PRE-EMPLOYMENT BACKGROUND CHECKS
Legal Information Regarding Pre-Employment Background Checks
Running pre-employment background checks with PublicInfoGuide.com can be a valuable
step in learning more about perspective employees. Using pre-employment background checks
when making hiring decisions, however, requires employers to follow certain legal compliance
guidelines. At the federal level, legal information regarding pre-employment background
checks is governed by the Federal Trade Commission (FTC).
For state- or city-level legal information regarding pre-employment background checks,
you may want to start by looking at your state's web site.
What follows, however, is a quick look at the most prominent issues and processes
associated with pre-employment background checks.
Getting Permission
As mandated by the Fair Credit Reporting Act (FCRA), employers must get written
authorization from applicants before conducting pre-employment background checks. The
authorization document for conducting a background check must also be on a document that
is separate from all other documents (i.e., employment applications or other application
materials).
In addition to mandates by the FCRA, individual states may also have laws further
governing the permission seeking process. For example, California law stipulates that at
the time an employer gains permission to conduct pre-employment background screening, the
employer should tell the prospective employee that he or she may also request a copy of
the report.
As a matter of precaution, it is recommended that you have a familiarity with local
and state laws regarding permission seeking for pre-employment background checks.
Adverse Action
Making the choice not to hire an applicant based on information gathered from a
pre-employment background screening is known as taking adverse action. Should you
decide to take adverse action, there are
well-defined compliance steps to be followed.
For exact legal phrasing, you can consult
section
604(b)(3) of the FCRA; it deals specifically with using pre-employment background
checks, in whole or in part, when making an adverse action decision in regards to employment.
In short, however, the FTC requires employers using all or part of a consumer report as
the basis for making a "no-hire" decision to follow two processes known as pre-adverse
action disclosure and adverse action notice.
When issuing pre-adverse action disclosure, an employer is required to provide the
applicant to whom the report pertains with:
- a copy of the report; and
- a written description of the applicant's rights per the FTC under section 609(c)(3)
of the FCRA.
After an employer has taken adverse action, the employer must then give the
applicant written, oral, or electronic notice that action has been taken in an adverse
action notice. When issuing adverse action notice, an employer is required to
provide the applicant with:
- contact information for the consumer reporting agency that supplied the report,
including name, address and phone number;
- a statement declaring that the consumer reporting agency supplying the report is
not responsible for the decision to take adverse action and offers no reasons for it; and
- notice that the applicant has the right to dispute the accuracy or completeness of
any information presented by the consumer reporting agency, and his or her right to
another free report from said consumer reporting agency if so requested within 60 days.
Repercussions from Non-Compliance
For employers who do not seek permission prior to running pre-employment background
checks or who fail to follow appropriate procedures in regards to pre-adverse action
disclosure and adverse action notice, there can be legal consequences. Applicants who
are victims of an employer's non-compliance in conducting or using pre-employment background
checks may sue the offending employer in federal court. In such cases, applicants are
entitled to sue prospective employers for court costs, legal fees, and even punitive damages
if such compliance violations are deemed deliberate.
Further, the FTC and state agencies also have the right to sue for non-compliance in
pre-employment background screening, and obtain civil penalties as a result.
Regarding Information Provided by PublicInfoGuide.com
When compiling pre-employment backgrounds checks, PublicInfoGuide.com provides public
information gathered from a variety of sources, including local, city, state, and even
federal governments, as well as businesses that collect and resell information and makes
them available online. PublicInfoGuide.com is not a consumer reporting agency, and as
such, is not the owner of the information provided. Additionally, PublicInfoGuide.com is
not authorized to provide "official" copies of reports supplied as part of pre-employment
background checks.
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