Employee Background Checks

Employee Background Checks

An employee background check reviews a candidate's criminal records, driving records, and whether they are on a terror watch list or sex offender registry. It may also include a check of credentials and credit background check.

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What Does A Background Check Cost
What Does a Background Check Cost?

Background checks cost between $19.00 and $80.00. The cost of a background check depends on how much information an employer seeks, and how fast it needs to be done. Credit checks, license verification, and job history verification usually cost extra.

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Need to make sure your business is protected, verify a candidate's history, and keep your workplace safe and secure? Employee background checks are the tool you need.

They can also help with screening the right candidates, and they're especially critical if you're hiring for a position of trust.

But people often have questions about if they should do one, cost, laws surrounding them, what info they'll need from an employee, what they'll get, and which service to go with.

We'll answer all your questions, and help you get started on your background checks quickly.

How To Do a Background Check:

A poorly created background check process will add nothing but cost and complexity to your interview process and could even land you in hot water if it causes candidates to be excluded for reasons you are not permitted to discriminate on.

1. Have a consistent policy regarding how background checks are performed.

This is best documented in a flow chart so everyone knows which steps to complete and at which point. Haphazard background verification check processes can cause legal issues if you are only applying some steps to some candidates such as only doing credit checks on candidates from specific backgrounds.

Background checks can unearth sensitive information and, in some states, you are not able to gather certain information as part of a background check. Talk to a lawyer to make sure your background check does not cause legal issues for your company.

3. Give candidates a chance to clear up mistakes or misunderstandings with background checks.

Information obtained through background checks can sometimes be slightly incorrect and even outright wrong. Giving candidates a chance to rectify or explain incorrect information can help you save a great candidate that could have been excluded incorrectly.

4. Use background check services that are FCRA compliant.

The Fair Credit Reporting Act (FCRA) is fairly clear on what you can and cannot do as part of a background check with regards to credit information. This document provides a nice summary of how the information should be treated from the candidates perspective.

Nearly all background checks are governed by the Fair Credit Reporting Act (FCRA), but you should know that there are an array of other laws that affect them, depending on state and region. For example, in some states, it's fine to use credit and criminal background checks for any employee, in others you can only perform these checks for specific types of employees.

Bottomline, any background check for employers should be FCRA compliant.

5. Know the difference between reference checks and investigative consumer reports.

A reference check happens when you contact someone such as a former employer to verify facts such as employment dates, the position held, etc. Reference checks are typically easy and straightforward. If you reject a candidate due to the information you obtained in an investigative consumer report then you must give the candidate a copy of the report. If the information was obtained through a reference check then you do not need to disclose this to the candidate.

6. Use background checks consistently, not on a candidate-by-candidate basis.

Apply the same background check process to every candidate you interview for the role. Applying it selectively to only candidates form a specific background or experience level can cause unintended legal consequences if it is shown to be a proxy for illegal discrimination. Outside of this, waving some candidates through based on gut feel as "they seem like a nice person" defeats the purpose of doing a background check to protect your company.

7. Do not assume parts of the background check process are "routine" - get the facts.

Critical information will often come up in the most mundane steps of the background check. Make sure that hiring managers take the process seriously and that they pay attention to the valuable information obtained.

8. Don't ask for information about character while verifying previous employment facts.

As soon as you start asking for opinions - questions about character, attitude, etc. you're doing an investigative consumer report. This falls under federal law, and you'll be required to give notice to the applicant, give them an option to ask for details, and comply with their requests. If you need this sort of information, it's best to get legal advice first.

Do you need an employees permission to do a background check?

You'll need written permission if you want to hire an outside company to investigate, want to do a credit report, want access to school transcripts, or want access to detailed military records.

If you have made a reasonable request, and the employee denies permission, you can legally take the candidate out of consideration for the position.

What Information Youll Need For A Criminal Background Check
What information do you need from candidates to do a background check?

To perform a background check you'll need to get the full name, social security number, and date of birth of the employee. You will also need the employee's permission for credit reports, school transcripts, and military records.

What Should a Basic Background Check Include:

1. Criminal records check.

Provides criminal history for the applicant. Especially important for positions of trust/security. Should include national and county records.

2. Social security validation.

Ensures the candidate's social security number is legitimate and finds all names, including aliases and variations, dates of birth and address history associated with the social security number. This shows employers if the candidate has lived in undisclosed locations or under other aliases, which may reveal criminal records that wouldn't have been found otherwise.

3. Address history check.

Traces previous addresses for the candidate. Finding out where a candidate has lived will make it easier to verify other research, and may reveal jurisdictions where criminal background checks should be performed.

