What employers need to know about background checks in 2018

Background checks are an essential piece of the recruiting puzzle. In fact, a survey from the National Association of Professional Background Screeners and HR.com revealed that 96 percent of businesses in the U.S. regularly conduct employment background screening.

"With such a competitive job market, it is more important than ever to have a defined background screening strategy at the start of the recruitment process to prevent any delays in onboarding," says Liz Davies, Division Director of Beacon Hill's Pharma Division in Wakefield, MA. "Candidates have their choice of offers in-hand and in order to expedite an offer and acceptance, it is essential that hiring managers stay current on local and federal regulations as well as internal policies for a smooth and successful screening process."

In 2018, it's more important than ever that employers understand their responsibilities when it comes to staying compliant with federal regulations on screening practices. Here are a few pieces of information every hiring manager should know:

Understand why background checks are important

Effective hiring practices rely on employee background checks to protect the business from risk, ensure the safety of current employees and confirm the qualifications of new hires. Depending on the organization, hiring managers may wish to conduct criminal history checks, substance abuse tests and credit checks.

"At Beacon Hill we try to be a resource for our clients when they have questions about background checks or regulations," says Katie Hackney, Division Director for Beacon Hill's Technologies Division in Columbus. "However, most companies have their own individual requirements based on their industry, internal policies, and other factors."

Employers who perform their due diligence not only bolster workplace safety but also reduce the financial risk of fraud and property loss. Likewise, screening candidates prior to extending a job offer creates additional opportunities to catch unqualified applicants before they become a part of a costly turnover statistic.

Though screening is important, hiring managers still need to be cautious about how they approach the subject. A number of regulations are in place to protect individuals from discriminatory practices.

Seek guidance on FCRA compliance

Any organization that conducts employee background checks must comply with the Fair Credit Reporting Act. According to the U.S. Equal Employment Opportunity Commission, FCRA applies to all background checks, even those without a credit component.

Essentially, the FCRA requires that employers do not use background information from any source to discriminate against individuals by violating federal law. The EEOC explained that employers must take care to treat all individuals equally, regardless of age, race, gender, religion or disability.

The FCRA can be complicated for a layperson to comprehend. Employers should consider having a legal expert who is familiar with the law audit the organization's hiring policies, especially as the guidelines apply to background checks.

Develop disclosure forms

According to the Federal Trade Commission, background checks are considered a type of consumer report, under the FCRA. Therefore, employers are required to make certain disclosures and receive authorization from the prospective employee.

Notably, employers must disclose an intention to perform a background check and receive authorization before any action can be taken. Failure to perform either of these tasks could place the organization at risk of a federal audit.

Further, the FTC requires employers to notify prospective employees if the report reveals something that causes their applications to be denied. Then, a waiting period goes into effect, during which time the prospective employees review and challenge information they deem to be incorrect. Any employment denials based on information from a background check must be provided in a written notice to the applicant.

Developing a standard disclosure and authorization document will help ensure that all candidates receive fair treatment under the FCRA.

Learn about the Ban the Box movement

In 2004, a group of formerly incarcerated people formed a civil rights movement called Ban the Box to fight against the discrimination of individuals returning to public life after serving time in jail or prison. Since the movement's inception, it has made great progress in securing fair treatment for groups who are disproportionately impacted by discriminatory hiring practices.

In fact, Ban the Box has successfully removed the question regarding conviction history from employment applications in many major cities, including Boston, New York City, Philadelphia, Chicago and Seattle, among others. Staying up to date with these local regulations will ensure your organization remains compliant with the letter of the law.

To learn more about improving the hiring process at your organization, connect with the experts at Beacon Hill today.