Fact Sheet 16:
Employment Background Checks:
A Jobseeker's Guide

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Copyright © 1994-2015
Privacy Rights Clearinghouse
Posted December 1994
Revised August 2015

PRC does not perform background checks.  You may search for a background screening company on the National Association of Professional Background Screeners website


1. Why Does an Employer Conduct a Background Check?
2. What Is Included in a Background Check?
3. What Cannot be in a Background Check Report?

4. Who Conducts Background Checks?
5. Your Rights Under the Fair Credit Reporting Act (FCRA)
6. What If There's an Error in My Background Check?
7. Background Checks and Your Credit Report

8. Employee Misconduct Investigations
9. Preparing for a Background Check
10. Resources


This guide explains the why and how of background checks. It also tells you what can be covered in a background report, your rights under the Fair Credit Reporting Act, and what you can do to prepare.

According to a study conducted by the Society for Human Resource Management, approximately two-thirds of organizations conduct criminal background checks on all of their job candidates. Whether you are hired or promoted may depend on the information revealed in a background check. Job applicants and existing employees as well as volunteers may be asked to submit to background checks. For some jobs, screening is required by federal or state law.

1. Why Does an Employer Conduct a Background Check?

Employers check both job applicants and existing employees for several reasons. The things an employer wants to know about you can vary with the kinds of jobs you might seek. Here are a few of the reasons for employment screening.

  • Negligent hiring lawsuits are on the rise. If an employee's actions hurt someone, the employer may be liable. The threat of liability gives employers reason to be cautious in checking an applicant's past.
  • Child abuse and child abductions have resulted in new laws in almost every state that require criminal background checks for anyone who works with children. The move to protect children through criminal background checks now includes volunteers who serve as coaches for youth sports activities and scout troop leaders.
  • Terrorist acts of September 11, 2001 have resulted in heightened security and identity-verification strategies by employers.
  • Corporate executives, officers, and directors face a degree of scrutiny in both professional and private life unknown before the Enron and other corporate scandals.
  • False or inflated information supplied by job applicants make employers wary of accepting anyone's word at face value.  
  • Federal and state laws require that background checks be conducted for certain jobs. For example, most states require criminal background checks for anyone who works with children, the elderly, or disabled.  Many state and federal government jobs require a background check, and depending on the kind of job, may require an extensive investigation for a security clearance.
  • The availability of databases containing millions of records of personal data. As the cost of searching these sources drops, employers are finding it more feasible to conduct background checks.

I don't have anything to hide. Why should I worry?

While some people are not concerned about background investigations, others are uncomfortable with the idea of an investigator poking around in their personal history. In-depth background checks could unearth information that is irrelevant, taken out of context, or just plain wrong. A further concern is that the report might include information that is illegal to use for hiring purposes or which comes from questionable sources.

An April 2012 report prepared by the National Consumer Law Center (NCLC), identifies these and other problems that may be found when background screening companies report on criminal history. 

Does a criminal record mean I can never get a job?

Not necessarily. The U.S. Equal Employment Opportunity Commission (EEOC) has said that use of criminal history may sometimes violate Title VII of the Civil Rights Act of 1964. This can happen, the EEOC says, when employers treat criminal history differently for different applicants or employees. 

The Equal Employment Opportunity Commission (EEOC) says that a person cannot be denied employment based on a criminal record alone. Instead, the decision to hire or not must be based on a “business necessity,” which requires the employer to consider:

  • The nature and gravity of the offense or offenses.
  • The time that has passed since the conviction and or completion of the sentence.
  • The nature of the job held or sought.

EEO laws apply in employment situations whether the employer hires a third-party screening company or not. The Fair Credit Reporting Act (FCRA) requires compliance with EEO laws.

The EEOC has issued extensive guidelines for employers in considering the criminal history of a job applicant or employee.  To aid in compliance with Title VII, the EEOC guidelines provide employers with examples of best business practices.

2. What Is Included in a Background Check?

Background reports can range from a verification of an applicant's Social Security number to a detailed account of the potential employee's history and acquaintances. Information included in a background check will depend to some extent on the employer and the job involved. For many jobs, a state or federal law requires the employer to conduct a background check. Jobs that involve work with children, the elderly or people with disabilities are examples of jobs that will almost certainly require a criminal background check. Some employers search social networking sites such as Facebook for the profiles of applicants. 

