Helpful Compliance Guidance for End Users of Consumer Reports

You may already know that the federal Fair Credit Reporting Act (FCRA) is the primary legislation regulating the procurement and use of a consumer report (a background screening report from A-Check Global, for example). In fact, A-Check is required to distribute a simplified document—Notice to Users of Consumer Reports: Obligations of Users Under the FCRA—that illustrates End User requirements.

Adding even more complexity to compliance focus—regulatory compliance for domestic consumer reporting also includes state and jurisdiction consumer reporting laws with additional procedures and disclosures.

Sound like a lot to keep up with? It is, and that’s why we’re your partner in the process.

This topic can become very confusing, very quickly. Regulatory compliance can be a lot for employers to digest while also depending on background screening reports to make ongoing hiring decisions. While many organizations may believe the background check company is solely responsible for the entire scope of every background screen, the reality is it’s a shared responsibility between those requesting a consumer report (the End User) and the company compiling the consumer report (A Consumer Reporting Agency like A-Check).

Your responsibilities as an End User:

It is recommended that your organization develop a background screening program and policy to ensure you’ve got a consistent process in place that can be regularly audited and adjusted if necessary. What’s more, this comprehensive documentation will go a long way in providing a defense should you experience a legal complaint from an applicant.

We welcome the opportunity to answer any questions you may have about your own background screening program, but in the meantime, A-Check has developed the following checklist to help you quickly gauge your organization’s current level of regulatory compliance for the end use of consumer reports in the hiring process:

PERMISSIBLE PURPOSE:
Ensure that your teams understands the permissible purpose for obtaining a consumer report and that you have certified with your Consumer Reporting Agency (A-Check, for example) that you’ll comply with the federal Fair Credit Reporting Act and all other legislation regulating the use of consumer reports.

DISCLOSURE:
Identify and carefully construct each of the required Disclosures for your process. Consider federal and state law, in addition to including all necessary language based on the type of information you include in the consumer report used for screening job applicants. For example:
– Consumer Report Disclosure
– Investigative Consumer Reporting Disclosure
– California Investigative Consumer Report Disclosure & check box requirement
– Credit Report Disclosure

AUTHORIZATION:
Craft a compliance Authorization form for signature. For example:
– Consumer Report Authorization that states “I authorize” the background check
– State required notices for Minnesota, New York, Oklahoma, Washington & check box requirements
– Personal Identifying Information form if applicable
– FCRA Summary of Rights
– If applicable, a compliant e-signature process

EVALUATION CRITERIA:
Standardize evaluation criteria based upon the characteristics and requirements of the job and not based on the characteristics of what is found in a consumer report.

DECISION:
A decision to hire is easy—simply onboard your applicant. However, the adverse decision not to hire based on the contents of a consumer report must be executed flawlessly each time a candidate is denied a job, including A) Pre-adverse—a dispute waiting period of 5 days, and B) Adverse communication. It is important to follow the FCRA process and applicable legislation like Ban the Box, etc. For example:
– FCRA: Pre-adverse Communication, EEOC form, copy of the report, and Summary of Rights
– Pre-adverse Ban the Box requirements including forms in Los Angeles and New York City
– Final Adverse Communication with state required notices for New Jersey, New York, & Washington
– Final Adverse Ban the Box requirements including forms in Los Angeles and New York City

Have questions about your current background screening program? We welcome your call, and we’re happy to help.

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