Many employers perform background checks to screen individuals they are considering hiring. Online background check websites claim that employers can perform background searches quickly and cheaply without having to hire a legitimate background check company. However, federal and state laws impose complex requirements on employers who perform background checks on prospective hires. Legal settlements for failing to comply with these requirements can easily reach millions of dollars.
For instance, the federal Fair Credit Reporting Act (FCRA) requires employers to properly notify candidates that they will be performing credit checks and to obtain proper advance authorization. The FCRA’s requirements are highly technical and it is easy to make mistakes, so FCRA violations are a subject of frequent and increasing class action litigation. According to WebRecon LLC, hundreds of lawsuits are filed under the FCRA every month and have increased every year for nearly two decades. Employers who perform quick credit searches online may be unwittingly violating the FCRA, exposing themselves to possible lawsuits. A legitimate background search agency, however, will have the expertise to help employers meet the FCRA’s vigorous notification and authorization requirements.
Similarly, several states, the District of Columbia and many cities have enacted “Ban the Box Laws” prohibiting employers from seeking criminal history information about job candidates in certain ways. Many of these laws not only ban job applications requiring that candidates check a box if they have a criminal record, but also prohibit employers from seeking any criminal history information too early in the application process. Employers who perform their own online criminal background checks on job candidates, without seeking guidance from background check experts, risk violating the law. A legitimate background search company, however, can help employers navigate the complex tapestry of federal and state laws that apply to criminal background checks.