Category Archives:Pre-Employment Checks

What Happens When You Don't Follow the FCRA's Stand-alone Disclosure Requirement

The Federal Trade Commission enforces the Fair Credit Reporting Act (FCRA), which outlines what you must do when requesting a background check for pre-employment.

To start, before you request the background check, you must tell the applicant and get permission from them. These 2 things must happen using documents that contain no “extraneous” information and are in a stand-alone disclosure format.

Small Details Lead to Big Lawsuits

These may seem like small details from a large act. But an increasing number of class-action lawsuits are being filed against companies that failed to comply with the details of the FCRA. Companies are paying millions of dollars for, what is usually, one small slip-up. Here are a few of examples:

  • Last year, Waffle House was accused of not providing a copy of the background check to potential employees that were not hired due to the information in the check
  • A lawsuit against Kelly Services Inc. alleged the company violated the FCRA’s stand-alone disclosure requirement. The case was settled earlier this year for $6,749,000
  • In 2014, it was alleged that Michaels Stores Inc. (the craft supply retailer) didn’t properly disclose to job applicants that the company regularly performed background checks on potential employees during the application and screening process

Mitigating the Risk

How do you ensure that your company always follows all of the rules and regulations set out in the FCRA when requesting background checks? You hire a trusted company with lots of experience. A background checking company who will work with you to ensure compliance with, not only the FCRA, but also your state laws. A company like Accurate Information Systems.

Further information

Kelly Services Inc., and Michaels Stores Inc., are just a couple examples of companies that allegedly didn’t follow all of the rules before requesting a background check. There are far more rules in the FCRA regarding what must happen once you receive the report, including what you can use the information for, how and when you can take “adverse” action, and how to dispose of the report.

More information about the FCRA, including the stand-alone disclosure requirement, is available on the Federal Trade Commission’s website:

If you need a trusted company to run your background checks for pre-employment please give us a call at 1-(800)-295-7109 or download a sample report here:

The Difference Between an Employer and Lender Credit Report, What You Can and Cannot Request

These days, running a background check on a candidate during the recruiting process is common practice. Most employers know they need to get consent in a stand alone form and provide the results of the check to the candidate in some cases (for more information on this see the EEOC’s website:

But what about requesting a candidate’s credit as a part of the background check? After all, in most cases, the more information that you can find to help with your hiring decision the better.

When to request a credit report

While credit reports are a part of the domestic screening services that Accurate Information Systems (AIS) offers, not all employers requesting screening services should be asking for one.

Kevin McCrann, President of AIS says “We really try to tell our clients (the employers requesting the reports) that a credit report should not be requested unless the applicant will be working in a fiduciary role. There are a lot of “gray” areas in credit reports.”

Don’t request a credit report unless the candidate is applying for a fiduciary role.

How to request a credit report

When an employer is hiring for a fiduciary role (ie has a permissible purpose for requesting a credit check) it is important to note that, just like a criminal record check, an employer must make a full disclosure to the candidate that they may pull the candidate’s credit report. The employer must then get authorization from the candidate to obtain a report.

The company that works with you to obtain the report should walk you through these steps to ensure full compliance with the fair credit reporting act. If they don’t, consider it a huge red flag and look for another company.

What does a credit report look like?

Pre-Employment Background ScreeningThe credit report will be very similar to a lender credit report. The major difference between the report that an employer can request and one a lender can request: a credit score is reported to the lender but not the employer.

So how does it work?

Like most lender credit reports, the credit reports conducted by a company like AIS for the purposes of pre-employment will not affect the candidate’s credit score (ie it is considered a “soft pull”).

A sample employee background screening report from AIS can be downloaded here.

Under no circumstances does an employer have a permissible purpose to pull a credit report that has a score.

How to use (and NOT use) a credit report

Before making a hiring decision about a candidate based in whole, or in part, on the credit report, it is important to check your state’s laws. Many states and cities now prohibit the use of credit information for employment related decisions. (These states are: California, Colorado, Connecticut, Delaware, District of Columbia (D.C.), Hawaii, Illinois, Maryland, Nevada, Oregon, Vermont, and Washington. New York will also be added to this list.)

Even if the employer resides in a state where it is still permissible to use information from the credit report in the hiring decision, employers are still not allowed to use certain information from the report. For example, any credit lines that are referred to as “medical” can’t be used.


With all of the rules and regulations around credit reports, it is best to speak with a qualified professional before requesting a credit report on a job candidate.

