Background check
Encyclopedia
A background check or background investigation is the process of looking up and compiling criminal records, commercial records and financial records (in certain instances such as employment screening) of an individual.

Background checks are often requested by employers on job candidates, especially on candidates seeking a position that requires high security or a position of trust
Position of trust
Position of trust is a legal term that is commonly used in the United Kingdom, the United States, and Canada. It refers to a position of authority over another person or within an organization, for example as a supervisor...

, such as in a school, 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. Results of a background check typically include past employment verification, credit score, and criminal history.

These checks are often used by employers as a means of objectively evaluating a job candidate's qualifications, character
Good moral character
Good moral character is a defined legal concept in United States law that details requirements for consideration for certain benefits or positions. The term is chiefly used by the federal government in immigration law, but it can also be a requirement for a particular position of employment or...

, fitness, and to identify potential hiring risks for safety and security reasons. Background check is also used to thoroughly investigate potential government employees in order to be given a security clearance
Security clearance
A security clearance is a status granted to individuals allowing them access to classified information, i.e., state secrets, or to restricted areas after completion of a thorough background check. The term "security clearance" is also sometimes used in private organizations that have a formal...

. However, these checks may sometimes be used for illegal purposes, such as unlawful discrimination
Discrimination
Discrimination is the prejudicial treatment of an individual based on their membership in a certain group or category. It involves the actual behaviors towards groups such as excluding or restricting members of one group from opportunities that are available to another group. The term began to be...

 (or employment discrimination
Employment discrimination
Employment discrimination is discrimination in hiring, promotion, job assignment, termination, and compensation. It includes various types of harassment....

), identity theft
Identity theft
Identity theft is a form of stealing another person's identity in which someone pretends to be someone else by assuming that person's identity, typically in order to access resources or obtain credit and other benefits in that person's name...

, and violation of privacy.

Pre-employment screening

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.

Screening applications in the UK

A number of annual reports, including BDO Stoy Hayward's Fraudtrack 4 and CIFAS
CIFAS
CIFAS - The UK's Fraud Prevention Service, is a not-for-profit membership association representing the private and public sectors. CIFAS is dedicated to the prevention of fraud, including staff fraud, and the identification of financial and related crime...

's (The UK's fraud prevention service) 'The Enemy Within' have showed a rising level of major discrepancies and embellishments on CVs over previous years. Such business fraud cost United Kingdom businesses $1.4 billion in 2005.

Almost half (48%) of organizations with fewer than 100 staff experienced problems with vetted employees.

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.

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. Annual research by Powerchex
Powerchex
Powerchex is a UK based pre-employment screening company specialising in the financial services sector in the City of London.Powerchex is a full member of the UK chapter of the National Association of Professional Background Screeners or NAPBS, and was started by Alexandra Kelly in 2005 who is the...

 has also shown that the number of applicants lying on their applications has been increasing steadily since the summer of 2007 when the financial crisis of 2007–2010 began. As of August 2009, nearly one in 5 applicants have a major lie or discrepancy on their application.

The market

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.

Types of checks

  • Employment References

  • Character Reference Check
  • Gaps in employment 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 - bankruptcies
  • Criminal History Report.

Regulation

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:
  1. Protecting consumers
  2. Maintaining market confidence
  3. Promoting public awareness
  4. Reducing financial crime


In the USA, the FCRA (Fair Credit Reporting Act) is the most important regulation governing background screening.

Laws

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
Fair Credit Reporting Act
The Fair Credit Reporting Act is a United States federal law that regulates the collection, dissemination, and use of consumer information, including consumer credit information. Along with the Fair Debt Collection Practices Act , it forms the base of consumer credit rights in the United States...

 (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
Credit rating agency
A Credit rating agency is a company that assigns credit ratings for issuers of certain types of debt obligations as well as the debt instruments themselves...

. Individuals must also consent in order for the employer to obtain a credit report.

Florida Law

Florida House Bill H0775, passed in 1999, provides protection for 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. These steps are:
  • Ordering a Florida state criminal record check
  • Taking reasonable efforts to contact an applicants past employers
  • Asking the applicant on the application if they have been convicted of a crime, date of crime and penalty imposed
  • Asking the applicant on the application if they were the defendant in a civil action for intentional tort
  • A driving record must be ordered if it is relevant to the performed work
  • The employer must interview the applicant

Types of checks

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 you use. A legitimate company will be happy to explain the process to you.

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

Reasons

They are frequently conducted to confirm information found on an employment application
Application for employment
An application for employment, job application, or application form is a form or collection of forms that an individual seeking employment, called an applicant, must fill out as part of the process of informing an employer of the applicant's availability and desire to be employed, and persuading...

 or résumé
Résumé
A résumé is a document used by individuals to present their background and skillsets. Résumés can be used for a variety of reasons but most often to secure new employment. A typical résumé contains a summary of relevant job experience and education...

