Employers Caveat: Why you MUST procure signed background check authorization

Just recently, a class action lawsuit claiming infringement of the Fair Credit Reporting Act (FCRA) was settled in the amount of $2.6 million. See Hall v. Vitran Express, Inc.
A former job applicant (lead plaintiff) in this class action lawsuit complained that due to defendant's manifested inability to procure signed authorization releases from potential job seekers before obtaining criminal background checks, their FCRA rights were violated. In addition, defendant failed to provide an FCRA compliant adverse action letter to their job applicants whom were rejected due to blemishes in their past criminal and credit records. From the surface, it appears as the employer (defendant) made substantial efforts in mantaining a safe workplace as well as avoiding a negligent hiring lawsuit due to no due diligence action on their behalf. But for some unstated reasons, they made the mistake of not notifying the applicant's to obtain their signed consent acknowledgement.

"The justified purpose of an FCRA adverse action letter is to provide the applicant the reasons for their disqualification and how to dispute the findings. To fully comply with those requirements, the employer or landlord must provide employee or tenant with a copy their background check report in addition to a copy of the FCRA summary of consumer rights."

Accordingly, employers should review their current human resources department's hiring policy to determine whether they abide by the FCRA guidlines and all pertinent state and local laws relevant to using criminal background checks and consumer credit reports when reviewing an applicant's employment opportunity in their workplace.

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