Why do employers conduct background checks?

An employer must first establish a background check policy with their company. Once implemented, they can begin performing background checks, usually for pre-employment, but sometimes ongoing depending on the position. According to the Fair Credit Reporting Act (FCRA) § 604 – 15 U.S.C. § 1681b, employers are required to provide applicants with a separate written disclosure, which advises that a consumer report may be obtained for employment purposes. The document must consist solely of the disclosure as a stand-alone document. Additionally, the employer also must obtain the applicant’s written consent to order the background check.

The background check company will contact verified previous employers to confirm dates of employment, job title, and reason for leaving. Education verifications generally confirm the year of graduation, major, degree earned, and attendance dates.

Organizations owe it to themselves and their customers to research the background of potential employees and volunteers to ensure the safety of other employees, customers, and their property. The most effective method to accomplish this is by conducting thorough background checks. The costs of fraud, embezzlement, theft, and violence are a multi-billion dollar drain on our economy, bleeding organizations both large and small. One of the most compelling reasons organizations now conduct background checks is to uncover deception or fraud. For example, it can confirm whether an individual provided accurate information on his/her resume or application. Depending on the industry, some form of background investigation may be required, whether because it is mandated by law or because their insurance company demands it.