A comprehensive employment background check is an important tool in an employer’s pre-employment screening arsenal. When you have multiple qualified candidates from which to choose, the information revealed may assist you in making your selection. It can also help you protect your business, employees and customers, making it easier for you to reject applicants with risky or violent pasts.
Of course, you must follow both federal and state laws when gathering background information. There are specific rules the consumer reporting agency (CRA) you work with must follow as well. Compliance is a joint responsibility—and one that you should take quite seriously. Consider the some of the following responsibilities employers and CRAs share in California.
Under California law, you are required to follow certain procedures that are unique to the state and not necessarily required under federal law. It’s critical that these guidelines are followed every time a employment background check is conducted.
Authorization and Reporting
Should you elect to reject an applicant due to negative information the resulting report contains, you must send a pre-adverse action notice along with a copy of the background report. You must then follow this with a post-adverse action notice and instructions for disputing inaccurate or incomplete information. This must be done, by law, within a specific time frame.
The law requires your CRA to certify that you will only use the data contained in the report for a permissible employment purpose. They may not include negative information that is more than seven years old.
They must also notify the applicant (and you) if they are going to transfer any information to a third party outside the United States. The law may hold them (and you) liable for harm resulting from unauthorized access of applicants’ personal information outside the U.S.
As an employer, you are prohibited from requesting a consumer credit report as part of a California background check unless you’re planning to hire the applicant for a managerial position, a law enforcement job, a position that involves access to confidential or proprietary information, a job in which the applicant will have access to the company’s credit cards and bank accounts, or a position that involves access to $10,000 or more in cash.
As mentioned earlier, the CRA may not include negative information—such as late payments or collections—that is more than seven years old on the consumer credit report.
As an employer, California law prohibits you from asking job candidates about arrests that did not lead to a conviction, expunged or sealed crimes, dismissed crimes, or crimes that were referred to a pre- or post-trial diversion program.
You are allowed to ask applicants about crimes that resulted in a conviction (i.e. a plea, verdict or other finding of guilt). However, the Equal Employment Opportunity Commission advised employers to consider the nature and gravity of the offense, how long ago it occurred, and whether it actually has any bearing on the job in question.
The CRA must verify the accuracy of all public record information they use. A search of a national or state database that shows a conviction must be verified for accuracy from the appropriate jurisdiction otherwise it can’t be included within the criminal history report.
If you or your partner CRA fails to comply with applicable laws, you may be subject to substantial penalties. A job applicant can sue for $10,000 or more in applicable damages plus court costs and attorney’s fees. Courts can award punitive damages as well if they determine your violation was willful or grossly negligent. For this reason, it’s advisable to review your background check policies and procedures carefully and take special care when selecting a CRA to provide background checks.
Disclaimer: None of this information is intended to be legal advice. No warranty is made or intended that the information at this site is current or correctly expressed or interpreted.