CREDIT CHECK - First Advantage

B AC KGRO U N D C H E C KS
PROACTIVE POINTS TO PREPARE
CONSIDER BANNING
ACTIVE BAN THE
BOX LAWS
These jurisdictions have laws that
restrict private-sector employers from
inquiring about criminal convictions on
the employment application. Employers
should consult with legal counsel to
fully understand these laws.
THE BOX
The Equal Employment Opportunity Commission (EEOC) issued guidance in 2012 suggesting that
the practice of asking about prior criminal convictions on an employment application has a
disparate impact on minorities such as Hispanic and African American individuals, and creates a
barrier to employment for these individuals.
Consider removing the question about criminal convictions from the employment application, and
pushing it back further into the hiring process so that it impacts fewer applicants.
STATES
California, Colorado, Connecticut,
Delaware, Hawaii, Maryland,
Massachusetts, Minnesota, Nebraska,
New Jersey, New Mexico, Rhode Island,
Washington, D.C.
Don’t use “bright line” rules that
automatically exclude certain demographics.
For example, this is a no-no: “We do not hire
felons for any positions.”
Consider the relevance of criminal records
when making a hiring decision based on: 1) the
nature and gravity of the offense; 2) the nature
COUNTIES
Montgomery County, MD and Prince
George’s County, MD
Understand how your jurisdiction defines
“criminal convictions” since it often varies by
of the job; and 3) the time elapsed since the
conviction or completion of sentence.
jurisdiction and state.
CITIES
Review your background screening program
Baltimore, MD
Buffalo, NY
Chicago, IL
Columbia, MO
Newark, NJ
Philadelphia, PA
Rochester, NY
San Francisco, CA
Seattle, WA
Centralize your background screening
process under one standardized program to limit
subjectivity and promote a more consistent and
and consider updating your screening packages
and scoring matrices to align with current federal
and state guidelines and restrictions.
compliant hiring process.
NOTE: This information is current as of March 2015
DON’T RUN A
STATE LAWS
PROHIBITING
CREDIT CHECKS
In 2013, 47 bills were pending in
26 states limiting the use of credit
histories. Currently, the following
10 states prohibit the use of credit
background histories:
STATES
California
Colorado
Connecticut
Hawaii
Illinois
Maryland
Nevada
Oregon
Vermont
Washington
CREDIT CHECK
IF THE POSITION DOESN’T REQUIRE IT
In lieu of active federal laws or regulatory guidance on the use of credit
checks for employment purposes, a good rule of thumb and best practice
is to avoid using credit checks for employment purposes unless you can
demonstrate job-relatedness.
Examples of relevant positions where credit checks might be appropriate
could include law enforcement, managerial positions, money-handling
positions and fiduciary positions.
NOTE: This information is current as of March 2015
SEPARATE THE
DISCLOSURE AND THE
AUTHORIZATION
DID YOU KNOW
that the disclosure and authorization
of the background check must be
separate from the application?
4 KEYS FOR BASIC
FCRA COMPLIANCE
1
Have a permissible purpose for
performing a background check.
2
FOR THE BACKGROUND CHECK FROM YOUR APPLICATION
To be clear, it must be a separate, stand-alone form or web page. The written
authorization can be included on the disclosure form, but nothing
else—meaning, no additional, extraneous language. However, this form can be
included within larger employment packet. Be sure to consult with legal
counsel regarding detailed state law requirements.
HAVE
A
PLAN
IN PLACE FOR HANDLING
CRIMINAL “HIT”
INFORMATION
Not only should you follow the new EEOC process and conduct due diligence in providing an
opportunity for indivduals to explain their criminal convictions, you need to follow the basic FCRA
adverse action requirements.
EEOC Guidance: Conduct an individualized assessment
The EEOC sets forth a number of individual pieces of evidence that an employer should review
when making an individualized determination including:
Provide disclosure and obtain
written consent.
3
Provide required notice and
documents before and after adverse
action, and provide reasonable waiting
period in between.
4
The facts or circumstances
surrounding the offense
or conduct;
The number of offenses for
which the individual was
convicted;
Age at the time of conviction,
or release from prison;
Evidence that the individual
performed the same type of
work, post conviction with the
same or a different employer,
with no known incidents of
criminal conduct;
The length and consistency of
employment history before and
after the offense or conduct;
Rehabilitation efforts, e.g.,
education/training;
Employment or character
references and any other
information regarding fitness
for the particular position; and
Whether the individual is
bonded under a federal, state, or
local bonding program.
Communicate certification to the
consumer reporting agency.
As the trusted partner of over 45,000
organizations worldwide, we at First
Advantage provide easy-to-understand
background screening results so you can
confidently make decisions about prospective
employees, vendors and renters. Not only
does this safeguard your brand, but you also
arrive at dramatically better background
insights – insights you can rely on.
It’s time to partner with First Advantage. Now
in 27 locations, 13 countries and conducting
over 54 million screens on 16.8 million
applicants annually.Trusted Knowledge.
Exceptional People.
As the regulatory environment continues to change, employers need to be vigilant in ensuring they
are following the applicable changes that may affect their business and be sure to gain legal
counsel when needed. Employers should also look to their employment background check vendor
to help inform them as legislative and regulatory changes are being debated and implemented.
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