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Background check
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A background check or background investigation is the process of looking up and compiling criminal records, commercial records, and financial records of an individual or an organization.[1]
Contents
1 Purpose
2 Pre-employment screening
2.1 United Kingdom
2.2 Poland
2.3 Asia/Oceania
2.4 The market
2.5 Types of checks
2.6 Regulation
2.7 United States
2.7.1 Laws
2.7.1.1 Florida
2.7.2 Types of checks
3 Possible information included
4 Controversies
5 Public records pay sites
6 See also
7 References
8 External links
Purpose[edit]
Background checks are often requested by employers on job candidates for employment screening, especially on candidates seeking a position that requires high security or a position of trust, such as in a school, courthouse, hospital, financial institution, airport, and government. These checks are traditionally administered by a government agency for a nominal fee, but can also be administered by private companies. Background checks can be expensive depending on the information requested. Results of a background check typically include past employment verification, credit history, and criminal history. The objective of background checks is to ensure the safety and security of the employees in the organisation.[2]
These checks are often used by employers as a means of judging a job candidate's past mistakes, character, and fitness, and to identify potential hiring risks for safety and security reasons. Background checks are also used to thoroughly investigate potential government employees in order to be given a security clearance. However, these checks may sometimes be used for illegal purposes, such as unlawful discrimination (or employment discrimination), identity theft, and violation of privacy.
Checks are frequently conducted to confirm information found on an employment application or résumé/curriculum vitae. One study showed that half of all reference checks done on prospective employees differed between what the job applicant provided and what the source reported.[3] They may also be conducted as a way to further differentiate potential employees and pick the one the employer feels is best suited for the position. Employers have an obligation to make sure their work environment is safe for all employees and helps prevent other employment problems in the workplace.[4]
In the United States, the Brady Bill requires criminal checks for those wishing to purchase handguns from licensed firearms dealers. Restricted firearms (like machine guns), suppressors, explosives or large quantities of precursor chemicals, and concealed weapons permits also require criminal checks.[5]
Checks are also required for those working in positions with special security concerns, such as trucking, ports of entry, and airports (including airline transportation). Other laws exist to prevent those who do not pass a criminal check from working in careers involving the elderly, disabled, or children.
Pre-employment screening[edit]
Pre-employment screening refers to the process of investigating the backgrounds of potential employees and is commonly used to verify the accuracy of an applicant's claims as well as to discover any possible criminal history, workers compensation claims, or employer sanctions. For example, CBC News of Canada reported that fraud in the workplace cost Canadian Businesses over $3.2 Billion in 2011.[6]
United Kingdom[edit]
A number of annual reports, including BDO Stoy Hayward's Fraudtrack 4[7] and CIFAS's [8] (The UK's fraud prevention service) 'The Enemy Within' have showed a rising level of major discrepancies and embellishments on CVs over previous years.[citation needed]
Almost half (48%) of organizations with fewer than 100 staff experienced problems with vetted employees.[citation needed]
Thirty-nine percent of UK organizations have experienced a situation where their vetting procedures have allowed an employee to be hired who was later found to have lied or misrepresented themselves in their application.[citation needed]
Since the onset of the financial crisis of 2007–2010, the level of fraud has almost doubled and some experts have predicted that it will escalate further.[9] Background-checking firm Powerchex has claimed the number of applicants lying on their applications has been increasing since the summer of 2007 when the financial crisis began.[10] In 2009, Powerchex claimed that nearly one in 5 applicants has a major lie or discrepancy on his or her application.[11]
Poland[edit]
The first Polish research on the issue of pre-employment screening shows that 81% of recruiters have come across the phenomenon of lies in the CVs of candidates for the job.[citation needed] The survey was conducted by IBBC Group and Background Screening Service, which deal with outsourcing and conducting background screenings in Central - Eastern Europe.
The research shows how many failures occurred in the relationship between employer and employee over the years and what dangers it brings. Applicants usually lie about additional skills (85%), dates of employment (58%), responsibilities (53%) or positions (28%).[citation needed]
Due to bad hire, employers lose in a multitude of ways: financial-wise, reputation-wise and time-wise. The research shows that as many as 77% of them have lost significant sums of money to carry out the re-recruitment. Moreover, the companies have suffered losses after hiring the dishonest employee due to his low competences (57%), lack of diligence at work (28%), spending on additional training (28%) or problems with attendance (15%) and employee theft (7%).[citation needed] The demand for pre-employment screenings is constantly growing among Polish entrepreneurs.
Background screening can be conducted in Poland on the grounds of written consent of the person. Depending on the degree to which recruitment is carried out, verifications can include: identity, history of education, employment history, reason for leaving, additional qualifications, employee opinion, criminal record, indebtedness, references, business connections, presence on sanction lists, presence in the media.
