An effective way for your organization to make informed hiring decisions and find key talent is to conduct employment background checks.
However, it’s crucial to follow legal guidelines during these screenings to avoid penalties and potential liability.
This guide provides compliant background check procedures to assist employers.
How to Complete an Employment Background Check
To ensure you comply with all applicable background check laws, it’s important to run employment background checks by completing the following steps:
1. Create and Implement a Background Check Policy
Before you conduct pre-employment screens, your organization should create and implement a well-drafted employment background check policy that includes:
- Guidance for HR staff on how to complete checks in compliance with relevant laws
- Procedures to reduce the risk of unconscious bias
- Types of searches included in screening packages should be specialized for each job type
- Procedures for running employment background checks
- How your company will use the results to make hiring decisions
- Uniform background screens company-wide rather than the selection of certain groups for checks to stay compliant with anti-discrimination laws.
You can vary the types of searches in each background checking package by position, however. For example, the screenings you conduct for some entry-level jobs can be less complexthan those for positions involving access to trade secrets, money, or holding significant authority.
The main focus should be ensuring your background check process is compliant and consistent across applicants for specific roles.
2. Know and Comply with Employment Background Check Laws
Federal, state, and local laws regulate employment background checks.
These laws are meant to ensure your hiring process is fair and unbiased.
While you can complete some background searches independently, it’s best to partner with a compliant, reliable company like iprospectcheck to simplify compliance and ensure reliable results.
As an employer, you must comply with multiple employment background check laws, including the Fair Credit Reporting Act (FCRA), Title VII of the Civil Rights Act of 1964, and state and local employment background check laws.
These laws control when you can conduct pre-employment screenings, how you must notify candidates and obtain consent, and the steps to take when you receive results and make hiring decisions.
If you violate background check laws, your organization could face significant penalties, fines, and litigation costs.
Some specific violations to avoid include:
- FCRA disclosure and consent rule violations for failing to adequately disclose your intention to complete an employment background check
- FCRA adverse action process violations when deciding against hiring someone based on information obtained in a background check report
- State and local ban-the-box rule violations for rules that control when in the hiring process you can inquire about criminal history information
- Title VII violations for failing to individually assess conviction records as they relate to the job before basing a decision not to hire a candidate on the conviction
In 2025, compliance laws are quickly changing across various states and municipalities.
State and local laws constantly evolve. Employers must remain up to date on legal changes as they occur.
Fortunately, iprospectcheck stays on top of legal changes to help employers maintain compliance with all regulations that apply to them.
3. Choose a Reliable Background Check Provider
Many companies advertise background check services, but they are not created equally.
It’s important to research providers carefully. Choose a reliable company like iprospectcheck that is legally compliant, accurate, and offers the following benefits:
- Cutting-edge technology and resources to increase reliability and accuracy while boosting turnaround times to enable fast hiring decisions
- Focus on offering a positive candidate experience with a dedicated support team, mobile-friendly app, and continuous communication throughout the process
- Multiple ATS integrations with existing platforms to streamline your background check process
- Built-in technology features to simplify compliance
4. Choose Relevant Employment Research
You can choose from many available search types to gain insight into an applicant’s background and make informed hiring decisions.
The packages that you customize should be relevant to the positions being hired.
Some of the common types of pre-employment searches include:
- National, state, and county criminal background checks to look for convictions related to the job
- Employment credit checks are recommended for positions with access to financial assets to help identify applicants whose poor credit history may indicate a candidate that has struggled with financial responsibility and integrity.
- Employment verification to confirm an applicant’s employment history, job titles, and employment dates
- Education verification to verify an applicant’s claimed degree, diploma, or certificate and confirm their institution and dates of attendance
- Professional license verification to confirm a candidate’s professional license status
- Pre-employment drug screen to check for an applicant’s recent use of illicit substances
- Motor vehicle records checks to look at an applicant’s driving history and traffic violations for jobs involving driving
Many other searches are also available that your organization can add to create a tailored background check program.
In addition to common types of searches, there are also different background checks for various industries, including:
- Healthcare background checks that include a wide variety of state and Federal sanctions checks
- DOT background checks that include DOT drug screens, DOT physicals, DOT safety and performance history searches, and other required searches
- Financial services background checks that include sanctions, credit, and credentials checks
- International background checks for companies hiring applicants who have lived and worked overseas
5. Know What and When to Communicate
The FCRA includes specific notice and consent rules employers must follow when they plan to conduct background checks.
Before you initiate a pre-employment screen, you must disclose that your company conducts background checks in writing and on a standalone form.
Don’t include extraneous information on this form.
You should never conduct a background check without obtaining an applicant’s written, signed consent, preferably separate from the disclosure
When you initiate a background screen with iprospectcheck, you will confirm you have followed the FCRA’s disclosure rules and have obtained your candidate’s written consent before we begin the process.
