HR leaders have to stay in front of a lot of regulatory concerns. Maintaining compliance with the Fair Credit Reporting Act (FCRA) with background checks is undoubtedly one of them.
FCRA in the beginning
According to the Federal Trade Commission (FTC), the FCRA was enacted in 1970 to regulate the practices of consumer reporting agencies (“CRAs”) that collect and compile consumer reports for use by certain third-parties, including employers.
The FCRA has seen amendments since its inception, but the intention remains the same – to keep the use of consumer information fair and allow space for consumer privacy. The Electronic Privacy Information Center states the Act does this through “…rights of data quality (right to access and correct), data security, use limitations, requirements for data destruction, notice, user participation (consent), and accountability.” For employers, the FCRA has created specific requirements that must be maintained.
Staying in compliance
Requirements for employers that complete background checks with third-party screening companies can feel muddled with gray areas. Compounding the confusion is the fact that laws can be amended and interpretations of the laws can change quickly. For example, we’ve recently written on the unclear direction the Federal Trade Commission gave on what employers shouldn’t include in disclosure documents. Additionally, we have also discussed a recent Ninth Circuit court decision discussing the same disclosure requirements.
Because of the changing nature of the FCRA, as well as state and local laws and regulations, the best way to stay compliant is always to consult with your legal representation. We’ve also compiled a short checklist with a few basic requirements to help you think about obligations under the FCRA.
If you want to learn more about what Verified Credentials’ FCRA-compliant background checks are all about, schedule a consultation today.