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What Are Background Checks and Why Are They Important?

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A background check is the process of confirming the identity of a person, and may also be used to confirm and explore more personal details, such as criminal history, educational credentials, employment history, credit history, and licenses. Background checks are typically part of the pre-employment process, although the specifics of what information will be reviewed depends on the organization and the position being offered. 

Background checks are commonly conducted in conjunction with pre-employment drug testing. Background checks are not only a matter of due diligence on the part of the employer for legal matters such as taxation, but also an opportunity for them to ensure that the potential employee is not omitting or fabricating information that may impact their qualifications to fulfill the role they are being hired for. 

Types of Background Checks

The information that is verified during a pre-employment background check can vary widely depending on the circumstances of the employer and position. Therefore, there are many different types of background checks, which may be conducted concurrently to save time. The types of background checks include:

  • Identity verification: Identity verification ensures that a person has not fabricated or stolen an identity by reviewing personal information such as name, address, and Social Security number. Employers are required by federal law to verify the identities of prospective workers as a condition of employment, to ensure that they are eligible to work in the United States. 
  • Criminal history: Criminal histories of prospective employees are sometimes reviewed as a means of character assessment. What will show up in a criminal history report depends on the service or system used, but typically they will list convictions, pending cases, and active warrants. Convictions and infractions that have been expunged, as well as sealed juvenile records, typically will not show up in a criminal history report. Some states also automatically clear public records of certain types of convictions and infractions after a set period. 
  • Credit history: Some employers may check your credit history as a means of assessing your general character or aptitude with money. Such credit checks are considered soft inquiries, and therefore will not affect your credit score. 
  • MVR: An MVR (motor vehicle record) is used to assess character and determine whether the prospective employee is a safe vehicle operator. MVRs will include information such as licensing details, traffic violations, accident history, DUIs, and suspensions. 
  • Professional license and education background: These background checks are used to confirm any professional credentials that the job candidate claims to have, and are especially likely to be used in scenarios where these credentials are a condition of employment. These credentials may include degrees, certifications, specialized training, and even duration of attendance at an institution. 
  • Fingerprinting: Fingerprinting as part of a pre-employment background check is used to verify whether the prospective employee is part of any criminal database. 
  • E-verify: E-verify is a website provided by the United States Department of Homeland Security, which is used to review and confirm the validity of Form I-9, which verifies an employee’s eligibility to work in the United States.

In many cases, it is more convenient for an employer to use a platform to integrate various screening processes, rather than handling each step separately. 

What Is Covered In a Background Check?

A typical pre-employment background check will confirm your identity and provide a review of your criminal history. However, some other elements that may come up in a background check include:

  • Credit score;
  • Debts;
  • Traffic accidents;
  • Degrees;
  • Licenses;
  • Certifications;
  • Education history. 

Typically, a pre-employment background check will review information going back seven years, although ten-year background checks are also relatively common. Legal requirements for background checks, available information, and screening options will also depend on state laws to some degree. 

The Importance of Background Checks

The main reason that pre-employment background checks are conducted is to protect the investments of the employer. Employers want to ensure that they will be getting the value that they expect out of the prospective candidate, and they can improve the chances of that by confirming credentials and assessing their past actions.

They also want to ensure that they are not subject to legal action as a result of failing to do their due diligence during screening. Furthermore, there are many financial issues that an inadequate or irresponsible candidate could cause, such as mishandling of funds, destruction of property, loss of productivity, workplace injury, and poor work environment. 

Additionally, while it is important to maintain some degree of employee privacy, employers also should ensure the safety of their workplace. Employee screening can reduce the chances of workplace injury resulting from incompetence or even aggression, and may even be legally required or necessary to mitigate a company’s insurance and liability expenses.

Background checks can be especially valuable in a situation where an employer is taking a chance on an imperfect job candidate, or when they are hiring for a safety-sensitive role. In this way, background screening can also potentially benefit employees, as it is an opportunity for them to demonstrate their credentials and good character as much as it is an opportunity for employers to protect their business interests.