CALL 503.248.1134

200 SW Market Street, Suite 1900
Portland, Oregon 97201

New Year Sees Changes to FCRA Forms

January 11, 2013

HR NOTEBOOK

As 2013 begins, we want to draw your attention to changes related to the Fair Credit Reporting Act (FCRA) that affect employers who use third-party background checkers.

The FCRA Changes
First, the Consumer Financial Protection Bureau (CFPB) recently replaced the Federal Trade Commission (FTC) as the federal agency responsible for FCRA enforcement. Second, the CFPB revised a number of forms for use starting January 1, 2013. Most notably, the CFPB revised these three commonly used forms by removing references to the FTC.
 
  • A Summary of Your Rights Under the Fair Credit Reporting Act;
  • Notice to Furnishers of Information: Obligations of Furnishers Under the FCRA; and
  • Notice to Users of Consumer Reports: Obligations of Users Under the FCRA.


No substantive changes were made. (See 12 CFR Part 1022 at Appendices K, M and N.)

The Bigger Picture
Employers conducting background checks should be aware that enforcement agencies, like the Equal Employment Opportunity Commission (EEOC), have demonstrated a continuing interest in the hiring process, particularly in aspects of the hiring process that lead to the rejection of applicants for employment. For example, in its recently adopted Strategic Enforcement Plan for FY 2013 - 2016, the EEOC specifically reiterated that the elimination of systemic barriers in recruitment and hiring is one of its top nationwide priorities.

Similarly, last year the EEOC also updated its Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions. The EEOC’s position is that there is potential for Title VII disparate impact liability where “a covered employer’s criminal record screening policy or practice disproportionately screens out a Title VII-protected group and the employer does not demonstrate that the policy or practice is job related for the positions in question and consistent with business necessity.” The EEOC puts the onus on employers to evaluate their background-checking practices to ensure compliance with federal and state law.

Thus, looking at the bigger picture, we see that the recent modifications to the FCRA forms as part of an overall enforcement philosophy that is intended to persuade employers to proactively engage in self-audits of their recruitment and hiring practices. The bottom line is that there need to be legitimate business reasons for any barriers to employment.

Bullard Law will continue to monitor legal developments that affect employer background check requirements and the recruitment and hiring process. Please also feel free to contact us anytime with any questions about these matters or any other labor, employment, or benefits issues.

- Jennifer N. Warberg
Print

Alert Archives

Alerts

Subscribe to Email Updates