Why Your Small Business Needs a Background Check Policy

Many small business owners and hiring managers search for terms like:

• “Do small businesses need background checks?”
• “What should a background check policy include?”
• “How do I write a background screening policy for my company?”

The answer is simple: a well-written policy helps you remain consistent, fair, and legally compliant during the hiring process. It also protects your business from liability and fosters a culture of trust and accountability.

Step 1: Define the Purpose of the Background Screening Purpose Policy

Start with a brief statement that outlines why your business conducts background checks. For example:

Example: “This policy is intended to guide the use of background checks in our hiring process to promote a safe and secure workplace, ensure job-related screening, and comply with applicable laws.”

Use clear language that reflects your company values and commitment to fair hiring practices.

Step 2: Determine the Types of Background Checks Needed

Tailor the checks to the roles you’re hiring for. Typical screening components include:

• Criminal history checks
• Employment and education verifications
• Professional license or credential checks
• Motor vehicle records (for driving positions)
• Drug testing (if applicable)
• Identity verification
• Credit Reports

Your policy should generally outline which screenings apply to which roles. For example, you might run motor vehicle checks only for delivery drivers.  For someone in finance handling sensitive banking information or accounting functions a credit report might be warranted.

Step 3: Establish the Timing of Background Checks

Indicate when background checks will occur during the hiring process. Most small businesses choose to conduct checks after a conditional offer of employment is made.

This timing helps you stay compliant with “Ban the Box” laws and prevents potential claims of discrimination.

Additionally, many companies also have in their policy to conduct periodic re-checks, particularly before transfers or promotions.

Step 4: Get Written Consent from Applicants

Your policy should clearly state that background checks will only be conducted with written permission. The Fair Credit Reporting Act (FCRA) requires this, and consent must be given via a separate disclosure form, not buried within a job application.

Make it easy for candidates to understand what you’re checking and why.

Step 4: Get Written Consent from Applicants

Your policy should clearly state that background checks will only be conducted with written permission. The Fair Credit Reporting Act (FCRA) requires this, and consent must be given via a separate disclosure form, not buried within a job application.

Make it easy for candidates to understand what you’re checking and why.  Transparency in your process builds trust with your applicants and generally helps everyone in the organization understand that you care about the safety and success of your employees, clients, and company.

Step 5: Clarify How Results Are Used

Explain how your company will review results and make decisions. Avoid blanket exclusions and instead use a job-related approach.

Include language like:

• “We assess each background check result on a case-by-case basis.”
• “A conviction will not automatically disqualify an applicant unless it is directly related to the duties of the position.”

This protects your business from potential claims of discrimination and supports individualized assessment.

Step 6: Outline the Applicant’s Rights

Your policy should inform applicants of their rights under the FCRA and any applicable state laws. If you decide not to hire someone based on their background check, you must:

• Provide a pre-adverse action notice
• Share a copy of the background report
• Provide a copy of the Summary of Rights Under the FCRA

Once this process is complete, a final adverse action notice may be sent.

Step 7: Maintain Confidentiality and Secure Data Storage

Reinforce your company’s commitment to confidentiality. Only authorized personnel should access background screening information, and all records should be stored securely.

This builds trust with applicants and helps you comply with data privacy requirements.

Step 8: Review and Update the Policy Regularly

Laws and best practices change over time. Commit to reviewing your policy annually or when laws change at the local, state, or federal level.

Staying up to date reduces legal risk and ensures continued fairness and transparency in your hiring process.

Final Thoughts

A clear and legally sound background check policy is more than a formality. It’s an essential part of your hiring strategy. By outlining your screening process and aligning it with your company values, you build a foundation of safety, compliance, and consistency.

If you need help drafting a policy or want to explore prebuilt background check packages for small and medium sized businesses, contact us today at [email protected] or visit www.edifyscreening.com.

Example Case Studies: Background Check Packages by Role

Case Study 1: Front Desk Administrative Assistant

• Company Type: Professional Services Firm
• Role Sensitivities: Access to client contact data, visitor management, front-line communications
• Background Check Package:
  • County Criminal Search (7-year)
  • National Criminal Database with Alias Search
  • Social Security Number Trace
  • Employment Verification (last 2 employers)
  • Education Verification (highest degree obtained)
  • Office of Foreign Assets Control (OFAC) Sanctions List

Why it fits: This package provides strong identity validation and a snapshot of trustworthiness without unnecessary screenings like MVR or credit report, which are not relevant for this office-based role.

Case Study 2: Warehouse Delivery Driver

• Company Type: E-Commerce Fulfillment Company
• Role Sensitivities: Operating company vehicles, handling merchandise, independent route management
• Background Check Package:
  • County Criminal Search (10-year)
  • National Criminal and Sex Offender Search
  • Motor Vehicle Report (MVR)
  • Drug Screening (5-panel)
  • Social Security Number Trace
  • Employment Verification (last 3 employers)

Why it fits: This role carries safety, compliance, and brand exposure risks. The inclusion of driving records and drug screening is critical to assessing risk and compliance for DOT and insurance purposes.

These examples highlight how screening packages can be customized to suit the nature and responsibilities of different roles. Matching the scope of your background checks to the position being filled is one of the most important steps in building a practical and defensible policy.

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