Handling Adverse Events and Candidate Disputes for Background Checks by ClearCompany

For some candidates completing a background check, their screening report may return with a flag that indicates a matching criminal record or missing information. The candidate has the right to dispute the report's flagged findings and there are specific steps to take in order to remain compliant. Additionally, based on your organization's employment processes, these flags may disqualify a candidate from the position. Follow the guide below to learn how to initiate an adverse event or manage a candidate dispute.

In this article:
Adverse Event Process Summary
Send Pre-Adverse and Adverse Action Letters
Candidate Dispute Process
Additional Resources

Adverse Event Process Summary

Completed reports with flags can be seen by navigating to the Completed Reports tab of your Background Check Dashboard. A   flag icon will be listed in the flag column for the applicant row whose results returned a discrepancy that should be reviewed.

When your company decides not to move forward with a candidate due to the results of a background check, the following process must be completed in order to remain compliant.

1. Click on the name of the candidate from within the Completed Reports list.

2. Scroll to the Search Results section and locate the search(es) with flags.

   

3. Click on the name of the flagged search to review the details of the report. Repeat this step until all flagged searches have been analyzed.
4. If, after the background check is reviewed and an individualized assessment is complete, and it is decided that the report disqualifies the candidate from employment, send a pre-adverse action notice to the candidate using the steps listed below. 
5. The candidate is given a minimum of 5 business days to respond or to dispute the report. An applicant can follow the steps outlined here to complete this process.
   • If the candidate does decide to dispute the report, continue with the Candidate Dispute process outlined below.
6. If the candidate does not dispute or does not respond in the 5-day timeframe, initiate the final adverse action letter letting the candidate know you will not be moving forward with employment.

Send Pre-Adverse and Adverse Action Letters

When a flag has been found on a report, in order to comply with laws, there are emails and notices that must be sent to a candidate before withdrawing an offer. Below are the emails and the steps involved in this process. 

1. In the background check dashboard, navigate to Reports > Completed Reports.

   

2. Click on the name of the candidate from within the Completed Reports list.

   

3. On the candidate report, scroll to the Disclosures and Forms section.

   

4. From the Select Disclosure or Form dropdown menu, select the letter/form to send to the candidate. The use cases for each letter are listed below.
   • Pre-Adverse Action: This is the first email that should be used alerting the candidate that there was an issue with their report that has disqualified them from employment.
   • Once sent, the candidate has 5 days to respond with any desire to dispute the background check results. If deciding to dispute, the email provides instructions on how to do so but you can also send the candidate this article. If 5 days have passed with no response, use the appropriate Adverse Action letter (based on their hiring status) to indicate that you will not be moving forward with employment. 
   • Adverse Action (Employment Denial): After a pre-adverse action notice has been sent, this letter is used when no offer has been extended to the applicant but your company has decided not to move forward with employment based on the background check results. 

   • Adverse Action (Employment Withdrawal of Offer): After a pre-adverse action notice has been sent, this letter is used if an offer letter has already been extended to the applicant but your company has decided to withdraw employment based on the background check results. 

       If you would like to customize the contents of these letters, or the email sent to the candidate, please reach out to [e-mail].

5. To send the selected letter, click Email. Confirm by clicking Yes.

   

     During this step, based on state regulation and compliance, you may be asked to enter the specific reason for employment denial.

6. Once the email has been sent, a timestamp of the letter's history will be stored in the Client Notes section.

   

Candidate Dispute Process

If a candidate decides to dispute the background check results, we advise not to fill the role until the claim is investigated and the final report is delivered. Follow the steps below to manage a candidate dispute claim.

1. After receiving the Pre-Adverse Action letter, the candidate is alerted to the flag on the report and given the option to dispute or respond.

2. The applicant is advised to fill out the Candidate Dispute Form. A visual example of this form can be viewed below and a PDF copy of the form is listed here.

   

3. Once ClearCompany receives the form and decision to dispute the background check results, your organization will be notified of this request. It is advised to wait on any final employment decisions for this role until the dispute is resolved.
4. ClearCompany's research team will immediately investigate the candidate's claim.
5. Once the research is completed, both you and the candidate are notified of the final results and provided with a final report.
6. You will determine if the report disqualifies the candidate from the role or if you would like to move forward.

Additional Resources

To review or download a PDF copy of the adverse action and candidate dispute forms, reference this article. Instructions for how the candidate should dispute a background check report can be found in this article, which can be shared with the applicant directly.