What Background Check Compliance and Regulation Managers Do

What role does a compliance manager play in business today? As background check compliance and regulation requirements change, staying up-to-date is not always easy. Explore how compliance managers support and protect businesses during key processes such as hiring and screening.

Background checks form an important part of the hiring process. Conducted properly, they provide a business with facts about a job applicant that help evaluate an individual’s employment suitability. They help safeguard against the risks of negligent hires and protect the company from threats such as embezzlement or violence. They can even be a part of meeting your obligations under the law. However, you must use these tools carefully or else you might fall out of alignment with current background check compliance and regulation requirements.

Compliance isn’t always easy. Indeed, laws surrounding background checks change frequently at the state and federal levels. That’s not to mention the large amount of existing regulation that already applies to pre-employment screening processes. If you aren’t careful, you could violate the law—which could mean fines, lawsuits, and other headaches that impede how you do business. How can you avoid those problems?

A background check partner you can trust is one vital asset, especially for smaller companies that do not have complex hiring requirements. However, the issue is more complicated for larger businesses and those operating at an increasing scale. In these scenarios, consider hiring or designating an experienced employee as your “compliance manager.”

Take a moment to consider the impacts of screening regulations on business and why compliance matters, then explore why a dedicated employee may offer important advantages.

The Impact of Background Check Legislation on Business Processes

At first glance, it’s easy to think you only need to do a few simple things to comply with background check laws. Making sure you get permission and avoiding decisions based on protected-class information might not seem like a burden—but that’s because this is only the surface of modern regulation. Consider that to use background checks effectively, you should understand the following:

  • The Fair Credit Reporting Act and its requirements for consent, notification, and adverse action processes.
  • The Civil Rights Act and its non-discrimination statutes.
  • Local “ban the box” laws that change when and how you can ask about criminal history.
  • “Fair Chance” laws that delay background checks, require individualized assessments, and go beyond obligations to federal law.
  • Other local regulations about fair hiring.

These laws require everything from changes to how you write job applications to alterations in your hiring workflow. In some jurisdictions, you cannot use any background check or search for information about a subject until you make a conditional job offer. Hiring has become less straightforward, and employers must keep track of many more legalities.

What Happens if You Aren’t Careful About Background Check Compliance?

Falling out of compliance and violating background check regulations can have many consequences. In some cities, violating Ban the Box or Fair Chance laws comes with fines that increase for repeat violations. In other areas, job applicants can sue your company for damages if they allege you discriminated against them. For cases involving failures in compliance with federal rules, such as those surrounding Form I-9, fines for willful disregard of the law can total tens of thousands of dollars. Meanwhile, FCRA violations, even simple ones, can open the door to troublesome lawsuits from litigious firms—or the government.

Non-compliance puts your business at risk. Adopting a better-planned approach to meet your obligations is important to protect your company from such problems. That’s where a compliance manager can help.

The Role of Compliance Managers in a Business

A compliance manager is a professional whose job focuses on ensuring the business meets all its legal duties. This person makes it their mission to fully understand the requirements you face, from the FCRA to local regulations. A compliance manager may also need to focus on seeing that the business conducts the correct type of background checks. For example, if you operate a regulated business in an industry such as transportation or childcare, there may be vetting steps the law mandates you take.

A compliance manager helps others in the business understand their obligations and checks their work. This worker can save the company from going down a road that leads to fines or potential legal exposure. They’re also responsible for reporting to leadership when process failures require action.

Does a Compliance Manager Review Background Checks?

It’s possible. Some organizations choose to involve compliance managers in the actual background check assessment process; others may delegate the authority of assessing screening results entirely to this professional. Their recommendations may then form the basis of a hiring manager’s further considerations about staffing decisions. Using a professional who fully understands what the law demands of your business may aid you in avoiding simple mistakes that lead to non-compliant outcomes. A manager may also double-check the hiring team’s work along the way.

In other companies, the compliance manager’s role may focus on establishing the guidelines that others follow when hiring. In this case, employee education is an important part of the job. The compliance manager may create rubrics, flow charts, or other guideline documents that help human resources evaluate background check results appropriately.

Job Responsibilities Beyond the Criminal Background Check

Compliance managers or officers may spend a great deal of time and energy creating policies for the effective, legal use of background checks. However, they may also assist companies in many other ways, especially in highly regulated industries. What are some of the tasks they have aside from navigating background check compliance and legislation?

You may task a compliance officer to verify that an applicant has the appropriate skills, experience, or licenses required to do the job. Verifying that someone has a professional license is important. Likewise, you may need to conduct employment or education verification when hiring. Your compliance officer can help with these efforts or create the processes and make them happen.

Compliance with federal employment eligibility law also falls into this employee’s wheelhouse, especially the Form I-9 processes. I-9 compliance involves properly completing and maintaining the forms and their eventual disposal following a retention period. Non-compliance can bring major fines, but an experienced manager helps you tick every box to hire new employees safely and smartly.

Evaluate Your Approach to Compliance Today

Not every business has needs complex enough to merit a dedicated, full-time compliance manager, but many do. Aside from large-scale hiring operations, delegating compliance responsibilities to a team or experienced individual in HR offers important benefits. Achieve peace of mind about avoiding costly lawsuits or potential negligent hiring claims. Stay on top of the shifting sands of regulation to continue equipping your business with quality candidates to fill important roles.

Background check compliance and regulation are important for establishing a level playing field and broadening employment opportunities. With a compliance manager, you can ensure your business clears the bar set by the local, state, and federal laws that apply to your processes. Visit the Resource Center for more compliance-related information today and evaluate whether a compliance manager would benefit your team.

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Michael Klazema

About Michael Klazema The author

Michael Klazema is the lead author and editor for Dallas-based backgroundchecks.com with a focus on human resource and employment screening developments

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