Background Checks for Sub Contractors

I work for a pharma consulting company and we are currently looking to hire a subcontrator in our offices in CA. The hiring manager is requesting HR to conduct a background check on the subcontractor. Is it legal to conduct background checks on subcontrators?


  • 4 Comments sorted by Votes Date Added
  • If your state law allows it, I don't see why not. Depending on what type of work in the pharma industry, some type of clearance may even be required by state law (i.e., for those handling or distributing narcotics). You should clearly state what type of checks will be run, and obtain a signed consent to do the check.
  • It is perfectly legal to background check a subcontractor as company, and their personnel as individuals.

    If you purchase the background check from a 3rd party, instead of performing it with in-house expertise, there are some limiting laws.

    a) Fair credit reporting act (FCRA)

    b) Americans with Disabilities Act

    c)  Driver's Privacy Protection Act (DPPA)

    d) and specific state laws, like Consumer Protection laws in Calif.

     Nationally, the FCRA says the disclosure
    and consent requirements of employers who use "consumer reports." Such
    reports might consist only of a credit check. More extensive reports might include criminal histories, driving
    records, and interviews with neighbors, friends and associates.

    be covered by the FCRA, the Federal Trade Commission (FTC) says that a
    report must be prepared by an outside company -- a "consumer reporting
    agency" or business that "for monetary fees, dues, or on a cooperative
    nonprofit basis, regularly engages in ... assembling ... information on
    consumers for the purpose of furnishing consumer reports to third
    parties." (FCRA §603f)

    the FCRA, the employer must obtain the applicant's written
    authorization before the background check is conducted. The
    authorization must be on a document separate from all other documents
    such as an employment application. In California, at the time an
    employer obtains permission for a background check, the applicant or
    employee should also be told that he or she may request a copy of the report. The FCRA, in contrast, says the subject is entitled to a copy of the report if a pre-adverse notice is given.

    federal law, if the employer uses information from the consumer report
    or background check for an "adverse action" - that is, denying the job applicant,
    terminating the employee, rescinding a job offer, or denying a promotion.


  • Is there any law which covers who is to pay for a background check for an independent contractor?

    The firm that I contract for, wants to initiate a background/drug test for the contractors.

    However, they want the contractor to pay $100.00.

    I have been led to believe that Colorado requires the that these costs not be passed down to either the employee OR the contractor.

    My state only covers employees. 

  • With consent and legitimate business interest, you can pretty much do a background check on anyone.  FCRA is a big deal and involves consent and notification in the event of any negative effects contemplated due to the results of the background check(s).  There are other laws in place as well, outlined by another poster.  That 's all easily available information and not too difficult to comply with.

    The meat of your question is about who can be negotiated into having to pay for this stuff.  I would be surprised if contractors were covered by that kind of legislation but I haven't passed the Coloarado state bar exam and I recommend that you contact someone who has [:D]  If your company or the contracting firm wants to pay, I'm sure that's not a problem.  If the contracting firm wants their sub-contracted individuals to pay, I'm sure they can do so unless there is in fact state law on the matter.  If the sub-contracting firm has employees, it gets more messy and depends on the state of employment of the employees and pre-existing written agreements.  I'm not sure we could even do that in Texas, which is pretty easy on payroll deductions.

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