Employers: Avoid the Pitfalls of Background Checks

With the Federal Trade Commission cracking down on a number of background-checking firms, one association's accreditation efforts are helping to raise the industry's standards.

As the Federal Trade Commission (FTC) revealed recently, not all background checks are created equal—and not all the personal information some outlets provide may be accurate. In fact, the information could prove damaging to the job-seeker.

But thanks to one association’s accreditation program, you may be able to avoid questionable results. More details:

Cracking down on background checks: On Tuesday, the FTC sent warning letters to 10 providers of online background checks, saying their checks may violate the Fair Credit Reporting Act. The FCRA requires that such companies double-check their records for accuracy, notify the subject that a background check was conducted, and verify that the information is being given to others for valid reasons. Part of the FTC’s concern is that the companies maybe posting outdated information on the sites. Consumers “don’t have the ability to review, challenge, and correct the information,” FTC staff attorney Laura Berger told the Associated Press. The warning letters went to sites such as USA People Search and ConsumerBase.

What’s important to employers: According to a recent study by EmployeeScreenIQ [PDF], many employers are interested in knowing about  criminal backgrounds, but background checks often don’t surface everything. “Nearly half of the respondents go beyond seven years in their criminal background checks, a sign of the heightened care and diligence that today’s employers are bringing to their hiring practices,” the study states. “However, based on the responses to question one of the survey—in which 73 percent of employers saw convictions for less than 10 percent of their candidates—we wonder how many of these employers find the records they say they are interested in evaluating.” The study also notes that employers prefer it when job candidates come clean about prior convictions before the background check.

The importance of accreditation: The National Association of Professional Background Screeners (NAPBS) has long worked to help raise standards for background checks. Its accreditation program “advances professionalism in the employment-screening industry through the promotion of best practices, awareness of legal compliance, and development of standards that protect consumers,” according to the group. A total of 36 companies have received the accreditation, including EmployeeScreenIQ.

Rules of the road: In a press release last year [PDF], NAPBS offered tips to help employers choose a background-screening provider, suggesting that timely but comprehensive and consistent usage of screening is key. However, the association notes that employers are equally responsible for understanding how to use background checks. “As an employer, you have certain responsibilities under the law. Make sure that all background-screening practices meet federal and state regulations as well as industry requirements,” the group states. NAPBS notes that the Equal Employment Opportunity Commission changed its rules [PDF] on criminal background checks last year, recommending that they be used only when necessary for the position or important to the business.

(Ingram Publishing/Thinkstock)

Ernie Smith

By Ernie Smith

Ernie Smith is a former senior editor for Associations Now. MORE

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