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An Employer Can’t Secretly Request Your Credit Report or Criminal Background And Then Deny You A Job Or A Promotion Without Telling You Why

by The Beasley Firm  |  January 30, 2012  |  

Lawyers who represent individuals, rather than corporations, spend a lot of time observing trends in litigation, and one issue we have noticed recently to our astonishment is the rapid growth in lawsuits alleging illegal background checks of consumer reports, credit reports, and criminal records in violation of the Fair Credit Reporting Act (FCRA).

Frankly, it is not that difficult for a company with more than a handful of employees to comply with the FCRA, and the Federal Trade Commission has posted on-line several easy-to-read guides on the subject. An employer only really has to do a handful of things if they want to use consumer reports when evaluating a job applicant for an employee who is up for a promotion:

  • Tell the applicant in a stand-alone document that you might use information from the consumer report, and have them sign an authorization for that report;
  • Before rejecting an applicant, reassigning or terminating an employee, or denying a promotion, give notice to the employee that their consumer report was involved, give them a copy of the report, and provide them the FTC’s summary of rights under the FCRA;
  • Then, provide the employee notice of which consumer reporting company supplied the report, and give them more government-provided information on their rights following the adverse employment action.

That’s it. It’s not that hard to do. Whoever makes the final call on employment decisions – whether it’s a large company with a human resources department, a small business with an office manager, or a mom and pop store where one person makes all of the decisions – should simply have a checklist that tells them what steps to follow and when, and keep on-hand copies of the relevant FCRA documents.

The companies that don’t comply with the FCRA do so largely because they just don’t care at all about employee and job applicant rights. They think it would be a hassle and they believe there isn’t any penalty for not doing it, so they do foolish things like secretly request criminal background checks and then use that information against the applicant or employee without even telling them.

Unsurprisingly, in this digital age in which few of us go a week without some phone company or health insurer messing up our information, those consumer reports are often littered with errors. It is not unusual to see someone with an entirely clean criminal record nonetheless show up as having dozens of arrests, even felony convictions, because the database improperly copied information from someone else with a similar name in another state. It’s also not uncommon for those consumer report companies to provide far more information than they should, in violation of the FCRA.

That’s where we come in. As companies are learning the hard way, although the penalty for each violation is only between $100 and $1,000, when you multiply that number by hundreds or thousands of job applicants, you quickly run into serious damages, including the costs and attorney’s fees for the job applicants and employees whose consumer records were improperly accessed and used. If you applied for a job and had a consumer report used against you that you didn’t authorize your employer to use or that contained factual errors, contact our Philadelphia, Pennsylvania consumer and employee rights attorneys using the form at the top for a free, confidential consultation.

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