Fair Credit Reporting Act Background Checks

News & Analysis as of

Congress Considers Changes to FCRA to Expand Consumer Credit Files and Limit Use of Credit Reports for Employment Decisions

The Fair Credit Reporting Act (FCRA) regulates consumer reporting agencies (CRAs) and the use of consumer reports. The FCRA’s stated purpose includes requiring CRAs to adopt reasonable procedures for meeting the needs of...more

Registration Requirement for CRAs in Rhode Island

Rhode Island has a quirky statute that arguably requires any consumer reporting agency who provides credit reports or information to state residents to register with the Department of State – Business Services Division. I...more

Wisconsin Employers Targeted for Technical Violations of the Fair Credit Reporting Act

Within the past year, one Wisconsin resident has filed several class-action lawsuits against Wisconsin employers. In each case, the resident claimed that the targeted employers were using improper disclosures in employment...more

Social Media-Based Screening and FCRA

By now, most employers are familiar with the requirements of the Fair Credit Reporting Act (FCRA) and understand how it impacts background checks and applicant screening. In short, FCRA says that if an employer uses a third...more

Spring Cleaning – Check Your Background Disclosure Form For FCRA Violations

In a trend that shows no signs of slowing down, lawsuits continue to be filed against employers for violating the Fair Credit Reporting Act’s (“FCRA”) strict requirements concerning background check disclosure forms. If the...more

Employment Law - March 2016

Failure to WARN Alleged in Complaint Against Yahoo - Why it matters - In a novel lawsuit, a former employee of Yahoo claims that the company manipulated its performance-review rating system in order to dodge both...more

Proposed Regulations Issued by the New York City Commission on Human Rights Clarify and Expand the Citywide "Ban-the-Box" Law

New York City’s Fair Chance Act (FCA), which became effective on October 27, 2015, imposes obligations on covered employers and employment agencies well beyond all other "ban-the-box" laws.  On November 5, 2015, the New York...more

Proposed Amendments to Fair Credit Reporting Act

Two new bills affecting credit reporting and the use of credit reports for employment purposes are working their way through Congress. If passed, the bills would amend the Fair Credit Reporting Act (FCRA). The first, The...more

If Being "Proactive" is a Management Objective, This is a Good Year

At the beginning of the calendar year, many in-house counsel and human resources professionals embark on taking steps to meet their annual management objectives. If history is any guide, many human resources professionals and...more

Dave & Buster’s faces FCRA class action for alleged background check violations

Joseph Alvarez filed a class action against Dave & Buster’s restaurant chain earlier this year in Florida alleging that it used background checks for employment decisions without providing a copy of the report to the...more

FINRA Members Subject to New Background Screening Rules

Last year, the Financial Industry Regulatory Authority (FINRA), a non-governmental organization that regulates member brokerage firms and exchange markets, approved proposed Rule 3110(e), which enhances the background...more

Federal Courts Increase Scrutiny of Employer Compliance with the FCRA's Adverse Action Requirements

In the last two years, the number of employment class actions under the federal Fair Credit Reporting Act (FCRA) has ballooned. Most of the cases reported in the media have involved challenges to an employer’s compliance with...more

Employers: Check the law before checking an applicant's background

A new hire is always a risk. There is concern that a new employee may not be a good fit or as qualified for the job as expected. Worse, the new hire could be a significant safety or liability risk. A poor hiring decision can...more

CFPB Takes Action Under FCRA Against Employment Background Check Providers

On October 29, 2015, the Consumer Financial Protection Bureau (CFPB) announced the settlement of an enforcement action against two of the country’s largest employment background screening report providers for failing to...more

CFPB Obtains $13M FCRA Settlement with Employee Background Screening Providers

The CFPB recently initiated an enforcement action against General Information Services (GIS) and its affiliate, e-Background-checks.com, Inc. (BGC) for allegedly violating the Fair Credit Reporting Act (FCRA) by failing to...more

CFPB Announces Consent Order with Employment Background Screening Report Providers

The Consumer Financial Protection Bureau’s (CFPB) announcement that it has entered into a consent order with two affiliated companies that generate and provide employment background screening reports serves as a reminder to...more

CFPB announces consent order with employment background screening report providers

The CFPB recently announced that it has entered into a consent order with two affiliated companies that generate and provide employment background screening reports. The consent order settles charges that the companies, which...more

Background check companies to pay $13 million for FCRA violations

General Information Services (GIS) and e-Background-checks.com Inc. (e-Background) agreed to pay $13 million in restitution and fines to settle their violations of the Fair Credit Reporting Act (FCRA) charged by the Consumer...more

CFPB’s Message to Employment Background Screening Providers: A Rose by Any Other Middle Name is Probably the Wrong Person

On October 29, the CFPB took action against two of the country’s largest employment background screening report providers for violations of the FCRA. This is one of the CFPB’s most significant FCRA actions to date, following...more

New York City Fair Chance Act

New York City’s Fair Chance Act took effect last week, amending the New York City Human Rights Law by prohibiting covered employers from asking about criminal history until after a conditional offer of employment has been...more

The Fair Credit Reporting Act: Misnamed but Mischievous

While its name might indicate that it is aimed at credit checks, the Fair Credit Reporting Act also regulates employer background checks. Indeed, the FCRA contains a number of potential traps for employers that a new wave of...more

CFPB Enforcement Action Against Two Background Screeners

The Consumer Financial Protection Bureau (CFPB) announced that it has taken action against two large background screening companies.  Yes, you are reading this correctly.  The CFPB…not the Federal Trade Commission, has taken...more

Employment Law - October 2015 #3

New California Employment Laws on Fair Pay, Waiver of Meal Periods - Why it matters: California continues its focus on employment-related legislation. Touted as the toughest law of its kind in the nation, Senate...more

Fenwick Employment Brief

Legislative Update - Governor Brown recently signed into state law the following employment law bills (among others): SB 358—Referred to as the California Fair Pay Act, this law is directed at closing the pay...more

Background Screening – When is Section 603(y) Applicable?

When a company uses commercial background checks to evaluate the suitability of job applicants, they must comply with the Fair Credit Reporting Act (FCRA), which regulates the collection, dissemination, and use of consumer...more

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