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Background Check Authorization Form: A Guide for Employers

Learn everything you need to know about background check authorization forms, legal compliance requirements, and best practices for HR managers, startup founders, and small business owners.

Introduction

A Background Check Authorization Form is a legal document that employers use to obtain permission from job candidates or employees before conducting background checks. This form is not just a formality—it's a critical compliance requirement under federal and state laws, including the Fair Credit Reporting Act (FCRA). For HR managers, startup founders, and small business owners, understanding how to properly implement background check authorizations can protect your company from potential lawsuits while helping you make informed hiring decisions. This guide explains what these forms must include, how to use them correctly, and common pitfalls to avoid.

Key Things to Know

  1. 1

    The Background Check Authorization Form must be a standalone document, separate from your employment application and other onboarding paperwork.

  2. 2

    You must provide a clear disclosure that you will be conducting a background check and obtain written authorization before proceeding with any background screening.

  3. 3

    If you take an adverse action (like not hiring someone) based on background check results, you must follow the FCRA's two-step adverse action process, which includes providing pre-adverse action and adverse action notices.

  4. 4

    Different types of background checks (criminal, credit, driving records, etc.) may have different legal requirements and restrictions depending on your state and industry.

  5. 5

    Keep signed authorization forms on file for at least the duration of employment plus any applicable statute of limitations period for potential claims.

  6. 6

    Review and update your Background Check Authorization Forms regularly to ensure continued compliance with changing laws and regulations.

  7. 7

    Consider working with a reputable background check provider that understands compliance requirements and can help you navigate the legal landscape.

Key Decisions

Small Business Owner

Startup Founder

HR Manager in Growing Company

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BACKGROUND CHECK DISCLOSURE AND AUTHORIZATION FORM

DISCLOSURE REGARDING BACKGROUND INVESTIGATION

IMPORTANT: PLEASE READ CAREFULLY BEFORE SIGNING

[EMPLOYER NAME] ("the Company") may obtain information about you from a consumer reporting agency for employment purposes. Thus, you may be the subject of a "consumer report" and/or an "investigative consumer report" which may include information about your character, general reputation, personal characteristics, and/or mode of living, and which can involve personal interviews with sources such as your neighbors, friends, or associates. These reports may contain information regarding your credit history, criminal history, social security verification, motor vehicle records ("driving records"), verification of your education or employment history, or other background checks.

This disclosure is provided to you in compliance with the Federal Fair Credit Reporting Act (FCRA) and applicable state laws. The consumer reports may be obtained for employment purposes, including but not limited to: evaluating your employment application, making decisions regarding offers of employment, and, if applicable, in connection with your continued employment, promotion, reassignment, or retention.

The scope of this disclosure and authorization is all-encompassing, allowing the Company to obtain from any outside organization all manner of consumer reports and investigative consumer reports now and throughout the course of your employment to the extent permitted by law.

CONSUMER REPORTING AGENCY INFORMATION

The background check will be conducted by:

[CONSUMER REPORTING AGENCY NAME]
[STREET ADDRESS]
[CITY, STATE ZIP]
[PHONE NUMBER]
[WEBSITE]

STATE-SPECIFIC DISCLOSURES

California Applicants or Employees

Under California law, you have the right to view your file that the Consumer Reporting Agency maintains. By providing proper identification and duplication cost, you may obtain a copy of this information in person at the Consumer Reporting Agency's normal business hours and after providing reasonable notice for your request.

You can also request a copy be sent to you by certified mail upon making a written request with proper identification. The Consumer Reporting Agency can answer questions about information in your file, including any coded information. If you come in person, another person can come with you so long as they can show proper identification.

New York Applicants or Employees

You have the right, upon written request, to be informed of whether or not a consumer report was requested. If a consumer report is requested, you will be provided with the name and address of the consumer reporting agency furnishing the report.

Massachusetts Applicants or Employees

You have the right to obtain a copy of any consumer report requested by the Company by contacting the consumer reporting agency identified above.

Minnesota Applicants or Employees

You have the right, upon written request to the Consumer Reporting Agency, to receive a complete and accurate disclosure of the nature and scope of any consumer report. The Consumer Reporting Agency must make this disclosure within five days of receipt of your request or of the Company's request for the report, whichever is later.

Washington State Applicants or Employees

You have the right to request from the consumer reporting agency a written summary of your rights and remedies under the Washington Fair Credit Reporting Act.

ACKNOWLEDGMENT AND AUTHORIZATION

I acknowledge receipt of the DISCLOSURE REGARDING BACKGROUND INVESTIGATION and A SUMMARY OF YOUR RIGHTS UNDER THE FAIR CREDIT REPORTING ACT and certify that I have read and understand both of those documents.