/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. 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.

In the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...

, the Brady Bill
Brady Handgun Violence Prevention Act
The Brady Handgun Violence Prevention Act is an Act of the United States Congress that, for the first time, instituted federal background checks on firearm purchasers in the United States....

 requires criminal checks for those wishing to purchase handgun
Handgun
A handgun is a firearm designed to be held and operated by one hand. This characteristic differentiates handguns as a general class of firearms from long guns such as rifles and shotguns ....

s from licensed firearms dealers. Restricted firearms (like machine guns), suppressor
Suppressor
A suppressor, sound suppressor, sound moderator, or silencer, is a device attached to or part of the barrel of a firearm which reduces the amount of noise and flash generated by firing the weapon....

s, explosives
Explosive material
An explosive material, also called an explosive, is a reactive substance that contains a great amount of potential energy that can produce an explosion if released suddenly, usually accompanied by the production of light, heat, sound, and pressure...

 or large quantities of precursor chemicals, and concealed weapons permits also require criminal checks.

Checks are also required for those working in positions with special security concerns, such as trucking, ports of entry
Port of entry
In general, a port of entry is a place where one may lawfully enter a country. It typically has a staff of people who check passports and visas and inspect luggage to assure that contraband is not imported. International airports are usually ports of entry, as are road and rail crossings on a...

, 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.

Recently, many jobs are using pre-employment credit checks and the trend has appear to have grown since 2000 within the United States (Bird, M., 2010). According to a survey in 2010, 26% of individuals felt that employers should have the right and duty to check credit reports for all jobs, while another 28 percent felt that it depended on the potential employee's job responsibilities such as banking or accounting jobs.

Possible information included

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
Minimum wage
A minimum wage is the lowest hourly, daily or monthly remuneration that employers may legally pay to workers. Equivalently, it is the lowest wage at which workers may sell their labour. Although minimum wage laws are in effect in a great many jurisdictions, there are differences of opinion about...

 job would be subject to far fewer requirements than somebody applying to work for a law enforcement agency
Law enforcement agency
In North American English, a law enforcement agency is a government agency responsible for the enforcement of the laws.Outside North America, such organizations are called police services. In North America, some of these services are called police while others have other names In North American...

 such as the FBI or jobs related to national security
National security
National security is the requirement to maintain the survival of the state through the use of economic, diplomacy, power projection and political power. The concept developed mostly in the United States of America after World War II...

.

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 illegal 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 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
E-Verify
E-Verify is an Internet-based, free program run by the United States government that compares information from an employee's Employment Eligibility Verification Form I-9 to data from U.S. government records. If the information matches, that employee is eligible to work in the United States...

 program to research the working status of Social Security number
Social Security number
In the United States, a Social Security number is a nine-digit number issued to U.S. citizens, permanent residents, and temporary residents under section 205 of the Social Security Act, codified as . The number is issued to an individual by the Social Security Administration, an independent...

s. 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
Qui tam
In common law, a writ of qui tam is a writ whereby a private individual who assists a prosecution can receive all or part of any penalty imposed...

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
Car accident
A traffic collision, also known as a traffic accident, motor vehicle collision, motor vehicle accident, car accident, automobile accident, Road Traffic Collision or car crash, occurs when a vehicle collides with another vehicle, pedestrian, animal, road debris, or other stationary obstruction,...

 or traffic tickets
Moving violation
A moving violation is any violation of the law committed by the driver of a vehicle while it is in motion. The term "motion" distinguishes it from other violations such as parking violations, equipment violations, or paperwork violations relating to insurance, registration, inspection, etc.-...

. Department of Motor Vehicles and Department of Transportation records are searched to determine a qualified driver.
Drug test
Drug test
A drug test is a technical analysis of a biological specimen – for example urine, hair, blood, sweat, or oral fluid / saliva – to determine the presence or absence of specified parent drugs or their metabolites...

s: Drug tests are used for a variety of reasons—corporate ethics, measuring potential employee performance, and keeping workers' compensation
Workers' compensation
Workers' compensation is a form of insurance providing wage replacement and medical benefits to employees injured in the course of employment in exchange for mandatory relinquishment of the employee's right to sue his or her employer for the tort of negligence...

 premiums down.
Education records: These are used primarily to see if the potential employee had graduated from high school (or a GED
GED
General Educational Development tests are a group of five subject tests which, when passed, certify that the taker has American or Canadian high school-level academic skills...

) or received a college degree
Academic degree
An academic degree is a position and title within a college or university that is usually awarded in recognition of the recipient having either satisfactorily completed a prescribed course of study or having conducted a scholarly endeavour deemed worthy of his or her admission to the degree...

