A Nonprofit Guide to Fair and Compliant Background Checks
In the nonprofit world, every hiring decision tells a story. It’s not just about who joins your team; it’s also about the values your organization upholds. When navigating background checks, especially those involving criminal convictions, nonprofits can approach the process with integrity, legal awareness, and compassion.
This guide has been created to help nonprofit leaders handle these situations with confidence and care while remaining true to their mission.
Where Law and Fairness Meet
Know the Landscape
Understanding the legal landscape around background checks is crucial. Laws are not one-size-fits-all. Federally, the Fair Credit Reporting Act (FCRA) sets specific requirements, including getting written consent from a candidate before conducting a background check through a third party. If something in the report might affect your hiring decision, you must provide a copy and explain their rights. This knowledge empowers you to make informed and fair decisions.
On the state and local level, many regions have passed “ban-the-box” laws, which limit when and how employers can ask about criminal history. These policies help ensure candidates are first evaluated for their skills and experience rather than being screened out too early.
Rethinking the Hiring Timeline
Fair chance hiring laws, like the Fair Chance Act, go a step further. These rules delay background checks until a conditional job offer is made. The idea is simple: give people a genuine chance to be seen for who they are today, not only for mistakes made in the past.
Leading with Thoughtfulness
Make Room for Context
When you discover a criminal conviction on someone’s record, it’s important not to jump to conclusions. Take the time to assess each case individually. Look at how much time has passed, whether the offense is relevant to the job, and what the person has done since. For instance, if the offense was a non-violent crime committed many years ago, and the individual has since demonstrated a commitment to rehabilitation through education or community service, this could be considered in their favor.
For example, a decades-old, non-violent conviction may have little bearing on someone’s ability to succeed in a role today. Personalized reviews like this demonstrate fairness and reduce the risk of unconscious bias.
Invite Conversation
Before you finalize a decision based on a background check, take time to talk with the candidate. Let them explain the situation in their own words. Many individuals have taken meaningful steps toward change through education, community service, or consistent, reliable work. Creating space for that story is not only respectful; it’s also smart hiring. This open communication makes candidates feel respected and considered.
Follow the Right Steps When Saying “No”
If a conviction does raise concerns that the job candidate can’t resolve, and you decide not to move forward with the hire, there are legal steps you must follow. This responsible and fair approach helps to ensures that the candidate is treated with respect and fairness.
Step 1: Send a Pre-Adverse Action Notice
This notification is a heads-up to the candidate that something in the background check may affect their chances. Please include a copy of the report and information about their legal rights along with the notice. This gives them a chance to correct any errors or offer additional context.
Step 2: Send a Final Notice
If you choose not to move forward after reviewing any new information, you’ll need to send an official notice. The notice should clearly state your decision and explain how the individual can dispute the report if required.
Strengthening Your Internal Practices
Keep Your Policies Current
Laws change, and so do expectations around equity in hiring. Make it a habit to review your background check policies regularly. Your documentation should spell out how and when checks are done, how results are reviewed, and what steps are followed for adverse action.
Educate Your Team
Anyone involved in hiring, from HR managers to executive leadership, must understand the legal rules and human impact of these decisions. Ongoing training can reinforce best practices and reduce the risk of missteps.
Steps You Can Act on Now
- Review Your Current Process – Take a fresh look at your background check procedures. Are they in line with the latest regulations and your organizational values?
- Put It in Writing – Develop or update written policies that outline how you handle background checks and criminal histories.
- Train Thoughtfully – Schedule regular training for hiring professionals, focusing on compliance, equity, and communication skills.
- Talk to Legal Counsel – If your policies haven’t been reviewed recently, contact a legal expert to ensure they are up to date.
- Lead with Inclusion – Make a conscious effort to remove unnecessary barriers. Support candidates who are rebuilding their lives.
Hiring fairly and legally doesn’t have to be complicated. It just requires intention. By approaching background checks with clarity, empathy, and an eye toward equity, you’re not just protecting your organization; you’re also building a team that truly reflects its values.
501 provides industry leading screening services at discounted rates to allow you the ability to engage the best talent available. If you are a client of 501, whether you are a Trust member or an HR Services subscriber, you have access to our program through First Advantage. For more information on background check services, hiring, and other HR issues and challenges you may have, reach out to us at HRServices@501c.com or (800) 358-2163.
About Us
For more than 40 years, 501(c) Services has been a leader in offering solutions for unemployment costs, claims management, and HR support to nonprofit organizations. Two of our most popular programs are the 501(c) Agencies Trust and 501(c) HR Services. We understand the importance of compliance and accuracy and are committed to providing our clients with customized plans that fit their needs.
Contact us today to see if your organization could benefit from our services.
Are you already working with us and need assistance with an HR or unemployment issue? Contact us here.
The information contained in this article is not a substitute for legal advice or counsel and has been pulled from multiple sources.
Images by: Annatolipova and Namii9.
