Criminal background checks for employees: How to maintain compliance

If you’re looking to hire for your small business, you should consider running criminal background checks for employees before they’re hired. Some industries may be less likely to hire somebody with a criminal record, so if your business falls into one of those industries, background checks are the way to go.

If you’re curious about what it takes to run a criminal background check on a potential candidate, we break down everything you’ll need to know.

What is a criminal background check for employees?

A criminal background check is a portion of a regular background check that searches public records to identify whether or not a potential candidate has a criminal background. Employers use this information to determine whether or not they want to hire this individual onto their team.

Some employers will require criminal background checks, depending on the role an employee is applying for. For example, a bank may not want to hire an individual convicted of embezzlement. It’s up to your team to determine what level of criminal background you’re willing to accept. You’ll also need to decide if regularly conducting a criminal background check for employees is something you want to make common practice.

How do you run a criminal background check for employment?

Running a full criminal background check for employment requires gathering information from a variety of different sources. 

Here are a few steps you can take to ensure you’re receiving the right information and maintaining compliance with local and federal laws.

1. Alert the candidate and request consent for a criminal background check

Conducting a background check without the consent of your candidate isn’t just rude, it’s illegal in most cases. When you’re going through the candidate interviewing process, be sure to clearly state if and when background checks occur so they’re aware.

In addition to alerting your candidate verbally, also get them to provide written consent. That way there’s documented proof that a candidate received notice of a background check. This remains compliant under the Fair Credit Reporting Act (FCRA), which regulates the consumer reporting agency and protects consumer privacy. 

2. Work with a criminal background check agency.

Under the FCRA, criminal background checks are considered consumer reports, and candidates are entitled to some level of privacy. Depending on your local laws, there are certain things you’re allowed and not allowed to use to determine candidacy. For instance, an arrest might show up on a candidate’s record. However, you’re not allowed to take the information into consideration, unless that arrest led to a conviction. 

Be sure to review your local state laws in regards to what information you can or can’t use to determine candidacy. Working with a third party background check company, or using specific software can help to ensure that the information you’re receiving remains compliant.

There are two different ways you can conduct a criminal background check. One is through fingerprint screening, the other through name-based screening. 

• Fingerprint screening: The act of conducting a criminal background check via fingerprints. While it’s true that everyone’s fingerprint is a unique identifier, they’re not used for sorting criminal records. If you do run a fingerprint screening, understand that you may not get as much information as you would with a name-based check. 
• Name-based screening: This is the most common way to run a criminal background check, since criminal records are filed by name. However, false negatives can sometimes occur with name-based checks. If a candidate has a common first and last name, or if they recently changed their name, finding accurate information may be challenging. 

3. Contact the employee’s references

Reference checks are a pretty common part of an employee background check. They give you the opportunity to talk with someone who worked with a candidate previously. Employer references are a great way to understand how a potential candidate works, what their work ethic is like, and how to best manage them from the perspective of someone who has worked with them before.

If you’re considering hiring someone who has a criminal background, conducting employer references gives you an opportunity to see if the candidate’s past has any bearing on how they work now. It’s very possible that their criminal record was far in the past, and has no bearing on how they work presently. It’s also possible that their arrest or conviction isn’t as relevant now, like a cannabis charge in a state where it’s now legal. Employer references are a great way to get more context on how an individual works in a way that a criminal background check can’t.

4. Conduct a drug test

For some small business employers, it’s important their employees maintain sobriety. For example, you may want to conduct drug screenings for individuals who are routinely managing heavy machinery, such as those working in a bakery or delivery drivers. This is to protect your potential employee, your business, and other employees from any safety hazards. 

Conducting a drug test is an optional part of a background check, and may not even be necessary. If you want to conduct a drug screening, you could work with specific third-party laboratories to conduct these tests, or do the test in house. Since most drug tests require some laboratory equipment, drug testing is often performed by a third-party agency for small businesses.

5. Check a candidate’s social media presence

Since the invention of social media, more and more employers are using new technology as an opportunity as a way to gain more context about a candidate beyond just their resume. A social media screening is when an employer looks up a candidate on publicly available forms of social media and reviews their activity. This is most commonly done on LinkedIn, but can also extend to sites like Facebook, Twitter, Instagram, and TikTok. 

Employers commonly scan a candidate’s social media presence to see if they have anything that might hurt the reputation of their company. While most social media sites are commonly used outside of a professional setting, you still wouldn’t want to hire an employee who may paint your business in a bad light. For example, a candidate who regularly bad mouths their employer on a public forum, posts photos of them participating in unsavory acts, or posts offensive comments probably isn’t the best choice to hire.

When should you run a criminal background check?

If your business decides that it wants to include criminal background checks for employees as part of the hiring process, it’s important that this check happens at the same stage of the interview process for every candidate.

The easiest way to do this is to create a criminal background check policy. That way, every candidate that goes through the hiring process will have the same experience and this can help minimize bias. 

You could also retroactively run criminal background checks on your current employees. If you do end up doing this, be sure to include this within your new company policy. It’s something that should be added to any and all HR and onboarding documents as well. Plus, you’ll need to alert your employees when you begin conducting the check. The same rules apply for them as they would for a new candidate—so be sure to provide them with written consent as well. You can share the news one-on-one, in a team meeting, or via a team communication app like Homebase.

What information does a criminal background check provide?

It’s important to understand that there’s a difference between a criminal background check and a regular background check. A criminal background check is the specific information that relates to an individual’s past criminal history. A regular background check can consist of a variety of different aspects. Sometimes they include a credit check, employment history, or driving record. 

