Texas Pre-Employment Background Checks for Employers

Running Texas pre-employment background checks legally comes down to a short list of obligations: give the applicant a standalone written disclosure and get written authorization before pulling the report, stay inside the seven-year reporting window (ten years for bankruptcies, with an exception for jobs paying $75,000 or more), judge criminal records by their connection to the job rather than by blanket rules, and follow the two-step adverse action process before rejecting anyone based on what the report shows. Federal law and Texas Business and Commerce Code Chapter 20 set the framework, and two Texas cities add timing rules of their own.

Disclosure and Authorization Before You Pull the Report

Before ordering a background report through a consumer reporting agency, an employer has to do two things under the federal Fair Credit Reporting Act. Give the applicant a written notice stating that a consumer report may be obtained for employment purposes, and get the applicant’s written authorization. The notice has to appear in its own standalone document. It cannot be tucked into a job application, an employee handbook, or any other paperwork.¹ The authorization is allowed to sit on the same page as the disclosure, so a single-page form can satisfy both requirements.²

This is one of the most heavily litigated provisions in the FCRA. Class actions over disclosure forms that bundle extra language with the required notice have produced significant settlements across industries. Keep the disclosure clean and separate.

Investigative Reports Need Extra Notice

Some employers go beyond database searches and commission investigative reports that include personal interviews with neighbors, coworkers, or acquaintances about the candidate’s character and reputation. These reports trigger a second layer of disclosure. The employer must notify the applicant in writing within three days of requesting the investigative report, and the notice must explain the applicant’s right to request a description of the nature and scope of the investigation. If the applicant asks, the employer has five days to respond in writing.³

What You Can Look At, and How Far Back

Criminal records draw the most attention. Employers search county-level databases, state repositories maintained by the Texas Department of Public Safety, and federal court records for felony convictions, misdemeanor charges, and pending cases. The depth of the search tends to track the role. A warehouse position might warrant only a county-level check, while a financial analyst role could call for a multi-state or federal search.

Credit reports come into play for positions involving money handling, access to sensitive financial data, or fiduciary responsibilities. Motor vehicle records matter when the job requires driving a company vehicle or operating heavy equipment. Employers also contact past employers and schools to confirm job titles, dates of employment, and degrees earned.

Texas Business and Commerce Code Section 20.05 caps how far back a consumer reporting agency can go when assembling a report. The general rule is seven years, but the clock starts in different places depending on the record type:

Criminal records: seven years from the date of disposition, release, or parole, not from the date of arrest. An arrest that produced a conviction with a release date in 2020 is still reportable in 2026 even if the arrest itself is older than seven years.
Suits and judgments: seven years from the date of entry, or the governing statute of limitations, whichever is longer.
Tax liens: seven years from the date of payment.
Bankruptcies: ten years from the date the order for relief was entered.
All other negative items: seven years from the date of the event.

These caps apply to every background report generated by a consumer reporting agency in Texas.⁴

The $75,000 Salary Exception

When a position has an expected annual salary of $75,000 or more, the seven-year cap disappears. The reporting agency may include older criminal records, judgments, and other negative items that would otherwise be excluded.⁴ The federal Fair Credit Reporting Act has a parallel carve-out, so state and federal law line up on this point.

Using Criminal Records Without Creating Discrimination Exposure

Title VII of the Civil Rights Act applies to Texas employers, and the EEOC has issued enforcement guidance explaining that blanket policies rejecting anyone with a criminal record can violate Title VII if they disproportionately screen out a protected group and are not justified by business necessity.⁵ The Texas Workforce Commission takes the same position, advising that any inquiry into criminal history should be job-related and that the employer should be able to explain how a specific offense, given its nature and recency, creates an unreasonable risk for the specific position.⁶

The EEOC recommends a targeted screening approach built around three factors drawn from Green v. Missouri Pacific Railroad:

The nature and gravity of the offense. A theft conviction weighs more heavily for a bank teller role than for a landscaping role.
The time that has passed. A fifteen-year-old offense carries less weight than one from last year.
The nature of the job sought. The offense should have a real connection to the duties and responsibilities of the position.