Here are some of the pieces of information that might be included in a background check. Note that many of these sources are public records created by government agencies.

  • Driving records
  • Vehicle registration
  • Credit records
  • Criminal records
  • Social Security no.
  • Education records
  • Court records
  • Workers' compensation
  • Bankruptcy
  • Character references
  • Medical records
  • Property ownership
  • Military records
  • State licensing records
  • Drug test records
  • Past employers
  • Personal references
  • Incarceration records
  • Sex offender lists

In addition to information gathered from documents or databases, employers may also gather information on job applications or employee questionnaires. Concerns about the highly personal nature of some questions can lead to lawsuits. One such case reached the U.S. Supreme Court. In this case, the Court said personal information required of contract workers at the Jet Propulsion Laboratory was “reasonable” given the government’s interest in screening employees.  

Will my old conviction, probation, or arrest show up on a background check?

It depends. What can be reported on a background check depends on a number of factors, such as the kind of job, salary, and whether the employer does the check or hires a third party screening company. These are just a few of the things that can factor in. Federal law allows the reporting of criminal convictions indefinitely. Your state may offer more protection. If you have a court record, check the court record yourself to see how this matter appears. 

Can an employer ask my friends and neighbors about me?

Yes. Under the FCRA, a background check that includes interviews with "neighbors, friends, or associates" about your "character, general reputation, personal characteristics, or mode of living" is called an "investigative consumer report." (The term "investigative consumer report" has a different meaning under California Law.)

When information about you is gathered from interviews, the FCRA requires a separate disclosure. You are also entitled to know the "nature and scope" of an investigative consumer report, but you have to ask.

    3. What Cannot Be in a Background Check Report?

The federal Fair Credit Reporting Act (FCRA) sets national standards for employment screening. However, the law only applies to background checks performed by an outside company, called a "consumer reporting agency" under the FCRA. The law does not apply in situations where the employer conducts background checks inhouse.

Your state may have stronger laws, such as California's Investigative Consumer Reporting Agencies Act (Civil Code §1786) and the California Consumer Credit Reporting Agency Act (Civil Code §1785). In addition, many state labor codes and state fair employment guidelines limit the content of an employment background check. 

Under the FCRA, a background check report is called a "consumer report." This is the same name given to your credit report, and the same limits on disclosure apply. The FCRA says the following cannot be reported:

  • Bankruptcies after 10 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.

However, the above reporting restrictions do not apply to jobs with an annual salary of $75,000 or more a year. (FCRA §605(b)(3).

Criminal convictions are reportable indefinitely, unless your state provides otherwise. California follows the seven-year rule (CA Civil Code 1786.18) as do some other states. To find the limit for reporting criminal convictions in your state, contact your state employment agency or office of consumer affairs.

Other laws that should be considered:

  • Arrest information. Although arrest record information is public record, in California and other states employers cannot seek from any source the arrest record of a potential employee. However, if the arrest resulted in a conviction, or if the applicant is out of jail but pending trial, that information can be used. (California Labor Code §432.7).

    In California, an exception exists for the health care industry where any employer who has an interest in hiring a person with access to patients can ask about sex related arrests. When an employee may have access to medications, an employer can ask about drug related arrests.

  • Criminal history. In California, criminal histories or "rap sheets" compiled by law enforcement agencies are not public record. Only certain employers such as public utilities, law enforcement, security guard firms, and child care facilities have access to this information. (California Penal Code §§11105, 13300) However, there are private companies that compile virtual "rap sheets."

Employers need to use caution in checking criminal records. Information offered to the public by online information brokers is not always accurate or up to date.

  • Workers' compensation. In most states including California, when an employee's claim goes through the state system or the Workers' Compensation Appeals Board (WCAB), the case becomes public record. An employer may only use this information if an injury might interfere with one's ability to perform required duties. Under the federal Americans with Disabilities Act, employers cannot use medical information or the fact an applicant filed a workers' compensation claim to discriminate against applicants. (42 USC §12101).