The 6 Questions You Need to Ask When Choosing a Professional Background Check Company

There is a plethora of companies in today’s background screening industry. A quick Google search of the term “professional background check” generates over 13 million hits!
These results range from honest reliable companies to others that will charge anywhere from $20-$50 dollars for an “instant national criminal search”. Their claim is that they will search billions of records, all instantly returned to you in an easy to read and understand format, right to your web browser. What they do not tell you is where this information comes from, how old it is, how often the information is updated or the legality of its use.
You need a professional to perform your pre-employment background checks.

Finding a professional

Like most things, you get what you pay for and not all professional background check companies are the same.
Here is a checklist of questions (and the answers to look for) that you can use to background check the background checkers:

1. Where are your call centers located and who is answering the phones?

The answer you’re looking for is: “The call centers are located in the United States and the people answering the phones not only have decision-making ability but also know and understand the products and services that they’re selling.”

If a company is offshoring their call centers, that is a huge red flag. When you call the company you need to know you’re speaking with someone in the USA who knows what is important in a background check and how to help you evaluate the results.

2. Will you guide me through the process, making sure that I’m following the applicable laws and regulations including the FCRA?

The correct answer to this is (obviously) “yes” and an explanation of how they plan to do so.
The professional background screening company you choose must know and be in full compliance with all applicable laws and regulations including the FCRA. This will ensure that you (and your employer) are on the right side of the law.

FYI – The Fair Credit Reporting Act (FCRA) is “a U.S. Federal Government legislation enacted to promote the accuracy, fairness, and privacy of consumer information contained in the files of consumer reporting agencies.” (wikipedia)

3. How many consent forms do you have for my perspective hire to sign?

You need 2 different forms for your perspective hire to sign. One of them is an authorization form and the other is a notification of disclosure. Both of these are standard and provided to you by the background screening company.

If the company has more or less forms than these 2, be wary and get more information about what the forms are and why you need them, or why they’re missing the ones we mentioned.

4. What is the process that you use to gather the information for the report?

The answer to this will heavily depend on the type of report that you’ve requested. This question is meant to make sure that they have a process in place that consists of a professional vetting the results of the report before it is given to you.

5. What is the cost?

The answer to this question will also heavily depend on the type of report that you’ve requested. Keep in mind that you get what you pay for.

6. What is the turnaround time?

All things being equal, a completed background check should be returned, on average, within 1-3 days. There are some aspects of a report that may require a lengthier turnaround time such as verifications of employment and education.

But ALL background check companies are held at the mercy of the prior employer, school or reference to reply in a timely manner. So, if a company is guaranteeing a certain turnaround time than that is a huge red flag.
What these companies are doing to close a search quickly and keep their “guarantees” is making three calls and if they don’t get a reply they close the search as unable to verify. This answer only provides additional questions for your staff and doesn’t provide a very good background check.
Keep in mind that international searches can and most often will, go longer.

One last piece of advice

Once you’ve made your (informed) choice, chosen a company and received the background report that you asked (and paid) for, do a gut check.

– Does the information contained in the report seem relevant?

– Did the company help you through the process? Showing their understanding of laws and regulations in different states and counties.

– Is there anything to make you believe that the company didn’t truthfully answer any of the questions you asked them in the pre-interview?


This may seem like a lot of work but choosing a background screening company should be something that you only need to do once. After you have a great team of people that you trust and are ready to help you, it will feel like an extension of your company and will be something that you no longer have to worry about.

The Problems with DIY Screening and Why You Need a Professional for Your Pre-employment Background Checks

From what we’ve seen, almost all of our customers have been there: halfway through the interview process and already cautiously optimistic that they may have found their purple squirrel.

Then they get to the “Pre-Employment Background Check” step.

It’s always tempting to cut corners, especially with the continued pressure from management to cut costs. But DIY screening really isn’t something you should waste your time with. Unless you have a highly skilled HR team already on the payroll, chances are it will cost more in wages to staff members trying to do the screening than it would to hire the pros. Let’s dig a little deeper into why.

A few common pitfalls we see when untrained staff members attempt to navigate DIY screening: lack of accuracy, no legal certifications, and incompleteness of the results.

Lack of Accuracy

At the time of posting, there were 382 people named Jack Smith in Florida alone. How much time will it take to dig through all of those people to find the Jack Smith that is nearly through your interview process?

Alternative names (preferred vs. given), different spellings, name changes and duplicate people (like our friend Jack from Florida) are a few of the problems untrained staff will be up against.

