What is an employee background check

An employee background check describes the process of verifying a candidate’s employment history, experience, education or certifications, and any past criminal history.

Background screening helps HR managers make smarter hiring decisions and mitigate risks to the organization, it’s especially effective before making an employment decision and extending a contract. 

What is an employment background check?

A company conducts an employee background check to assess whether a person has any criminal activity on their record, confirm their employment history and education, and verify other claims made by a potential new hire.

A background check uses an individual’s date of birth and Social Security number to scan public records and court records (depending on the type of information being assessed). With this information, hiring managers are able to evaluate a candidate’s character and help protect the organization against the wrong hire.

What is the purpose of employee background checks?

Companies conduct background checks to get an accurate overview of a candidate before offering an employment contract. The employee background check should raise any red flags while conducting identity verification, checking work history, and reference checks. In the process, they help hiring managers make empowered decisions. 

Background checks offer the following benefits:

• Verify employment qualifications including proficiency in skills, commitment to previous organizations, and claimed income
• Protect organization and workforce against potential liabilities
• Safeguard customer data by avoiding internal data security breaches
• Maintain legal compliance with governing bodies 

Employee background checks are conducted at different points of the hiring process. Some companies run an employee background check after sharing a conditional job offer with a candidate (before their employment is finalized) while others run checks on all job applicants during the interview process. 

The pre-employment screening helps human resources and hiring teams make confident hiring decisions, ensuring that the business remains profitable and productive. 

With rapid globalization and the rise of remote work, global hiring teams are hiring from an international talent pool. In this instance, background checks help organizations hire from an expanding and evolving workforce with reduced risk.

What is included in an employment background check?

An employee background check may include a variety of different details, depending on the type of assessment.

In most instances, the following details are included:

• Past employment verification  — assess whether the employee held the position and performed the jobs that they claimed

• Education verification — confirm that the employee holds the credentials that they claim

• Check for criminal records — check whether the employee has any felony or misdemeanor convictions that could put the organization, other employees, or customers at risk

There are different types of employee background checks and the screening process may include other methods of investigation. Consider the following as examples.

Identity and Social Security Verification

Department of Homeland Security and Social Security Administration records reveal whether an identity is valid or whether it’s been used in the past. These checks can also verify an address.

Credit report

Credit reports are prepared by credit bureaus who collect information and assist with a credit check. General categories include identifying information and credit inquiries. High levels of debt, multiple bankruptcies or excessive spending could indicate financial irresponsibility.

Criminal records

Hiring managers may be held accountable for negligent hiring if they fail to conduct criminal background checks on potential employees. These checks will highlight pending charges, felony convictions, and acquitted charges. Certain offenses, such as being a sex offender, could impact hiring decisions.

Driving records

If an employee will represent the company on the road, then it’s important that their driving records are clean. An employee with a poor driving record will have a negative impact on the company’s insurance rates.

Other types of background checks

A company may choose to run background checks for a particular reason. For example, a company may check an applicant’s credit history to prevent theft or embezzlement. Other specific checks are conducted to confirm professional licenses or conduct drug testing for the presence of illicit drug use. 

In the modern digital age, some companies conduct a basic check on social media as part of their screen process. However, it’s important to be aware of the ethical and legal repercussions of using social media as a screening metric for little of it is predictive of performance.

What compliance laws are relevant during an employee background check?

Pre-employment background checks must follow legal and fair processes, remaining consistent when assessing all potential employees. 

Employers of both small businesses and large corporations must consider compliance laws when conducting background checks on employees. Examples of these compliance laws are stipulated by the federal Fair Credit Reporting Act (FCRA) and guidelines are stipulated by the Equal Employment Opportunity Commission (EEOC). 

State laws impact compliance and must also be considered, as well as local ban-the-box laws which prevent employers from asking applicants about their criminal history after the initial job application.