- 28 Jun 2019
Fair Credit Reporting Act: Disclosure & Candidate Authorization
- Updated on 28 Jun 2019
Disclaimer: The resources provided here are for educational purposes only and do not constitute legal advice. If you have questions regarding your background check policy or a particular record, we advise you to consult legal counsel.
Fair Credit Reporting Act - The Basics
Before running a background check on a candidate, the Fair Credit Report Act (FCRA) requires that employers:
- Provide the candidate with a written disclosure which states that a background check is being run for employment purposes.
- Provide any applicable state disclosures
- Obtain the candidate's consent through a written authorization
The FCRA states that an employer can’t obtain a background report unless a clear and conspicuous disclosure has been made to the candidate, in a document that consists solely of the disclosure.
The employer has to inform the applicant, in writing, that a background check will be run for employment purposes. This must be done in a very clear way:
- The disclosure should not be within a job application
- It should not be provided in small font
- It should not be amongst other information relating to duties of the job
The disclosure must be provided in a document that contains only information about the background check. Many lawsuits filed against employers allege that the disclosure wasn’t clear and conspicuous and wasn’t provided in a stand-alone document due to the presence of “extraneous language.”
Some states will have additional disclosure and formatting requirements. You can find state-specific disclosures on our Employer Forms page.
In order to run an employment background check legally, the Fair Credit Reporting Act (FCRA) requires that employers obtain written authorization from the job candidate or employee before they’re screened.
By obtaining consent, employers can certify that they have:
- Notified candidates about the details of the background screening process
- Informed candidates about their legal rights in case of an adverse action
- Taken steps to ensure candidate privacy and prevent discrimination
Background check laws are complex and may depend on your jurisdiction. For specific compliance questions regarding your hiring process, we recommend consulting with your legal counsel.