The Importance of Updating FCRA Forms for Job Applicants and Employees

In September 2018, the Bureau of Consumer Financial Protection issued an updated version of “A Summary of Your Rights Under the Fair Credit Reporting Act,” one of the forms that employers who conduct background checks on applicants and employees must provide under certain circumstances during the hiring process and employment.

The Fair Credit Reporting Act (FCRA) permits employers to obtain “consumer reports,” which include credit information as well as driving and criminal records, but to be in full compliance, they must also provide the appropriate notices and disclosures. For example, before an employer may make an adverse decision against an applicant, they must provide a copy of the consumer report, as well as the Summary of Rights.

This notice informs the applicant or employee of their right to know the “name, address, and phone number of the agency that provided the information.” Moreover, it gives them a chance to dispute anything in the report or otherwise explain the circumstances surrounding the information contained in it.

Complying with FCRA requirements concerning consumer reports is critical for employers because, in addition to penalties outlined in the FCRA, they can face stiff penalties during litigation — including punitive damages— for any violations. Many such lawsuits are class actions brought by groups of job applicants and can be costly to defend. Therefore, the best strategy is to handle such issues with full FCRA compliance.

If you want to make sure you’re in full compliance with FCRA provisions, we can help. Send us a message or call us at (303) 894-8948 to get the conversation started.