Background Screening:
Definition, Types, Uses & Comparison

Background screening is the process of using third-party providers to verify a candidate's identity, employment history, education, criminal records, and other relevant information to assess their suitability for employment, housing, or volunteer positions. This systematic investigation helps organizations make informed decisions about applicants by confirming the accuracy of their claims and uncovering potential risks that may not be apparent during interviews or on resumes.

Background screening serves several critical functions: protecting the rights of consumers, promoting safe homes and workplaces, helping employers comply with state and federal screening regulations, enabling informed placement decisions, and providing risk mitigation tools. The process typically involves comprehensive database searches, reference checks, and verification of credentials through authorized sources such as public records, law enforcement, credit bureaus, and previous employers.

Related terms: pre-employment screening, background check, employment verification, criminal record check

Pre-employment background checks are important because they provide employers with verified information beyond what candidates supply on applications, which may not always be accurate or complete. Without background checks, employers have only the information provided by applicants to form the basis of their hiring decisions.

Background screenings enable organizations to hire the most qualified people and improve productivity, prevent instances of theft and other criminal behavior, avoid workplace harassment and safety issues, and preserve company reputation and brand image. Research shows that 83% of employers use background checks to protect the safety of employees and customers, while 51% use them to improve the quality of hires.

The importance of screening services cannot be understated in industries or roles involving children, vulnerable adults, or access to sensitive data. For example, health-care organizations that commit hiring indiscretions may be excluded from receiving federal assistance such as Medicare and Medicaid, and they risk allegations of negligence and medical malpractice lawsuits if staff members make mistakes.

A typical employment background check consists of 7 key components:

• Identity verification , Confirms the candidate's name, address, and Social Security number to ensure they are who they claim to be
• Employment history , Verifies length of previous employment, titles held, job responsibilities, and reasons for leaving positions
• Education history , Confirms degrees earned, attendance dates, and academic achievements to spot falsified credentials
• Criminal history , Reveals spent and unspent convictions, records of arrest, and any instances of incarceration
• Credit reports , Examines financial records including debts, open credit cards, credit limits, and bankruptcies (typically only for roles involving financial responsibilities)
• Driving records , Shows license status, validity, class, driving-related arrests, convictions, and license points (essential for roles requiring vehicle operation)
• Reference checks , Validates professional contacts and confirms information through interviews with previous employers or associates

Not all of this information may be permissible or necessary for every role. For instance, driving records are typically not requested unless the employee will be operating a vehicle as part of their job. Various federal and state regulations govern when an individual's criminal history and credit report may be accessed.

Employee background checks work by cross-referencing an individual's identity and Social Security number against a collection of relevant databases after obtaining proper consent from the candidate. The process typically follows these steps in the hiring timeline.

First, employers make a conditional job offer before running the check. The federal Fair Credit Reporting Act and similar state laws require employers to provide written notification to and obtain authorization from any individual subject to background checks performed by third parties. Employers must notify the applicant that they might use information from a background check to make employment-related decisions, and this notice must be in writing and in a stand-alone format separate from the employment application.

Employers must apply screening policies consistently across all candidates. Running background checks on certain groups of people and not others may be considered discriminatory and illegal. The Equal Employment Opportunity Commission provides guidance stating that employment decisions based on criminal history must be job-related and consistent with business necessity.

Most background checks vet educational information, criminal records, and even social media for potential risks. The results are typically returned within 2 days to 1 week, though court and agency backlogs, holidays, and information requested from outside the United States may extend this timeline. Once results are received, employers review the data and determine if the findings justify reconsidering a potential hire.

There are 17 common types of background checks employers use to verify new hires:

