Employee Criminal Record Checks: Consent, Scope, and Adverse Action

Employee criminal background check laws sit in three main layers: the federal Fair Credit Reporting Act (FCRA) controls how a check is authorized, delivered, and acted on; Title VII of the Civil Rights Act, through EEOC guidance, limits how the results can be used; and a growing patchwork of state and local “fair chance” laws restricts when in the hiring process the question can even come up. On top of that, a handful of industries — banking, aviation, childcare — have their own federal statutes that require checks and name specific disqualifying offenses. Whether you are an employer trying to stay compliant or a candidate trying to understand your rights, the rules below are the ones that actually decide outcomes.

Consent and Disclosure Before the Check

An employer cannot lawfully order a background report through a screening company without first doing two things. It must give the applicant a written notice, in a standalone document, disclosing that a consumer report may be obtained for employment purposes. And it must get the applicant’s written authorization to run the check.¹

“Standalone” is the word that trips up employers. The disclosure cannot be buried inside a job application, an employee handbook, or a form containing other information. The authorization can appear on the same page as the disclosure, but nothing else can be added.² Courts have penalized employers who combined the disclosure with liability waivers or extra language, so keeping the form clean is not optional.

To run the check accurately, the screening agency will need the candidate’s full legal name, any former names or aliases, date of birth, and Social Security number.

How Far Back a Report Can Go

The FCRA limits how deep into someone’s past a screening company can reach for certain items. Non-conviction records, including arrests that never led to a guilty verdict, generally cannot be reported if they are more than seven years old.³ Criminal convictions have no federal time limit and can appear on a report indefinitely.

There is one important exception. Positions with an expected annual salary of $75,000 or more are exempt from the seven-year cap on adverse information, so older arrests, civil judgments, and other adverse items that would otherwise age off the report can be included.³ The wider window applies automatically based on compensation, not job title.

State law often goes further. Some states bar the reporting of non-conviction records entirely. Others extend the seven-year restriction to convictions as well. Employers operating across state lines usually need to apply the strictest rule that covers each applicant’s location.

What Can and Can’t Be Used Against a Candidate

Title VII of the Civil Rights Act does not mention background checks, but it applies to them through the doctrine of disparate impact. If a screening policy disproportionately excludes applicants from a protected class, the employer must show the policy is job-related and consistent with business necessity. Blanket policies that reject anyone with any criminal record have been found to fail that test since the 1975 decision in Green v. Missouri Pacific Railroad.

The EEOC’s enforcement guidance sets out three factors, drawn from that case, that employers should weigh when evaluating a candidate’s criminal history:⁴

The nature and gravity of the offense, including the harm caused, the legal classification, and the specific facts.
The time that has passed since the offense and the completion of any sentence.
The nature of the job, including whether it involves money, vulnerable populations, confidential data, or minimal supervision.

When an applicant is screened out by a criminal history policy, the EEOC recommends an individualized assessment. Notify the person they were excluded, give them a reasonable chance to provide context such as rehabilitation efforts, employment history since the offense, or character references, and genuinely consider whether an exception is warranted.⁴ Running the check is easy; documenting the reasoning behind the decision is where most compliance fails.

Arrests Are Not Convictions

The EEOC draws a hard line between arrests and convictions. An arrest by itself does not prove that someone committed a crime. Rejecting a candidate based solely on an arrest record, without examining the underlying conduct, is not considered job-related or consistent with business necessity.⁴ An employer can look into the conduct behind an arrest and make a decision based on that conduct, but not on the fact of the arrest alone.

The same caution applies to pre-trial diversion entries. Successful completion of a diversion program typically results in dismissed charges rather than a conviction, and treating a diversion entry as a conviction creates the same risk under the EEOC’s arrest-record guidance.

When Employers Can Ask

Thirty-seven states, the District of Columbia, and over 150 cities and counties have adopted some form of “ban the box” or fair chance hiring policy. These laws generally remove the criminal history question from initial job applications and delay the background check until later in the process. The strongest versions push the inquiry past the conditional offer stage, meaning an employer cannot ask about criminal history until it has decided the candidate is otherwise qualified.

Beyond timing, many fair chance laws also limit what an employer can consider. Some bar the use of non-conviction records entirely. Others require employers to evaluate whether a conviction actually relates to the duties of the job. A growing number require a written explanation when an employer rejects a candidate on the basis of criminal history, separate from the FCRA adverse action process. The federal and local requirements stack, and the stricter rule controls.

The Adverse Action Process

When a report comes back with information that may cost the applicant the job, the FCRA requires a two-step notification. Skipping either step, or rushing through them, is what most FCRA lawsuits are built on.

Pre-Adverse Action Notice

Before making a final decision, the employer must send the applicant a pre-adverse action notice that includes a copy of the actual background report and a written description of the consumer’s rights under the FCRA.¹ The point is to let the candidate review the report and dispute anything inaccurate before the decision becomes final. The FCRA does not set a minimum waiting period, but the FTC has recommended at least five business days as a reasonable window.² Sending both notices on the same day is a common compliance failure that courts have treated as a violation.

