Background Checks

Background

Checks

What Employers

Need to Know

A joint publication of the Equal Employment Opportunity Commission

and the Federal Trade Commission

hen making personnel decisions — including hiring,

retention, promotion, and reassignment — employers

sometimes want to consider the backgrounds of applicants

and employees. For example, some employers might try to

find out about the person’s work history, education, criminal

record, financial history, medical history, or use of social

media. Except for certain restrictions related to medical

and genetic information (see below), it’s not illegal for an

employer to ask questions about an applicant’s or employee’s

background, or to require a background check.

However, any time you use an applicant’s or employee’s

background information to make an employment decision,

regardless of how you got the information, you must comply

with federal laws that protect applicants and employees

from discrimination. That includes discrimination based on

race, color, national origin, sex, or religion; disability; genetic

information (including family medical history); and age (40

or older). These laws are enforced by the Equal Employment

Opportunity Commission (EEOC).

In addition, when you run background checks through

a company in the business of compiling background

information, you must comply with the Fair Credit Reporting

Act (FCRA). The Federal Trade Commission (FTC) enforces the

FCRA. This publication explains how to comply with both

the federal nondiscrimination laws and the FCRA. It’s also a

good idea to review the laws of your state and municipality

regarding background reports or information because some

states and municipalities regulate the use of that information

for employment purposes.

Before You Get Background

Information

EEOC

In all cases, make sure that you’re treating everyone equally.

It’s illegal to check the background of applicants and employees

when that decision is based on a person’s race, national origin,

color, sex, religion, disability, genetic information (including

family medical history), or age (40 or older). For example,

asking only people of a certain race about their financial

histories or criminal records is evidence of discrimination.

Except in rare circumstances, don’t try to get an applicant’s or

employee’s genetic information, which includes family medical

history. Even if you have that information, don’t use it to make

an employment decision. (For more information about this law,

see the EEOC’s publications explaining the Genetic Information

Nondiscrimination Act, or GINA.) Don’t ask any medical

questions before a conditional job offer has been made. If the

person has already started the job, don’t ask medical questions

unless you have objective evidence that he or she is unable to do

the job or poses a safety risk because of a medical condition.

FTC

If you get background information (for example, a credit or

criminal background report) from a company in the business

of compiling background information, there are additional

procedures the FCRA requires beforehand:

● Tell the applicant or employee you might use the

information for decisions about his or her employment.

This notice must be in writing and in a stand-alone format.

The notice can’t be in an employment application. You can

include some minor additional information in the notice (like

a brief description of the nature of consumer reports), but

only if it doesn’t confuse or detract from the notice.

● If you are asking a company to provide an “investigative

report” – a report based on personal interviews concerning

a person’s character, general reputation, personal

characteristics, and lifestyle – you must also tell the

applicant or employee of his or her right to a description of

the nature and scope of the investigation.

● Get the applicant’s or employee’s written permission to do

the background check. This can be part of the document

you use to notify the person that you will get the report. If

you want the authorization to allow you to get background

reports throughout the person’s employment, make sure you

say so clearly and conspicuously.

● Certify to the company from which you are getting the

report that you:

● notified the applicant and got their permission to get a

background report;

● complied with all of the FCRA requirements; and

● won’t discriminate against the applicant or employee, or

otherwise misuse the information in violation of federal

or state equal opportunity laws or regulations.

Using Background Information

EEOC

Any background information you receive from any source must

not be used to discriminate in violation of federal law. This

means that you should:

● Apply the same standards to everyone, regardless of their

race, national origin, color, sex, religion, disability, genetic

information (including family medical history), or age (40

or older). For example, if you don’t reject applicants of one

ethnicity with certain financial histories or criminal records,

you can’t reject applicants of other ethnicities because they

have the same or similar financial histories or criminal

records.

● Take special care when basing employment decisions on

background problems that may be more common among

people of a certain race, color, national origin, sex, or

religion; among people who have a disability; or among

people age 40 or older. For example, employers should not

use a policy or practice that excludes people with certain

criminal records if the policy or practice significantly

disadvantages individuals of a particular race, national

origin, or another protected characteristic, and does not

accurately predict who will be a responsible, reliable, or

safe employee. In legal terms, the policy or practice has a

“disparate impact” and is not “job related and consistent

with business necessity.”

● Be prepared to make exceptions for problems revealed

during a background check that were caused by a disability.

For example, if you are inclined not to hire a person because

of a problem caused by a disability, you should allow the

person to demonstrate his or her ability to do the job –

despite the negative background information – unless doing

so would cause significant financial or operational difficulty.

FTC

When taking an adverse action (for example, not hiring

an applicant or firing an employee) based on background

information obtained through a company in the business of

compiling background information, the FCRA has additional

requirements:

● Before you take an adverse employment action, you must

give the applicant or employee:

● a notice that includes a copy of the consumer report you

relied on to make your decision; and

● a copy of “A Summary of Your Rights Under the Fair

Credit Reporting Act,” which you should have received

from the company that sold you the report.