I hereby authorize the obtaining of "consumer reports" and/or "investigative consumer reports" by the Company at any time after receipt of this authorization and throughout my employment, if applicable. To this end, I hereby authorize, without reservation, any law enforcement agency, administrator, state or federal agency, institution, school or university (public or private), information service bureau, employer, or insurance company to furnish any and all background information requested by [CONSUMER REPORTING AGENCY NAME], [CONSUMER REPORTING AGENCY ADDRESS], [CONSUMER REPORTING AGENCY PHONE NUMBER], another outside organization acting on behalf of the Company, and/or the Company itself.

I understand that by signing this authorization:

  1. I authorize the Company to conduct a background check which may include, but is not limited to, information regarding my credit history, criminal history, social security verification, motor vehicle records, verification of education or employment history, or other background checks.

  2. I agree that this Disclosure and Authorization form in original, faxed, photocopied, or electronic (including electronically signed) form will be valid for any reports that may be requested by or on behalf of the Company.

  3. I understand that providing any false information or omitting significant information on my application materials or in interviews may be sufficient grounds for rejection of my application or immediate termination of employment.

  4. I understand that I have the right to request a complete and accurate disclosure of the nature and scope of any investigative consumer report prepared on me. I understand that I may request a copy of my report, and that I may dispute the accuracy or completeness of the report by contacting the consumer reporting agency identified above.

  5. I understand that before the Company takes any adverse employment action based in whole or in part on the report, I will be provided a copy of the report and a description in writing of my rights under the FCRA.

  6. I understand that if I am applying for employment in California, Minnesota, or Oklahoma, I can receive a free copy of any consumer report or investigative consumer report obtained on me if I check the box below:

    □ I request a free copy of the report.

  7. I understand that if the Company is located in California, Minnesota or Oklahoma, that I have the right to request a copy of my report by checking the box below:

    □ Please send me a copy of my report at the following address: ________________________________

ONGOING AUTHORIZATION

I further authorize the Company to obtain additional consumer reports and investigative consumer reports about me without asking for my authorization again, throughout my employment, to the extent permitted by applicable law, for the purpose of evaluating continued suitability for employment, promotion, reassignment, or retention as an employee.

DATA PROTECTION AND PRIVACY STATEMENT

The information collected through this background check process will be used solely for employment purposes. The Company maintains appropriate administrative, technical, and physical safeguards to protect the security and confidentiality of the information collected. Information obtained through the background check process will be retained in accordance with applicable laws and the Company's record retention policies, and will be securely destroyed when no longer needed for business or legal purposes.

For international candidates: If you are located in the European Economic Area, the United Kingdom, or another jurisdiction with comprehensive data protection laws, additional protections may apply to the processing of your personal information. The Company will process your personal information in accordance with applicable data protection laws, including obtaining your explicit consent where required.

PERSONAL INFORMATION (Please print clearly)

Full Legal Name: _______________________________________________________________ (First) (Middle) (Last)

Previous Names/Aliases (including maiden name): ____________________________________

Current Address: ______________________________________________________________ (Street) (City) (State) (ZIP)

Previous Addresses (past 7 years):

  1. (Street) (City) (State) (ZIP) (Dates: From-To)

  2. (Street) (City) (State) (ZIP) (Dates: From-To)

  3. (Street) (City) (State) (ZIP) (Dates: From-To)

Date of Birth: //______ (For identification purposes only)

Social Security Number: -_____-

Driver's License Number: ________________________ State of Issue: _________________

Email Address: ________________________________________________________________

Phone Number: ________________________________________________________________

EMPLOYER INFORMATION

Position Applied For: ___________________________________________________________

Purpose of Background Check: □ Pre-employment (new hire) □ Promotion □ Reassignment □ Other: _____________________________________________________________________

RIGHT TO REQUEST ADDITIONAL DISCLOSURES

You have the right to request additional disclosures regarding the nature and scope of the investigation. To exercise this right, please submit a written request to [EMPLOYER CONTACT INFORMATION].

RIGHT TO OBTAIN REPORT COPY

You have the right to request and obtain a copy of any background check report secured by the Company by contacting the consumer reporting agency listed above directly.