, graduate degree, or some other accredited university degree. There are reports of SAT
SAT
The SAT Reasoning Test is a standardized test for college admissions in the United States. The SAT is owned, published, and developed by the College Board, a nonprofit organization in the United States. It was formerly developed, published, and scored by the Educational Testing Service which still...

 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 score
Credit score
A credit score is a numerical expression based on a statistical analysis of a person's credit files, to represent the creditworthiness of that person...

s, lien
Lien
In law, a lien is a form of security interest granted over an item of property to secure the payment of a debt or performance of some other obligation...

s, civil judgments, bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....

, and tax
Tax
To tax is to impose a financial charge or other levy upon a taxpayer by a state or the functional equivalent of a state such that failure to pay is punishable by law. Taxes are also imposed by many subnational entities...

 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
Military discharge
A military discharge is given when a member of the armed forces is released from their obligation to serve.-United States:Discharge or separation should not be confused with retirement; career U.S...

.
Social Security Number: (or equivalent outside the US). A fraudulent SSN may be indicative of identity theft
Identity theft
Identity theft is a form of stealing another person's identity in which someone pretends to be someone else by assuming that person's identity, typically in order to access resources or obtain credit and other benefits in that person's name...

, insufficient citizenship
Citizenship
Citizenship is the state of being a citizen of a particular social, political, national, or human resource community. Citizenship status, under social contract theory, carries with it both rights and responsibilities...

, 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

Drug test
Drug test
A drug test is a technical analysis of a biological specimen – for example urine, hair, blood, sweat, or oral fluid / saliva – to determine the presence or absence of specified parent drugs or their metabolites...

s and credit checks
Credit history
Credit history or credit report is, in many countries, a record of an individual's or company's past borrowing and repaying, including information about late payments and bankruptcy...

 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
Northwest Airlines
Northwest Airlines, Inc. was a major United States airline founded in 1926 and absorbed into Delta Air Lines by a merger approved on October 29, 2008, making Delta the largest airline in the world...

 were the subject of a civil lawsuit
Lawsuit
A lawsuit or "suit in law" is a civil action brought in a court of law in which a plaintiff, a party who claims to have incurred loss as a result of a defendant's actions, demands a legal or equitable remedy. The defendant is required to respond to the plaintiff's complaint...

 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
Fair Credit Reporting Act
The Fair Credit Reporting Act is a United States federal law that regulates the collection, dissemination, and use of consumer information, including consumer credit information. Along with the Fair Debt Collection Practices Act , it forms the base of consumer credit rights in the United States...

:
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".

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
New Zealand
New Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...

, criminal checks have been affected by the 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
Michigan
Michigan is a U.S. state located in the Great Lakes Region of the United States of America. The name Michigan is the French form of the Ojibwa word mishigamaa, meaning "large water" or "large lake"....

, 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.

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

Taking advantage of public records
Public records
Public records are documents or pieces of information that are not considered confidential. For example, in California, when a couple fills out a marriage license application, they have the option of checking the box as to whether the marriage is "confidential" or "Public"...

 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 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.

See also

  • Credit check
  • Criminal record check
  • Employment discrimination
    Employment discrimination
    Employment discrimination is discrimination in hiring, promotion, job assignment, termination, and compensation. It includes various types of harassment....

  • Identity resolution
    Identity resolution
    Identity resolution is an operational intelligence process, typically powered by an identity resolution engine or middleware stack, whereby organizations can connect disparate data sources with a view to understanding possible identity matches and non-obvious relationships across multiple data silos...

  • Negligence in employment
  • Psychological evaluation
    Psychological evaluation
    A psychological evaluation or mental examination is an examination into a person's mental health by a mental health professional such as a psychologist. A psychological evaluation may result in a diagnosis of a mental illness...

  • Security clearance
    Security clearance
    A security clearance is a status granted to individuals allowing them access to classified information, i.e., state secrets, or to restricted areas after completion of a thorough background check. The term "security clearance" is also sometimes used in private organizations that have a formal...

  • Trends in pre-employment screening
    Trends in pre-employment screening
    A number of companies publish annual research into pre-employment screening, applicant fraud and its effect on business.- The market :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...

  • Vetting
    Vetting
    Vetting is a process of examination and evaluation, generally referring to performing a background check on someone before offering him or her employment, conferring an award, etc...

  • Online vetting
    Online vetting
    Online vetting, also known as cyber-vetting is increasingly being used by potential employers and other acquaintances to vet people's online presence or "internet reputation" on social network services such as Facebook, MySpace, Twitter, Bebo, and LinkedIn...


External links

The source of this article is wikipedia, the free encyclopedia.  The text of this article is licensed under the GFDL.
 
x
OK