Educational Series

As the business world increasingly goes global, even small or medium-sized companies may have international outposts or employees located beyond the U.S. border. In addition, with security – both physical and digital – an important issue, employers want to know everything they can about their employees.

Many employers are turning to international background checks. But a criminal record or a credit report like those used in the United States can get lost in the translation.

First up: cultural norms. What may seem perfectly routine and acceptable in the United States may confuse or offend those in other countries. For example, things like credit checks and drug tests are virtually unheard of abroad and cultural differences may yield what might by American standards be unusual answers in a personality test. A second important consideration: the law. Just as the U.S. has the Fair Credit Reporting Act (FCRA) and other regulations setting the boundaries of background checks, foreign jurisdictions have their own laws of the land. The French Labor Code, for example, requires that its “works council” review employment screening procedures prior to an employer’s use.

One huge legal complication can be found in the area of privacy law. The European Union imposes restrictions on obtaining information about employees or applicants, the way in which such information can be used, and how the information can be shared or transmitted. To alleviate some of the liability concerns, the U.S. has entered into a Safe Harbor framework with the European Commission, which requires compliance with seven principles of data security. And while the EU leads the pack, other countries (like Australia, Canada, Hong Kong, and Japan) also pose challenges with their strict regulation of privacy.

Having an applicant sign a consent form to release information may be of little help as several EU countries also recognize a presumption against enforcement of such agreements on the basis that employees and applicants have limited bargaining power in the employment context. Alternatively, employers may have better luck by having applicants do the work themselves, providing their own background information to avoid implicating data privacy laws. Of course, this raises authentication and accuracy questions.

The collection of criminal information can also present logistical challenges. Many countries do not have an organized court system, and records, if available, may have to be searched on a regional or town-by-town basis, or at multiple agencies (like the police, the court venue and a government agency, for example). Certain countries offer what is known as a “police certificate” which will confirm the information about an applicant found in police records. Some countries, like Poland, have banned the collection of criminal records altogether; Spain prohibits the possession of records but an applicant could, in theory, show an employer his or her record.

If the screening is being conducted by a consumer reporting agency located in the United States, the FCRA requirements also come into play. International background checks are not impossible, but they do pose a number of legal and cultural risks that can be tackled with the right planning and professional assistance from an experienced background screening company.