1. Criminal history checks , Search local police and federal court records to verify a candidate's character and reveal any misdemeanor or felony convictions
2. DBS checks , Disclosure and Barring Service checks used in the UK to identify whether an applicant has a criminal record, with basic, standard, or enhanced levels available
3. Employment verification checks , Validate previous job titles, dates of employment, responsibilities, and reasons for leaving
4. Education verification , Confirm degrees earned, attendance dates, and academic transcripts to detect fabricated qualifications
5. Reference checks , Contact professional references to verify legitimacy of contacts and validate qualifications
6. Drug screening , Test for substance use to ensure workplace safety and compliance
7. Credit background checks , Examine financial records for roles involving money management or access to financial information
8. Social media behavior checks , Review public social media accounts to identify harmful behaviors, privacy breaches, or threatening conduct
9. Driving record (MVR) checks , Reveal license status, violations, and driving-related arrests for positions requiring vehicle operation
10. Professional license verification , Confirm validity and status of required professional licenses and certifications
11. Civil records searches , Examine civil court records for lawsuits, judgments, and other legal matters
12. Sex offender checks , Search national and state sex offender registries
13. Global sanctions checks , Verify individuals against international watchlists and sanctions databases
14. Identity verification , Confirm Social Security numbers and addresses match official records
15. I-9 verification , Verify legal authorization to work in the United States
16. FCA checks , Financial Conduct Authority checks for positions in the financial sector, combining multiple verification types
17. International background checks , Verify information and criminal records from countries outside the United States

The specific types of checks required depend on the industry, position responsibilities, and regulatory requirements. For example, healthcare positions require health-care employee background checks that verify licenses and certifications, while education roles require checks against sex offender registries and verification of teaching credentials.

DBS checks are Disclosure and Barring Service checks utilized in the UK to identify whether an applicant has a criminal record. These checks are standard within the UK and are required in several industries to verify whether an applicant poses a risk before working for an organization.

Employers can conduct a basic, standard, or enhanced DBS check depending on the position they're hiring for. DBS checks show any spent and unspent convictions, whereas enhanced DBS checks show the same information but include additional information from police records. Enhanced DBS checks are typically required for roles working with children or vulnerable adults, such as positions in education or care sectors.

The data from DBS checks is only accurate at the time of completion, which is why some organizations conduct regular re-screening of employees in sensitive positions.

FCA checks are Financial Conduct Authority background screenings essential for candidates applying for positions of authority and trust within the financial sector. These comprehensive checks ensure people are fit and proper for their applied role in financial services.

FCA checks consist of multiple verification types including credit checks, criminal records checks, employment history verification, educational verification, and identity confirmation. The Financial Services Authority states in their Training and Competence guidance that regulated firms should have adequate procedures for taking into account knowledge and skills of potential recruits, obtaining sufficient information about previous activities and training, ensuring individuals have passed appropriate exams, and assessing competence for sales roles.

Background checks typically look back 7 to 10 years, but this varies significantly based on the type of check and local regulations. There are no set federal limits for how far back background checks can search, which means even a 20-year-old misdemeanor charge may appear on a criminal background check.

Under Fair Credit Reporting Act rules, non-conviction civil actions, tax liens, and credit history may appear on pre-employment screening for 7 years. Criminal convictions may be available indefinitely. However, some states have stricter limitations. California, Massachusetts, Montana, Washington, Texas, New York, Nevada, and Maryland all have a limit of 7 years for certain types of records.

Exceptions exist to these limits. In certain situations, such as when a job has a salary over $75,000 or $125,000 (depending on the state), employers can access information beyond the standard lookback period. This variance from state to state means that paying close attention to each jurisdiction's unique rules helps employers better understand how far back the information goes.

A background check typically takes 2 days to 1 week to complete, though the exact timeline varies based on the type and depth of screening required. The length of time ranges from as little as 2 days to as much as a week or longer for comprehensive reports.

Court and agency backlogs, holidays, and information requested from outside the United States may extend this timeline beyond the typical range. For example, employment verification checks can be completed quickly if previous employers respond promptly, while international background checks may require several weeks due to differences in record-keeping systems and response times across countries.

HR teams can help speed the process by collecting all necessary candidate data upfront and automating adverse action workflows. Professional background screening companies often have established relationships with data sources and can expedite searches more effectively than employers conducting checks internally.

Red flags on background checks are items of concern that may cause an employer to reconsider a hiring decision. Employers determine their own policies for whether an applicant meets their hiring standards based on the specific requirements of the role and industry regulations.

Typical items that may raise concerns include criminal convictions, failed drug tests, traffic violations, poor credit scores, and inconsistencies in employment history. Research shows that applicants commonly lie about additional skills (85%), dates of employment (58%), responsibilities (53%), or positions (28%). One study revealed that half of all reference checks done on prospective employees differed between what the job applicant provided and what the source reported.

Any employment decision taken as a result of these concerns must be job-related and based on business necessity. Employers should consult Equal Employment Opportunity Commission guidance on using criminal history information in hiring decisions to ensure they do not disproportionately screen out protected individuals. The Fair Credit Reporting Act requires employers to follow specific steps when taking adverse action against an individual based on background check results, including providing pre-adverse and final adverse action notices.