In California, employers may access workers' compensation records after making an offer of employment. To gain access, employers must register with the WCAB and confirm that the records are being accessed for legitimate purposes. Although the agency may not reveal medical information and the employer may not rescind an offer due to a workers' compensation claim (California Labor Code 132a), employers sometimes discover that applicants have not revealed previous employers where they had filed claims. In such situations, employers often terminate the new hire because it appears they falsified the application.

  • Bankruptcies. Bankruptcies are public record. However, employers cannot discriminate against applicants because they have filed for bankruptcy. (11 USC §525)

Although these laws should prevent an employer from considering certain information, there is no realistic way for the applicant to determine whether such information will be revealed in a background check. This is particularly true for investigations conducted online where the information obtained might not be verified for accuracy or completeness.

For example, if you were arrested but never convicted, a data search could reveal the arrest, but the investigator who compiled the information might not delve further into the public records to determine that you were acquitted or the charges were dropped. Reputable employment screening companies always verify negative information obtained from database searches against the actual public records filed at the courthouse.

Can an employment application ask about things that should not be reported?

The FCRA does not prohibit an employer from asking questions in an employment application. See FTC letters to Nadell and Sum:

For example, an employment application might ask if you have "ever" been arrested. The FCRA says a consumer reporting agency cannot report an arrest that from date of entry was more than seven years ago. It does not say the employer cannot ask the question.  How to handle such questions on an employment application is of real concern to many people, especially those concerned with a youthful mistake from the distant past.

To learn about employment laws in your state, search the Internet for “employment inquiries” followed by the name of your state. State and local equal employment opportunity agencies, along with federal EEO field offices, may also be located through the US Equal Opportunity Commission site.

State, county, or city employment laws may limit the questions that an employer includes on a job application.  So-called "Ban the Box" laws may prohibit employers from inquiring into criminal history in a job application. These laws can be complex and varied.  For examples and lists of state and municipal laws, see http://www.nelp.org/page/content/banthebox/.

The California Labor Code says an employer cannot ask about:

  • Any arrest or detention that did not result in a conviction.
  • Any arrest for which pretrial diversion has been completed.
  • Any criminal records that have been expunged, sealed or dismissed.
  • Public sector employers (California state and local agencies, cities and counties) are prohibited from asking about criminal records on employment applications.  Public sector employers must review an applicant's qualifications before inquiring about their conviction history.

Provisions of the Labor Code are reinforced in regulations of the California Department of Fair Housing and Employment. (See: 2 Cal. Codes Regs Sec. 7287.4(d)(1) (Register 95, No. 29: 7-21-95) A Department publication lists questions that are inappropriate for a California job applicant.

Aren't some of my personal records confidential?

An employer is required to get your permission before obtaining the following records. 

  • Education records. Under both federal and California law, transcripts, recommendations, discipline records, and financial information are confidential. A school should not release student records without the authorization of the adult-age student or parent. However, a school may release "directory information," which can include name, address, dates of attendance, degrees earned, and activities, unless the student has given written notice otherwise. (20 USC §1232g, www.ed.gov/offices/OM/fpco/ferpa/index.html)
  • Military service records. Under the federal Privacy Act, service records are confidential and can only be released under limited circumstances. Inquiries not authorized by the subject of the records must be made under the Freedom of Information Act. Even without the applicant's consent, the military may release name, rank, salary, duty assignments, awards, and duty status. (5 USC §§552, 552a)
  • Medical records. In California and many states, medical records are confidential. There are only a few instances when a medical record can be released without your knowledge or authorization. The FCRA also requires your specific permission for the release of medical records. If employers require physical examinations after they make a job offer, they will have access to the results. The Americans with Disabilities Act allows a potential employer to inquire only about your ability to perform specific job functions. (42 USC §12101)

There are other questions such as age, marital status, and certain psychological tests that employers cannot use when interviewing. These issues are beyond the scope of this fact sheet. If you have further questions, contact the resources at the end of this fact sheet. The federal Equal Employment Opportunity Commission and the fair employment agencies in the states handle these issues.

What can my former employer say about me?