No Legal Certifications

According to Wikipedia, the Fair Credit Reporting Act (FCRA) is “a U.S. Federal Government legislation enacted to promote the accuracy, fairness, and privacy of consumer information contained in the files of consumer reporting agencies.

Any professional background screening service worth their salt will be in full compliance with the FCRA.

As an aside: Accurate Information Systems is not only in full compliance with the FCRA, but also with state consumer reporting laws and International data protection and privacy regulations.

Can you guarantee that your staff will know the in’s and out’s of the FCRA? How much time will they spend trying to sort through the 100+ pages of the act?

Incompleteness of the results

Still not convinced that you need a professional? Up until this point, we have assumed that the only extra cost versus hiring the pros, is in the wages of the staff members doing the screening.

We’re assuming that, while it took WAY longer than expected, (because it always does with DIY screening), it’s done, and you have hired the perfect candidate.

But what if you missed something? And your purple squirrel ends up being a bad hire. It happens all the time. According to a CareerBuilder survey of 6,000 hiring managers and HR professionals worldwide, more than half of employers in each of the ten largest world economies said that a bad hire has negatively impacted their business and 27 percent of employers in the U.S. who reported a bad hire said that a single bad hire costs more than $50,000. Don’t let your company fall into that statistic.

What you need to know

If you’re serious about finding and retaining top talent you need to be sure about who you’re hiring. Pre-employment background checks are a must and trying to do it yourself may cost more in the long run.

It’s worth the investment to use a professional background screening company that can show you everything from a federal criminal search and personal/professional reference interviews to education and employment history searches.

If you go with the pros you’re more likely to finally find your purple squirrel, or at least know when you haven’t, before you offer them the job.

Creating a High Performance Culture - What It Looks Like

Many managers and business owners mistakenly assume that “high performance” is a synonym for “workaholic.” It might surprise those people to learn that just putting in longer hours does not guarantee that an employee is a top performer. In fact, if the research is to be believed, it may be the employees who work fewer hours who are more productive.

So, if you’re just watching to see who’s still at their desk an hour after quitting time, stop. If you want a high performance culture and workforce, it may be time to change your company culture.

Put Results First

If you’re the boss who stands at the door, handing out frowns and tardy slips to anyone who dares to stroll in one minute after starting time, and who records which employees work the most hours, it’s time to forget that whole attitude.

High performance teams aren’t the ones that reward quantity of time worked. They’re the ones that reward results. After all, squeezing ten extra unproductive hours out of an employee won’t help your bottom line, but rewarding employees who save you money, or increase sales, will. Single out the employees that get the best results, and figure out how they do it.

Give Your Team the Tools They Need

If your team is working harder than ever, but it’s not showing on your balance sheet, then they may not have the right tools for the job. Review how you do everything, and look for tools, software and training that will help your team to do their jobs better, more efficiently and with better results.

Hire Right

There’s an old saying about trying to force a square peg into a round hole, and the same goes for hiring. If you’re trying to force an employee who is not used to being super productive into a high-performance team, you may be fighting a losing battle.

Take a closer look at your talent recruitment strategies. Create profiles of your ideal employees. Take more time on pre-employment checks, and upgrade your employee verification process.

Look beyond college results to employment track records. Has the employee done amazing things elsewhere? Do they have the habit of job hopping? If so, why? Tailor interview questions to find out how candidates would improve your team’s performance, and whether they’re simply putting in time, or a genuine go-getter.

Embrace Change

One of the most common issues for companies these days is often that they’re too set in their ways to change. They’ve been around for so long, and things have always been done a certain way, that they stagnate, and their younger, quicker, more nimble competitors run rings around them.

If you ever catch yourself saying that you’ve always done something that way, then it’s probably time to force change. Hire a top performer from one of those younger competitors. Change how you do things. Investigate new technology. Embrace change, and make continuous improvement a part of your culture.

Competition is tighter in business than it has ever been, and you need to be the very best that you can be to stay relevant and profitable.

The Importance of Non-Financial Factors in Employee Retention Programs

There’s an old saying that goes “people don’t quit jobs, they quit managers.” What that means is that the number one reason most people leave jobs is because they don’t get along with a manager or supervisor, and that’s usually true. It may surprise you to learn that, but it’s not money, location or any other single factor that impacts employee turnover the most. It’s the people they work for, and when you’re looking for ways to improve culture and your employee retention programs, this is a good place to start.

Identify departments where you have high turnover, and take a closer look at the management structure, and if that doesn’t solve the problem, consider the following options.

