What Happens if You Fail a Background Check?

This article is not legal advice or medical advice. It is presented for informational purposes only.

Employee background checks are an increasingly common part of the hiring process. Some applicants might not realize that under federal law, appropriate disclosures are required before a background check can be run.

Employers often conduct background checks on potential hires or employees to determine the suitability of that person for a particular position. If an employee is being evaluated for a new position or for a promotion, including one with greater financial responsibility, the employer is allowed to conduct a background check.

Generally, it is legal for companies to engage in the process of conducting employee background checks. In fact, many employers use this as a pre-screening tool before inviting someone to a formal interview or making an offer. However, research has shown that these pre-employment background checks conducted in the last five years could have been done without appropriate compliance with federal laws.

How Can You Fail a Background Check?

Every employer who uses background checks as part of their screening process will have their own criteria. Some might be willing to look past a previous criminal conviction, whereas others will turn down an applicant just for having a history of bad credit.

A background check could be failed based on company policy related to any of the following:

• A criminal conviction on your record of a nature like theft
• Details that reveal you lied about something your resume
• A poor driving history, especially if the job at hand involves driving
• If the employer accidentally pulls information that is out of date or not applicable, this could still be used to deny you a job offer

It is estimated that slightly under half of all resumes submitted for positions contain tweaked or false information. Employers often use pre-employment background checks to verify whether or not these details are accurate.

For example, they might complete a background check to determine the applicant’s previous service with another employer, or whether or not they actually graduated from college or graduate school. These checks are used from an employer’s perspective to help to protect an employer from liability issues.

Employers, however, still must ask before doing any background check. Employers have to get written permission from an applicant to do such a check, and if the company declines to hire the applicant based on any of the information obtained by that report, then the applicant must be informed and given a copy of the report.

How Do I Know if My FCRA Rights Were Violated?

If a company performs a background check as part of the pre-employment process, it’s possible they could have violated the Fair Credit Reporting Act.

Many applicants are not familiar with their rights under the Fair Credit Reporting Act, or FCRA. This law was originally enacted by Congress in 1970, and the primary intent of the law at that time was to protect the financial data of consumers that is used to generate consumer credit reports.

The scope of that law has evolved significantly since that time, and now background check services frequently fall within the act’s definition of a “consumer report.” The purpose of the FCRA is to reassure consumers that they have the authority to review information that is included in that report and correct any errors inside.

Even when the employer is within their rights to conduct a background check, applicants need to be aware of their rights. A company does have to provide an applicant with certain disclosures if the background check will involve credit reports. Applicants can ask upfront what information will be collected and request copies of all documents provided by the  company.

Applicants have the right to be notified and must give their consent to the employer when an employment background check is carried out that they have the right to know when personal information was evaluated in outcomes that affect them. An employee can also appeal the decisions made based on that data if they argue it was unfair.

Some of the most common pitfalls engaged in by employers include failing to share results or consent, inappropriate adverse action procedures, improper disclosure, and failure to provide a summary of rights to the candidate.

Join a Free Employee Background Check Class Action Lawsuit Investigation

If a company performed a background check on you as part of the pre-employment process in the last 5 years, an experienced employment attorney can help you determine if the employer complied with federal rules during that process.

Learn More