Often a potential employer will contact an applicant's past employers. A former boss can say anything truthful about your performance. However, most employers have a policy to only confirm dates of employment, final salary, and other limited information. California law prohibits employers from intentionally interfering with former employees' attempts to find jobs by giving out false or misleading references. (California Labor Code §1050)

Under California law and the laws of many other states, employees have a right to review their own personnel files and make copies of documents they have signed. If you are a state or federal employee, your personnel file is protected under the California Information Practices Act or the federal Privacy Act of 1974 and can only be disclosed under limited circumstances. (California Civil Code §56.20; California Labor Code §§432, 1198.5; 5 USC §552a)

Jobs such as truck driver positions fall under regulations of the federal Department of Transportation. Employers are required to accurately respond to an inquiry from a prospective employer about whether you took a drug test, refused a drug test, or tested positive in a drug test with the former or current employer. (49 CFR §40.25, 49 CFR §382.413)

4. Who Conducts Background Checks?

There are many companies that specialize in employment screening. The most important thing to keep in mind is that companies conducting background checks fall into several broad categories. This can range from individuals commonly known as "private investigators," to companies that do nothing but employment screening, and to online data brokers. 

Corporations that employ large numbers of people may have an established relationship with a third-party background checking company or may even use an affiliated company for their employment screening. Other background checking companies may work on a less formal basis with employers. Some screening companies operate in specific areas of the country while others, including some private investigators, conduct background screening nationwide.

It is easy for employers to gather background information themselves. Much of it is computerized, allowing employers to access public records and commercial databases online. Finding one of these online companies is as easy as using an Internet search engine to find web sites that specialize in "background checks."

Employers should beware of companies advertising on the Internet that they can "find everything about anyone." They are not necessarily going to be in strict compliance with federal and state laws, especially the provisions that require accuracy of background check reports. 

Employers should also understand that online data brokers may be subject to the FCRA, triggering obligations on the part of the company as well as the employer.  In June 2012 the FTC announced a settlement in a case charging online data broker Spokeo with acting as a consumer reporting agency.

How much does a background check cost?

Background checks vary significantly in price depending on a number of factors, including: the comprehensiveness of the search, what types of background information is sought, and the number of background reports that the company or agency has the screening company conduct each year (usually prices are lower per search when a high volume of reports are conducted per organization).

5. Your Rights Under the Fair Credit Reporting Act (FCRA)

The federal Fair Credit Reporting Act (15 USC §1681 et seq.) does not require employers to conduct employment background checks. But the law sets a national standard that employers must follow in employment screening. State laws may give an employee more rights than the FCRA.

Do I have a right to know when a background check is requested?

Yes, if it is not performed by the employer. The background check must be prepared by an outside company -- a "consumer reporting agency" or business that "for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in ... assembling ... information on consumers for the purpose of furnishing consumer reports to third parties." (FCRA §603f)

Under the FCRA, the employer must obtain the applicant's written authorization before the background check is conducted. The authorization must be on a document separate from all other documents such as an employment application. In California, at the time an employer obtains permission for a background check, the applicant or employee should also be told that he or she may request a copy of the report. The FCRA, in contrast, says the subject is entitled to a copy of the report if a pre-adverse notice is given.

Under federal law, if the employer uses information from the consumer report for an "adverse action" - that is, denying the job applicant, terminating the employee, rescinding a job offer, or denying a promotion - it must take the following steps:

  • Before the adverse action is taken, the employer must give the applicant a "pre-adverse action disclosure." This includes a copy of the report and an explanation of the consumer's rights under the FCRA.

  • After the adverse action is taken, the individual must be given an "adverse action notice." This document must contain the name, address, and phone number of the employment screening company, a statement that this company did not make the adverse decision, rather that the employer did, and a notice that the individual has the right to dispute the accuracy or completeness of any of the information in the report.

Modified disclosure and adverse action procedures under the FCRA (§604(b)(3)(B)) apply to positions subject to U.S. Department of Transportation (DOT) regulations such as truck drivers. The DOT has independent authority to set qualifications for workers in transportation industries.  (49 USC §31502)

Can a background check report include a case that was expunged?

According to the FTC, it should not. In August, 2012, the agency fined one background screening company $2.6 million for, among other things, reporting criminal records that had been expunged. In addition, the FTC charged the company with failing to follow other FCRA provisions, including failure to provide consumers with a copy of their background check report.

