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.
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Key Things to Know
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The Background Check Authorization Form must be a standalone document, separate from your employment application and other onboarding paperwork.
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You must provide a clear disclosure that you will be conducting a background check and obtain written authorization before proceeding with any background screening.
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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.
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Different types of background checks (criminal, credit, driving records, etc.) may have different legal requirements and restrictions depending on your state and industry.
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Keep signed authorization forms on file for at least the duration of employment plus any applicable statute of limitations period for potential claims.
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Review and update your Background Check Authorization Forms regularly to ensure continued compliance with changing laws and regulations.
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Consider working with a reputable background check provider that understands compliance requirements and can help you navigate the legal landscape.
Key decisions before you file
Before you file a Background Check Authorization Form in North Carolina, a few decisions shape the document: which option to choose and what each one means. The Background Check Authorization Form guide walks through them.
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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.