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What if Candidate Fails Background Check After Job Offer?


You’ve already extended an offer to the candidate. They accepted, look forward to taking on the role, and are excited to get started. So now the conditional offer can become a proper offer letter unless their background check reveals something that gives you pause.

The candidate failed background check after job offer during the entire job cycle. They can have issues related to their resume, work history, criminal record, or other elements that do not match their employer’s needs and requirements.

This article will explore what options you have as an employee if you fail a background check and if your employer can change their decision based on this.

What Does It Mean to Fail a Background Check?

Most people think “failing” means that your criminal record has something. But it doesn’t necessarily mean that at all. There are many reasons why an employer might decide not to hire someone after doing a background check:

They found out you lied on your application or resume: This can include lying about education, employment history, or other qualifications related to the job opening they’re trying to fill.

Failing a background check is a serious issue that often comes with significant implications. Employers rely on the results of a background check to make critical decisions about an applicant’s possibility of getting hired, and an unfavorable outcome may prevent you from getting the job or moving forward in the hiring process.

If you fail a background check, it doesn’t necessarily mean that you won’t be hired. There are several reasons why someone would fail a background check; some of them may leave room for explanation or review, while others are more cut and dry.

Read on to find out what can cause applicants to fail a background check and your options if you receive less than favorable results.

A failed background check after job offer may indicate that the job candidate:

  • Lied in the application or interview process.
  • Has a criminal history
  • Does not have a clean driving record
  • Has an undesirable employment history
  • Lacks sufficient educational credentials

Types of Employee Background Check

There are three kinds of background checks that employers can do. The most basic is a reference check, which involves calling the people who have worked with you in the past and asking them about your skills and abilities.

The second kind is a more formal criminal record check. This is conducted by going to your local courthouse, county sheriff’s office, or state police station and submitting a request for information about your criminal history. In some states, this requires you to submit fingerprints so that the report can be checked against criminal databases as well as court records.

The third kind of background check is a credit check. Many employers ask for permission to conduct one of these so they can get information about how you manage money and whether you have been involved in legal proceedings such as bankruptcies or lawsuits over unpaid debts.

Related article: Kohl’s Hiring Process | Job Application, Interviews, and Employment

A Candidate Failed the Background Check After Job Offer: Here’s What to Do

Here’s a scenario that’s becoming all too common for employers: You’ve just completed a hiring process for a key position within your business. You have a candidate you like, and you’re ready to make an offer.

Then you receive the results of the pre-employment background screening, and you find out that something on the report that says the candidate has failed background check. Now what?

Confirm You Ran the Check on the Correct Person

The first step is to make sure the person who failed the background check after job offer is the same person you interviewed. Some people don’t realize that alias names can be reported in criminal histories. You may also want to check if the name listed on their application differs from their Social Security card or driver’s license.

If your candidate truly did fail the background check, it’s time to decide what to do next. You’ll need to determine whether or not the issue is relevant to the job opening and if it will affect their ability to perform job tasks.

For example, a speeding ticket won’t impact an administrative assistant’s ability to work for your company; however, a DUI could be problematic for someone who’s required to drive as part of their duties.

Give Them a Chance to Explain

The second thing you should do is give your candidate a chance to explain themselves before making a final decision. Maybe they had a tough time in college but have turned their life around since then. Maybe they lied about their previous employment because they were trying to hide something embarrassing which wouldn’t affect their performance at this job.

Whatever the case, you must hear their side of the story before making any decisions, especially if there are mitigating circumstances involved, such as drug abuse or mental illness record.

Carefully Review Your Hiring Policy

The hiring process is a significant investment of your company’s time and resources. It involves reviewing dozens of resumes, conducting interviews, performing background checks, and onboarding new employees.

While you probably want to hire candidates quickly to avoid losing them to another employer, you must maintain the integrity of your hiring process and avoid making any hasty decisions.

You might also consider speaking with an experienced employment law attorney in your area, who can review your employee handbook and hiring practices and advise you on any necessary changes to prevent similar situations.

Notify the Candidate with a Pre-Adverse Action Notice

Suppose your organization is required to use the FCRA. In that case, you must notify the candidate with a pre-adverse action notice before you deny employment based on information in the candidate’s background check report. The pre-adverse action letter tells the candidate:

  • The name and address of the company that provided the background check report (the CRA)
  • A statement that the CRA did not make the decision to take adverse action and cannot explain why it was taken
  • That they have a right to dispute any inaccurate or incomplete information in their report
  • They have a right to an additional free copy of their report from the CRA within 60 days.

Determine if You Can Move Forward

One of the most important steps is to determine if you can move forward with this candidate after a candidate failed background check after job offer, despite the failed background check. Most companies have a policy that states they will not hire candidates who have a criminal history related to the job.

This might include a drug conviction if you’re hiring for a position where employees will be driving company vehicles, or a history of theft if you’re hiring for a position involving working with cash.

However, it’s important to remember that not all failed background checks are created equal. For example, missing the “seven-year rule” could be caused by an error from the credit reporting agency and isn’t necessarily indicative of bad credit.

If this information is available, it’s up to you whether or not you want to move forward with the candidate because they missed the mark by just a few points.

Read also: 15 Best High Paying Entry Level Jobs

What Employers Need to Know About the Fair Credit Reporting Act (FCRA)

The Fair Credit Reporting Act (FCRA) regulates how employers may use credit reports and other personal information when making hiring decisions. Employers must follow FCRA rules when obtaining background checks on applicants and employees, including credit checks.

Employers need to understand these rules as a failure to comply with the FCRA can lead to penalties that include fines, lawsuits, and damage to an employer’s reputation.

Employers must obtain applicants’ written permission prior to running a credit check for employment purposes. This is done through a disclosure form, which employers typically present along with an application form or during the interview process. The notice must be written on paper and cannot be part of an electronic document such as an email or website agreement.

The notice must clearly state that the employer is requesting a credit report connected with your job application, so you know why the employer is requesting your authorization. It also must provide notification that you have the right to find out what information is included in your credit report (at no charge) and dispute any incorrect information. 

In addition, it should inform you that if you choose not to allow the prospective employer to obtain a credit report, this decision will not affect your employment opportunity.

Conclusion

While there are various reasons why a candidate may not pass the background check, there are also things that you can do to address the concerns that the report may raise. We hope we’ve helped you feel equipped to address these issues with candidates going forward.

If you’d like to learn more about how employment screening works, or read our guide to what happens during a typical background check, check out some of our other posts on employment search.

FAQs

Why do employers complete background checks?

Employers complete background checks to make sure you meet all requirements and to verify your qualifications. These actions help protect a company’s interest by making successful hires. Some industries require background checks to ensure the safety and well-being of other employees and the general public.

How do you tell the candidate their background check failed?

When someone you are interested in hiring fails a background check, the easiest thing to do is send them a pre-adverse notice, giving them the chance to explain or correct an error or improper behavior. If you receive no response, it is time to send an adverse action notice and withdraw your offer.

What laws regulate the background check screening process?

Employers subject to the Fair Credit Reporting Act (FCRA) must comply with certain laws when performing a background check. Some states, like California, have passed ban-the-box laws, which may affect how a company screens applicants.

Is social media included in a background check?

Social media profiles are often included in an employee background check nowadays. Social media can have a big impact on how people perceive you, and if it’s used to post inappropriate information, your reputation can be harmed.

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