Key provisions of the Fair Credit Reporting Act
We comply with the Fair Credit Reporting Act, which promotes the accuracy, fairness, and privacy of consumer information, protecting candidates from false information in their credit reports.
Before you can order a consumer report for employment purposes, you must notify the individual in writing – in a document consisting solely of this notice – that you are using the report. You must also get the person's written authorization before you ask a CRA for the report. (Special procedures apply to the trucking industry). If you want the authorization to allow you to get consumer reports throughout the person's employment, make sure you say so clearly and conspicuously. It's a good idea to review applicable laws of your state related to consumer reports. Some states restrict the use of consumer reports – usually credit report – for employment purposes.
If you rely on a consumer report for an "adverse action" – denying a job application, reassigning or terminating an employee, or denying a promotion – be aware that:
After you've taken an adverse action, you must give the individual notice – orally, in writing, or electronically – that you have taken the adverse action. The notice must include:
Maintaining an excellent candidate experience is more important than ever. Read our latest blog post on what you need to focus on as we slowly enter our post-pandemic world.
Now is the time for human resource departments to re-evaluate their processes as organizations begin to plan for the return to the workplace.