contractor background check is an important step in the hiring process to ensure that individuals who may have access to secure areas have been appropriately screened. When you are reviewing applicants, consider these contractor screening best practices.

What are the risks that a company faces when they do not perform background checks on contractors, or do so improperly?

There are two critical areas of risk for programs that do not require background checks for contractors who have access to physical sites, systems and interactions with an organization’s staff and/or clients.
  1. In many instances, contractors will have the same access to facilitates, systems, staff and clients as your employees.  An organization must assure that these contractors have met the same background requirements as their own employees.  This need is amplified since an organization and its leadership are much more familiar with their employees than contractor staff.  This level of risk mitigation is essential to manage organizational exposure to contractor behaviors.
  2. Organizations need a “line of sight” to the contractor population.  In addition to risk mitigation, in many instances contractors may be hired with the intent to bring them on as employees at some point.  If there is no background check process – or that process is outsourced to the contractor’s employee – an organization has no visibility to the background screen for the contractor.  If a decision is made to hire the contractor and the organization orders a background screen – information may be developed that disqualifies that person from employment.  In addition to the potential exposure, all the time invested in training and evaluating the person as a contractor is now lost – and the employer must start over with a new contractor.

What are key factors to keep in mind, during employment screening, to best comply with industry rules and regulations?

The employment screening process involves a consumer report and is therefore required to comply with the Fair Credit Reporting Act (FCRA).  There must be a permissible purpose for the background screen and the subject of the screen must consent to background check.  The consent document must be a stand-alone document and not part of the application.  The information in the consumer report must be actionable information – in other words, raw data that has been adjudicated to consider appropriate state and federal laws/guidance.

The core solution in most background checks is the criminal record search.  A criminal background search is critical to assure due diligence in efforts related to negligent hiring litigation and workplace safety.  This search and the actionable data associated with the search, if any, must comply with any applicable local, state, federal and international laws.

comprehensive criminal background search should include a search of county courts where the candidate has lived and worked, as well as a search with a national criminal database.  The national criminal database includes records (but not all records) from all 50 states.  Any records developed from the national criminal database must be verified at their original reporting source to be compliant with the FCRA guidelines.

If a decision is made to not hire an individual based on information in the consumer information report, the employer must follow the steps outlined under adverse action.  This includes a pre-notification letter, a copy of the background report, the individual’s summary of rights as prescribed by the Consumer Financial Protection Bureau and within very specific time frames, the an adverse action notification.  During this process, the candidate has the opportunity to dispute information contained in the background report.