4. U.S. terror watch list check.

Most background checks will look to see if the candidate is on the U.S. terror watch list. Especially important for security jobs.

5. Sex offender registry check.

Extremely important for positions of trust, this check is included with most background checks.

Employee Background Check Legal

Background checks are governed by the Fair Credit Reporting Act (FCRA), but you should know that there are an array of other laws that affect them, depending on state and region. Companies are not required to perform them by law. Checks should be applied to all employees consistently and fairly.

Additional Background Screening Options to Consider:

Want to go more in-depth with your background checks? There are several other types of checks you can do to get additional information that may be important depending on the job you're hiring for.

Character References: Great for seeing what a person is like to work with. Remember, asking for these falls under FCRA rules - get legal advice first.

1. Driving records.

Hiring a driver? You'll definitely want these.

2. Student transcripts.

Need to verify an applicant's school performance? Transcripts are helpful, but you'll need applicant permission.

3. Credit report.

Gives you perspective on an applicant's history of meeting financial obligations, as well as previous address information.

4. Military service records.

Helpful if an employee's military service plays a big role in your decision to hire them. You'll need permission for this.

5. State licensing records.

Double check to be sure candidates have the state licenses they need.

6. Professional license records.

Check to be sure candidates have professional licenses they need.

7. Workers' compensation.

Employers may want to check a candidate's past workers' comp claims. This may be subject to legal restrictions - get legal advice.

Betterteam checked out several background check providers and created an easy table to help you make a decision.

Background Check Service Providers:

One thing to be aware of, if you just Google "background check services" you'll get a whole lot of companies. A lot of them offer background checks that are meant for personal use and are not compliant with federal laws for employers.

How Long Does It Take To Do A Background Check
How Long Does It Take to Do a Background Check?

The typical time, according to several popular background check services, is 1-5 days to verify social security numbers and addresses, check national and county criminal records, and the U.S. terrorism watch list.

Should You Do a Background Check Yourself?

It may be advisable in cases where you're after very basic info, or if the background check is not likely to make a big impact on your hiring decision. Basically, if you feel like a cursory glance at information on social media and Google search is good, maybe this is your best choice.

Maybe. The problem with this method is that it's hard to be 100 percent sure you got the right person and that the information you're seeing is totally accurate. It's also possible you'll see information that you should not legally be using in your consideration for a hire.

This is why, 9 times out of 10, it's best to go with a search firm.

It'll cost you less than $80 per candidate, you can rely on the information, keep yourself from seeing the information you're not supposed to, and get much more in-depth.

Also, you can spend the time you would have used doing a background check on things that you're an expert at, while the experts handle the background checking.

Ready to do your own reference check? Here are some reference check questions to help. You may also want to use an employment verification letter.


What is the price range for background check services?

Background check services can cost between $19.95 and $59.95 per use, or more, depending on how many checks you need to perform, and how deep the background check needs to go.

What is the best background check site for companies that need to do a lot of checks?

Background check companies allow you to buy your criminal background checks on a subscription basis, which will save you money if you need to do several background checks each month.

What is the best background check service for hiring security guards?

Security guards are in a position of trust and high responsibility, especially if they're armed. The best background check website, in this case, offers a great criminal background check. Try Crimcheck, GoodHire, HireSafe, or Kennect.

How can I be sure I'm using a reputable background check company?

There have been some less than reputable companies offering employment background checks. Before you buy, see how background check reviews have ranked companies and check that there aren't serious complaints with the BBB.

Also take note of the latest news from the FTC regarding background check companies. Background checks for employment have also been used to target employers for subscription traps. Basically, your company is tempted into starting a monthly subscription, and then finds it impossible to cancel.

Are background check services affordable for small businesses?

Yes, in general, they're not that expensive, and you can do a fairly cheap background check if you don't need to include multiple states in the criminal background check. Pricing for a background check starts at $19.95 per check.

How can I be sure I'm getting a comprehensive background check?

Most websites will actually give you add-on options so that you can decide how comprehensive you want your background check to be. GoodHire's premium service, for example, checks county criminal courts, verifies education credentials, and checks work history.

Final Thoughts:

The cost of a bad hire is staggering these days.

Even for small businesses, the costs can run into the tens of thousands of dollars when you factor in money spent hiring, damaged relationships with clients, the strain on your work culture that hurts productivity, work that needs to be redone, etc.

If the hire turns out to be really bad, there can also be legal costs that run your business into the ground. Don't just rely on a candidate resume and interviews. Fight bad hires with a background checks for employers.

Most background checks take less than a week and cost under $80, so it's worth your time and money to take this extra step.

Before you jump into background checks though, you'll want to understand the laws that govern them.