As a staffing firm, your reputation depends upon the integrity of the candidates you place with your clients. Your nightmare is a candidate who underperforms on the job and jeopardizes the safety of your client’s workplace. Thus, the background check is a linchpin procedure to help protect against those undesirable scenarios. But what happens when your candidate fails the background check? What are your next steps?

Step 1: Evaluate the Report

First of all, it’s necessary to understand what you mean by “fail.” Red flags on a background check may not necessarily mean automatic disqualification from the job. It’s vital to evaluate the report in the right context. To establish a sound context, it is strongly recommended that you develop a background screening policy for your company that explicitly identifies the types of searches that are to be performed for the various positions that you employ. It is equally important that the policy be consistently applied for candidates and employees for a given position.

Talk to your screening service provider. First of all, is the report accurate and complete? Were the first, last, and middle names and other identification details provided to the screening company correct? Do you know what sources of information the screening company uses? For example, FBI fingerprinting and state criminal repositories are not always one hundred percent accurate or complete. If discrepancies exist, candidates should be notified and given time to dispute the claims (we address this in more detail below). If adverse information was reported in a public record, was an FCRA 613 notice sent to the candidate?

If the red flags appear accurate, it’s necessary to consider how the candidate’s background may impact the job. If, for instance, a criminal background is revealed, the EEOC recommends that you consider the nature and circumstances of the offense, the time elapsed since the offense, corrective actions that were taken (e.g., restitution), and how specifically those offenses intersect the candidate’s responsibilities on the job.

On the other hand, if the background check reveals that the candidate misrepresented their education, experience, or certifications, the lie may be enough to disqualify them from the position, depending upon the specific requirements for that position. Read below about how to notify the candidate about adverse action.

Step 2: Keep the Candidate Informed

Throughout the entire background screening process, staffing firms should continue to focus on creating a positive candidate experience. Background checks can be a stressful experience for applicants, especially in the midst of interviews. The more efficient and user-friendly the process, the more valued the candidate will feel.

Keeping your candidate informed is particularly important when the results of the background check are taking a long time to get back, which can occur for a number of reasons having nothing to do with discrepancies or criminal records. Keep them in the loop and maintain open communication with candidates in order to build trust and strengthen the relationship.

Step 3: Comply with FCRA Regulations

This step is one of the most critical when dealing with the situation in which a candidate fails the background check. FCRA class action lawsuits are on the rise, and, with the large workforces that staffing firms employ and manage, it’s essential to maintain compliance. Here’s what the FCRA regulations require from employers if an adverse employment decision is made:

A Pre-Adverse Action letter must be sent to the applicant, including a copy of the report and a summary of rights; The applicant must be given “reasonable time” (typically 5 to 7 days is the current best practice) to review the letter and, if they choose, dispute the report; A final employment decision can only be made after reasonable time has passed, and any explanations or disputes from the candidate have been addressed pursuant to FCRA requirements; and Candidates must be notified in writing of the final Adverse Action decision and must also receive a copy of the final report and the FCRA summary of consumer rights

If you’re interacting with hundreds of candidates each day, it’s easy to overlook one of these steps. Make sure there’s a process in place that holds your firm accountable to each step, or else you risk major legal consequences.

Step 4: Establish a Formal Process for Failed Background Screening

Finally, staffing firms should work closely with their human resources department and legal counsel to establish a formal, comprehensive procedure for dealing with candidates who fail the background check. This process should address FCRA compliance, EEOC guidance, and guidelines for communicating the process to the candidate.