With black Friday at the end of the week the holiday season is upon us. This time is for family, warm fires with friends and for seasonal hiring. Companies have made hiring choices for this time of year and maybe even ran a few background checks on employees. Unfortunately, this is also the season for lawsuits against employers who have been a little bit naughty when it comes to compliance. Since a recent Ninth Circuit decision held that inaccurate reports like those from cheap background checks are enough to file a lawsuit companies need to be more diligent deciding which background check company to use.
Around this time of year budgets are stretched thin in expectation of winter sales, it’s hard to warrant spending more on background checks for your employees so some employers will turn to cheap background check services they find online. What does this mean? Well, background check companies that offer inexpensive services for screening employees have to cut corners somewhere. Usually that means one of two things, either the information given is not compliant or their procedures are not compliant.
Inaccurate and non-compliant candidate history
Companies that offer cheap background check options may get their information from multiple sources, but that information may not be correct. These companies often conduct searches with the name of the candidate and their date of birth, which is the type of report that prompted the Robins v. Spokeo, Inc. lawsuit considered above. If an individual has the same name, or similar or if the information was just improperly filed your candidate might come up with a record from this type of search. Sometimes courts or other systems report information connected to the wrong individual and these cheap background check companies might give you the wrong record all together.
In addition to the record found possibly being false, when a record is found the background check company has a requirement to confirm the legitimacy of that information. If they do not take steps contacting the county court level, then there is no way of knowing if the information about that candidate is true. Confirming the information with multiple methods is the only way to get FCRA Compliant background check information.
Not only can that information be simply false, not only is considering it without confirmation from the county court level needed but the data even within a report from one of these companies can also be non-compliant with FCRA guidelines. For instance with a cheap background check company you could get information past the 7 year mandate or you could get information that shouldn’t be returned in a background check for employment by law.
More non-compliant procedures
Even if we were to ignore the above there are two more problems with the procedures these companies use that are problematic. First is that they generally are not getting proper authorization or preparing the necessary documents to provide the candidate. There are strict FCRA guidelines with getting authorization from the candidate, and giving them a summary of their rights separate from that documentation. If you find a company that doesn’t provide these then you could find yourself in legal trouble fast.
Finally, when a background check company finds a record on a candidate the law requires that individual be given a copy of that report on request and be given time to dispute the information. Cheap background check companies won’t provide a report to the candidate and definitely won’t allow them to dispute the record since it’s probably not legal to attain or even connected in the first place.
It’s mistakes like these that landed Spokeo inc. in court and trusting a company that seems a bit too good to be true will put you in court as well. To stay up to date on the necessary FCRA guidelines and state laws check out our compliance page which has tons of information for employers including proper procedures like adverse action be sure to subscribe to our newsletter and check our blog.