The U.S. Equal Employment Opportunity Commission (EEOC) and the Federal Trade Commission (FTC) jointly released two documents regarding the use of background checks in the workplace on March 10, 2014. These two documents, one aimed at employers and one aimed at employees and job applicants, can be located on the EEOC’s website. The documents are titled: Background Checks: What Employers Need to Know and Background Checks: What Job Applicants and Employees Should Know. While these documents offer very little new guidance, they do serve to remind employers of the “best practices” to be followed in the use of background checks in the employment context.
The documents do make it clear that “it’s not illegal for an employer to ask questions about an applicant’s or employee’s background, or to require a background check.” However, they also caution employers that the use of background checks must comport with the federal Fair Credit Reporting Act (FCRA), if the background information is being obtained from a consumer reporting agency (CRA), as well as Title VII of the Civil Right Act of 1964.
Among the guidance offered employers in these documents is the following:
- In all cases, make sure that you're treating everyone equally. It's illegal to check the background of applicants and employees when that decision is based on a person's race, national origin, color, sex, religion, disability, genetic information (including family medical history), or age (40 or older). For example, asking only people of a certain race about their financial histories or criminal records is evidence of discrimination.
- Except in rare circumstances, don't try to get an applicant's or employee's genetic information, which includes family medical history. Even if you have that information, don't use it to make an employment decision. (For more information about this law, see the EEOC's publications explaining the Genetic Information Nondiscrimination Act, or GINA.) Don't ask any medical questions before a conditional job offer has been made. If the person has already started the job, don't ask medical questions unless you have objective evidence that he or she is unable to do the job or poses a safety risk because of a medical condition.
- Apply the same standards to everyone, regardless of their race, national origin, color, sex, religion, disability, genetic information (including family medical history), or age (40 or older). For example, if you don't reject applicants of one ethnicity with certain financial histories or criminal records, you can't reject applicants of other ethnicities because they have the same or similar financial histories or criminal records.
- Take special care when basing employment decisions on background problems that may be more common among people of a certain race, color, national origin, sex, or religion; among people who have a disability; or among people age 40 or older. For example, employers should not use a policy or practice that excludes people with certain criminal records if the policy or practice significantly disadvantages individuals of a particular race, national origin, or another protected characteristic, and does not accurately predict who will be a responsible, reliable, or safe employee. In legal terms, the policy or practice has a "disparate impact" and is not "job related and consistent with business necessity."
- Be prepared to make exceptions for problems revealed during a background check that were caused by a disability. For example, if you are inclined not to hire a person because of a problem caused by a disability, you should allow the person to demonstrate his or her ability to do the job - despite the negative background information - unless doing so would cause significant financial or operational difficulty.
- Any personnel or employment records you make or keep (including all application forms, regardless of whether the applicant was hired, and other records related to hiring) must be preserved for one year after the records were made, or after a personnel action was taken, whichever comes later. (The EEOC extends this requirement to two years for educational institutions and for state and local governments. The Department of Labor also extends this requirement to two years for federal contractors that have at least 150 employees and a government contract of at least $150,000.) If the applicant or employee files a charge of discrimination, you must maintain the records until the case is concluded.
- Once you've satisfied all applicable recordkeeping requirements, you may dispose of any background reports you received. However, the law requires that you dispose of the reports - and any information gathered from them - securely. That can include burning, pulverizing, or shredding paper documents and disposing of electronic information so that it can't be read or reconstructed. For more information, see "Disposing of Consumer Report Information? Rule Tells How" at http://www.business.ftc.gov/documents/alt152-disposing-consumer-report-information-rule-tells-how.
Both the EEOC and FTC have made it clear that enforcement of Title VII and the FCRA remains a top priority. Thus, employers who make use of background checks should review their processes, policies, and procedures to ensure that they comply with these laws. Additionally, prudent employers should also review their respective state’s laws regarding the use of background checks to ensure that they are in compliance with those laws as well.