Asia/Oceania[edit]
While background screening and verification is well established in Australia and New Zealand,[12] it is in its infancy in Asia and regulations vary widely across the region.[13] Leading background screening companies in the region must navigate different regulatory frameworks and market leaders offer a full complement of services including financial probity, education, criminal background checking where legal, directorships.
The market[edit]
Larger companies are more likely to outsource than their smaller counterparts – the average staff size of the companies who outsource is 3,313 compared to 2,162 for those who carry out in-house checks.
Financial services firms had the highest proportion of respondents who outsource the service, with over a quarter (26%) doing so, compared to an overall average of 16% who outsource vetting to a third party provider.
The construction and property industry showed the lowest level of outsourcing, with 89% of such firms in the sample carrying out checks in-house, making the overall average 16%. This can increase over the years.
Companies that choose to outsource must be sure to use companies that are Fair Credit Reporting Act (FCRA) compliant. Companies that fail to use an FCRA compliant company may face legal issues due to the complexity of the law.
Types of checks[edit]
Academic Verifications
Character Reference Check
Gaps in employment history
Gap in educational history
Identity and Address Verification - whether the applicant is who he or she claims to be. Generally includes verification of the candidate’s present and previous addresses. Can include a money laundering, identity and terrorist check and one to verify the validity of passports.
Whether an applicant holds a directorship
Credit History (credit score is not included)
Purchase fire arms
Regulation[edit]
The Financial Services Authority states in their Training & Competence guidance that regulated firms should have:
Adequacy of procedures for taking into account knowledge and skills of potential recruits for the role
Adequacy of procedures for obtaining sufficient information about previous activities and training
Adequacy of procedures for ensuring that individuals have passed appropriate exams or have appropriate exemptions
Adequacy of procedures for assessing competence of individuals for sales roles
The Financial Services Authority’s statutory objectives:
Protecting consumers
Maintaining market confidence
Promoting public awareness
Reducing financial crime
United States[edit]
Laws[edit]
Due to the sensitivity of the information contained in consumer reports and certain records, there are a variety of important laws regulating the dissemination and legal use of this information. Most notably, the Fair Credit Reporting Act (FCRA) regulates the use of consumer reports (which it defines as information collected and reported by third party agencies) as it pertains to adverse decisions, notification to the applicant, and destruction and safekeeping of records.
If a consumer report is used as a factor in an adverse hiring decision, the applicant must be presented with a "pre-adverse action disclosure," a copy of the FCRA summary of rights, and a "notification of adverse action letter." Individuals are entitled to know the source of any information used against them including a credit reporting company. Individuals must also consent in order for the employer to obtain a credit report. Pre-employment credit reports do not include a credit score. A pre-employment credit report will show up on an individuals credit report as a "soft inquiry" and do not affect the individual's credit score.[citation needed]
Florida[edit]
Title XLV, section 768.095, of the Florida Statutes protects employers from negligent hiring liabilities, provided they attempt to conduct certain screening procedures. Employers who follow these steps will be presumed not to have been negligent when hiring if a background check fails to reveal any records on an applicant.[14]
Types of checks[edit]
There are a variety of types of investigative searches that can be used by potential employers. Many commercial sites will offer specific searches to employers for a fee. Services like these will actually perform the checks, supply the company with adverse action letters, and ensure compliance throughout the process. It is important to be selective about which pre-employment screening agency one uses. A legitimate company will be happy to explain the process. Many employers choose to search the most common records such as criminal records, driving records, and education verification. Other searches such as sex offender registry, credential verification, skills assessment, reference checks, credit reports and Patriot Act searches are becoming increasingly common. Employers should consider the position in question when determining which types of searches to include, and should always use the same searches for every applicant being considered for one.
Possible information included[edit]
The amount of information included on a background check depends to a large degree on the sensitivity of the reason for which it is conducted—e.g., somebody seeking employment at a minimum wage job would be subject to far fewer requirements than somebody applying to work for a law enforcement agency such as the FBI or jobs related to national security.
Criminal, arrest, incarceration, and sex offender records
There are several types of criminal record searches available to employers, some more accurate and up to date than others. These "third party" background checking agencies cannot guarantee the accuracy of their information, thus many of them have incomplete records or inaccurate records. The only way to conduct an accurate background check is to go directly through the state. Most times using the state of choice is much cheaper than using a "third party" agency. Many websites offer the "instant" background check, which will search a compilation of databases containing public information for a fee. These "instant" searches originate from a variety of sources, from statewide court and corrections records to law enforcement records which usually stem from county or metro law enforcement offices. There are also other database-type criminal searches, such as statewide repositories and the national crime file. A commonly used criminal search by employers who outsource is the county criminal search.