Often equated to the sealing or destroying of legal records. Each state offers its own definition of expungement, based on different rules and laws. Generally, expungement can be viewed as the process to "remove from general review" the records pertaining to a case. But the records may not completely "disappear" and may still be available to law enforcement.

I am applying for a job in a profession that is required by law to perform background checks, such as in law enforcement, childcare, or a hospital. Will this affect my rights under the Fair Credit Reporting Act?

Maybe. When a specific law requires a background check, that same law usually outlines the rights employees have. These rights may not necessarily follow the Fair Credit Reporting Act, the background screening law that governs "consumer reports."  However, if a third-party screening company is hired, the FCRA would apply.

Law enforcement agencies or state licensing authorities may have direct access to state and federal criminal records databases, which many private employers do not have. A government-run database is not a consumer reporting agency and is not subject to the FCRA. Whether you have a right to get your report or make corrections may be spelled out in the background check forms you signed or perhaps on the agency's Web site.

However, individuals are generally allowed to access their own criminal records files maintained by a state or federal agency. To access your state’s criminal records data files, contact your state Attorney General. The federal Privacy Act also gives you the right to request records maintained about you. To check federal criminal records, contact the Federal Bureau of Investigation.

I am an independent contractor. What are my rights if the employer wants to do a background check?

The Federal Trade Commission staff has issued a couple of advisory opinion letters about contractors and the Fair Credit Reporting Act.

Allison Letter.  This FTC advisory opinion says that a trucking operation that uses consumer reports to evaluate whether to hire independent owner operator truck drivers must comply with the provisions of the FCRA pertaining to consumer reports, including the disclosure and authorization provisions.

The opinion goes on to say that even a homeowner who is considering hiring an individual to perform services for the homeowner is indeed required to comply with the FCRA when obtaining a "consumer report" on that individual. Like any employer, the homeowner must abide by the applicable disclosure and authorization provisions like any other employer.

Solomon Letter. This FTC advisory opinion says that  the term "employment purposes," as used in the FCRA, should be interpreted broadly. 

Does a nonprofit organization have to follow the FCRA when screening volunteers?

Yes, if the investigation is conducted by a consumer reporting agency. Some nonprofit organizations are allowed direct access to state or federal criminal data bases. This is especially true for those organizations where employees and volunteers work closely with children, the elderly, or the disabled.

Does the FCRA require that I receive notice and give authorization at any time a background check is obtained?

The FCRA allows a "blanket" authorization. This means a one-time notice and authorization is sufficent to allow the employer to obtain reports at any time during employment.  The requirement to get authorization may, however, be different under state law. In California, for example, notice and authorization is required "at any time before a report is procured." (California Civil Code Sec. 1786.16)

May an employment report include medical information?

The FCRA imposes specific obligations on employment screening companies. Medical information supplied for employment purposes requires your specific written consent and must be “relevant” to the employment. An employer may also ask you to take a pre-employment physical. If so, the Americans with Disabilities Act requires such requests be made only after a job offer.

How does the FCRA fall short?

The federal law has two significant loopholes. First, if the employer does not use a third-party screening company but, rather conducts the background check itself, it is not subject to the notice and consent provisions of the FCRA.

Second, the employer might tell the rejected applicant that its adverse decision was not based on the contents of the background investigation, but, rather that the job pool was so exceptional that it made its hiring decision based on the fact that there were individuals more qualified than the applicant.

In both of these situations, the applicant would not have the ability to obtain a copy of the background check to find out what negative information it contained. 

Where do I go to complain about an employer or a background screening company that does not follow the FCRA?

Complaints should be filed with the Federal Trade Commission. Your state may also have a law that applies to employment background checks. In that case, file a complaint with your state Attorney General. Contact for state Attorneys General can be found through the National Association of Attoneys General

In California, complaints should be submitted to the Attorney General's Public Inquiry Unit, (916) 322-3360 or Toll Free in California (800) 952-5225.

The FCRA includes a private right of action, that is consumers themselves may sue for violations. Attorneys who specialize in employment law may be located through the National Employment Lawyers' Association. State and county bar associations are another resource for referrals.

6. What If There's an Error in  My Background Check?

There is an error in my background check report.  What should I do?

