FCRA Information
Responsible Screening. Informed Hiring.
The Fair Credit Reporting Act (FCRA) is a federal law that governs how consumer information may be collected, reported, and used for employment and other permissible purposes.
When an employer obtains a background report from a third-party background screening company for hiring, promotion, reassignment, retention, or another employment purpose, both the employer and the consumer reporting agency may have responsibilities under the FCRA.
Stonebridge Investigative Group is committed to responsible screening practices designed to promote accuracy, transparency, and the protection of consumer information.
Before Requesting a Background Check
Employer Responsibilities
Before obtaining a consumer report for employment purposes, employers generally must take several steps required by the FCRA.
01 — PROVIDE DISCLOSURE
Tell the applicant or employee, in a clear and conspicuous written disclosure in a document consisting solely of the disclosure, that a consumer report may be obtained for employment purposes.
The disclosure should not be buried within an employment application or combined with unnecessary acknowledgments, liability waivers, or unrelated information.
02 — OBTAIN AUTHORIZATION
Obtain the applicant's or employee's written authorization before procuring the background report.
The disclosure and authorization may generally be provided electronically when applicable legal requirements are satisfied.
03 — CERTIFY COMPLIANCE
Before Stonebridge provides an employment consumer report, the employer will be required to certify that it has complied with applicable FCRA requirements, including required disclosure and authorization obligations, and that the information will not be used in violation of applicable equal-employment-opportunity laws.
The FCRA requires consumer reporting agencies to obtain certain certifications from employer clients before furnishing reports for employment purposes.
A Permissible Purpose Is Required
Background information cannot be accessed simply because someone wants to know more about another person.
Consumer reports may only be provided for purposes permitted by law. Employment is one permissible purpose when applicable FCRA requirements have been satisfied.
Stonebridge requires clients requesting employment background reports to identify and certify their permissible purpose for obtaining the information.
The FCRA requires consumer reporting agencies to take reasonable steps to verify users and ensure reports are furnished only for permissible purposes.
If Information May Affect an Employment Decision
The Adverse Action Process
Finding information in a background report does not automatically disqualify a candidate.
Employers are responsible for evaluating reported information in accordance with applicable federal, state, and local laws and determining whether the information is relevant to the position.
When an employer is considering an unfavorable employment decision based in whole or in part on information contained in a consumer report, the FCRA generally requires a two-step process.
BEFORE THE DECISION — PRE-ADVERSE ACTION
Before taking adverse action, the employer generally must provide the individual with:
A copy of the consumer report relied upon; and
A copy of A Summary of Your Rights Under the Fair Credit Reporting Act.
This gives the individual an opportunity to review the information and address potential inaccuracies before the employer makes its final decision.
AFTER THE DECISION — ADVERSE ACTION
If the employer ultimately takes adverse action based in whole or in part on information in the consumer report, the employer must provide the required adverse-action notice.
Among other required information, the notice identifies the consumer reporting agency that supplied the report and explains that the reporting agency did not make the employment decision.
Stonebridge's Role
Research. Verify. Review.
Stonebridge provides background screening and verification information to authorized employers. Stonebridge does not make hiring, termination, promotion, retention, or other employment decisions on behalf of its clients.
As an employment background screening provider, Stonebridge's procedures are designed around important FCRA responsibilities, including:
ACCURACY
Maintaining reasonable procedures designed to assure the maximum possible accuracy of information reported about an individual.
PERMISSIBLE PURPOSE
Providing consumer reports only to authorized users with a legally permissible purpose.
CLIENT CERTIFICATION
Obtaining required certifications from employer clients before providing employment consumer reports.
CONSUMER ACCESS
Providing consumers access to information in their files as required by applicable law.
DISPUTES
Providing a process for consumers to dispute information they believe is inaccurate or incomplete and conducting required reinvestigations.
PUBLIC RECORDS
Following applicable FCRA requirements when reporting public-record information for employment purposes.
These are substantive obligations for employment screening companies under the FCRA—not simply recommended practices.
LEARN ABOUT CONSUMER RIGHTS
Investigative Consumer Reports
Some enhanced screening services may involve interviews with references or other individuals regarding a candidate.
Under the FCRA, a report based on personal interviews concerning an individual's character, general reputation, personal characteristics, or mode of living may qualify as an investigative consumer report.
Additional disclosure requirements may apply when an employer requests this type of investigation, including notifying the individual of the right to request information concerning the nature and scope of the investigation.
Fair and Consistent Hiring
The FCRA Is Only Part of the Process.
Compliance with the FCRA does not replace an employer's responsibilities under federal, state, or local employment laws.
Employers should apply background-screening policies consistently and ensure employment decisions do not unlawfully discriminate based on protected characteristics. The FTC and EEOC also recommend reviewing applicable state and local laws because additional restrictions may apply to employment background information.
Employers are responsible for establishing their own lawful hiring criteria and determining the relevance of reported information to the position being filled.
Stonebridge provides information. The employer makes the employment decision.
Information for Applicants and Employees
If Stonebridge prepared a consumer report about you, you may have rights under the FCRA, including rights concerning access to information in your file and the ability to dispute information you believe is inaccurate or incomplete.
Stonebridge does not charge consumers to dispute the accuracy or completeness of information contained in a Stonebridge consumer report.
Official FCRA Resources
For additional information about the Fair Credit Reporting Act and employment background screening, visit:
Federal Trade Commission — Employment Background Screening & FCRA
Federal Trade Commission — Background Checks: What Employers Need to Know
Consumer Financial Protection Bureau — Employment Background Checks
Federal Trade Commission — Fair Credit Reporting Act
Questions About Employment Screening?
Stonebridge works with employers to provide professional, carefully reviewed background screening and verification services.
For questions regarding Stonebridge screening services:
Stonebridge Investigative Group
1905 Sherman Street, Ste. 200
Denver, Colorado 80203
intel@stonebridgeintel.com
720-999-5845
Disclaimer
The information provided on this page is for general informational purposes only and is not legal advice. Employment screening requirements vary depending on the circumstances and may be subject to additional federal, state, and local laws. Employers are responsible for determining the legal requirements applicable to their organization and should consult qualified legal counsel regarding specific compliance questions.