What Is a Background Check?
Updated · Mar 04, 2023
At least at one point in your life, you’re likely to have some experience with background screenings. Whether you’re applying for a job that requires you go through one or whether you’re the one doing the checking, here is everything you need to know about it.
In this article we’ll cover:
- What is a background check?
- When do people need it?
- What does it show?
- How to pass it (and what might be a red flag)?
Background Check Definition
In simple terms, running a background check means verifying you are who you say you are. Before you start a new job, for example, your new boss may want to run one to ensure you won’t pose a danger to the workplace or become a liability to the company.
A background report usually includes information about the last seven years, though this number can go up to 10 in some states.
Types of Background Checks
Although people tend to have at least a vague idea of what a background check is, they don’t usually know the specifics. But don’t worry—we’ll cover those in a moment.
The first thing you need to know is that not all background checks are the same. There are multiple reasons why someone might require a background check (and different types of background checks to accommodate each of those reasons).
These are ten of the most common types:
Employment Background Check
Nowadays, you need a background check for pretty much any job—whether you’re applying to NASA or to your local McDonald’s.
Recent statistics reveal that 96% of companies conduct background checks on their (prospective) employees.
When they’re considering you for a position, most employers run an SSN background check:
First, they confirm your identity through an SSN trace.
Then, they research your criminal record, motor vehicle reports (MVRs), credit history, and work experience.
Your future company may even go through your social media and medical history, or ask for a drug screening, as a part of the selection process.
Employers might also conduct background checks while you work in the company. For instance, many institutions have implemented annual or semi-annual drug testing.
Criminal Background Check
This one looks specifically for any issues with the law. Most criminal checks include:
- SSN trace - it shows the year, state, name, and address associated with your social security number.
- National criminal database check - it’s usually done through the National Crime Information Center (NCIC) to see any federal criminal record.
- Sex offender status verification - it’s basically scouring through the National Sex Offender Registry to see if there’s a match.
This type of screening is a crucial part of nearly all background checks for employment and, depending on the job, additional investigations may be conducted. For instance, felons can’t work in most government positions or in the police force.
OIG Background Check
The Office of Inspector General (OIG) of The Department of Health & Human Services maintains a list of individuals who have committed healthcare-related crimes.
These include Medicare or Medicaid fraud, patient abuse, felonies related to financial misconduct or controlled substances, etc.
The list is one of the federal employment background check disqualifiers. This means that if you were convicted of one of these crimes, you can’t work in federally funded healthcare programs.
Also, there’s a civil monetary penalty for employers who fail to run the check and accidentally hire a person on the list.
Fingerprint Background Check
The Automated Fingerprint Identification System (AFIS) is a national database of biometric information and identifying data. A complete background check usually involves an AFIS search. Fingerprint checks are mandatory for governmental and government-run positions, as well as for some professional licenses.
Professional Background Check
If a job requires a specific license to practice it, employers run a professional license (or education verification) background check. This involves contacting the relevant licensing board to ensure that your certification exists, that it hasn't expired, and that there are no violations against it.
International Background Check
A full background check doesn’t usually involve international information. However, if you recently lived or worked in another country, or you come from outside the US, employers might request:
- International criminal records
- Education verification
- Employment history
Companies would usually ask for your government-issued identification, like a state ID or passport, so they can run background checks in another country.
E-Verify Background Check
E-Verify helps employers ensure people are eligible to work in the US. It compares Form I-9 information (submitted by workers) with records from the Social Security Administration (SSA) and the Department of Homeland Security (DHS).
Universal Background Check
Employers aren’t the only ones who might be interested in checking your background. If you want to buy a firearm, for example, the seller would typically use the National Instant Background Check System (NICS) to verify that you are allowed to own a gun.
State regulations for this differ.
For instance, California requires both licensed and unlicensed vendors to run a point of sale (POS) background check. In Hawaii, on the other hand, people need a permit to purchase a gun—which they get after passing a background check.
Credit Background Check
A credit background check, by definition, is a report that shows your debit-to-credit ratio for the past seven years. In other words, it tells potential creditors how you’re doing with your other loans.
You can get a free annual credit report that won’t affect your history. But other than that, every time somebody asks to pull that information, your credit score will drop slightly.
Financial institutions aren’t the only ones that might be interested in your credit history—landlords and some employers might also ask for that information.
Personal Background Check
Can I check my own background? Sure you can!
Key takeaways: The main types of background investigations include:
- Employment - corroborates information given by (potential) employees.
- Criminal - looks for any convictions.
- OIG - traces healthcare-related crimes.
- Fingerprint-based - uses fingerprint databases to review records on a national level.
