April 5, 2022
Steps to Take When a Background Check Needs Additional Consideration
Editor’s note: As an organization, Checkr does not use pass or fail language with regards to background checks. However, we know that many people do use these terms and have questions about how to proceed when a background check requires extra consideration. Nothing in Checkr’s Blog should be construed as legal advice, guidance, or counsel.
If an employment background check comes back and needs to be considered, it’s important to understand your next steps. Candidates with a “failed” employment background check can derail the hiring plans of your business. If a candidate’s background check “failed”, it’s important to fairly assess the findings. The actions you take will depend on the standards put in place by you, the business owner.
If you find yourself in a situation where a candidate has a “failed” background check after a job offer, what should you do?
The reasons for “failing” the background check matter. Let’s break down how to proceed in this situation.
What can cause a “failed” background check after a job offer?
Candidates often wonder how it’s possible to “fail” a background check. They may ask, “How do I know if I passed my background check?” Employers are entitled to set the parameters of their background checks.
For example, an employer may state that only certain criminal offenses could impact a job offer. An automotive-related offense may not qualify as a “failed” background check reason when hiring someone for an office job.
Let’s examine some of the most common causes of a “failed” background check.
Criminal records are one reason candidates “fail” to pass a background check. Roles that involve working with minors, vulnerable populations, or involve significant responsibility typically have the tightest parameters.
On the other hand, some employers may choose not to run a criminal background check for certain positions. It all depends on company policy.
Typically, employers search for criminal records that directly relate to the job at hand. For example, a bank may decide to rescind a job offer if the candidate has convictions for fraud and embezzlement.
Consult with your stakeholders and counsel regarding the severity of various criminal offenses and how they may impact a candidate’s suitability.
Inaccurate employment history
Employment history can play a large part in determining a candidate’s suitability for a role. A long working history within an industry speaks to a candidate’s level of expertise.
One of the biggest background check “red flags” is being dishonest about tenures and positions held.
Comprehensive employment checks give employers peace of mind that they’re hiring someone with the hard and soft skills necessary for the position advertised.
Education background check
If an education background check “failed”, it’s possible a candidate may have misreported their GPA, degree classification, or which institution they attended.
Education background checks are vital for those looking to secure a highly technical role within your company. Furthermore, they are helpful for younger candidates entering the workforce for the first time.
The importance of conducting an educational background check has only increased with the prevalence of fake degrees. Rough estimates state there could be as many as two million fake degrees in the US alone.
What can you do if a candidate “failed” a background check?
Determining your next steps after a background check requires further consideration in accordance with your organization’s policies. However, deciding to rescind a job offer requires you to know the candidate’s rights as well as your own legal obligations.
Deciding what happens if candidates “fail” a background check can be complex, and seeking professional legal advice should be your first step.
Create a compliant background check disclosure form
Confronting a “failed” background check after a job offer starts when you ask a candidate to consent to a background check.
A background check disclosure form spells out your intent and how you will use the information. It must lay out that you will use any and all information to make employment-related decisions, such as offering a contract of employment.
Run this form through your legal team first. There are rules and regulations you must follow to protect the rights of the candidate.
Consult your hiring policy
Comprehensive corporate hiring policies help protect you if a job offer must be rescinded based on the results of a background check.
The policy outlines your actions in various circumstances and how background check results may influence your employment decisions. Many companies choose to format hiring procedures in the form of a decision tree to provide a visual map.
For example, a company may decide that a single misdemeanor may lead to a candidate being hired regardless. On the other hand, a violent crime or theft may require further review.
Your hiring policy can help mitigate legal risk and also gives candidates insight into how you made your decision. Candidates often wonder, “How do you know if you “failed” an employer background check?”.
Issue an adverse action notification
Did you see something in a candidate’s background check that requires further review? Considering any form of adverse action requires the candidate to receive a formal notification.
The Fair Credit Reporting Act (FCRA) mandates that the candidate must be provided with the following documentation:
- Pre-adverse action letter
- The background report
- A summary of rights under the Fair Credit Reporting Act
All documents listed above may be copies, but they should be the most recent versions. You fully involve the candidate in the process and support their right to reply by providing these documents.
Allow the candidate to respond
Mistakes happen, and sometimes, a candidate may have something in their background check that they are not aware of. Candidates may also have genuinely forgotten about an arrest or conviction from years before.
Regardless of the situation, the candidate always has the right to review the background check, understand their rights, and respond appropriately.
Your hiring policy should stipulate how long the candidate has to present a reply. The standard length is five days, but you can opt for longer. Be sure to work with your counsel to understand the rules and regulations regarding response time in your jurisdiction.
Can you move forward?
After receiving the candidate’s response, you need to begin the decision-making process. Withdrawing any job offer is never an easy decision, and you should make sure you are coming to an informed conclusion.
For example, if necessary, you may want to seek legal counsel, speak to your partners, and review industry guidelines and standards. If you work in a protected industry, such as finance or healthcare, there can be additional considerations.
Take adverse action or continue with the hire
You have a choice whether to take adverse action or continue with the hire. Weigh up all the pros and cons before making any choice. Of course, allow the candidate to provide any further updates that could influence your decision.
Keep the candidate in the loop, so they have a chance to present further evidence. Encourage them to provide any additional information that could allow you to continue with the hiring process.
For example, candidates may be able to give an explanation for the information on their background check. They may also decide to dispute some information on the background check.
In contrast, a candidate who cannot do any of this may lead to you initiating adverse action.
How to take adverse action
Taking adverse action is not as simple as simply rescinding a job offer. There is a strict set of rules your business must adhere to. Remember, following each step could protect you if the candidate decides to take legal action.
You must issue an adverse action notice. Within this notice, you need to cover the following:
- The name of the company responsible for the background check
- Provide a disclaimer that the employer/business made the employment decision, not the background check company or a credit reporting agency
- Attach a copy of the candidate’s rights under the provisions of the FCRA
- Provide another copy of the background check report
- Reaffirm the candidate’s right to ask for a further copy of their background check report within 60 days
Again, seek legal guidance when formulating your approach to taking adverse action to help support your FCRA compliance. Consider your formal hiring policy when making a decision to take adverse action.
Background checks are a staple of the hiring process. Ensure you get the most qualified, experienced candidate to transform your business and take it to the next level. Checkr can support you in hiring the best candidate for your company with fast and fair background checks.
Companies should consult their own legal counsel about their compliance responsibilities under the FCRA and applicable state and local laws. Checkr expressly disclaims any warranties or responsibility or damages associated with or arising out of information provided.