What You (and Your Employer) Should Know About Background Checks

More companies are using background checks to screen job applicants, rejecting the ones who have poor credit because they’re unemployed and struggling to pay bills, credit cards and household expenses. That’s why it’s so important to know what’s in your credit report. And employers should know how to stay clear of the risks of running such checks.

Tips for Employers

1. Keep background screening limited to relevant positions. For example, check driving records only for positions that involve operating a vehicle.

2. Develop specific criteria for performing background checks and put it in writing.

3. Evaluate the use of background checks when hiring new employees. By eliminating unnecessary screening, employers can eliminate the risk of a costly legal battle.


Tips for Job Seekers

1. Sign a waiver allowing a background check. Refusing to do so is likely a deal breaker for an employer.

2. Avoid surprising the prospective employer. Explain the circumstances surrounding negative information that will turn up.

3. Know what’s on your credit report by checking regularly, at least twice a year. Ask for a 3-in-1, merged credit report with a summary from all three credit bureaus. Under the federal Fair and Accurate Credit Transactions (FACT) Act, consumers are entitled to one free credit report each year from each of the major agencies. For details, visit annualcreditreport.com call 877.322.8228.

4. Request a copy of a background check if an employer turns you down for a job. That’s your right, under the Fair Credit Reporting Act. If something doesn’t make sense to you, be sure to check it out further.