Background checks are needed to help prevent negligent hires. During the selection process, in addition to verification of the information on a candidate’s application form and/or résumé, several other types of background checks may or may not be appropriate. It is not unusual for the background check to be a simple pass or fail. Background checks can become rather expensive depending on which checks we do and how often we have to do them, so they are usually left until we have at least narrowed down the list of candidates to a final few, or in some cases even to the final candidate. We may then offer employment to the candidate conditioned on passing various background checks. Remember, though, that you cannot use a background check to discriminate in violation of federal or state laws. Although several states have recently put limits on its use, one of the most commonly used background checks is the credit check. Credit checks are subject to the Fair Credit Reporting Act (FCRA), which requires that employers disclose to the applicant that they will use credit reports for employment decisions. The act also says that if the information on the credit report results in an adverse employment action, the employer has to give a copy of the report to the person and inform the applicant of rights under FCRA, including the right to dispute the report. All states allow criminal background checks in at least some cases. However, laws vary so significantly across jurisdictions that it is difficult to enumerate the circumstances in which criminal background checks are allowed. However, due to the issue of negligent hiring, most companies today will generally complete a criminal background check when it is allowed. Reference checks include not only calls to references that are provided by the applicant, but also reference letters from employers, personal letters of recommendation, and possibly cold calls to previous employers.