By Dave Katzenmeyer
President, Genesis Background Screening Services
If your company is currently doing background checks during the hiring process, good for you! In today’s workplace environment, making sure you hire safer is important for protecting your business, your employees and your clients. You already know that you need to get a signed authorization and release from your applicant in addition to any other requirements under your state’s laws. But do you know how to stay in compliance after you get a background report that has negative information?
Are you aware of an employer’s responsibilities under the FCRA for notifying candidates about background checks, specifically the Pre-Adverse and Adverse Action steps? Failure to comply could have serious consequences for your company. Here are some definitions and examples to help you understand the process:
Pre-Adverse Action
After ordering a background screen, you get a background report back from your provider with negative information about your applicant. The report reveals that your candidate for a valet attendant position has a conviction that is less than 2 years old for Grand Theft of a Motor Vehicle. Naturally, this information is a concern for the type of position for which you are considering the candidate.
Your gut reaction is to immediately call up the candidate and say something along the lines of, “You have a serious conviction on your background check, so we can no longer proceed with hiring you.” However, this is not the right thing to do. Before you make an official decision, you have to provide a Pre-Adverse Action Notice to this candidate that MUST include:
- Copy of the entire report
- A copy of the FCRA notice of a consumer’s rights (called “A Summary of Your Rights Under the Fair Credit Reporting Act”)
This is intended to give the candidate the chance to contest any false information. This is not your cue to move to Adverse Action, though. You need to give the candidate time to contest anything on the report that they believe is inaccurate. Since the FCRA does not state a specific amount of days to allow for the candidate’s response, it is best to consult with your legal counsel on the time frame that is appropriate for your company. Based on information from the FTC (Fair Trade Commission), we suggest at least 5 business days once delivery has been confirmed.
Adverse Action
Once you’ve waited an appropriate amount of time, you can now move forward with Adverse Action. In our scenario above, you’ve already given the Pre-Adverse Action Letter and several days have passed. You can now notify your candidate that you will not proceed with hiring him and will rescind the existing offer of employment with an Adverse Action Notice.
Although this can be done verbally, doing it in writing is always the best option.
This Adverse Action notice MUST contain
- The name, address, and phone number of your background screening company
- A statement confirming that the background screening company only performs the screen and provides the report and does not make the hiring decision
- A notice that the individual can contest the information in the report with the background screening company
It is well worth the small investment to use a CRA that specializes in pre-employment screening and compliance. They will have a support system in place to help you with this process, including form letters for Pre-Adverse and Adverse Action and compliance experts that can help you formulate policy. For more information about your responsibilities under the FCRA, you can download www.ftc.gov/os/statutes/fcradoc.pdf If you would like a free consultation with a qualified CRA, you can call Genesis Background Screening at 866 944-0041 ext 106, email getstarted@gbsspro.com or vist www.genesisbackgroundscreening.com