By giving the person the notice in advance, the person has

an opportunity to review the report and explain any negative

information.

● After you take an adverse employment action, you must

tell the applicant or employee (orally, in writing, or

electronically):

● that he or she was rejected because of information in the

report;

● the name, address, and phone number of the company

that sold the report;

● that the company selling the report didn’t make the hiring

decision, and can’t give specific reasons for it; and

● that he or she has a right to dispute the accuracy or

completeness of the report, and to get an additional free

report from the reporting company within 60 days.

Disposing of Background

Information

EEOC

Any personnel or employment records you make or keep

(including all application forms, regardless of whether the

applicant was hired, and other records related to hiring) must be

preserved for one year after the records were made, or after a

personnel action was taken, whichever comes later. (The EEOC

extends this requirement to two years for educational institutions

and for state and local governments. The Department of

Labor also extends this requirement to two years for federal

contractors that have at least 150 employees and a government

contract of at least $150,000.) If the applicant or employee files

a charge of discrimination, you must maintain the records until

the case is concluded.

FTC

Once you’ve satisfied all applicable recordkeeping

requirements, you may dispose of any background reports

you received. However, the law requires that you dispose

of the reports – and any information gathered from them

– securely. That can include burning, pulverizing, or

shredding paper documents and disposing of electronic

information so that it can’t be read or reconstructed. For more

information, see “Disposing of Consumer Report Information?

Rule Tells How” at www.business.ftc.gov/documents/

disposing-consumer-report-information-rule-tells-how.

Further Information

EEOC

To find out more about federal antidiscrimination laws, visit

www.eeoc.gov, or call the EEOC toll-free, 800-669-4000

(voice); TTY: 800-669-6820. The EEOC is responsible for

enforcing federal laws that make it illegal to discriminate

against a job applicant or an employee because of the person’s

race, color, religion, sex (including pregnancy), national origin,

age (40 or older), disability, or genetic information. The EEOC

investigates, conciliates, and mediates charges of employment

discrimination, and also files lawsuits in the public interest. For

specific information on:

● Preemployment medical inquiries: see

Preemployment Disability-Related Questions and Medical

Examinations at www.eeoc.gov/policy/docs/preemp.html.

● Medical inquiries during employment: see

Questions and Answers: Enforcement Guidance on

Disability-Related Inquiries and Medical Examinations of

Employees Under the Americans with Disabilities Act (ADA)

at www.eeoc.gov/policy/docs/qanda-inquiries.html.

● Genetic inquiries, including inquiries about

family medical history: see Background Information

for EEOC Final Rule on Title II of the Genetic Information

Nondiscrimination Act of 2008 at www.eeoc.gov/laws/

regulations/gina-background.cfm.

● EEOC recordkeeping requirements: see Summary

of Selected Recordkeeping Obligations in 29 C.F.R.

Part 1602 at www.eeoc.gov/employers/recordkeeping_

obligations.cfm.

● Using arrest and conviction records to make

employment decisions: see Questions and Answers

about EEOC’s Enforcement Guidance on the Consideration

of Arrest and Conviction Records in Employment Decisions

Under Title VII at www.eeoc.gov/laws/guidance/qa_arrest_

conviction.cfm.

● Whether arrest and conviction records act as

an automatic bar to all employment: see Reentry

Myth Buster: On Hiring/Criminal Records Guidance at

csgjusticecenter.org/wp-content/uploads/2012/11/Reentry_

Council_Mythbuster_Employment.pdf.

● Background on the EEOC for small businesses:

see Get the Facts Series: Small Business Information,

www.eeoc.gov/eeoc/publications/smallbusiness.cfm.

FTC

To find out more about federal laws relating to background

reports, visit www.business.ftc.gov, or call the FTC toll-free,

1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261.

For specific information on employment background

reports, see:

● Using Consumer Reports: What Employers

Need to Know at www.business.ftc.gov/documents/

bus08-using-consumer-reports-what-employers-need-know

● The Fair Credit Reporting Act & social media:

What businesses should know at www.business.ftc.

gov/blog/2011/06/fair-credit-reporting-act-social-media-what-

businesses-should-know

● Background screening reports and the FCRA:

Just saying you’re not a consumer reporting

agency isn’t enough at www.business.ftc.gov/

blog/2013/01/background-screening-reports-and-fcra-just-

saying-youre-not-consumer-reporting-agency-i

● Reentry Myth Buster: Criminal Histories and

Employment Background Checks at csgjusticecenter.

org/wpcontent/uploads/2012/11/Reentry_Council_Mythbuster_

FCRA_Employment.pdf.

The FTC works to prevent fraudulent, deceptive, and unfair

business practices in the marketplace and to provide information

to businesses to help them comply with the law.

A joint publication of the Equal Employment Opportunity Commission

and the Federal Trade Commission