ADVERSE ACTION NOTIFICATION PROCESS

If the Company intends to take an adverse action based in whole or in part on information contained in a consumer report, you will be provided with the following before the adverse action is taken:

  1. A copy of the consumer report relied upon for the adverse action
  2. A copy of "A Summary of Your Rights Under the Fair Credit Reporting Act"
  3. A Pre-Adverse Action Notice explaining that the Company is considering taking adverse action
  4. An opportunity to dispute the accuracy or completeness of the information in the report

After the waiting period (typically 5 business days), if the Company proceeds with the adverse action, you will receive:

  1. An Adverse Action Notice stating that the adverse action has been taken
  2. The name, address, and phone number of the consumer reporting agency that supplied the report
  3. A statement that the consumer reporting agency did not make the decision to take the adverse action and cannot give specific reasons for it
  4. A notice of your right to dispute the accuracy or completeness of any information the consumer reporting agency furnished
  5. A notice of your right to an additional free consumer report from the agency upon request within 60 days

BAN-THE-BOX COMPLIANCE

The Company complies with applicable "ban-the-box" and fair chance hiring laws. Criminal history information will not be requested or considered before a conditional offer of employment is made, except where permitted by law. Any criminal history information obtained will be evaluated in accordance with applicable laws, considering factors such as the nature and gravity of the offense, the time elapsed since the offense or completion of the sentence, and the nature of the job sought.

INFORMATION RETENTION POLICY

Information obtained through the background check process will be maintained in a secure and confidential manner. The Company will retain this information for the duration of your employment plus [NUMBER] years thereafter, or as otherwise required by applicable law. After this retention period, the information will be securely destroyed in accordance with the Company's record retention policies.

NO LIABILITY WAIVER

Nothing in this authorization is intended to be or shall be construed as a waiver of your legal rights under applicable federal, state, or local laws.

SIGNATURE

By signing below, I acknowledge that I have read and understand this Disclosure and Authorization form. I authorize [EMPLOYER NAME] to obtain consumer reports and/or investigative consumer reports about me for employment purposes as described in this document.

Signature: ____________________________________________ Date: ________________

Print Name: ___________________________________________

FOR EMPLOYER USE ONLY

Requested by: _________________________________________ Date: ________________

Position: _____________________________________________

North Carolina Requirements for Background Check Authorization Form

FCRA Disclosure Requirement (15 U.S.C. § 1681b(b)(2)(A)(i))

The Fair Credit Reporting Act requires that employers provide a clear and conspicuous disclosure to the applicant that a consumer report may be obtained for employment purposes. This disclosure must be in a standalone document, separate from the employment application.

FCRA Written Authorization (15 U.S.C. § 1681b(b)(2)(A)(ii))

The FCRA requires that employers obtain written authorization from the applicant before procuring a consumer report for employment purposes.

FCRA Pre-Adverse Action Notice (15 U.S.C. § 1681b(b)(3)(A))

Before taking any adverse action based on information in a consumer report, employers must provide the applicant with a copy of the report and a summary of their rights under the FCRA.

FCRA Post-Adverse Action Notice (15 U.S.C. § 1681m(a))

After taking an adverse action based on information in a consumer report, employers must provide notice to the applicant that includes the name and contact information of the consumer reporting agency, a statement that the agency did not make the adverse decision, and notice of the applicant's right to dispute the accuracy of the information.

North Carolina Identity Theft Protection Act (N.C. Gen. Stat. § 75-60 et seq.)

Requires businesses to implement reasonable measures to protect personal identifying information and properly dispose of records containing such information.

North Carolina Expunged Records Protection (N.C. Gen. Stat. § 15A-153)

Employers may not inquire about arrests, criminal charges, or convictions that have been expunged. The authorization form should clarify this limitation.

Ban the Box for State Employment (Executive Order No. 158 (2020))

While North Carolina does not have a statewide ban-the-box law for private employers, state agencies are prohibited from asking about criminal history on initial job applications. Private employers should be aware of this trend when designing their forms.

Equal Employment Opportunity Commission Guidance (Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.)

Background checks must comply with federal anti-discrimination laws. The authorization form should not have a disparate impact on protected classes.

Americans with Disabilities Act Compliance (42 U.S.C. § 12112(d))

Medical inquiries are restricted under the ADA. The authorization form should separate any medical information requests from general background check authorization.

North Carolina Medical Records Privacy (N.C. Gen. Stat. § 8-53)

Requires specific authorization for the release of medical records, which must be separate from general background check authorization.

North Carolina Personnel Privacy Act (N.C. Gen. Stat. § 126-22 et seq.)

Protects the privacy of state employee personnel records and requires specific authorization for their release.

Driver's Privacy Protection Act (18 U.S.C. § 2721 et seq.)

If the background check includes driving records, the authorization form must comply with the DPPA, which restricts the disclosure of personal information in motor vehicle records.