- Professional - verifies work experience and relevant licenses.
- International - checks for records in other countries.
- E-Verify - confirms eligibility to work in the US.
- Universal - verifies clearance to buy a firearm.
- Credit - shows whether you’re a reliable debtor.
- Personal - it’s the one that you run on yourself.
What Are Level 1, Level 2, and Level 3 Background Checks?
Now that you know what a background check is, we can delve a little deeper on the subject. Background checks can be categorized into three levels, depending on their thoroughness:
This is the most basic of all background checks, as it only covers one jurisdiction. It’s a name-based review in one state (usually the one you live in).
Pre-employment background checks usually go above Level 1, though, as companies prefer to be safe when hiring.
It involves a more comprehensive examination than Level 1. It expands to fingerprint-based information, as well as a nationwide screening. Florida’s legislation declared it necessary to run a Level 2 check on all employees who work with vulnerable groups.
It includes criminal records, education and employment history screenings, reference checks, and possibly a drug test. It’s not defined under any legislation and is generally reserved for people in executive roles and certain professions.
Key takeaways: Level 1 is the most basic check, covering only local information. Level 2 is a deeper, fingerprint-based report, while Level 3 refers to the most in-depth investigation.
How Do Background Checks Work?
Most employers need a background check authorization form before they can proceed—running a background check without consent might have legal implications.
Here’s how data gathering usually works:
- Instantly available information - plenty of background check data is digital. Basic searches, such as SSN traces and Sex Offender Registry scans, can be done quickly and free of charge.
- Criminal background checks - a federal screening usually takes one day and covers all federal courts. Most employers also look into state records, which can take a little more time (especially if you've lived in several different places).
- Fingerprint checks - an AFIS search can take up to three days. If you haven’t been fingerprinted before, the review won’t yield any information.
- Professional licenses - these must be verified for medical personnel, real estate agents, and other professionals. Each licensing board has its own turnaround time.
Background Check Companies
Background checks are essential in specific industries—government employees, educational workers, healthcare professionals, and basically, anyone who works with vulnerable groups must pass a background check.
That’s why most businesses hire a dedicated service to run them, rather than having HR manually research every prospect. Usually, these companies offer comprehensive reports for a fixed fee.
For example, the GoodHire screening portal is a popular choice for pre-employment background checks. Prices start at $29.99 plus a one-time setup fee. Most companies prefer the $59.99 Standard Plan, as it provides more information than the Basic Plan for a relatively low additional cost.
VerifiedCredentials, on the other hand, is an excellent option for a personal background check. Pricing starts at just $34.00.
Key takeaways: To gather data for a background check, you can go to relevant institutions to request records. Or you can turn to companies like GoodHire, who can do this for you (they’re a popular choice among most employers).
The Fair Credit Reporting Act (FCRA) is federal legislation that basically regulates people’s credit reports—what information they show, who can access them, and under what circumstances.
There is no such thing as an FCRA-certified background check.
However, individuals can get an FCRA accreditation, which will attest to their ability to provide accurate, in-depth, FCRA-compliant background information to any interested party.
There is also a Professional Background Screening Association (PBSA) certificate for companies. If a firm is PBSA-accredited, then it’s verified to provide a professional, high-quality background check service.
FCRA-certified employees can work in any company, whether it is PBSA-certified or not. (But it’s obviously preferable to hire background check companies who have both: PBSA certifications and FCRA-accredited employees).
You can check which companies are certified in the PBSA database.
Key takeaways: FCRA and PBSA are the most relevant accreditations in the background check industry. The first, certifies individuals; the second, companies. When hiring a background check vendor, you should verify if they have these certificates as a guarantee of quality.
By definition, a background check can be any investigation into who you are.
Usually, it includes identity, criminal record and employment history verifications.
Depending on your industry, additional screenings might be required, such as license verifications, drug tests, or international background checks.
So, if somebody says they need to run a background check on you, don’t take it personal. Such screenings are increasingly common nowadays—after all, one can never be too careful.
- Federal court and county records
- Education and professional history
- International checks
- Drug screenings
- Credit history
- Get a new job
- Receive a loan
- Rent a home
- Buy a firearm
- Criminal history - especially if you're a convicted felon.
- Failed drug screening - if you use medicinal marijuana, make sure to disclose this.
- Give your employer accurate information - don’t lie about your education or work experience.
- Disclose any criminal history - you might still be eligible for the position, just don’t let it come up as a surprise on the background check.
- Don’t use illicit drugs - a drug screening is required for a wide range of professions, so avoid illegal substances to make sure you pass.
Denny is a content marketing enthusiast, writer, and occasional tech geek. She also studies Medicine, sometimes.