You would expect to receive certain benefits from screening applicants for employment, such as being able to know a resume is accurate, or that you aren’t hiring someone with a criminal background. By actually saying in your employment advertising that you use background screening, you also receive another benefit. Most people who have a criminal background won’t even apply for the job, and all applicants are much more likely to provide a complete and truthful application or resume. You’ll save time and money in the hiring process, before you even begin reviewing applications.

The Fair and Accurate Credit Transactions Act of 2003 (FACTA) states that all background screening and credit report information must be disposed of properly. All paper records must be shredded or otherwise destroyed in a way that there is no way that the information can be reconstructed. Any information of the same type that exists on a computer must be completely erased before that computer can be sold, donated, or disposed of.

According to FCRA (Fair Credit Reporting Act), you must obtain signed consent from the applicant prior to performing a background check. The FCRA applies to these kinds of reporting activities, in addition to credit reports. Also, state laws differ as to what can be included in a background check, and to how that information can be used in the process of screening applicants. You should check with your attorney, or hire a background screening company with experience in your state, before you start screening employee applications.

No. Even though other HR-related laws often change with the size of the company, the Fair Credit Reporting Act applies to all large corporations and small business owners alike. Any information you request that is considered a consumer report, and is received from a consumer reporting agency, falls under the rules of the FCRA, without consideration given to the number of employees you have.