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Criminal background checks

How to protect your business with proper screening.

May 28, 2014
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Since past behavior is a good predictor of future behavior, criminal background checks can help determine whether a prospective employee will steal from an employer. If an applicant has a recent conviction for a theft-related crime, then it should be a legitimate and useful basis for denying employment. Also, conducting a criminal background check demonstrates that the employer is taking proper care in hiring employees, making such checks a useful defense in negligent hiring suits.

On the other hand, ADP’s 2007 Annual Screening Index indicates that only 5 percent of criminal background checks reveal a conviction. And of these convictions, many are not theft or job-related crimes. Since research and the general experience of employers consistently shows that about 25 percent of the workforce poses a significant counter-productivity risk, obviously a 5 percent or less rejection rate of job applicants doesn’t come close to eliminating problems.

Another problem with criminal background checks is that they exhibit a disparate impact on the basis of race. As a result, the Equal Employment Opportunity Commission (EEOC) has indicated that it will pay close attention to an employer’s rejection of applicants on the basis of criminal convictions. The EEOC has recently filed a complaint in the U.S. District Court in Maryland against Freeman Companies, a Dallas-based corporate event-planning company. The EEOC claims that Freeman’s use of criminal background checks discriminates against African American and Hispanic job applicants.

Another limitation to criminal background checks is their use with younger job applicants. In the vast majority of cases, no information regarding juvenile convictions will be provided, since juvenile records are typically sealed by the courts.

Finally, the vast majority of employers who utilize criminal background checks in the employment process use a third party to get that information. Use of a third party requires that the employer comply with the FCRA. Employers must be very careful about which third party they use to help ensure that the criminal background information they receive is free of errors and omissions.


David W. Arnold is General Counsel for Wonderlic, Inc., where he is involved with legal issues concerning privacy, negligent hiring, employment testing and equal employment matters. He also serves as General Counsel for the Association of Test Publishers. Dr. Arnold holds a J.D. from Loyola University Law School and a Ph.D. in industrial psychology from the University of Nebraska.

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