Importance of Protection from Legal Issues throughBackground Verification In both cases, whether as an employer or HR professional, the right hire is critical to the success and integrity of your business. One of the most adequate ways of ensuring this is through background verification. While a background check can save you from hiring risks, it is very important to understand the legal Pitfalls landscape that surrounds background checks. Poor handling might get you into some serious trouble with regard to lawsuits, discrimination claims, and infringement on privacy.
What are the Legal Risks in Background Verification?
On paper, background verification is a simple job-just verifying a person’s background for suitability. However, failure to do the proper procedure might finally get your organization to run the risk of some serious financial loss and loss of reputation. The following are some of the major legal Pitfalls issues an employer should always bear in mind while carrying out background checks.
1. Failure to Comply with FCRA
One type of background checks used in hiring are regulated under the Fair Credit Reporting Act – those provided by a third-party background check service. Under the FCRA, employers must do the following:
Get the applicant’s written permission for any background check.
This would entail noticing the applicant that the intended adverse action viewed in the background check has come back, and they no longer qualify for the position. Under the FCRA, the applicant must have a copy mailed to them along with an adverse action notice of the report if the final hiring decision is decided not to hire the applicant.
The consequence of non-compliance could be brutal and might contain heavy fines among other legal consequences. Though compliance is compulsive under FCRA, it is important you understand what you getting yourself into with the FCRA in order to protect your business.
2. Discrimination/EEO Violations
The verification should not be discriminatory, and it should be uniform in the background. In case there is some criminal history or other issues in any candidate’s background check, the information should be objectively analyzed, and your decisions should not have disparate adverse impact on protected classes.
According to EEOC guidelines, you are not supposed to hire or fail to hire an individual simply based on their criminal history except if the conviction in any way relates to the job at hand. For example, you will most likely be in a position to deem someone who has been found guilty of embezzlement unsuitable to deal with company funds, yet it would be considered discriminatory for you not to hire him as a customer care assistant.
Discrimination-whether intentional or not-can lead to expensive lawsuits and harm your company’s reputation. It is important as an employer to have a clear, consistent, and legally compliant background verification process that does not inadvertently discriminate against certain groups.
3. Privacy Violations and Data Protection
Other concerns of employers while carrying out background verification is that many states as well as countries have privacy laws that protect private information of the candidates like the social security number or any other medical information.
Pre- background verification steps:
- Before you begin the process for background verification, ensure that:
- You collect information only when required by the nature of the job.
- Store information securely and provide access to information only on a need-to-know basis.
- Inform candidates what information is needed and how the information will be used.
A failure to maintain privacy regarding personal information, or failure to get consent regarding the use of certain information could lead to some serious lawsuits including fines and other legal consequences.
Legal Pitfalls – How Can Employers Reduce the Risk?
Clear policies and practices can, in fact, be the only way to avoid the legal risks of background verification on behalf of employers. Here’s how you can protect your business:
1. Develop Clear, Consistent Policies
Develop a clear background verification policy which states the process, what shall be verified, and how the information will be used. The following should be included:
The types of checks you would make include criminal history, verification of education and employment history, credit checks. The criteria of the decision-making process in case of adverse findings are, for instance, exclusion on particular convictions. How written consent would be acquired, and what the candidates must know about such checks. In this way, having a set policy will enable you not just to stay within the law, but also you will be constant and treat applicants equitably.
2. Be Transparent to Candidates
Transparency plays a very key role when it involves background verifications. Even before the process gets underway, candidates must be made to understand the following:
3. Outsource the Background Verification to a Reputable Vendor
If the background verification is to be outsourced, then one needs to seek the services of a reputable vendor who is in compliance with the FCRA and other applicable laws in the context. A third-party vendor with enough experience and well-versed with the legal aspects assures one that the background checks are being carried out legally and discriminately.
What does your background check process contain?
A robust and legallysound background verification process would contain many elements, which would include but not be limited to:
Candidate Consent:
The consent of candidates in writing must always be attained that they have agreed to such checks being conducted.
Clearly Explain:
Besides that, it also needs to be explained to the candidates what kind of checks would be conducted and how the results of such checks would be utilized.
Fairness:
Just one set of checks, with the same set of criteria for all candidates, on every count. Legal Compliance: Be ahead of the curve regarding local, state, and federal legislation with regards to background checks to keep your process compliant. Data Security: Respect candidate privacy around sensitive information and ensure that information is shared only with those who have to know.
All these, when actually performed, ensure lesser risk related to any legal concern on one hand, while on the other, it helps in informed decisions about hiring.
Conclusion: Stay Compliant and Protect Your Business
While background verification will help fetch the right candidates, the line of legality has to be toed very cautiously. Your company would be able to avoid falling into any legal Pitfalls red tape only if one is fully aware of the potential risks that could arise from a background verification, maintain transparency in the process, and be consistent with and comply with all the relevant laws.