Today, we’re talking specifically about what’s included in a criminal background check. For more information on general background checks, view Homebase’s guide to employee background checks.

A criminal background check may include:

• Court orders: This is any outcome or judgment a judicial officer issues from the court after an agreement is made. For example, a restraining order is a type of court order.
• Arrests: The instances in which an individual has been arrested. It’s important to note that in some states, employers aren’t allowed to consider arrests as part of an employment process, only convicted crimes. 
• Records of incarceration: This details the amount of time and where someone was incarcerated, if applicable.
• Felony or misdemeanor convictions: If a person was convicted of a crime, this information would show up on a criminal background check.

Depending on your local legislation, criminal background checks are only allowed to go back a certain number of years. In a handful of states, including New York and California, it’s illegal to search for criminal records beyond the past seven years. The other thing you should never see on a criminal background check is expunged or sealed convictions. If those do show up, candidates have the right to dispute that information.

Industries that use or require a criminal background check for employees

There are some industries that are more likely than others to require a criminal background check before extending an offer of employment to a candidate. Here are a few industries that you might see requiring criminal background checks.

1. Restaurants 

Some restaurants may require criminal background checks before hiring employees. For example, fine dining restaurants, or restaurants that have a large delivery-centric model may require a more in-depth background check than a hole-in-the-wall cafe. 

2. Retailers

Retailers may choose to conduct a criminal background check solely for the purpose of minimizing the chance of theft and fraud. If a candidate has past behavior of theft, they may choose not to hire that individual to avoid any potential liability on their business.

3. Child care and educational workers

When working with minors, it’s important to ensure that students are in a safe environment. Most daycare and educational workers are required to undergo a criminal background check to ensure the safety of students and that they hold the right qualifications to educate their students.

4. Healthcare employees

Healthcare employees are required to undergo background checks to ensure that they’ve received the necessary education and experience to provide adequate care to their patients. Depending on the type of healthcare, employers may look for more specialized issues. 

5. Banking and financial institutions

Banks and other financial institutions are often more risk averse due to the sensitive financial nature of their industry. Hiring a criminal convicted of certain crimes is a risk, and often not one they’re willing to take.

Federal laws around employee background checks

There are two different federal agencies that help to protect consumers when it comes to background checks. Those two agencies are the Federal Trade Commission (FTC) and the Equal Employment Opportunity Commission (EEOC). These two organizations work together to ensure that employers are conducting fair background checks and that everyone has equal opportunity to apply for a job without discrimination. 

Employees and potential candidates have rights to their privacy, and it’s important to understand what those rights are before diving in and running that background check. 

Fair Credit Reporting Act

Here are a few things that you can do to remain compliant with the Fair Credit Reporting Act (FCRA).

Ask the same questions to every candidate or employee.

When conducting a background check, you don’t want to come across as giving preferential treatment to one person or another. To avoid this, have everyone go through the same exact background check process, so there’s little room for preferential treatment.

Don’t ask for any medical or genetic information.

Medical and genetic information is protected under the Genetic Information Nondiscrimination Act (GINA). Medical information is private and protected, and employers should never ask this of employees unless it poses a specific safety risk while on the job.

Don’t discourage those with a criminal background from applying.

Depending on what state you’re located in, targeting those with criminal backgrounds and preventing them from applying for a job could be considered discrimination.

Always provide written consent for background checks.

During the interviewing process, be incredibly clear about where and when background checks occur. In addition to alerting the candidate verbally, also require them to sign a consent form, as that’s documented proof that you’ve given them enough notice in advance that the background check will occur. Keep track of this information in a cloud-based hiring tool like Homebase.

Provide the applicant or employee with a copy of the completed background check.

Even if there’s nothing incriminating on their background check, this gives candidates the opportunity to look at the information other employers could see about them in the future. 

Provide ample time to dispute information if you decide to take any adverse actions.

If you’re choosing not to move forward with a candidate because of something you found on their background check, they have the right to dispute that information. As long as they go through the process of disputing information through the right channels, they can correct any incorrect information. 

Benefits of running a criminal background check for employees

If you’re debating whether or not you should run a criminal background check for your small business, here are a few reasons why it can be helpful. 

• Minimizes your risk. Conducting a criminal background check helps protect your business from any potential risk that comes with hiring a past convicted criminal. 
• Find the right members for your team. Hiring someone who has been incarcerated for a long time can lead to potential challenges, like training on new technologies. Depending on how your business is run, it might be easier to hire individuals who have more qualified experience.
• Helps you maintain a strong brand image. Running a criminal background check can help you maintain a strong brand image. Helping to get past convicted criminals get back on their feet is a great way to affect societal change and do some good. A side benefit? It can also improve  how the public perceives your business.

Get help managing your team and staying compliant, all in one place.

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Criminal background check for employees FAQS 

What is a criminal background check for employees?

A criminal background check for employees is documentation that identifies whether a specific person has a history of a criminal background. Most of the time, this information is pulled from public records, such as through court documentation.

How do you run a background check on an employee?

There are a couple of ways you can run a background check on an employee. Using a background check website is a common way people run background checks. You could also hire third party agencies to run background checks for you, or you can spend the time pulling all of that information yourself, which is an extremely time consuming process.

How long does a background check usually take?

It depends—a background check can commonly take anywhere between a few hours to a week. It all depends on the amount of information you request. The more information you request, the longer the background check will take. 

What will a criminal background check tell me about an employee?

Criminal background checks often include court orders, arrest records, records of incarceration, and convictions for felonies or misdemeanors. If you’re an employer looking at someone’s criminal background, it’s important to understand what information that’s provided is okay for you to consider for employment, and what isn’t.