October 29, 2020

The Inside Dirt on Employment Background Checks

Ed. note: Herc Hammer — obviously not his real name — is a Certified Fraud Examiner and licensed private investigator who works for a Big 4 firm. If you still have questions about the background check process, head over to Open Items and ask away.

So you’ve landed a job offer from a prestigious firm, and you’ve nearly dislocated both shoulder blades from patting yourself on the back. Then comes that sobering email: please log into this web site and fill out a questionnaire for a background check. Your mind races. What about that time you and your bros got cited for public vomiting at the football game? Or that notice to appear you got for wearing a thong bikini near an elementary school during spring break?

Before you mail a tear-stained confession to your campus recruiter, take a few minutes to understand what is—and what is not—included in an employment background check. Doing so will not only calm your nerves but also come in handy someday when you’re the one doing the hiring.

Background checks for a first-year associate and a newly admitted partner are about as different as a peek down your shorts and a colonoscopy. Just as auditors perform fewer procedures when control risk is low, firms do limited checks on employees who lack the authority to really screw things up.

Employers usually farm out rank-and-file background checks to vendors such as HireRight or First Advantage. The vendor will provide you with a scary-looking authorization form, which will say that your background report may contain everything from drug test results to details of your personal habits gleaned from an interview with your psycho ex-roommate.

Fear not. This is a standard form used for all levels of background checks and designed to protect the vendor and the employer from liability. In truth, the vendor will conduct a narrow check focused on three things:

  • Verifying your academic and work experience
  • Checking for criminal records
  • Checking your personal financial history

If you’ve had trouble in any of these areas, you may wonder whether to tell your employer in advance. This is a judgment call only you can make. However, notice on the authorization form that you can request a copy of your background report. I recommend that you avail yourself of this for two reasons: 1) if you find errors, you can promptly correct them, and 2) if a legitimate skeleton from your closet shows up, you can contact your employer and offer to explain.

What if the skeleton doesn’t show up? Are you ethically obligated to disclose its existence? Again, this is your call. Just remember you may have to undergo another background check in the future, and previously undisclosed items may or may not show up. On the other hand, there’s a fine line between being honest and over-sharing. Your employer doesn’t need or want to know every detail of your personal history.

So just how likely is a past run-in with Johnny Law to make an appearance on a background report? The first thing to know is that there is no such thing in the U.S. as a comprehensive national database of criminal records that private employers can legally search. The closest thing is the FBI’s Interstate Identification Index, which is off-limits to everyone but law enforcement.

Most criminal records in the U.S.—arrests, trials, and convictions—are open to the public even if the charges were dismissed. But good luck finding them. There are over 10,000 courthouses in over 3,500 jurisdictions. Each has its own policies regarding access to criminal records, and many still use paper rap sheets stored in moldy basements.

Background check firms typically subscribe to databases like Accurint, TLOxp, and IRBsearch, whose owners are forever trying to acquire more criminal records. But their collections are far from complete. Beyond federal and state felony convictions, they contain a hodgepodge of data from local courts, police departments, sex offender registries, and most wanted lists.

A criminal record in a commercial database rarely includes all the data from the original source. It’s more like an entry in a library catalog. A search result may show, for example, that the Wyandotte County Police Department has an arrest record matching your name for a misdemeanor charge on March 18, 2012. An investigator would have to obtain the original document to confirm the details of the offense, whether the charges were dropped, and whether the arrestee was actually you.

That’s why the questionnaire you fill out for your background check asks for your residential address history. The investigators will check which records are available in the jurisdictions in which you’ve lived. If felony convictions are online but misdemeanor arrests are not, they have to decide whether it’s worth it to send someone to the courthouse in Butte, Montana to check whether you’ve ever spent the night in the drunk tank. Chances are they’ll skip it.

Junior employees do most of the actual work at background check firms, and they’re on tight deadlines and low budgets (sound familiar?). Their verification of your academic and work history will consist of calling your alma mater and former employers and asking for transcripts and verbal confirmations. If they hit a snag, don’t be surprised if they call you to ask for help.

The financial information the investigators are after is mostly in your credit report, which they can lawfully obtain only after you’ve signed their authorization form. Even without your consent, they can pull bankruptcies, tax liens, foreclosures, evictions, and judgments, all of which are available from commercial databases.

In examining your financial history, employers are concerned mainly about the risk of fraud or theft you may pose. But beware of hiring managers who think they can divine such risk from a credit report. A responsible employer who sees red flags in your financial records will approach you privately and request an explanation. If your response is reasonable and credible, the matter may go no further.

The same is true of any blemish on a background report. An employer should use the report to identify areas for follow up rather than as smoking-gun evidence. Reports can contain errors and miscues. So remember to exercise restraint years after you’ve gone through a grueling background check only to wake up one morning, look in the mirror, and realize you’re The Man.

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