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Background check in the USA

Updated on:
16 Jan, 2024
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Background checks allow employers to hire the best candidates for the positions they want to fill, and with good reasons. This guide will cover the requirements and processes of managing and running a background check in the USA. We’ll dive deeper into the different background checks available, the benefits, legal requirements, and the process to follow when conducting these checks.

What is an employee background check?

An employee background check is a legal process that verifies an applicant’s personal, professional, criminal, and credit history. It’s a normal process in human resources in many companies as it assures employers that they aren’t putting their businesses or customers at risk. When hiring global employees, running an international background check also ensures you’re getting the right fit for your team.

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What are the benefits of background checks in the US?

Conducting background checks on potential hires has many benefits for your business, including:

  • Reduced risk: The possibility of employing a person with a criminal record or a track record of deceit or fraud can be lessened with the help of a background check. An extensive background investigation shows prior criminal convictions and reveals any disparities or errors in a candidate's resume.
  • Better safety and security: Background checks help you to spot possible red flags in job applicants, such as a past of violence or theft. By avoiding such individuals, you can enhance the security and safety of your business, workers, clients, and other stakeholders.
  • Legal compliance: Companies need to abide by local, state, and federal regulations, and background checks are handy for this. For instance, checking employment history within the US, credit rating, and other background checks are necessary for some sectors, including healthcare, IT, and education. Noncompliance can result in costly lawsuits.
  • Better hires:  A background check helps you to confirm a candidate's employment history to ascertain if they meet your requirements for the position. In the end, you can hire better employees.

What are the types of background checks in the US?

Below are the most common types of background checks used by employers in the US.

US criminal record check

A criminal record check in the US check involves searching an applicant's criminal history, including arrests, convictions, and court records. This check helps to flag applicants who are a threat to your business or organization. Consequently, you can create a team you trust and maintain safety and security in your workplace.

Employment history check US

An employment history check, also known as employment screening in the US or work history check in the US, is the most common type of background check. This check reviews an applicant’s work history, including roles held, company, previous job performance, and civil litigation issues. It also allows hiring teams to make sound decisions about the overall personality of an applicant and whether they are fit to work in a role.

Medical screening

A medical screening background check in the USA can be mandatory for certain professions, such as those that involve working with hazardous materials. Usually, an employer wants to know an applicant's health status, and the check may include reviewing the following:

  • Medical records
  • Body physique
  • Alcohol and drug tests
  • Past and present medical conditions

You must abide by ethical and legal requirements for medical screening tests. For instance, the Americans with Disabilities Act (ADA) prohibits employers from discriminating against job applicants based on their medical conditions or disabilities. Therefore, businesses should strive to conduct medical screening only if it's relevant to the job.

Credit history check

Employers mainly perform credit history checks for job applicants in financial positions. The check evaluates an applicant's credit history to determine their financial responsibility. Before initiating a credit background check in the USA, federal law requires you to comply with the Fair Credit Reporting Act (FCRA). This act requires you to get written approval from a job applicant before conducting a credit check.

Also, keep in mind that different countries may have different requirements for background checks. If you’re relocating US employees to another country, you’ll need to learn the laws and regulations of that country.

Education history check

Many professions in IT, healthcare, law, or related fields require applicants to meet specific education requirements such as college degrees, diplomas, GEDs, or masters-level education. An academic background check ascertains an applicant's educational background, such as the validity of their college degree. This background check also includes dates of attendance, GPA, academic performance, college degree type, and area of study.

Social media check

With social media, employers are now interested in how potential hires conduct themselves outside of a professional setting. Candidates who display fanatic behaviors, are openly discriminative or are bullies, can hurt your brand’s reputation. In the long run, this exposes you to loss of trust, potential legal hurdles, and a revenue dip.

Requirements for background check in the USA

You must comply with several legal requirements when conducting a United States background check. These include:

  1. Disclosure and consent: Before conducting a background check, you must disclose to the candidate, in writing, that you intend to obtain a report for employment. You must also obtain written consent from the candidate before conducting the check.
  2. Compliance with federal nondiscrimination laws: You must comply with federal laws that protect job applicants and employees from discrimination when using their background information to make employment decisions.
  3. Compliance with the Fair Credit Reporting Act (FCRA): When running background checks through a company that does background checks, you must comply with the FCRA. The FCRA sets standards for employment screenings, including credit checks.
  4. Pre-adverse action: If you intend to take adverse action against a candidate based on information obtained during a background check, ensure you provide the candidate with a pre-adverse action notice. This notice includes a copy of their consumer report and a summary of their rights under the FCRA.

Steps in conducting a background check in the USA

  1. Develop a background check policy: Document the details of your screening program. This allows you to apply the policy consistently across the company.
  2. Ensure compliance with federal, state, and local laws: You must comply with federal, state, and local laws that govern background checks for employment.
  3. Screen the background check company: Choose a reputable company to conduct your employment screenings and one that complies with all legal requirements.
  4. Select the appropriate background checks: Tailor your employment check packages by position. For instance, you may require credit checks for jobs that involve finances or driving record checks for roles that involve operating motor vehicles.
  5. Acquire disclosure and consent: Before conducting a background check, remember to disclose to the candidate, in writing, that you intend to obtain a report for employment.
  6. Conduct pre-and-post adverse action: If you intend to take adverse action against a job candidate based on information obtained during a background check, you must give them a pre-adverse action notice. The notice includes a copy of their consumer report and a summary of their rights under the FCRA.
  7. Communicate results: Communicate the results of background checks to candidates or employees under applicable laws and regulations.

Are employee background checks legal in the US?

Yes. Employers have the right to know who they’re hiring for the better functioning of their businesses and organizations. Besides, depending on the industry, running a background check may be a part of establishing compliance.

Planning to hire in the US? Here's how Skuad can help

Are you looking to hire and manage talent in the US? With Skuad as your Employer of Record, we run extensive background checks in the United States and beyond, along with managing the entire employment cycle for you.

Our unified platform allows you to onboard new hires anywhere in the world in minutes, run global payroll securely, stay 100% compliant with local employment laws, and manage benefits, work permits, timesheets, and more.

FAQs

1. How long does a US background check take?

A standard background check in the US typically takes three days to one week. However, various factors can prolong this timeframe, such as varying federal or state regulations and incomplete check request forms.

2. What shows up on a full background check?

A complete background check can reveal diverse information, including criminal arrests, bankruptcies, civil litigations, assets, academic background, weapons permits, and professional licenses.

3. What is a US government background check?

A US government background check thoroughly examines an individual’s personal, professional, and criminal history. The review assesses if an individual is reliable, trustworthy, and suitable for a job with the federal government.

4. How far back does a background check go in the USA?

Standard background checks for employment typically cover seven years of criminal and court records. However, these checks may date further depending on state and federal laws.

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