First, talk to the employer. Explain the report’s errors, and tell the employer you intend to file a dispute with the employment screening company. Although the FCRA does not require the employer to hold the job for you, a sympathetic employer may be willing to give you a chance to correct any errors.

Next, file a dispute with the employment screening company that made the error. You may first call the company and tell them about the error. Then follow-up with a written dispute letter pointing out the errors in the report. Send your letter certified mail, return receipt requested.

Along with your letter you may submit information that verifies your side of the story. For example, you may have a common name. The background check report may show a criminal record for someone with your first and last name but with a different middle initial. 

The process for disputing errors in an employment report is the same as the process for disputing errors in your credit report. For more about filing disputes, along with a sample dispute letter, see the FTC publication How to Dispute Credit Report Errors.

What happens after I file a dispute with the employment screening company?

After you file your dispute, the screening company has 30 days to investigate. If, during that 30 day period, you file additional information, the investigation may be extended by another 15 days. So, 45 days is the maximum time allowed for considering your dispute.

If information in your background screening report cannot be verified, it must be deleted. You must receive written notice of the results of the investigation not later than five business days after the investigation is completed. You can ask the screening company to send the revised report to anyone who has received an employment report about you within the last two years. You also have the right to receive another free copy of your report within 60 days.

I want to file a lawsuit against a background check company for reporting inaccurate information on my background check, because it cost me my job. What should I do?

You should contact an employment or consumer lawyer to discuss your situation. An employment lawyer can be found through the National Employment Lawyers Association. A consumer attorney can be found through the National Association of Consumer Advocates.

If a background checking company deletes inaccurate information, does the employer have to re-instate a job offer?

No. The FCRA does not obligate an employer to act upon a corrected report.

7. Background Checks and Your Credit Report

An employment background check often includes a copy of your credit report. The three major credit reporting agencies (Experian, TransUnion, and Equifax) provide a modified version of the credit report called an "employment report." An "employment report" includes information about your credit payment history and other credit habits from which current or potential employers might draw conclusions about you.

An employment report provides everything a standard credit report would provide. However it doesn't include your credit score or date of birth. Nor does it place an "inquiry" on your credit file that may be seen by a company looking to issue you credit. Having too many credit inquiries tends to lower your credit score.

Why do some employers do a credit check?

Often employers use your credit history to gauge your level of responsibility. Whether a valid assumption or not, some employers believe if you are not reliable in paying your bills, then you will not be a reliable employee. Unfortunately, a bad credit report can work against you in your search for employment.

In addition to your payment history, a credit report typically includes information about your former addresses and previous employers. Employers can use this as one way to verify the accuracy of information you provide on an application or resume.

Do any state laws limit the use of credit reports for employment screening purposes?

Several states have passed laws limiting credit reports for employment decisions with provisions that require a nexus to actual job duties. Those states are: California, Colorado, Connecticut, Hawaii, Illinois, Maryland, Nevada, Oregon, Vermont, and Washington .

A California employer cannot review your credit report unless the job falls into one of numerous exceptions. Credit checks are allowed for, among other things, jobs with the state Department of Justice, management positons, law enforcement jobs, and jobs that entail access to money, financial accounts, or personal information. For more on employment background checks in California, see PRC's guide to Employment Background Checks in California.

Can my employer continue to check my credit after I’ve been hired?

Yes. The FCRA allows employment checks not only for hiring purposes but for other employment purposes such as promotion, retention, or transfer. Credit checks for the purposes of retaining you as an employee allows the employer to check you credit periodically. Once you have given your permission, you generally need not be asked again.

Employers may run periodic checks, for example, as a way to identify individuals who have a high debt to salary ratio. To an employer, an employee who is overextended financially may be more prone to stealing from the company.

I never use credit. Can an employer hold that against me?

Yes. The employer might be looking for someone who has an established record of paying bills on time. The FCRA says only that certain things like negative information more than seven years old cannot be considered. The absence of a credit history can also be considered. But if this bit of information means you don't get the job, the employer has to give you an adverse notice decision. 

My credit rating went down when I lost my job. Now I can’t get a job because of poor credit. Is this fair?

