 5-business day waiting period, you may send the final adverse notice. Note: some jurisdictions require a longer waiting period between pre-adverse and adverse action. Consult your legal counsel to ensure your process is compliant with both FCRA and state/local law.

Misconception: Employers may provide a candidate with a copy of background check prior to its completion.

Best Practice: If a background report has not been completed, best practice is not to discuss or disclose the information on the report with the candidate. Providing the candidate with a copy of his or her incomplete background report runs the risk of multiple disputes being filed. In particular, the candidate may file a dispute regarding the information on the incomplete report, only to then file another dispute once the report is complete.

Misconception: Candidates cannot dispute information reported on a background check.

Best Practice: Candidates may absolutely dispute information reported on a background check. Candidates may either notify the employer of the dispute, who must then provide the disputed information to InCheck, or the candidate may file a dispute directly with InCheck. In any situation where the employer notifies InCheck of the dispute, we will work directly with the candidate to reinvestigate and resolve any potential discrepancies.

Misconception: Employers may send adverse action notices during a candidate dispute.

Best Practice: Under the FCRA, background screening companies are required to notify employers when a candidate files a dispute, as well as once the dispute is complete. Once a dispute is filed, the report is considered “in review” and best practice is not to base any hiring decisions off of the report until the reinvestigation is complete, as the reinvestigation may result in changes to the original report.

Disclaimer: This blog is for general informational purposes only and should not be construed as legal advice.