Citizenship, immigration, or legal working status
The hiring of undocumented workers has become an issue for American businesses since the forming of the Department of Homeland Security and its Immigrations and Customs Enforcement (ICE) division. Many history making immigration raids[15] over the past two years have forced employers to consider including legal working status as part of their background screening process. All employers are required to keep government Form I-9 documents on all employees and some states mandate the use of the federal E-Verify program to research the working status of Social Security numbers. With increased concern for right-to-work issues, many outsourcing companies are sprouting in the marketplace to help automate and store Form I-9 documentation. Some jobs are only available to citizens who are residents of that country due to security concerns.
Litigation records
Employers may want to identify potential employees who routinely file discrimination lawsuits. It has also been alleged that in the U.S., employers that do work for the government do not like to hire whistleblowers who have a history of filing qui tam suits.
Driving and vehicle records
Employers that routinely hire drivers or are in the transportation sector seek drivers with clean driving records—i.e., those without a history of accidents or traffic tickets. Department of Motor Vehicles and Department of Transportation records are searched to determine a qualified driver.
Drug tests
Drug tests are used for a variety of reasons—corporate ethics, measuring potential employee performance, and keeping workers' compensation premiums down.
Education records
These are used primarily to see if the potential employee had graduated from high school (or a GED) or received a college degree, graduate degree, or some other accredited university degree. There are reports of SAT scores being requested by employers as well.
Employment records
These usually range from simple verbal confirmations of past employment and timeframe to deeper, such as discussions about performance, activities and accomplishments, and relations with others.
Financial information
Credit history, liens, civil judgments, bankruptcy, and tax information may be included in the report.
Licensing records
A government authority that has some oversight over professional conduct of its licensees will also maintain records regarding the licensee, such as personal information, education, complaints, investigations, and disciplinary actions.
Medical, mental, and physiological evaluation and records
These records are generally not available to consumer reporting agencies, background screening firms, or any other investigators without documented, written consent of the applicant, consumer or employee.
Military records
Although not as common today as it was in the past fifty years, employers frequently requested the specifics of one's military discharge.
Polygraph testing
Those seeking employment in the government relating in a field of national security, law enforcement, or other field of safety or security may look into a persons background not disclosed in applications. Those who fail a polygraph test may not be selected. In the United States laws regarding the use are under the Employee Polygraph Protection Act.
Social Security Number
(or equivalent outside the US). A fraudulent SSN may be indicative of identity theft, insufficient citizenship, or concealment of a "past life". Background screening firms usually perform a Social Security trace to determine where the applicant or employee has lived.
Other interpersonal interviews
Employers may investigate past employment to verify position and salary information. More intensive checks can involve interviews with anybody that knew or previously knew the applicant—such as teachers, friends, coworkers, neighbors, and family members; however, extensive hearsay investigations in background checks can expose companies to lawsuits. Past employment and personal reference verifications are moving toward standardization with most companies in order to avoid expensive litigation.
Controversies[edit]
Drug tests and credit checks for employment are highly controversial practices. According to the Privacy Rights Clearinghouse, a project of the Utility Consumers' Action Network (UCAN): "While some people are not concerned about background investigations, others are uncomfortable with the idea of investigators poking around in their personal histories. In-depth checks could unearth information that is irrelevant, taken out of context, or just plain wrong. A further concern is that the report might include information that is illegal to use for hiring purposes or which comes from questionable sources."
In May 2002, allegedly improper post-hire checks conducted by Northwest Airlines were the subject of a civil lawsuit between Northwest and 10,000 of their mechanics.
In the case of an arrest that did not lead to a conviction, employment checks can continue including the arrest record for up to seven years, per § 605 of the Fair Credit Reporting Act:
Except as authorized under subsection (b) of this section, no consumer reporting agency may make any consumer report containing . . . Civil suits, civil judgments, and records of arrest that from date of entry, antedate the report by more than seven years or until the governing statute of limitations has expired, whichever is the longer period.
Subsection (b) provides for an exception if the report is in connection with "the employment of any individual at an annual salary which equals, or which may reasonably be expected to equal $75,000, or more".[16]
Some proposals for decreasing potential harm to innocent applicants include:
Furnishing the applicant with a copy of the report before it is given to the employer, so that any inaccuracies can be addressed beforehand; and
Allowing only conviction (not arrest) records to be reported.
In New Zealand, criminal checks have been affected by the Criminal Records (Clean Slate) Act 2004, which allows individuals to legally conceal "less serious" convictions from their records provided they had been conviction-free for at least seven years.
In Michigan, the system of criminal checks has been criticized in a recent case where a shooting suspect was able to pass an FBI check to purchase a shotgun although he had failed the check for a state handgun permit. According to the spokesman of the local police department,
... you could have a clear criminal history but still have contacts with law enforcement that would not rise to the level of an arrest or conviction [that can be used] to deny a permit whether or not those involved arrests that might show up on a criminal history.[17]
The Brady Campaign to Prevent Gun Violence has criticized the federal policy, which denies constitutional rights based on a criminal check only if the subject has been accused of a crime.
