Background checks are a crucial part of modern hiring practices, but the process can be quite complex. There are a number of federal laws and regulations regarding how employers should conduct background checks, and many states have their own laws that apply to this area as well. 

In addition, there are other types of companies that also perform background checks on employees or potential employees; these include contractors who work with government agencies or credit card companies that offer pre-employment screening and compliance with federal law.

Fair Credit Reporting Act (FCRA)

The Fair Credit Reporting Act (FCRA) is a federal law that governs how consumer reporting agencies (CRA) collect, use, and disclose consumer information.

FCRA requires that an individual has the right to access their credit report from each CRA every 12 months. FCRA also requires that a consumer be given notice before any adverse action is taken against them based on information in their credit report. This includes being denied credit or insurance, having your interest rate increased or the amount of debt you owe reduced.

Equal Opportunity Employment Act (EEO)

The Equal Employment Opportunity Act (EEO) is a federal law that prohibits employment discrimination based on race, color, religion, sex, national origin, age, disability or genetic information. EEO also requires employers to provide reasonable accommodations for qualified individuals with disabilities. 

The EEO laws apply to all public and private employers with 15 or more employees.

The EEO laws prohibit employment discrimination based on race, color, religion, sex, national origin or disability. It also requires employers to provide reasonable accommodations for qualified individuals with disabilities.

CA Civil Code

There are many federal laws and regulations that govern law background checks, but there is also state law in California.

The CA Civil Code Section 1798.82(a) states that if a business has the intent to sell or transfer personal information to another party, it must inform the affected person of this intent before doing so.

The California Civil Code Section 1798.82(c) requires businesses to provide notice to consumers of the categories of information being collected and the purposes for which it will be used.

Immigration Reform and Control Act of 1986 (IRCA)

IRCA prohibits employers from knowingly hiring or continuing to employ an unauthorized alien and requires that employers verify new hires’ eligibility for employment in the US.

Employers must complete the I-9 form within 3 days of hire. The I-9 form contains two parts: an Employment Eligibility Verification (Form I-9) and a U.S. Citizenship and Immigration Services (USCIS) Employment Authorization Document (Form I-766).

The I-9 form contains two parts: an Employment Eligibility Verification (Form I-9) and a U.S. Citizenship and Immigration Services (USCIS) Employment Authorization Document (Form I-766). Form I-9 is used by employers to verify that new hires can legally work in the US. 

Employers complete Section 1 of the form, which includes identifying information about both parties as well as employment eligibility requirements for each employee. Once completed, the employer must sign Section 2 of the form and provide a copy of this signed document to each employee hired after November 6, 1986

FTC Staff Opinion Letter

The Federal Trade Commission (FTC) is an independent agency of the U.S. government that investigates fraud and unfair business practices in the marketplace, including issues related to background checks. The FTC has published a staff opinion letter on law background checks that you need to know if your organization uses or plans to use such services.

An opinion letter is an official communication from an agency that offers guidance on interpreting provisions of law and regulations within its jurisdiction. In other words, it’s simply information from someone who works at the FTC about what they believe their job duties are when it comes to protecting consumers’ rights—in this case, in regards to your right to privacy regarding personal information when finding the background check laws.

State Laws

A few states with background check laws may affect your process. While federal law requires you to conduct only criminal history record checks and credit reports, some states have additional requirements. For example, many states require employers to perform a more extensive background check (such as a polygraph or psychological examination) on applicants for certain positions, such as emergency responders or childcare workers. Some states also require employers to notify applicants of the results of their background checks and provide them with an opportunity for rebuttal prior to making an adverse employment decision based on those results.

Drug Screening Law

Drug screening is a requirement for some jobs and not others.

If you are applying for a position that requires drug testing, the employer cannot require you to take a drug test before making an offer of employment. However, they can ask if you consent to the test and then refuse to hire you if you refuse or fail the test. Suppose a drug-related incident occurs in your workplace (such as safety violations or accidents). In that case, employers can require all employees who may have been involved in that incident to submit themselves for drug testing.

Employers may also ask job candidates about their past use of illegal substances, but only after making them an offer of employment with benefits and compensation (and usually only after checking references). Unfortunately, these laws do not prohibit “blanket” pre-employment screening tests such as hair follicle analysis–so be wary when answering questions about previous drug use!

Fair and Accurate Credit Transactions Act (FACT)

The Fair and Accurate Credit Transactions Act (FACT) is a federal law that protects consumers from credit reporting errors on their credit reports by providing them with the ability to dispute any mistakes they find. The act also allows consumers to request a free copy of their credit report every 12 months and allows them to place a security freeze on their account, which prevents anyone from accessing it without permission.

Americans with Disabilities Act (ADA)

The Americans with Disabilities Act (ADA) protects individuals with disabilities in the workplace. This federal law prohibits discrimination against qualified individuals with disabilities. The ADA also requires employers to provide reasonable accommodations to employees and applicants with disabilities unless doing so would create an undue hardship on the employer’s business.

A “disability” is defined as a physical or mental impairment that substantially limits one or more major life activities of such individual; a record of such an impairment; or being regarded as having such an impairment. Examples of impairments that are covered under the ADA include hearing, vision, and mobility impairments; cancer; heart disease; diabetes mellitus; intellectual disability (formerly referred to as mental retardation); bipolar disorder; alcoholism and drug addiction (when not the result of current illegal use); post-traumatic stress disorder (PTSD); obsessive-compulsive disorder (OCD); schizophrenia

Gramm-Leach-Bliley Act (GLBA)

The Gramm-Leach-Bliley Act (GLBA) was passed in 1999 and amended the Federal Trade Commission Act, the Right to Financial Privacy Act, and the Fair Credit Reporting Act. GLBA requires organizations to take reasonable steps—taking into consideration available technology—to protect customer information from unauthorized access by employees or others with legitimate access to it.

This law also requires organizations to disclose privacy policies in writing when they collect personal information about consumers. These policies must include the following:

• A clear description of what types of customer information you collect
• How do you use that information?
• Whether you disclose it to anyone else