Using pre-adverse and adverse action letters

Oct 12, 2010 - 6:44 pm

If you’re new to running background checks on you prospective employees, it’s important to read and understand your obligations as an employer under the Fair Credit Reporting Act, which is designed to promote fairness, privacy and accuracy of information in background check consumer reports and investigative consumer reports. 

Should you decide that the results of the background check maybe play a roll in your decision not to hire, promote and maintain employment of a subject (an adverse action) then you must clearly notify the subject of your intentions and give them an opportunity to contest the results of the background check.  This is called an Pre-Adverse Action and it needs to be sent to the applicant with a copy of the background check.  

After a reasonable period of time, and the applicant has not contested the background check, you can conduct the adverse action (not hire, promote or maintain employment) and then you must send them an “Adverse Action Letter”  announcing you have made your decision and provide them with a copy of a document called “A summary of your rights under the FCRA”.

If you need more information about your obligations under the FCRA as an employer, please contact Corra Group at 310.822.7788.

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