Background Check Compliance
What Does the FCRA Require Before Running a Background Check?
Background check compliance refers to the federal (Fair Credit Reporting Act) and state rules governing how employers may obtain and use background checks in hiring decisions—including required disclosures, candidate authorization, and adverse action notices.
The FCRA requires a clear, standalone written disclosure and the candidate’s written authorization before requesting a background check. If the employer intends to take adverse action based on the report, FCRA requires a two-step notice process—a pre-adverse action notice giving the candidate a copy of the report and a chance to dispute it, followed by a final adverse action notice.
A growing number of states and cities have “ban the box” laws restricting when in the hiring process an employer can ask about criminal history. Most employers use a third-party background check vendor specifically because they build required disclosures and timing into their standard workflow.
FCRA Background Check Compliance Key Facts
- FCRA requires a standalone disclosure and written authorization before running a background check.
- A two-step adverse action process is required before denying employment based on results.
- “Ban the box” laws in many states/cities restrict when criminal history can be asked about.
- Frequently subject to class action litigation given standardized hiring processes.
Frequently Asked Questions
Can an employer run a background check without telling the candidate?
No—the FCRA requires a standalone written disclosure and authorization.
What is a "pre-adverse action" notice?
A notice given before denying employment based on a background check, with a chance to dispute inaccuracies.
What does "ban the box" mean?
Laws restricting when during hiring an employer can ask about criminal history.
Can a candidate dispute information found in a background check?
Yes—the pre-adverse action notice gives candidates a copy of the report and a reasonable window to dispute inaccuracies before a final decision.
Are all employers subject to “ban the box” laws?
No—these laws vary by state and city, and some apply only to public employers or larger companies, so requirements differ by location.
Related terms: I-9 Verification, Employee Handbook Requirements, New Hire Reporting