How to Set Up a Background Check Program

Introduction

Setting up a comprehensive background check program is one of the most important investments you can make in your organization’s safety, security, and success. Whether you’re a small business owner hiring your first employees or an HR professional looking to standardize your screening process, this guide will walk you through creating a legally compliant, efficient background check program from start to finish.

What You’ll Accomplish

By the end of this guide, you’ll have:

A fully documented background check policy
Clear procedures for consistent screening
Compliance with federal and state regulations
An efficient system that protects your organization while respecting applicant rights

Who This Guide Is For

This guide is designed for:

Small business owners implementing their first screening program
HR professionals updating existing procedures
Property managers establishing tenant screening protocols
Nonprofit organizations ensuring volunteer safety
Any organization looking to improve their hiring process

What You’ll Need

Before starting, ensure you have:

Authority to make hiring decisions for your organization
Basic understanding of your organization’s hiring needs
Access to your state’s employment law resources
Budget allocation for screening costs
Time to implement the program properly (typically 2-4 weeks)

Before You Start

Prerequisites

Successful background check programs require careful planning. Before diving into implementation, ensure you have:

Legal Foundation

Understanding of the Fair Credit Reporting Act (FCRA)
Knowledge of your state’s specific screening laws
Awareness of Equal Employment Opportunity Commission (EEOC) guidelines
Any industry-specific compliance requirements

Organizational Buy-In

Executive approval for the program
Budget approval for screening costs
Support from department managers
Agreement on program scope and requirements

Preparation Steps

1. Audit Current Practices: Document any existing screening procedures, even informal ones
2. Define Your Needs: Determine which positions require screening and why
3. Research Legal Requirements: Identify federal, state, and local regulations affecting your screening
4. Gather Resources: Collect job descriptions, company policies, and legal forms
5. Set Timeline: Establish realistic implementation deadlines

Information to Gather

Compile the following information before proceeding:

List of all positions in your organization
Current job descriptions and requirements
Existing employment policies
Budget constraints and cost considerations
Contact information for legal counsel (if applicable)
Industry best practices and standards

Step-by-Step Process

Step 1: Define Your Screening Policy

Start by creating a written policy that outlines:

Policy Components

Purpose of background screening
Positions subject to screening
Types of checks to be conducted
When screening occurs in the hiring process
Who has access to screening results

Example Policy Statement:
“[Company Name] conducts background checks to ensure a safe workplace, protect company assets, and verify candidate qualifications. All positions involving financial responsibility, access to sensitive information, or direct customer contact require pre-employment screening.”

Step 2: Determine Screening Levels

Create position-based screening tiers:

Tier 1 – Basic Screening

criminal background check (7 years)
identity verification
Work authorization verification

Tier 2 – Standard Screening

Everything in Tier 1, plus:
Employment verification
education verification
Reference checks

Tier 3 – Comprehensive Screening

Everything in Tier 2, plus:
Credit check (for financial positions)
professional license verification
Drug testing

Step 3: Select a Background Check Provider

Choose a reputable screening partner by evaluating:

Key Selection Criteria

FCRA compliance and accreditation
Turnaround time for results
Pricing structure and transparency
Integration capabilities with your systems
Customer support availability
Report clarity and accuracy

Evaluation Process
1. Request demos from 3-5 providers
2. Compare pricing and services
3. Check provider references
4. Test the ordering process
5. Review sample reports

Step 4: Create Required Forms and Notices

Develop legally compliant documentation:

Essential Forms

Background check disclosure form
Authorization form (separate from disclosure)
Pre-adverse action notice template
Adverse action notice template
Dispute process documentation

Form Requirements

Use clear, conspicuous language
Provide forms as standalone documents
Include all required FCRA language
Maintain forms in multiple languages if needed

Step 5: Establish Your Process Workflow

Design a consistent screening workflow:

1. Job Posting: Include background check notice
2. Application: Collect initial candidate information
3. Interview Process: Proceed with standard evaluation
4. Conditional Offer: Extend offer contingent on background check
5. Disclosure & Authorization: Obtain written consent
6. Background Check: Order appropriate screening package
7. Review Results: Evaluate findings against job requirements
8. Decision: Proceed with hire or follow adverse action process
9. Documentation: File all records appropriately

Step 6: Train Your Team

Ensure everyone involved understands their role:

Training Topics

Legal requirements and compliance
Company policy and procedures
How to order background checks
Interpreting screening results
Handling adverse information
Maintaining confidentiality
Record keeping requirements

Training Methods

Initial comprehensive training session
Written procedure manual
Regular refresher training
Updates on law changes

Step 7: Implement Quality Controls

Build safeguards into your program:

Quality Measures

Standardized evaluation criteria
Multi-person review for adverse decisions
Regular compliance audits
Consistent documentation practices
Periodic policy reviews and updates

Tips for Success

Expert Recommendations

Start Small and Scale
Begin with a pilot program for one department or location before rolling out company-wide. This allows you to identify and fix issues before full implementation.

Document Everything
Maintain detailed records of all screening decisions, including why specific checks were ordered and how results were evaluated. This documentation protects you legally and ensures consistency.

