There are a number of ways for employers to gather information on the background of an applicant for employment. Employers may simply call an applicant's former employer to confirm the applicant's dates of employment and title and to try to obtain a more detailed reference from a supervisor. However, more and more frequently, employers are hiring third parties to conduct background checks on applicants who have been offered employment. In addition, depending on the nature of the position, employers are requesting reports about an applicant's driving record, criminal record, and/or credit history. There are often legal limits on employers obtaining and using this type of information. When employers hire a third party to conduct a background check or to obtain reports from outside agencies, such reports are subject to the federal Fair Credit Reporting Act (FCRA) and state laws. In Texas, employers must comply with laws related to consumer reports, criminal background checks, and driver's record information.
In addition to the FCRA, Texas employers should be aware that there is a state law regulating consumer reporting agencies. The state law permits employers to obtain consumer reports for employment purposes. However, unless the employee or prospective employee will be making more than $75,000 per year, information contained in the consumer report generally may not date back more than 7 years from the date of the report. This includes information regarding arrests, indictments, and convictions of crimes. In addition, a consumer report obtained for employment purposes may not include medical information (TX Bus. Code Sec. 20.05).