When a background check yields questionable results, the employer must determine whether to reject the applicant or, in cases of current employees, take corrective action up to and including termination. Failure is relative when it comes to background checks, as what constitutes a disqualifying result varies by employer, industry, and specific role requirements.

If a consumer report is used as a factor in an adverse hiring decision, employers must provide the applicant with a pre-adverse action disclosure, a copy of the FCRA summary of rights, and a notification of adverse action letter. Applicants denied employment based on either their criminal or credit history must receive these notifications according to the Fair Credit Reporting Act, and employers may also have to comply with adverse action requirements of applicable state and local fair chance laws.

The EEOC provides guidance on considering an individual's criminal history when making employment decisions, stating that such decisions must be job-related and consistent with business necessity. Employers should consult with legal counsel before proceeding with adverse action to ensure compliance with all applicable regulations.

When choosing a background screening service, employers should evaluate providers based on 5 key criteria:

• Compliance support , The provider should offer support with federal, state, and local regulatory compliance, including FCRA and EEOC guidelines
• Integration capabilities , Look for integrations with top applicant tracking systems and recruitment management systems to streamline the screening process
• Data security , Ensure the provider maintains strict data privacy and security procedures to protect sensitive candidate information
• Customization options , The service should offer customizations that help companies meet unique industry requirements or organizational hiring policies
• Transparent pricing , Choose providers with all-inclusive pricing and no hidden fees to accurately budget screening costs

Reputable third-party providers that specialize in background screening services help businesses save time and money while reducing the chance of error. Larger companies are more likely to outsource than their smaller counterparts, with the average staff size of companies who outsource being 3,313 compared to 2,162 for those who carry out in-house checks.

Companies that choose to outsource must use FCRA-compliant providers. Companies that fail to use an FCRA-compliant provider may face legal issues and hefty penalties. It is important to be selective about which pre-employment screening agency to use, as a legitimate company will maintain a background check policy and will explain the process clearly.

Professional background screeners exist to provide the public with safe places to live and work. These companies are regulated by both the Federal Trade Commission and the Consumer Financial Protection Bureau at the federal level, as well as subject to state attorney general enforcement actions.

Professional screeners must comply with the Fair Credit Reporting Act as well as state privacy and consumer protection laws. The FCRA, in place since the 1970s, requires professional background screeners and employers to provide consumers the highest level of protection. Federal and state laws and regulations, along with competitive market forces, have combined to make professional background screens the most comprehensive, accurate, and fair way for employers, landlords, and volunteer groups to make informed decisions.

The profession employs thousands of people and invests countless dollars dedicated to ensuring that employers, landlords, and volunteer groups have a full picture of those who enter workplaces, lease apartments, and care for vulnerable populations. Professional screening companies typically have established relationships with data sources and can access records more efficiently than individual employers.

Background screening is often compared to 3 related verification processes:

Background Screening vs. Security Clearance

Background screening is a general process used by employers to verify candidate information and assess suitability for employment across various industries. Security clearance is a specialized government process that determines if an individual can be trusted with classified national security information. Security clearances require much more extensive investigation, including interviews with neighbors, friends, and associates, and result in different levels of access (confidential, secret, or top secret). While background screening may take days to weeks, security clearances can take months to complete and require periodic reinvestigation.

Background Screening vs. Reference Check

Reference checks involve contacting individuals provided by the candidate to gather subjective opinions about their work performance, character, and abilities. Background screening objectively verifies factual information through official records, databases, and third-party sources without relying on candidate-provided contacts. Reference checks can be biased since candidates typically provide contacts who will speak favorably about them, while background screening reveals information the candidate cannot control or influence. Many organizations use both processes together, with reference checks providing qualitative insights and background screening offering quantitative verification.

Background Screening vs. Identity Verification

Identity verification is a single component within the broader background screening process. It confirms that a person is who they claim to be by validating documents like driver's licenses, Social Security numbers, and addresses. Background screening encompasses identity verification plus additional checks of criminal records, employment history, education credentials, credit reports, and other relevant information. Identity verification typically occurs at the beginning of the screening process to establish a foundation for all subsequent checks, ensuring that the correct individual's records are being reviewed.