The U.S. Equal Employment Opportunity Commission and the Federal Trade Commission recently joined forces to issue informal guidance explaining how federal anti-discrimination laws and the Fair Credit Reporting Act apply to the use of background checks in connection with personnel decisions.

On Monday, the agencies released a pair of technical assistance documents explaining the legal pitfalls associated with employers conducting background checks into applicants’ and employees’ criminal records, financial history, medical history, and use of social media. One document is for employers; the other is for job applicants and employees.

The guidance explains that, generally, it is not illegal for an employer to ask questions about an employee’s or applicant’s background, or to require a background check, except with respect to medical and genetic information (including family medical history).  The guidance advises employers not to ask any medical questions before making a conditional job offer.  Employers should only ask employees medical questions if there is objective evidence that the employee is unable to do the job or poses a safety risk because of a medical condition.

Moreover, employers must not use background information received from any source to discriminate based on age, race, color, or any other protected characteristic. Employers should make sure that they are seeking the same background information from all applicants or employees. The guidance also cautions employers to take special care when basing employment decisions on background problems that may be more common among people of a certain protected class.

When an employer receives a report from a company in the business of compiling background information, the guidance advises that the employer must follow a number of procedures. The employer must notify the applicant or employee, in writing in a stand-alone format, that the information might be used in making employment decisions. The employer must also obtain the applicant’s or employee’s written permission to conduct the background check. The guidance also outlines the FCRA’s requirements for employers to provide notice to employees or applicants when they have made an adverse employment decision based on information obtained through a background check.

While this guidance highlights potential dangers involved with conducting background checks of job applicants and employees, it should not deter employers from performing such checks. Employers should, however, review their background check procedures and confirm that the same questions are being asked of all applicants or employees. Employers should also ensure that they are complying with all of the FCRA’s notice requirements.