What Employers Know About FCRA Requirements Makes a Big Difference

It’s an issue that’s tripped up plenty of companies lately.

 

FCRA (Fair Credit Reporting Act) rules govern the way companies do background checks. Those rules say, in part, that background checks can’t be done without consent. They also say notification must happen in a written, stand-alone format.

 

But, according to recent headlines, more than one major company has missed the mark when it comes to FCRA requirements.

 

Delta Air Lines just agreed to pay $2.3 million in a class action suit.  As part of the settlement, Delta admitted they failed to provide the stand-alone disclosures the FCRA requires.

 

And they’re not the only company.

 

Frito-Lay settled a similar suit in April 2018 for $2.4 million. FCRA mistakes cost Omnicare $1.3 million. A subsidiary of PepsiCo paid $1.2 million for FCRA violations. And in October 2018, the FTC got its largest civil penalty so far for FCRA violations— $3 million—from a tenant screening company.

 

There’s more news. An associate director at the FTC testified last summer that “vigorous” enforcement of FCRA law ranks high on the agency’s to-do list.

 

It’s always important for companies to know and understand screening laws. Situations like this emphasize the issue.

 

So, where do you start? Here are some of the basics.

 

Do your homework. Employment law may never be simple. But staying current on FCRA rules—and other hiring laws—will be a game changer.

 

Format matters. Maybe you did notify the applicant of a pending background check. But how you notify them matters.

 

Stay organized. Background checks are a process. Knowing and understanding the FCRA rules is one good way to make sure your process is organized and includes all the right elements.

 

Keeping up with the FCRA feeling impossible? It doesn’t have to be that way. Get support by connecting with the ClearStar team today.

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