How does the FCRA factor into employment background checks?

The Fair Credit Reporting Act (FCRA) helps people want to avoid problems with their credit reports. The FCRA’s rules stipulate that information on the report is accurate and kept private. Not everyone realizes how expansive the FCRA’s rules are. A Minnesota job seeker may not realize that FCRA rules and regulations apply to employment-related background checks. Those violating the law may find themselves involved in a civil suit.

The FCRA and employment-related background checks

A potential employer may review a job applicant’s background to make a hiring decision. Looking at someone’s credit history and debt situation tells a story about the person’s financial stability. Employers may also conduct background checks to ascertain someone’s criminal record.

When an employer performs a background check, it must follow the rules established under the law. For example, the would-be employer must procure permission to conduct a background check in writing. When the report reveals negative information that leads the employer to reject the application, the employer must provide a job applicant with a copy. Upon reviewing the report, the job seeker might notice inaccurate information that requires fixing.

Legal matters and background checks

An employer may not violate someone’s privacy when performing a background check. Publicly revealing information without someone’s consent might lead to legal consequences.

The FCRA also bans “extraneous information” in disclosures, and if such content appears in the documents, a job seeker might have a legal claim. In 2020, the U.S. Court of Appeals for the 9th Circuit made publicized rulings regarding extraneous information in background check disclosures, and the rulings raised awareness about it.

Legal action might be necessary to force an entity to fix inaccurate information. Without taking such steps, false information may continue to hamper job prospects.