You’ll also have specific adverse action requirements to follow once you receive your results if you decide not to hire someone based on them under the FCRA, which will be addressed further below.
6. Review Results and Make Hiring Decisions
When you receive and review the screening results, you can make a hiring decision aligned with your organization’s background check policy.
If your review reveals the candidate is a good fit for your organization and doesn’t have concerning issues in their history, you can communicate those results, and move forward in the onboarding process.
However, if the search reveals information that negatively affects your hiring decision, you must comply with the EEOC’s individual assessment guidance for convictions and the FCRA’s adverse action process.
The Equal Employment Opportunity Commission (EEOC) regulates and enforces Title VII of the Civil Rights Act of 1964 and has issued employer guidance for what to do when a background check reveals criminal convictions.
Instead of automatically basing a decision not to hire an applicant on a criminal conviction, you must assess it as it directly relates to the job and may affect workplace safety.
The FCRA’s adverse action process applies when you learn negative information on a background check that makes you want to deny employment to a candidate. To comply with this process, you must complete the following three steps:
- Send the applicant a pre-adverse action notice that includes a copy of the report with the problematic information highlighted. Include a copy of the document “A Summary of Rights Under the FCRA” with each notification.
- Allow the applicant a reasonable amount of time to respond, which is typically five business days. The applicant can respond by challenging the accuracy of the information and showing evidence it is wrong or by submitting evidence of rehabilitation.
- Send the applicant a final adverse action notice if you still want to deny employment. Include a copy of their rights under the FCRA and then follow applicable state and local laws.
Know Before You Hire
Other Things Employers Should Consider
You should also consider the following factors before initiating background checks at your company:
1. Remote Position Hiring
Many companies have moved to remote work and hybrid positions.
If you’re hiring remote workers located far from your office, you’ll likely need to rely on video interviews and conduct background checks in the states where the candidates work and live.
2. Avoid Online Providers Promising Free or Cheap Background Checks
If you search for an employment screening provider online, you might see advertisements from providers that promise free background checks.
You should avoid relying on these vendors when you conduct employment background checks.
Most of these shady vendors are not legally compliant and frequently return outdated, inaccurate, non-compliant information.
If you rely on that type of erroneous information to make employment decisions, you could expose your organization to lawsuits, fines, and penalties.
Instead, it’s best to partner with a reputable background check company like iprospectcheck that complies with federal, state, and local laws and offers affordable packages. With our access to extensive resources and the use of advanced research methods, we return up-to-date, legally compliant, reliable, and accurate background checks with some of the fastest turnaround times in the industry.
3. Understand the Varying Times for Background Checks
The length of a background screening process varies based on the searches you select and the provider you choose. Certain types of searches might be returned within a few minutes, including motor vehicle records checks, credit checks, and others.
However, county criminal records checks might take longer if they come from a county without digitized records or from courts that redact birthdates from electronic searches.
When conducting searches in those counties and states, iprospectcheck uses advanced methods to obtain accurate and reliable information that complies with the FCRA’s reporting requirements. However, these searches might require runners and take more time.
Similarly, some education and employment verifications might take longer than a few hours, depending on how quickly former employers and educational institutions respond to information requests.
Typically, however, most employment background checks can be completed within a couple of days.
4. Employer Verification Requirement
Before a consumer reporting agency (CRA) can initiate an employment background check for your company, it must first verify your organization is a legitimate business.
This is because the FCRA has stringent regulations that require business verification to ensure sensitive information of consumers is only provided to those with a lawful purpose for receiving it.
Plan for the employer verification process to take about one business hour.
5. Adding Reference Checks Might Be Smart
Even if you include employment verification, it might be a good idea to request professional reference checks with your background screens.
6. Determine Whether to Conduct Ongoing Screens Post-Hire
Employment background checks capture a picture of an applicant’s background at one point in time.
Information can change with time.
In certain industries and for certain jobs, employers might conduct post-hire employment screens annually or more frequently to ensure their employees continue to meet the qualifications for their positions.
If you decide to implement post-hire screens, include them in your background check policy.
You should also include an evergreen clause in your background check disclosure form if allowed to in your state. Otherwise, provide a new disclosure form to your employees before you conduct post-hire checks and obtain their written consent.
iprospectcheck: Your Reliable, Legally Compliant Background Check Partner
As an employer, you must comply with numerous background check laws when you conduct pre-employment screens to avoid legal violations, penalties, and potential liability.
Partnering with a reliable provider like iprospectcheck can simplify your screening process.
We keep current with changes to the law as they occur and always provide accurate, current, and legally compliant background check reports.
To learn more about our employment background checks and how we can help, call us for a free quote today: (888) 509-1979
DISCLAIMER: The resources provided here are for educational purposes only and do not constitute legal advice. Consult your counsel if you have legal questions related to your specific practices and compliance with applicable laws.
