How to Avoid Discrimination in Employment Background Checks: Part 1 of 2

How to Avoid Discrimination in Employment Background Checks:  Part 1 of 2
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An employment background check entails compiling criminal records, commercial records, financial records, and the history of employment of a job applicant to ascertain the integrity of the candidate before hiring.

Federal and state laws prohibit discrimination in employment background checks and do not allow companies to decline employment offers based on sex, race, color, religion, national origin, age, or disability considerations, unless such characteristics of the candidate are essential to do the job.

Much federal and state legislation prohibits discrimination in employment background checks, with Title VII of the Civil Rights Act of 1964 (Title VII), the Fair Credit Reporting Act, the Americans with Disabilities Act of 1990 (ADA), and with the Age Discrimination in Employment Act of 1967 (ADEA) as the major federal legislation that concerns the subject. Title VII prohibits intentional discrimination based on race, color, religion, sex, or national origin.

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Age Discrimination

The federal Age Discrimination in Employment Act of 1967 and many state civil rights laws, although not specifically prohibiting employers from asking the applicant’s date of birth and age before making a job offer, prevent rejecting applicants based on the candidate’s age.

Court records do not record social security numbers, making date of birth the most important identification. Some jurisdictions require date of birth to undertake a criminal search. The law requires employers to specify the purpose of asking for the candidate’s age or date of birth, and ADEA stipulates close scrutiny of requests by employers for age details of candidates, for such inquiries may ‘deter older workers from applying for employment or may otherwise indicate possible intent to discriminate based on age.’

One solution for employers to avoid age discrimination is to request the candidate’s date of birth information on the screening firm’s form instead of any employer form and not release this information to the recruiters.

Criminal Records

The Equal Employment Opportunity Commission stipulates automatic disqualification of a candidate based on any criminal record as discrimination. EEOC rules warrant that to disqualify a candidate based on criminal conviction requires three major considerations:

  • The nature of the job and whether the conviction relates to the job in question,
  • The nature and seriousness of the offense, and
  • The length of time since the conviction occurred.

2006 EEOC guidelines allow employers to reject the applications of ex-offenders “when the conduct that was the basis of the conviction is related to the position, or if the conduct is particularly egregious.” For instance, an employer hiring a cashier could justify excluding applicants with a larceny record, but rejecting applicants for a cook based on a larceny record might attract provisions of discrimination.

Consumer Reports

Discrimination in Employee Background ChecksThe federal Fair Credit Reporting Act sets standards on employee background screening.

The 1997 amendments to the Fair Credit Reporting Act increase the disclosure and consent requirements of employers who use ‘consumer reports’ such as credit checks, criminal histories, driving records, and interviews with neighbors, friends, and associates. Preparation of such reports by a third party requires the written authorization of the applicant.

Employers using information from the consumer report for ‘adverse action’ such as denying the job applicant or rescinding a job offer are bound by the Fair Credit Reporting Act regulations to:

  • Give the applicant a ‘pre-adverse action disclosure’ including a copy of the report and an explanation of consumer rights under the FCRA before taking the action.
  • Provide the employee with an ‘adverse action notice’ that contains the name, address, and phone number of the employment screening company, a statement that the employer rather than the screening company made the adverse decision, and a notice informing the individual of the right to dispute the accuracy or completeness of any of the information in the report.

The FCRA also forbids considering the following factors when making hiring decisions for jobs with an annual salary of less than $75,000.

  • Bankruptcies after ten years.
  • Civil suits, civil judgments, and records of arrest, from date of entry, after seven years.
  • Paid tax liens after seven years.
  • Accounts placed for collection after seven years.
  • Any other negative information except criminal convictions after seven years.

Many companies run the risk of adverse impact discrimination by relying on non-reputable third-party investigators or online databases. For instances, an online database might reveal the arrest but fail to mention the acquittal, and the company denying employment based on the arrest discriminates against the candidate.

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The Americans with Disabilities Act prevents employers from discriminating against disabled applicants provided the disability does not prevent the person from doing the job.

In most states, the employee’s making a Workman’s Compensation claim to the Workman’s Compensation Appeals Board becomes public record and subject to the scope of background checks. The law allows the employer to such information to reject candidates only if such injury interferes with the candidate’s ability to perform required duties.

Other forms of potential discrimination in employment background checks include rejecting candidature based on political affiliation, diseases such as AIDS, and other atypical circumstances.

While the employer retains the right to reject any application, the use of background check reports wrongfully or subjectively to deny employment becomes discriminatory. Companies need to draw up a discrimination policy that conforms to various legislation and ensures that their background check procedures conform with such policy.

Please be sure to check out the other tips and strategies found in Bright Hub’s HR Guide for Recruiting and Retaining Employees.


Rosen, Lester. Background Checks: Trends and Legal Issues.

The U.S. Equal Employment Opportunity Commission. Employment Tests and Selection Procedures.