No. Often a poor credit rating results from circumstances that are beyond your control. The loss of a job or high medical bills often leads to late payments, even bankruptcy. Still a bank or other financial institution may reason that a solid financial history is a qualifying factor for an employee who has control over substantial sums of money.

However, the same argument cannot be made when a credit check serves only as a kind of character screening. Some states have now recognized the unfairness in this by adopting laws that require a direct relationship to the job before a credit check is made.

8. Employee Misconduct Investigations

What is an "employee misconduct investigation"?

This is an investigation conducted by a third-party your employer may hire if the employer suspects you of:

  • Misconduct relating to your employment.
  • A violation of federal, state or local laws or regulations.
  • A violation of any preexisting written policies of the employer.
  • Noncompliance with the rules of a self-regulatory organization, that, for example, oversees the securities and commodity futures industry.

If my employer suspects me of misconduct, what does this mean for me?

It means your employer does not have to give you notice and get your permission to conduct a misconduct investigation. Like other inquiries covered by the FCRA, this only applies if the employer hires an outside party to conduct the investigation.

It also means you will not receive a notice of your rights as others who are subject to a standard employment background check normally would. If, at the end of the investigation, the employer decides to take some action against you, you receive the "adverse action" notice only after the action has been taken.

You will receive only a "summary" of the investigation report, but not the more detailed report that may include sources.

Who will see the investigation report?

The report may be communicated to:

  • The employer or its agent.
  • Any federal or state officer, agency or department or any officer, agency or department of a unit of general local government.
  • Any self-regulatory organization with regulatory authority over the activities of the employer or the employee.
  • Others, as is otherwise required by law; or
  • A government agency, in accordance with an existing FCRA section that allows a consumer reporting agency to disclose personal identifying information to a government agency.

Can I dispute the findings?

Not under the FCRA dispute procedure. The usual protections that apply to a "consumer report" conducted for employment purposes do not apply to workplace misconduct investigations. If you find yourself in this position, you will probably want to seek the advice of an employment law attorney.

9. Preparing for a Background Check

When you know you are going to be on the job market, take the following steps to reduce the chances that you and/or the potential employer will be "surprised" by information found in the background check process:

  • Order a copy of your credit report. If there is something you do not recognize or that you disagree with, dispute the information with the creditor and/or credit bureau before you have to explain it to the interviewer. Another individual's name may appear on your credit report. This happens when someone mistakenly writes down the wrong Social Security number on a credit application causing that name to appear on your file. Or you might be a victim of identity theft.
  • Check court records. If you have an arrest record or have been involved in court cases, go to the county where this took place and inspect the files. Make sure the information is correct and up to date.

    Reporting agencies often report felony convictions when the consumer truly believes the crime was reduced to a misdemeanor, or that it was reported as a misdemeanor conviction when the consumer thought the charge was reduced to an infraction. Court records are not always updated correctly. For example, a signature that was needed to reduce the charges might not have been obtained or recorded by the court. Don't rely on what someone else may have told you. If you think the conviction was expunged or dismissed, get a certified copy of your report from the court.

    It is always a good idea to keep certified copies of any papers filed in court, especially the judge’s order or other document that disposes of the case. If you later learn the court record is inaccurate but do not have a certified copy, first contact the clerk of court where the matter was heard. If you cannot correct the problem at this level, it may be necessary to petition the court yourself or hire an attorney to act on your behalf.
  • Check DMV records. Request a copy of your driving record from the Department of Motor Vehicles, especially if you are applying for a job that involves driving.

    Many employers ask on their application if you were ever convicted of a crime. Or they might word the question to ask whether you have ever been convicted of a felony or misdemeanor. Typically, the application says you do not have to divulge a case that was expunged or dismissed, or that was a minor traffic violation.

