The Fair Credit Reporting Act (FCRA) requires employers who obtain a consumer report on a job applicant to provide the applicant with a “clear and conspicuous disclosure” that they may obtain such a report (the “clear and conspicuous” requirement) “in a document that consists solely of the disclosure” (the “standalone document” requirement) before procuring the report. Because neither of these requirements are defined in the statute, they have been the subject of almost constant litigation in recent years. Most notably, the 9th Circuit has led the way in finding that an employer’s inclusion of a liability waiver in its disclosure form violates the standalone requirement. Now, in Gilberg v. California Check Cashing Stores, LLC, a panel of the 9th Circuit Court of Appeals has held that an employer’s inclusion of state law mandated requirements in the disclosure form provided to job applicants violates the standalone document requirement despite the fact that they were included in the form in an effort to assist the applicants in understanding all of their rights as it related to the background screen being obtained on them. In short, the panel was not moved by the employer’s argument that its additional disclosure of the applicable state laws “furthers rather than undermines FCRA’s purpose.” To the contrary, the panel held that “the presence of this extraneous information is as likely to confuse as it is to inform” and therefore, it does not further FCRA’s purpose. Instead, the panel noted that the only exception to the standalone document requirement is the one in the statute itself that permits the disclosure and authorization to be combined into a single document.
Section 301 of the federal Economic Growth, Regulatory Relief and Consumer Protection Act, which was signed into law on May 24, 2018, amended the Fair Credit Reporting Act (FCRA), effective Sept. 21, 2018, to require consumer reporting agencies (such as those that employers use for applicant and employee background check purposes) to include new language…
Recent multi-million dollar settlements highlight the importance for employers of complying with the Fair Credit Reporting Act (FCRA). They also highlight that, when it comes to class action lawsuits in the employment-law context, the FCRA is the new FLSA!
The FCRA has very specific requirements employers must comply with if they engage a background check…
It should be old hat by now: Employers who use a third party to conduct a background check on an applicant or employee for employment purposes must comply with the Fair Credit Reporting Act (FCRA). But what many employers do not know, or may have forgotten, is that the Fair and Accurate Credit Transactions Act (FACTA) also imposes upon them some obligations when conducting a background investigation. …
Continue Reading Happy Birthday to the FACTA! The Often Forgotten Law that Imposes Obligations and Provides Helpful Exceptions for Employer Background Checks and Workplace Investigations
As we told reminded you last month here, the Consumer Financial Protection Bureau (“CFPB”), the agency that has enforcement responsibility over the Fair Credit Report Act (“Act”), revised the forms which employers must use to comply with the FCRA, effective January 1, 2013. There was only one little problem with the forms the CFPB provided for use: They contained various typos and technical errors that the CFPB now has recognized in its Supplementary Information in the November 14, Federal Register Notice.
Continue Reading Not So Fast … CFPB Issues Revised Forms for FCRA Compliance by January 1, 2013, First Ones Contained Typos and Other Errors
By now, you should know that the Equal Employment Opportunity Commission (“EEOC”) has issued “Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions”, which is designed to restrict criminal background checks by employers, but you may not know that enforcement responsibility for the Fair Credit Reporting Act (“FCRA”) has been transferred from the Federal Trade Commission to the recently created Consumer Financial Protection Bureau (“CFPB”).
Continue Reading Complying with the FCRA Amendments Before January 1, 2013 – a Step-By-Step Guide
Here is one more potential advantage of using independent contractors rather than employers that so far has flown below the radar screen. According to a federal district court in Wisconsin, the Fair Credit Reporting Act’s disclosure obligations do not apply to independent contractor relationships.
Continue Reading Federal Court: FCRA Does Not Apply To Independent Contractor Relationships