Background Check Policy: What to Include + Free Template
This article is part of a larger series on Hiring.
An employment background check is a process an organization uses to verify a person’s background and qualifications and screen for red flags by checking criminal records, credit reports, driving history, and more. Before conducting background checks, it is important to implement a background check policy. This policy should outline when it is appropriate to conduct a background check and how to determine which items will be checked.
If you need to quickly create a policy, download our free, customizable background check policy template.
Your background check policy should generally include five major sections that touch on the circumstances around conducting background checks, the information obtained, the use of that information, and what happens in light of the findings.
1. Background Check Circumstances & Frequency
This section should be used to notify new hires and current staff that all employees are subject to a background check as part of their employment. You may want to include a clause for new hires and a separate one for current employees, as these decisions will be different. For instance:
- New Hires: Employment may be contingent upon the results of the background check
- Current Employees: Promotions or transfers may be contingent upon the results of the background check if one has not been conducted within the past three years
2. Information Obtained in Background Investigations
Reference each type of background check you may conduct and the information that will be collected on each new hire. It is also good to note that a criminal background check will not automatically disqualify a candidate for employment.
There are several types of background checks, each serving a different purpose. Often, background checks can be customized, depending on the role and the organization’s policy. Be mindful that each additional inquiry incurs costs, and that you’ll want to only request information pertinent to the position and within the guidelines of state regulations where the employee is based.
Click through the tabs below for more information on the most common types of background checks:
3. Use of Information Obtained in a Background Investigation
Your background check policy should always acknowledge that any information collected during a background investigation would be used to determine eligibility for employment. Additionally, notify the candidate or employee that all information provided will be thoroughly reviewed to determine eligibility.
Before conducting any background check, you must notify the candidate or employee and receive their consent to investigate. Be sure to include this language in your background check policy under this section.
Several states have specific laws around background checks and what can and cannot be considered when determining hiring eligibility. Although this list is by no means exhaustive, limitations in some states include:
- Conviction Reporting Limited to Seven Years: California, Kansas, Maryland, Massachusetts, Montana, New Hampshire, New Mexico, New York, and Washington
- Prevention of Non-convictions Being Reported: California, Kentucky, New York, and New Mexico
- Pending Criminal Cases Are Not Reportable: Kentucky
- Ban the Box Laws: Over 31 states and 100 cities and counties
4. Adjudication
Adjudication is the act of reviewing information received to determine an action. In the case of your background check policy, notify the candidate or employee that you will be reviewing their background check, should anything adverse be found within.
You may include the following reasons to review:
- Relevance of incident
- Nature of work to be performed
- Time since the incident
- Age of candidate or employee at the time of the incident
- Seriousness of the incident
- Number of offenses
- Pending charges
- Relevant evidence, or lack thereof
5. Adverse Action
Note in your policy that should you find anything in the background check that could prevent you from hiring the candidate (or cause you to release a current employee), you will provide them with a copy of the report obtained, the company’s background check policy, and an FCRA Summary of Rights. You will also advise the candidate which part of the background check made them ineligible for employment, and offer them an opportunity to dispute the findings.
Conducting Background Checks During the Hiring Process
A wide array of organizations utilize background checks as an important part of the hiring process. Whether or not you decide to use a third-party screening company to perform a background check is often determined by your organization’s size, the nature of your business, and the types of employees working for you.
For instance, while one employer may only need a basic criminal background check on every employee, another might decide to specifically request driving history for their employees who will be driving a company-issued vehicle. Similarly, if the organization is a CPA firm, it may request credit history from each of their new employees who would be dealing with financial business.
The key to establishing an effective process is understanding your industry-specific regulations and being consistent—even when applying role-specific background check standards.
If you need a background check service to help you conduct efficient checks on your candidates, consider ShareAble for Hires. You can get up-to-date information on their credit, financial, and employment history without having to do the research yourself, and packages start at just $25 per report.
Bottom Line
Background checks can be a vital part of the due diligence process. Employers conduct them to get to know potential employees better and protect the company and its reputation. To protect the candidate, however, there are guidelines, laws, and policies that should be closely adhered to. Creating a consistent and compliant policy that is enforced across the organization will prevent possible legal concerns while setting the foundation for a safe environment for all.