Public records pay sites[edit]
Taking advantage of public records availability in the United States, a number of Web-based companies began purchasing U.S. public records data and selling it online, primarily to assist the general public in locating people. Many of these sites advertise background research and provide employers and/or landlords with fee-based checks.
There has been a growing movement on the web[citation needed] to use advertising-based models to subsidize these checks. These companies display targeted ads next to the reports delivered to landlords or employers. Some of the reports provided by these pay sites are only expanded versions of a basic people search providing a 20-year history of addresses, phone numbers, marriages and divorces, businesses owned and property ownership. Usually, these sites will also provide a nationwide criminal report for an added charge.
As a general rule, employers may not take adverse action against an applicant or employee (not hiring or terminating them), solely on the basis of results obtained through a database search. Database searches, as opposed to source records searches (search of actual county courthouse records), are notoriously inaccurate, contain incomplete or outdated information, and should only be used as an added safety net when conducting a background check. Failure by employers to follow FCRA guidelines can result in hefty penalties.[18]
See also[edit]
Credit check
Criminal record check
Employment discrimination
Identity resolution
Negligence in employment
Psychological evaluation
Security clearance
Universal background check, a U.S. political term regarding firearm sales
Vetting
Online vetting
References[edit]
Jump up ^ "Advanced Personnel Vetting Techniques in Critical Multi-Tennant Hosted Computing Environments" (PDF). Thesai.org. Archived (PDF) from the original on 2013-10-29. Retrieved 2013-10-25.
Jump up ^ "Need for Employee Background check". www.emptrust.com. Archived from the original on 2017-08-08. Retrieved 2017-08-08.
Jump up ^ "ASUW Students Attorney Program". Archived from the original on October 14, 2012.
Jump up ^ "The Attorney General's Report on Criminal History Background Checks" (PDF). Usdoj.gov. Archived (PDF) from the original on 2009-05-30. Retrieved 2013-10-25.
Jump up ^ Davidson, Charlie. "The Brady Gun Background Check Act". Fbinicsystem.com. Archived from the original on 28 August 2013. Retrieved 23 August 2013.
Jump up ^ CBC News (December 6, 2011). "Workplace fraud cost $3.2B last year". CBC News. Archived from the original on April 19, 2012. Retrieved May 13, 2012.
Jump up ^ "BDO Fraudtrack 4 Report". Bdo.co.uk. Archived from the original on October 20, 2008. Retrieved 2012-06-17.
Jump up ^ "The Enemy Within". CIFAS. Archived from the original on 2015-09-09. Retrieved 2015-06-08.
Jump up ^ Fraud doubles yet expert says the worst is still to come Archived July 27, 2009, at the Wayback Machine.
Jump up ^ Jessica Shepherd (August 6, 2009). "Under-21s told 29% more lies on job applications this year than last". The Guardian. Archived from the original on March 6, 2016. Retrieved May 13, 2012.
Jump up ^ "Annual pre-employment Screening Survey" (PDF). Powerchex.co.uk. Archived from the original (PDF) on 2011-10-01. Retrieved 2012-06-17.
Jump up ^ "Hidden dangers of background checks". news.com.au. Archived from the original on 5 October 2016. Retrieved 27 March 2018.
Jump up ^ "Archived copy" (PDF). Archived (PDF) from the original on 2016-08-20. Retrieved 2016-08-04.
Jump up ^ "The 2012 Florida Statutes". Florida Senate. Archived from the original on July 17, 2013. Retrieved July 16, 2013.
Jump up ^ "U.S Immigration and Customs Enforcement News Release". Ice.gov. 2008-08-26. Archived from the original on 2012-09-21. Retrieved 2012-06-17.
Jump up ^ "Fair Credit Reporting Act". Ftc.gov. Archived from the original on 2012-06-15. Retrieved 2012-06-17.
Jump up ^ Kathy Barks Hoffman, Associated Press, 10:33 am EDT Apr 13, "Mich. shooting suspect was denied permit"
Jump up ^ "Bellwether Settlement For $5.9 Million Given Preliminary Approval For FCRA Class Action Involving Criminal History Information : Workplace Class Action Litigation : Lawyers & Attorneys for Labor & Employment Law Litigation, Counseling, Employee Relations : Seyfarth Shaw LLP". Workplaceclassaction.com. Archived from the original on June 15, 2012. Retrieved 2012-06-17.
External links[edit]
Advocates Complain of Background Check Errors, ABC News, 13 Oct 2008.
Why You Shouldn’t Rely On Free Background Checks, Crimcheck, 4 May 2018.
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