Beyond applying the three factors, the EEOC advises conducting an individualized assessment before rejecting a candidate. Notify the applicant that the criminal record may be a problem, give them a chance to provide context (rehabilitation, stable work history since the offense, evidence that the record is inaccurate), and genuinely consider that information before making a final decision.⁵

One boundary worth knowing: Texas law lets eligible applicants have arrests expunged or convictions sealed through an order of nondisclosure. Expunged records are erased, and sealed records are generally hidden from private employers, so neither will appear on a standard background check and applicants are not required to disclose them.⁷

Local Timing Rules in Austin and DeSoto

Texas has no statewide ban-the-box law, but Austin and DeSoto have adopted local fair chance hiring ordinances that apply to private employers. Austin’s ordinance, in effect since April 2016, covers private employers with 15 or more employees. It prohibits covered employers from asking about criminal history on the job application or during an interview, and it bars running a criminal background check until after a conditional offer of employment has been extended.⁸

The ordinance does not apply to employers with fewer than 15 employees, government employers at any level, public school districts, or employers headquartered outside Austin that have fewer than 15 workers primarily based in the city. Covered employers still have full authority to run a background check and reject candidates based on criminal history. The ordinance controls only the timing. DeSoto has a similar ordinance covering private employers within its jurisdiction.

The Adverse Action Process

When a background report contains something that makes you consider not hiring, the FCRA requires a two-step notification process. Skipping either step is one of the fastest ways to land in court.

Pre-Adverse Action Notice

Before making a final decision, send the applicant a copy of the background report that influenced the decision along with a written summary of the applicant’s rights under the FCRA.¹ The point is to give the applicant a chance to review the report, catch errors, and dispute inaccurate information with the reporting agency before you act.

The FCRA does not set an exact waiting period. Most employers allow at least five business days, which courts and the FTC have treated as reasonable. Deciding the same day you send the notice undermines the purpose of the step and invites a lawsuit.

Final Adverse Action Notice

If, after a reasonable wait, you still decide not to hire, send the final adverse action notice. It must include the name, address, and phone number of the consumer reporting agency that furnished the report, a statement that the agency did not make the hiring decision, and notice of the applicant’s right to dispute the report’s accuracy and to obtain an additional free copy of the report within 60 days.⁹

Drug Tests, Social Media, and Other Screens

Texas has no comprehensive state statute governing workplace drug testing for private employers, which gives businesses broad discretion over their own policies. Employers can require pre-employment drug tests, random testing, and post-accident testing as conditions of employment, and refusal to submit is generally treated as grounds to withdraw an offer or terminate employment. Safety-sensitive positions regulated by the federal Department of Transportation follow a stricter, nonnegotiable framework that employers cannot customize. Texas has not legalized recreational marijuana and does not require accommodation of off-duty use, so a positive THC result on a pre-employment test remains a lawful basis for denying employment. CBD products containing trace THC can trigger that result.

Social media screening is also loosely regulated here. Roughly half of U.S. states restrict employer access to private social media accounts, but Texas is not among them. An employer in Texas can legally ask a job applicant for login credentials, though many employers avoid it because of reputational risk and the chance of encountering protected information (religion, disability status) that could complicate later discrimination claims. When you hire a third-party service to compile a social media report, that report qualifies as a consumer report under the FCRA, and the disclosure, authorization, and adverse action rules apply the same as they would for a criminal background check.

What Screening Costs

Professional background screening services typically charge between $25 and $200 per candidate depending on the scope. A basic county criminal check sits at the low end, while a package covering criminal records in multiple jurisdictions, credit reports, education verification, and employment history runs toward the higher end. Employers generally absorb these costs and cannot pass them on to applicants.

1
Office of the Law Revision Counsel. 15 USC 1681b – Permissible Purposes of Consumer Reports
2
U.S. Equal Employment Opportunity Commission. Background Checks: What Employers Need to Know
3
Office of the Law Revision Counsel. 15 USC 1681d – Disclosure of Investigative Consumer Reports
4
State of Texas. Texas Business and Commerce Code Section 20.05
5
U.S. Equal Employment Opportunity Commission. Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions
6
Texas Workforce Commission. References and Background Checks
7
State of Texas. Texas Government Code Section 411.0725
8
AustinTexas.gov. Fair Chance Hiring
9
Federal Trade Commission. Using Consumer Reports: What Employers Need to Know