    Don't be confused. A DUI (driving under the influence) or DWI (driving while intoxicated) conviction is not considered a minor traffic infraction. Applicants with a DUI or DWI who have not checked "yes" on a job application may be denied employment for falsifying the form -- even when the incident occurred only once or happened many years before. The employer perceives this as dishonesty, even though the applicant might only have been confused by the question.
  • Do your own background check. If you want to see what an employer's background check might uncover, hire a background screening company that specializes in such reports to conduct one for you. That way, you can discover if the data bases of information vendors contain erroneous or misleading information. You can use one of the many online search services to find out what an employer would learn if conducting a background check in this way.
  • Ask to see a copy of your personnel file from your old job. Even if you do not work there anymore, state law might enable you to see your file. Under California law, you can access your file until at least a year from the last date of employment. And you are allowed to make copies of documents in your file that have your signature on them. (California Labor Code §432.) You may also want to ask if your former employer has a policy about the release of personnel records. Many companies limit the amount of information they disclose.
  • Read the fine print carefully. When you sign a job application, you will be asked to sign a consent form if a background check is conducted. Read this statement carefully and ask questions if the authorization statement is not clear. Unfortunately, jobseekers are in an awkward position, since refusing to authorize a background check may jeopardize the chances of getting the job.
  • Tell neighbors and work colleagues, past and present, that they might be asked to provide information about you. This helps avoid suspicion and alerts you to possible problems. In addition, their prior knowledge gives them permission to disclose information to the investigator. Forewarning others speeds up the process and helps you get the job faster.

  • Clean up your "digital dirt." Conduct a search on your name -- in quotation marks -- in the major search engines such as Google. If you find unflattering references, contact the Web site to learn if and how you can remove them. You can monitor the web for new mentions of your name by setting up a Google Alert at http://www.google.com/alerts. Google Alert will send you email updates of the latest Google results mentioning your name.

    If you have created profiles in popular social networking sites such as Facebook, review, and if necessary, edit what you have posted to make sure that an employer would not be offended.   Some employers are turning to third-party screening companies to monitor and report on a potential employee’s social networking activity. Understand that if employers themselves monitor your Internet activity, you do not have rights under the Fair Credit Reporting Act.

Do you blog? Re-read your entries from the perspective of a potential employer. Remove or edit postings that could harm your jobseeking efforts. But don't necessarily remove Web content that shines a light on your positive achievements. A personal Web site or blog that highlights your good deeds could benefit you.

  • Request previous background check reports. If you have been the subject of a background check covered by the FCRA, you may be entitled to receive a copy of your "file" from the employment screening company. If you do not know the name of the screening company, ask the employer who requested the check.

10. Resources

Laws on Background Checks

Laws on Workplace Discrimination

  • Equal Employment Opportunity Commission (EEOC),
    The EEOC was established by Title VII of the Civil Rights Act of 1964. It enforces the following laws:
  • Title VII of the Civil Rights Act of 1964 (Title VII), which prohibits employment discrimination based on race, color, religion, sex, or national origin. 42 USC §2000e
  • Equal Pay Act of 1963, which protects men and women who perform substantially equal work in the same establishment from sex-based wage discrimination. 29 USC §206(d)
  • Age Discrimination in Employment Act of 1967 (ADEA), which protects individuals who are 40 years of age or older. 29 USC §621
  • Americans with Disabilities Act of 1990 (ADA), which prohibits employment discrimination against qualified individuals with disabilities in the private sector, and in state and local governments. 42 USC §12101

Contacting Government Agencies

  • U.S. Equal Employment Opportunity Commission (EEOC)
    1801 L Street, N.W.
    Washington, D.C. 20507
    Phone: (202) 663-4900
    TTY: (202) 663-4494
    Web: www.eeoc.gov
  • EEOC Field Offices
    To be automatically connected with the nearest EEOC field office, call:
    Phone: (800) 669-4000
    TTY: (800) 669-6820
  • Federal Trade Commission (FTC)
    Consumer Response Center, CRC-240
    Washington, D.C. 20580
    Phone: (877) FTC-HELP (877-382-4357)
    TTY: (866) 653-4261
    Web: www.ftc.gov

FTC Publications

Equal Employment Opportunity Commission (EEOC)

California Department of Fair Employment and Housing
For information on how to file an employment-related complaint, call one of the numbers below.

(800) 884-1684 (Within California)
(916) 227-0551 (Outside California)
Web site: www.dfeh.ca.gov

Fair Employment Agencies in the 50 States

Articles of Interest

The Privacy Rights Clearinghouse has revised and updated this guide with funding assistance from the Rose Foundation Consumer Privacy Rights Fund.
We acknowledge the assistance of Barry Nadell, Nadell Investigations, in developing this guide,

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