If you plan to hire employees, you want to be able to verify the information on candidates' resumes or job applications. There are frequent news stories about job applicants who falsify their educational degrees and employment experience. In some cases, you may also want to be sure the candidate isn't in severe financial trouble, or doesn't have a criminal history.
Before you can verify an employee's information, you must obtain their permission to do so, which requires the use of an employee release of information form.
Employee Background Investigation Basics
Most companies conduct some form of background check on potential employees. The most important thing to know about the background check is that the employee must consent to its being done. This is required by regulations of the Equal Employment Opportunity Commission (EEOC) and the Federal Trade Commission (FTC). More information on what is required and what is prohibited may be obtained from this joint EEOC/FTC publication.
Applicants for employment should be informed that a background check may be conducted. This can be done in the position announcement, on the application form, or at the initial interview. All applicants may be asked to sign an employee information release form, even if a background check will only be done on the candidate who is chosen. Knowing that a background investigation is possible gives candidates an incentive to provide truthful information throughout the process.
A preemployment background check is not typically done on everyone who submits an application. This would be too expensive and time-consuming. Background checks are typically conducted after a likely candidate is selected but before an employment agreement is finalized. The offer of employment is conditional upon the performance of a satisfactory background check.
Types of Background Checks
An authorization to release employee information may cover various types of background checks, including:
- Educational background. This authorizes an educational institution—high school, trade school, college, or university—to release information on the individual's academic performance.
- Employment background. This authorizes the potential employee's former employers to release information about the person's employment. Many companies have a policy of limiting the information that is disclosed, typically to the person's position, dates of employment, and possibly salary. For fear of a lawsuit, they will not disclose things like performance evaluations, disciplinary actions, reason for termination of employment, or whether they would hire the person again. The employee information release form not only will authorize disclosure of such information, but also will release the former employer from liability for what is disclosed.
- References. If your application process requires applicants to designate personal or professional references, the applicant should assume that such references will be asked to provide personal information, and should have notified them that they may expect to be contacted. However, if you plan to contact references by mail, you may want to include them in the release form.
- Criminal background. This type of background check is designed to reveal things like arrest and conviction records, traffic citations, and sex abuse registry listings. Depending on the circumstances, it may be conducted by the FBI, by a state or local law enforcement agency, or by a private company.
- Credit report. Some caution needs to be exercised in obtaining a credit report from one of the large credit reporting companies. This requires an awareness of what is required by federal law under the Fair Credit Reporting Act (FCRA). There also may be state or local laws that limit or prohibit obtaining credit reports on employees. Such laws need to be considered before deciding whether to use a release of credit information form.
The extent and nature of a background investigation should take into consideration the nature of the position to be held by the prospective employee. For most positions, confirming the employee's education and employment history will be sufficient. A credit report is not usually obtained unless the employee will be working in a position dealing with money, such as in the banking, accounting, or investment fields. A criminal background investigation may be required by law if the person will be employed in a position of responsibility for children or the elderly, such as a day care worker, a school bus driver, or an aide in an assisted living facility.
A basic, and broad, employee release of information form will enable you to conduct whatever types of background checks you determine are needed. Knowing that you may conduct such an investigation also will encourage the applicant to be honest on the application and at interviews.