Hiring the right candidates for your organization can be the most important decision you make. As an employer, it is your right to know certain information regarding the background history of potential employees before you make the decision to hire. However, regulations in the Fair Credit Reporting Act mandate that certain compliance steps need to be taken when using background check reports for employment decisions.

The first step toward being compliant is to obtain permission from applicants to perform the background checks. You will then need the following information from your candidates:

  • Full legal name (first name, middle name, and last name).
  • Full date of birth.
  • Social Security number (used to verify the identity of the person being checked).
  • A driver’s license number (this is needed if you plan to run a motor vehicle report).

If you intend to decline an employment applicant based on what is found in the background screening, you need to provide the applicant with at least two notifications, commonly known as the pre-adverse and adverse action letters.

The pre-adverse action letter should include a copy of the applicant’s consumer report as well as a document from the Federal Trade Commission (FTC) titled “A Summary of Your Rights Under the Fair Credit Reporting Act.” The employer should allow a reasonable amount of time for the applicant to respond to this pre-adverse action notification before final determination is made or adverse action is taken (the FTC deems 5 days as a reasonable amount of time).

The adverse action step is next and can be delivered orally, in writing, or electronically. This must include the following:

  • The name, address, and phone number of the Consumer Reporting Agency (CRA) that supplied the report.
  • A statement that the CRA that supplied the report did not make the decision to take the adverse action, and this agency cannot give specific reasons regarding the decision.
  • A notice of the individual’s right to dispute the accuracy or completeness of any information the agency furnished and his/her right to an additional free consumer report from the agency upon request within 60 days.

To find out more information about employment background screenings, visit Protect People’s FAQ page.