North Carolina DMV Records Access (N.C. Gen. Stat. § 20-43.1)

Specific authorization is required for employers to access an applicant's driving records from the North Carolina Division of Motor Vehicles.

Consumer Financial Protection Bureau Regulations (12 CFR Part 1022)

The CFPB enforces the FCRA and has issued regulations that affect background check authorizations, including requirements for clear and conspicuous disclosures.

North Carolina Consumer Economic Protection Act (N.C. Gen. Stat. § 75-1.1)

Provides additional consumer protections that may affect how background check information is obtained and used.

North Carolina Right to Review (N.C. Gen. Stat. § 75-63)

Applicants have the right to request and review information about themselves that is collected by consumer reporting agencies.

Federal Trade Commission Enforcement (15 U.S.C. § 45)

The FTC enforces the FCRA and has issued guidance on proper background check authorizations, including prohibitions against excessive information in disclosure forms.

North Carolina Employment Security Law (N.C. Gen. Stat. § 96-4(x))

Regulates how employment information may be shared and requires proper authorization for the release of certain employment records.

Electronic Signatures in Global and National Commerce Act (15 U.S.C. § 7001 et seq.)

If the authorization form is provided electronically, it must comply with E-SIGN Act requirements for electronic signatures and records.

North Carolina Uniform Electronic Transactions Act (N.C. Gen. Stat. § 66-311 et seq.)

Governs the use of electronic signatures in North Carolina and affects how background check authorizations can be signed electronically.

Frequently Asked Questions

A Background Check Authorization Form is a document that job applicants or employees sign to give an employer permission to conduct a background check. This form acknowledges that the individual consents to having their background information reviewed, which may include criminal history, credit reports, employment verification, education verification, and other personal information. Under the Fair Credit Reporting Act (FCRA), employers must obtain written authorization before conducting background checks through third-party consumer reporting agencies.

A compliant Background Check Authorization Form should include: 1) Clear disclosure that a background check will be conducted, 2) Statement that the information may be used for employment decisions, 3) The applicant's signature and date, 4) Authorization for the employer to obtain background information, 5) Acknowledgment that the applicant has the right to request information about the nature and scope of the report, 6) Notice that the applicant can request a copy of the report, and 7) Information about the consumer reporting agency being used. The form must be standalone (not buried in an employment application) and written in clear, understandable language.

Yes, while the FCRA provides federal requirements, many states have additional regulations regarding background checks and authorization forms. For example, California, New York, and Illinois have 'ban-the-box' laws that restrict when employers can ask about criminal history. Some states limit the lookback period for criminal records or restrict credit checks for employment purposes. As an employer, you must comply with both federal and state laws, following whichever provides greater protection to the applicant. It's advisable to consult with legal counsel familiar with the specific requirements in your state.

For new hires, you need to obtain a signed Background Check Authorization Form before conducting the initial background check. For existing employees, the requirements vary based on your company policies and the nature of the checks. If you conduct periodic background checks on current employees, best practice is to obtain a new authorization each time, especially if significant time has passed since the previous authorization. Some employers include language in the initial authorization that permits ongoing or periodic checks throughout employment, but this approach carries legal risks and may not be compliant in all jurisdictions.

Failing to use a proper Background Check Authorization Form can result in significant legal and financial consequences. Violations of the FCRA can lead to lawsuits, including class action litigation, with statutory damages ranging from $100 to $1,000 per violation, plus punitive damages and attorney fees. The Federal Trade Commission (FTC) and Consumer Financial Protection Bureau (CFPB) can also impose civil penalties. Beyond legal penalties, improper background check procedures can damage your company's reputation and make it difficult to attract quality candidates. Several major companies have faced multi-million dollar settlements for FCRA violations related to background check disclosures and authorizations.

No, you should not include a liability waiver in your Background Check Authorization Form. The FCRA specifically prohibits including liability waivers in the disclosure and authorization document. Courts have consistently ruled that including waiver language violates the FCRA's requirement that the disclosure be in a standalone document consisting solely of the disclosure. Including additional provisions like liability waivers, acknowledgments of employment-at-will status, or other unrelated terms can invalidate the authorization and expose your company to lawsuits.

While templates can provide a starting point, using a generic Background Check Authorization Form without customization is risky. Background check requirements vary by industry, position type, and location. A generic template may not address specific state law requirements or industry regulations that apply to your business. It's best to start with a template that's designed for your industry and then have it reviewed by legal counsel familiar with employment law in your jurisdiction. This ensures your form meets all applicable legal requirements while addressing your specific business needs.

Background Check Authorization Form: A Guide for Employers - North Carolina