This article explains how Checkr’s solutions can make your hiring processes more compliant.
Checkr is a member of the Professional Background Screening Association (PBSA), the industry trade association for consumer reporting agencies (CRAs). The PBSA's accreditation program recognizes consumer reporting agencies for their adherence to the principles below:
- Continued institutional improvement
- High professional standards
The PBSA first accredited Checkr in 2015.
What do you need to comply with, and why?
The Fair Credit Reporting Act (FCRA) and state and local laws govern background checks for employment purposes. Under the FCRA, "employment" likely includes independent contractor and volunteer relationships.
Incorporating guidance from the Equal Employment Opportunity Commission (EEOC), many states and municipalities also have fair hiring laws such as the ones below:
- “Ban the box” laws
- Individualized assessment ordinances
- Salary history bans
Not complying with the FCRA or state and local laws can increase your compliance and litigation risk, including class action lawsuits from candidates or government investigations.
The list below highlights the main ways of implementing fairer hiring practices and avoiding common areas of legal risk. Consult your legal counsel to check what laws apply to you and to implement practices that meet your compliance and industry needs.
- Under the Fair Credit Reporting Act (FCRA), you must have a permissible purpose to order a background check. Consult your legal counsel to choose the appropriate permissible purpose for your location and business needs.
- Set up your disclosure and consent forms. Checkr provides your forms to the candidate when you order through the dashboard. If you use manual orders or our API to order background checks, you must deliver disclosures and gain consent.
- Create and consistently use an adverse action process. If you decide not to engage, hire, or retain someone because of their background check, inform them and wait enough time before finalizing your decision.
- Use the individualized assessment tool. Some cities have regulations that require companies to demonstrate their reason for declining a candidate based on criminal history. Train your team on how to complete this step, and to use the required forms in New York City and Los Angeles. Checkr’s assessment tool helps with the steps below:
- Guide you through the individualized assessment process.
- Document the analysis.
- Provide the assessment to the candidate.
- Before adding credit reports to your account, confirm your permissible purpose. Several states and cities have laws limiting pre-employment credit reports.
- Observe "Ban the Box" laws where you hire. Several states and cities have laws limiting how and when you discuss criminal or salary history with candidates.
This information doesn't constitute and isn't intended as legal advice. Consult your legal counsel about your compliance obligations and best practices.