Employers running background checks on their employees must adhere to the laws set forth by the Fair Credit Reporting Act (FCRA). The consequences of violating these rules can be serious including litigation lawsuits. Even the Federal Trade Commission (FTC) has taken action against some employers for breaking these rules.
The best advice to stay away from trouble is to start by reviewing your current background screening practices, especially following the consent and disclosure requirements. Make sure you are using a basic one page disclosure and release form which applicants sign before any background checks are conducted. Do not add any language to this form regarding liability waivers.
If obtaining consent with an online process, make sure the form is displayed on one screen by itself without any other content added. In addition, if you plan to obtain periodic background checks throughout an employee’s tenure, it must be stated as such on the disclosure.
You also need to maintain a backup of your disclosure forms for a minimum of five years from the original date. If there will be adverse action taken as a result of partially or wholly relying on the information in a background report, you must send a pre-adverse action letter to the applicant which gives them at least five business days to respond and dispute the findings. You also must provide a copy of the consumer report and an updated Summary of Rights document.
Lastly, you must follow both federal and state laws regarding consumer reports. Keep in mind, that some states have additional restrictions on the type of information you are allowed to request. The best way to avoid any problems is to work with a company like United Background Checks LLC, which follows a very stringent compliance process, which is completely dialed into the FCRA requirements.