In 2019, the phrase “FCRA Lawsuit” will still turn heads when mentioned in a law practice. In fact there were over 4,200 FCRA lawsuits in 2018 alone. These lawsuits are still causing headaches for employers and their human resource departments. Settlements, some in the multi-millions, have been reached for companies and institutions including: Amazon, Stanford University, Pepsi Co and Target to name a few. FCRA litigation damages can range from $100 to $1,000 per violation which can be a financial burden on any size organization. But there is some good news! Employers can use companies such as SwiftCheck which offer a fully FCRA compliance screening and adverse action process. Here are the 5 requirements that prevents HR from an FCRA lawsuit:
The applicant must be informed, prior to the request, that a background check will be performed on them. Additionally, this disclosure a stand-alone document that is separate from other hiring forms.
Applicant’s must provide written consent via an authorization form that allows the employer to conduct a background check report. This form must be signed by the applicant either physically or digitally.
Pre-Adverse Action Notification
If an employer believes that the contents of the background check report may lead to an adverse hiring decision, the employer must share that with the applicant. Additionally, a copy of both the background check report and the applicant’s Summary of Rights must be provided.
Reasonable Time for the Applicant to Dispute
Once the applicant receives their pre-adverse information, employers must provide “reasonable” time for the applicant to dispute the contents of the report. Through the FCRA does not provide a specific time frame, a 1997 Federal Trade Commission (FTC) opinion letter states that 5 days appears reasonable.
If an applicant disputes the information in the report the employer must: provide them with the completed report, an adverse action letter, Summary of Rights and the contact information of your screening providers compliance department. This will ensure that the applicant receives all everything needed to dispute the contents of the report.
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