Is Your Hiring Process Completely FCRA Compliant?

If not, your company could quickly be in the same situation as a large trucking conglomerate, which was recently ordered to pay $4.4million to settle a class action suit claiming that it fa...iled to disclose to more than 10,000 job applicants that they can access their consumer reports for free and contest background checks used in the hiring process.

The lead plaintiff also alleged that the trucking company conducted a background report on him without proper authorization and that he did not get the job as a result of that report. The complaint does not disclose the information included in the criminal background check, nor whether it was accurate. It does, however, allege that the company’s decision not to hire him was based on the report without informing him of the reason, which is in violation of the FCRA

The trucking company has since updated its hiring disclosures. Applicants now receive a notice with information on the consumer reporting agency used for background checks and they must sign a statement authorizing the background check.

If you haven’t done so already, now is the time to review your hiring process to ensure compliance with the FCRA. Failure to do so could cause your company to be embroiled in a similar class action suit which is costly in terms of the settlement and the ramifications to your company’s reputation.

In light of the recent volume of FCRA cases relating to background checks used in the hiring process, the Equal Employment Opportunity Commission and the Federal Trade Commission co-published a new guidance consolidating the two agencies’ rules on such checks. Visit www.carcogroup.com to view the guidance.