Friday, November 03, 2006

FCRA and Background Checks

The Tennessee Employment Law Letter examines duties related to consumer reports and background checks:

Under the
Fair Credit Reporting Act (FCRA), employers have a series of duties whenever a "consumer report" is used for a background check. Although the most common type of consumer report is a credit report, employers frequently use other types, such as driving record reports and criminal record checks obtained from commercial services that specialize in providing that type of information.

Here's the deal: Any type of consumer report is covered so long as it's prepared by a "consumer reporting agency."

The FCRA defines a consumer reporting agency as "any person which for monetary fees, dues, or on a cooperative non-profit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on a consumer."

The short version of that definition? When you use a third party to do a background check on an applicant or employee, you must comply with the FCRA.

Read the rest here.

No comments: