Clients often ask us if derogatory information from their past will show up in a background check. From old criminal records to former lawsuits, understanding the different categories of background checks and how they work may help alleviate some uncertainty about what may show up in a report.
We’ll explore specific categories of background checks, the Fair Credit Reporting Act (FCRA), and state laws that can influence whether a past record can/will appear in a background check.
Categories of Background Checks and Their Impact
The category of background check conducted on an individual can significantly affect whether a past record shows up. Common background investigations include the following:
- FCRA-Governed Background Checks. Often conducted when an individual is considered for a position, either as a new hire or a promotion. An employment background check aims to verify qualifications, work history, and sometimes personal history, depending on the job’s requirements. These checks and others, such as tenant screening reports, are governed by the Fair Credit Reporting Act (FCRA).
- Other Background Checks. Background checks conducted for purposes such as litigation support or company investments/partnership due diligence are generally exempt from the FCRA.
Each category of check has different objectives and may dig into different aspects of an individual’s history. For instance, an employment check might focus on job-related records and may be limited to a certain time scope, while researching an opposing party in a litigation matter may be broader in scope and encompass personal or financial items that date further back.
The Fair Credit Reporting Act (FCRA) and How it Affects Background Checks
The FCRA regulates how background checks are conducted, particularly for employment purposes. Information reported in an employment background check must be accurate, up-to-date, and confirmed to be associated with the subject of the report. The FCRA also limits the reporting of certain records, depending on the age of the record and the individual’s expected annual salary. For example, most criminal convictions can be reported forever. However, for individuals making less than $75,000 in their role, the FCRA only allows reporting non-conviction records within seven years of the filing date.
For this reason, the FCRA can play a significant role in determining what records can be reported on an individual.
Alternatively, background checks not governed by the FCRA have fewer restrictions on what can be reported.
Scope of Employment Background Checks
Background checks also differ on the level of detail they provide. Some employers prefer a basic check that only includes criminal record searches. Other employers want a more thorough investigation that may include civil record searches, bankruptcy searches, and/or derogatory media searches. The specifics often vary based on an employer’s time and budgetary constraints.
Typically, the types of employment background checks are also determined by the position to be filled. For example, an entry-level position may only require a limited criminal check. If the potential employee’s duties include driving, an employer may opt to run a motor vehicle report to see if there is evidence of irresponsible driving. If the candidate will be handling money, perhaps a credit check is warranted, where allowable by law. Executives will typically have a more detailed check to include professional license verifications, employment and education verifications, sanctions checks, professional reference checks, and more.
State Laws and Their Impact on Reporting
Like the FCRA, state laws may also influence what information can be reported on employment background checks. Some states have more restrictive laws to protect employee rights, which must be followed for individuals applying to work in those jurisdictions.
- New York. New York has strict regulations on what can be reported. Criminal convictions can only be reported for up to seven years for individuals making less than $25K. New York prohibits reporting non-convictions.
- California. In addition to banning reports of non-convictions, California law states only permits reporting criminal convictions within the past seven years, regardless of salary.
To illustrate the difference, a person working in Florida, which has no restrictions beyond the FCRA, could have a five-year-old arrest that was ultimately dismissed appear in a background check, whereas this same arrest would not be reportable in New York.
Conclusion
Whether an old record will show up in a background check largely depends on the category of check conducted and the scope of the check itself. Employment checks are governed by the FCRA, which restricts how long certain records can be reported. Some state laws further refine these guidelines, with states like New York and California imposing stricter regulations. Background checks that are not regulated by the FCRA, do not have reporting restrictions.
If you’re concerned about a past record, you can better manage your expectations and prepare for the potential outcomes of a background check by understanding the different factors that could affect what makes it into your report.
