As a business owner or HR professional, it’s important to understand the laws and regulations surrounding employment screening, including the Fair Credit Reporting Act (FCRA). The FCRA sets standards for the collection, use, and distribution of consumer credit information and applies to businesses that use consumer reports for employment purposes.
Here are some key points to keep in mind when it comes to the FCRA and employment screening:
Obtain Written Consent
Before obtaining a consumer report for employment purposes, you must first obtain written consent from the applicant or employee. This consent must be provided in a standalone document that clearly explains the purpose of the report and the applicant’s rights under the FCRA.
Provide a Copy of the Report
If you take adverse action (such as denying employment or promotion) based in whole or in part on the information contained in a consumer report, you must provide the applicant or employee with a copy of the report and a summary of their rights under the FCRA.
Perform an Adverse Action Notice
If you take adverse action based on a consumer report, you must also provide the applicant or employee with an adverse action notice, which includes the name, address, and phone number of the consumer reporting agency that provided the report, as well as a statement that the agency did not make the adverse decision and cannot provide the applicant or employee with the specific reasons for the decision.
If an applicant or employee disputes the accuracy of the information contained in a consumer report, you must investigate the dispute and report the results to the consumer reporting agency.
By understanding and complying with the FCRA, you can protect your business and ensure that you are making fair and informed hiring decisions. At TruDiligence, we specialize in FCRA-compliant employment screening and can help you navigate the legal requirements for background checks. Contact us today to learn more about how we can support your business.