Now more than even employers must adhere to specific federal and state laws when conducting employment background checks. There has been an increase in class action lawsuits brought against employers for violating such laws, specifically the Fair Credit Reporting Act (FCRA). We wanted to highlight 5 reasons how employers can easily fall prey to noncompliance:

  1. Disclosure and Authorization form buried in the employment application. This is a very simple rule that majority of employers break. The FCRA specifically says that a disclosure form must be completed by the subject of the report consisting solely of the disclosure (and must be on one page), separate from any other internal documents.
  1. Not providing the consumer with rights under the FCRA. Anytime an employer elects to run a background check for employment purposes, then they must provide a document explaining to the consumer their rights under the Fair Credit Reporting Act (FCRA Summary of Rights). This notice is 3 pages long and MUST be provided to every single application residing in the United States.
  1. Utilizing records that are older the 7 years. Employers must only use criminal records that result in a conviction not older than 7 years from the date of disposition. Unfortunately employers are unware of this due to the lack of information provided by the 3rd party background screening vendor, resulting in potential liability to the employer (especially if the applicant isn’t hired due to inaccurate information being reported).
  1. Making and employment decision based on criminal records that didn’t result in a conviction. This is where employers are really getting in trouble with regards to non-compliance. The FCRA explicitly states that only convictions are reportable on an employment background check. Therefore if you are an employer and are receiving records with these types of dispositions it may be a good idea to switch background screening vendors:
    • Dismissed
    • Expunged
    • Pending
    • Not Guilty
    • Deferred
    • Sealed
    • Not Prosecuted
  1. Not allowing the subject of the report to review and dispute the findings. When an employer decides to take adverse action based on the results of an employment background check then they must follow the pre-adverse/adverse action process. Essentially it allows the applicant an opportunity to view the background report procured, and identify any inaccuracies. If there are any issues with the report they the applicant is able to contact the background screening company and dispute the findings.