Roles & Responsibilities
The Federal Fair Credit Reporting Act (FCRA) promotes the fairness, accuracy and privacy of information in the files of consumer reporting agencies. The Fair Credit Reporting Act (FCRA) is a federal law that governs how a consumer reporting agency
(CRA) handles your credit information. It is designed to protect the integrity and privacy of your credit information. The FCRA protects your right to access and correct any inaccuracies in your credit report and provides you with remedies if a credit reporting agency or information furnisher violates your rights.
The success of a business is dependent on the people who represent the company. Employers need to make smart and effective hiring decisions, when looking to fill an open position. Employers need to weigh each candidate’s qualifications and abilities against those of other competing applicants. In doing so, employers often determine that their interests are at odds with the legal rights of employees. There are laws that are put into place to protect employee rights as well as to help employers navigate the legal complexities of employee privacy laws. The Fair Credit Reporting Act (FCRA), enforced by the Federal Trade Commission (FTC), applies broadly to consumers, but also plays an important role for employers who use background checks and consumer reports to make hiring decisions.
Employers and business owners, landlords and property managers, basically any business that is looking to hire an employee or to see if resident is the person they portray on their application can be challenging. A single wrong decision can lead to potential liabilities. Companies are most often advised to adopt strategic hiring practices and background screening practices that include
a comprehensive background check. While knowing who you are hiring is important employers that don’t comply with the Fair Credit Reporting Act (FCRA), can face legal and financial consequences.
Beacon Background Screening Services strongly encourages all clients whether employers, landlords or service contractors to consult with legal counsel and develop a legally compliant hiring policy, based on a comprehensive background check.
As an employer, you may want to perform a background check on a potential or current employee for reasons including hiring, retention, promotion, or reassignment. Communities, Property Managers, Landlords also have reasons to perform a background check.
Relying on a third party to run background checks on job candidates or existing employees, you must adhere to federal Fair Credit Reporting Act (FCRA). Your responsibilities are detailed in the document entitled Notice to Users of Consumer Reports: Obligations of Users under the FCRA. Whatever the reason is, your company must comply with the FCRA, a law that is enforced by the Federal Trade Commission (FTC)
Adverse action is the official legal process that a business is required to follow as they inform an employee or applicant that they did not meet the acceptance requirements due to information found in their background check. This applies not only new applicants it applies to the termination of existing employees. Beacon Background Screening Services recommends all employers to consult with legal counsel to develop a legally compliant adverse action policy.
EEOC's Rules for Background Checks
The Equal Employment Opportunity Commission (EEOC) is an independent regulatory body that enforces Title VII. Title VII of the Civil Rights Act of 1964 prohibits discrimination by covered employers on the basis of race, color, religion, sex, national origin, disability, or age in hiring, promoting, firing, setting wages, testing, training, apprenticeship, and all other terms and conditions of employment. Title VII applies to and covers an employer who has fifteen (15) or more employees for each working day in each of twenty or more calendar weeks in the current or preceding calendar year. The Act does not apply to employers with 14 employees or less. Title VII also prohibits discrimination against an individual because of his or her association with another individual of a particular race, color, religion, sex, or national origin.
Since its creation in 1964, the EEOC’s power has been expanded to include investigatory authority, creating conciliation programs, filing lawsuits, and conducting voluntary assistance programs. The EEOC also enforces other employment legislation, including the Age Discrimination in Employment Act of 1967 that prohibits employment discrimination against individuals 40 years of age or older; the Equal Pay Act of 1963 that prohibits discrimination on the basis of gender in compensation for substantially similar work under similar conditions; Title I of the Americans with Disabilities Act of 1990 that prohibits employment discrimination on the basis of disability in both the public and private sector, excluding the federal government; the Civil Rights Act of 1991 that provides for monetary damages in case of intentional discrimination; Section 501 of the Rehabilitation Act of 1973, that prohibits
employment discrimination against federal employees with disabilities; Title IX of the Education Act of 1972 that forbade gender discrimination in education programs, including athletics that received federal dollars; and the Pregnancy Discrimination Act, which made it illegal for employers to exclude pregnancy and childbirth from their sick leave and health benefits plans.
The EEOC also discourages employers from excluding applicants for employment based on conviction or arrest records that may adversely impact certain minority segments of the population. Hence exclusion of applicants based on conviction records is prohibited unless the employer can show business necessity. To establish a business necessity, an employer must be able to show that it considered:
The severity and age of the offense or offenses
Evidence of rehabilitation
***This section is not meant to act as legal advice, nor is it intended to be comprehensive. Beacon Background Screening Services, encourages all its clients to consult with their legal counsel when establishing a background screening program