Communicate Transparently
Be upfront with candidates about your screening process. Clear communication reduces anxiety and demonstrates professionalism.

Time-Saving Tips

Use Technology

Implement electronic consent forms
Set up automated status notifications
Create template emails for common scenarios
Use integration features to avoid duplicate data entry

Batch Processing

Order multiple background checks simultaneously
Schedule regular review meetings
Process adverse action notices together
Update multiple job postings at once

Quality Improvements

Regular Reviews

Audit your program quarterly
Survey hiring managers for feedback
Track turnaround times and costs
Monitor legal compliance updates

Continuous Improvement

Refine screening packages based on actual needs
Eliminate unnecessary checks to save time and money
Update job-related criteria regularly
Enhance candidate communication

Common Mistakes

What to Avoid

Legal Pitfalls

Using background checks to discriminate
Failing to provide required notices
Mixing disclosure with application materials
Making decisions based on arrest records alone
Ignoring state and local restrictions

Process Errors

Inconsistent screening between candidates
Ordering wrong screening packages
Rushing adverse action procedures
Poor record keeping
Inadequate team training

How to Fix Errors

If You Discover Non-Compliance
1. Stop the problematic practice immediately
2. Consult with legal counsel
3. Audit affected cases
4. Implement corrective measures
5. Retrain staff on proper procedures

Common Fixes

Create clearer documentation
Implement approval workflows
Use checklists for consistency
Regular compliance training
Periodic external audits

Troubleshooting

Problem: Slow turnaround times
Solution: Review screening package necessity, choose faster providers, improve authorization process

Problem: High costs
Solution: Negotiate volume pricing, eliminate redundant checks, focus on job-related screening

Problem: Candidate complaints
Solution: Improve communication, provide clear dispute process, ensure accuracy in ordering

Legal Considerations

Compliance Requirements

Federal Requirements (FCRA)

Written disclosure and authorization
Pre-adverse and adverse action notices
Provide copy of report and rights summary
Allow dispute opportunity
Maintain records appropriately

EEOC Guidelines

Apply screening consistently
Focus on job-related criteria
Consider individual circumstances
Avoid automatic disqualifications
Document business necessity

Rights and Obligations

Employer Obligations

Follow all notice requirements
Ensure information accuracy
Provide dispute opportunities
Maintain confidentiality
Use information only for stated purpose

Candidate Rights

Receive clear disclosure
Authorize screening
Review their report
Dispute inaccuracies
Understand adverse decisions

Documentation Needs

Required Record Keeping

Signed authorizations
Copies of reports
Adverse action documentation
Dispute correspondence
Policy and procedure documents

Retention Periods

Federal: 1-2 years minimum
State: Varies by location
Best practice: 3-5 years
Secure storage required

Next Steps

What to Do After Implementation

Immediate Actions
1. Monitor first month closely
2. Gather feedback from users
3. Address any issues quickly
4. Document lessons learned
5. Celebrate successful implementation

Ongoing Maintenance

Quarterly compliance reviews
Annual policy updates
Regular team training
Vendor performance evaluation
Budget analysis and optimization

Related Processes

Integration Opportunities

Onboarding procedures
HR information systems
Compliance programs
Risk management initiatives
Employee handbook updates

Additional Resources

Helpful References

FCRA full text and summaries
EEOC enforcement guidance
State labor department resources
Industry association guidelines
Professional HR organizations

FAQ

Q: How long does it take to set up a background check program?
A: Most organizations can implement a basic program in 2-4 weeks. Complex organizations or those with multiple locations may need 6-8 weeks for full implementation.

Q: What’s the typical cost for background screening?
A: Costs vary based on screening depth. Basic checks range from $20-50 per candidate, while comprehensive packages can cost $75-150. Volume discounts are often available.

Q: Do all employees need the same level of screening?
A: No. Screening should be tailored to position requirements. Entry-level positions may need basic checks, while executive or financial roles require comprehensive screening.

Q: Can we run background checks on current employees?
A: Yes, but you need proper authorization and must follow all FCRA requirements. Some states have additional restrictions on screening current employees.

Q: What if a candidate refuses to authorize a background check?
A: You can make background checks a condition of employment. If a candidate refuses authorization, you can legally withdraw the job offer or decline to proceed with their application.

Conclusion

Setting up a background check program doesn’t have to be overwhelming. By following this systematic approach, you’ll create a compliant, efficient screening process that protects your organization while treating candidates fairly. Remember that your program should evolve with your organization’s needs and changing regulations.

The investment you make in proper screening setup pays dividends through better hiring decisions, reduced risk, and improved workplace safety. Take time to build your program right from the start, and you’ll enjoy these benefits for years to come.

Ready to implement your background check program? BackgroundChecker.com makes it easy with our FCRA-compliant platform, fast turnaround times, and transparent pricing. Our user-friendly system guides you through each step, while our clear reports help you make informed decisions. Whether you’re a small business or enterprise HR team, our dedicated support ensures your screening program runs smoothly. Start building a safer, more secure workplace today with BackgroundChecker.com’s trusted screening solutions.