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Human Resource Hiring: Why Conduct Employee Background Checks

By October 24, 2012February 19th, 2015No Comments


Human resources departments are tasked with one of the most mission critical functions for a healthy company.  Hiring and recruiting employees.  Employees are the most important asset to a company or small business.  They handle money, interact with your customers, and are the face and representation of your business to your clients. Your workforce is the business tool behind production or services rendered.

It is vital to the success and well-being of any business to  have honest, responsible and reliable employees.  Even with the best screening methods, its an unfortunate reality that some people will attempt to fluff their credentials or even misrepresent their experience.

Employee background checks are a vital tool to insuring that the company or small business has performed its due diligence in the hiring process.

Most employers are aware that some candidates will alter the facts when filling in their application for a position.  Today, many companies use parsing software to evaluate the resumes received to match certain keywords representing skills or experience.  Savvy applicants will incorporate the keywords from the job posting into their resume, so it survives the prescreening tests to make it to the interview rounds.

If the application for a position looks too right, and matches the job criteria too closely, it should be evaluated to determine whether the information provided is accurate and truthful?

During the interview process, you should probe the information on the resume to determine whether the applicant omitted any important details. Gaps in employment history or periods of holding dual positions should be subject to request for greater clarification when meeting with the candidate.

When there is no way to answer these questions in an interview or pre-screening, or when the decision has been made to potentially extend a job offer, it’s time to conduct the background check.


The initial step in screening a prospective employee starts with a signed employment application. It is essential that the application include a “Release of Information Statement.” The signed release grants the employer the right to access educational, credit, police, criminal and court records. Without a signed release, it is exceptionally difficult to verify the information provided on the written application or any statements made during an initial oral interview.

Credit Reports

Under the Fair Credit Reporting Act (FCRA), businesses must have written consent from the candidate before accessing that person’s credit report. If the information in that report is the reason you decide against hiring or promoting the person, you must provide the report to the candidate.  You also must advise the applicant that they have the right to challenge the report under the FCRA.

Visit the FTC’s Bureau of Consumer Protection’s website for more information.

Criminal Records

An employer may consider the criminal history of an applicant dependent upon state law.  Be sure to know the laws of your state before ordering the criminal background search.

For Federal Bureau of Investigation (FBI) checks, consult these resources:

Lie Detector Tests

Employee Polygraph Protection Act  is legislation that prohibits  the use of lie detector tests for pre-employment screening, and also during the course of employment. There are exceptions for certain businesses, primarily those involved with security services,  armored car services, alarm or guard services, or pharmaceutical manufacture, distribution or dispensing.

Medical Records

Medical records can be considered confidential and an employer is not allowed to discriminate based upon medical conditions, unless it’s directly related to job performance. Under the Americans with Disabilities Act, employers cannot discriminate based on a physical or mental impairment or request an employee’s medical records. Be careful when inquiring about the candidate’s health and ability to perform specific job duties, and be sure to structure the questions related to medical information carefully.


Bankruptcies are public records.  A bankruptcy would likely be shown on the applicant’s credit report, however the Federal Bankruptcy Act prohibits employers from discriminating against applicants due to bankruptcy.

Military Service

Military service records may be released only under limited circumstances, and consent is generally required. The military may, however, disclose name, rank, salary, duty assignments, awards and duty status without the service member’s consent.

School Records

The Family Education Rights and Privacy Act protects educational records including transcripts, recommendations and financial information.  This information will  not be released without the student’s consent.

Workers’ Compensation Records

Being careful not to discriminate, an employer can review an applicant’s worker comp info. Workers’ compensation appeals are a matter of public record.  This information can only be used in a hiring decision if the applicant’s injury would interfere with the candidate’s ability to perform the required duties of the job.


Current Address – It is important to confirm that the applicant lives at the address indicated. If it is an apartment, check with the manager for verification. If the address is a personal residence, a check with the county recorder’s office will verify ownership of the home or condominium.

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