Final Adverse Action Notice

If the employer still intends to deny the position after the waiting period, a final adverse action notice must follow. It must include the name, address, and phone number of the screening company, a statement that the screening company did not make the hiring decision, and a reminder that the applicant can request another free copy of the report and dispute its accuracy within 60 days.²

Dispute Timeline

If a candidate disputes information on the report, the screening company generally has 30 days from receiving the dispute to complete its investigation.⁵ That period can be extended by up to 15 additional days if the candidate submits new information during the initial 30-day window. Once the investigation is complete, the agency has five business days to notify the candidate of the results. Information that turns out to be inaccurate or unverifiable must be deleted.

Expunged and Sealed Records

If a court has ordered a record expunged or sealed, it should not appear on a background report. The CFPB has stated that screening companies are not following “reasonable procedures to assure maximum possible accuracy” when they report information that has been expunged, sealed, or otherwise legally restricted from public access.⁶

In practice, sealed records still surface. Screening companies pull from court records, law enforcement databases, and third-party aggregators, and those sources do not always update promptly after a sealing order. Candidates who have gone through expungement or sealing should verify that the records have actually been removed from commercial databases, not just from the court’s own system. Requesting your own consumer file from the major screening companies before a job search is one of the more effective ways to catch stale records before an employer sees them.

A growing number of states have enacted “Clean Slate” laws that automate the sealing process for eligible records. As of 2026, at least 13 states and the District of Columbia have passed legislation meeting this standard. These laws typically seal certain misdemeanor and lower-level felony records after a waiting period, provided the individual has no new convictions. Serious offenses such as murder and sex crimes are never eligible, and sealed records may still be visible to law enforcement and certain sensitive-sector employers.

Jobs Where a Check Is Required by Law

Some industries do not merely permit criminal background checks. Federal law requires them and names the offenses that create automatic bars to employment.

Banking

Section 19 of the Federal Deposit Insurance Act, at 12 U.S.C. § 1829, prohibits anyone convicted of a crime involving dishonesty, breach of trust, or money laundering from working at an FDIC-insured bank without prior written consent from the FDIC. The same bar applies to individuals who entered a pre-trial diversion program for such an offense. For the most serious financial crimes, including bank fraud, embezzlement of bank funds, and money laundering under specific federal statutes, the FDIC cannot grant an exception for at least 10 years after the conviction becomes final.⁷ Amendments through the Fair Hiring in Banking Act have introduced relief for older offenses and for certain minor ones under FDIC regulations.⁸

Aviation and Transportation Security

Under 49 U.S.C. § 44936, the TSA requires an FBI fingerprint-based criminal records check for security screeners, employees with unescorted access to secured airport areas, and workers handling baggage or cargo. A conviction within the preceding 10 years for offenses including murder, espionage, sedition, kidnapping, distribution of controlled substances, armed robbery, or arson creates an automatic employment bar.⁹ Similar screening applies to applicants seeking hazardous materials endorsements on commercial driver’s licenses.

Childcare

The Child Care and Development Block Grant Act requires criminal background checks for all staff at childcare facilities receiving federal funding. The required screening includes a state criminal and sex offender registry search in every state where the person has lived over the past five years, a search of state child abuse and neglect registries, a National Crime Information Center check, an FBI fingerprint check, and a National Sex Offender Registry search. Disqualifying offenses include felony convictions for murder, child abuse or neglect, sexual assault, kidnapping, arson, and physical assault, along with drug-related felonies committed in the preceding five years. Anyone required to register as a sex offender is permanently ineligible.¹⁰

The Negligent Hiring Counterweight

Employers who skip background checks entirely face a different risk. Under the common-law doctrine of negligent hiring, an employer can be held liable if it hires someone without a reasonable investigation and that employee later harms a coworker, customer, or member of the public. The question is whether the employer knew, or should have known through ordinary diligence, that the person posed a foreseeable risk.

That is the tension that makes employment screening so difficult. Checking too aggressively invites a Title VII disparate impact claim. Not checking at all invites a negligent hiring lawsuit if something goes wrong. The workable answer for most employers is to screen consistently, apply the EEOC’s individualized assessment framework, document the reasoning behind every decision, and keep the scope of each check proportional to the actual risks of the specific role.

1
Office of the Law Revision Counsel. 15 USC 1681b – Permissible Purposes of Consumer Reports
2
Federal Trade Commission. Using Consumer Reports: What Employers Need to Know
3
Office of the Law Revision Counsel. 15 USC 1681c – Requirements Relating to Information Contained in Consumer Reports
4
U.S. Equal Employment Opportunity Commission. Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act
5
Office of the Law Revision Counsel. 15 US Code 1681i – Procedure in Case of Disputed Accuracy
6
Consumer Financial Protection Bureau. Fair Credit Reporting; Background Screening
7
Office of the Law Revision Counsel. 12 USC 1829 – Penalty for Unauthorized Participation by Convicted Individual
8
eCFR. 12 CFR Part 303 Subpart L – Section 19 of the Federal Deposit Insurance Act
9
Office of the Law Revision Counsel. 49 USC 44936 – Employment Investigations and Restrictions
10
Office of the Law Revision Counsel. 42 USC 9858f – Criminal Background Checks