Hire Right

Getting and keeping the right people in your organization can have a huge impact on your bottom line, and it all starts with your hiring policies. Instead of using the hiring process to exclude as many people as possible, use tools like character reference checks to find people who are skilled, experienced, and loyal team players.

The right team goes a long way to company success, and to employee retention.

Employee Retention Programs: It’s Not All About Money

There’s no denying that money is a core factor in the employment relationship. People work because they need money to live, and if they didn’t have to, most would probably be out surfing, climbing mountains or creating art.

If you’re already paying your employees market-related or better salaries, and you’re still struggling to hold on to them, then you need to start looking at employee retention programs, which may include:

Access to in-house or external training. Great employees are always looking for ways to improve their skills, and this benefits them and you!

– Improve the working environment. While you might be far from sick building syndrome, there’s no denying that a nice, comfortable work space makes being at work more enjoyable for everyone. Install standing desks. Paint the walls a bright, sunny shade. Start an employee graffiti wall. Whatever it takes to spruce up your space.

– Listen to your employees. Even if you think your managers are the best thing since sliced bread, it’s your employees that have to work with them, and they might be having a very different experience. If one employee complains, it may be personal. If they all do, it’s a cause for concern, and a reason for action.

– Stop micromanaging. Employees want to have some autonomy, and to feel that they can make decisions and take action within the scope of their job. If you’re hanging over their shoulder all the time, that can’t happen, and they’re going to find somewhere that they can be creative and make a real difference.

– Have an internal promotion policy, and stick to it. Your people want to know that they are working towards something, and if you’re hiring outside the organization for all the best jobs, they won’t feel that way.

As much as we’d like to, we can’t all be like Google, with their free food, chill out rooms and maker spaces. But there are things every company can do to make working there more enjoyable for everyone, and when people like their workplace and their jobs, they stay longer, and that’s good for the bottom line.

8 Questions You Can’t Ask During a Job Interview

It’s perfectly understandable that employers want to get as much information about potential new hires before making an offer. You want to limit your short list, cut back on the need for a pre-employment check for each one, and minimize the number of employee reference checks you need to conduct. After all, there are all sorts of horror stories about bad hires out there. However, while it is understandable that you want to ask as many questions as possible, there are several that you could get into big trouble for asking.

You’re not alone either. Studies have shown that up to 20% of interviewers have asked an inappropriate question during an interview. Here are some that you will want to avoid:

Religious affiliation. It is illegal to discriminate against candidates based on their religious affiliation or lack thereof. The only exception to this rule would be where religion is a core element of the job, for example, if you were hiring a religious leader for a church or similar organization.

Pregnancy and family plans. You cannot discriminate against a potential hire because they are pregnant or because they plan to become pregnant. Similarly, it’s illegal to discriminate against candidates for having or not having children.

Questions about race, color or ethnicity. Again, you cannot choose whether to hire or not hire a candidate based on their race or ethnicity.

Political affiliation. You can get into a lot of trouble if you choose to hire or not hire based on politics. Don’t even make small talk about politics!

Age, disability or marital status. Unless these play a direct role in the job, you have no business asking them. An exception would be, for instance, where a job requires the candidate to climb ladders, and they are in a wheelchair. If the disability is directly opposed to being able to carry out the job, and there is no means of working around that requirement, then a disability may be a factor in hiring.

Drinking or smoking. As long as your candidates are above the legal age of consent, and as long as they are not involved in illegal drugs, their social drinking or smoking habits cannot be a factor in your hiring decisions.

Financial record: Unless the job is related to finance, and credit scores and bankruptcy history are a direct requirement for the position, there’s no reason to ask a candidate about their financial situation.

Documentation and qualifications unless relevant. It’s reasonable to ask whether your prospective employee has a degree or certification that is required for the job. It’s not reasonable to ask about something like a driver’s license unless the job specifically requires driving.

Basically, any question that may result in information that could be perceived as leading to discrimination can cause problems later on.

When in Doubt, Don’t

These are some of the more common illegal interview questions employers ask prospective employees, but they’re not the only ones. There are many other questions that can get you in hot water, depending on the context.

If there’s any doubt at all about the legitimacy of a question, rather don’t ask it. It’s better to hire professionals to conduct pre-employment checks and background screenings, and avoid the potential legal minefield that asking the wrong questions can result in than to take a chance.

Remember, it’s becoming more common for prospective employees to sue potential employers who didn’t hire them based on discrimination. If you want to avoid that sort of litigation, you need to avoid even the perception of discrimination. It’ll save you time, money and headaches in the long term.