Employment Background Check Rights Under the FCRA
The main law governing criminal background reports is the Fair Credit Reporting Act (“FCRA”). Despite its somewhat misleading name, the FCRA applies to both credit reports and criminal background reports, and it covers employers and companies that create background reports.
When a company uses public record information for employment purposes—which is often the case regarding criminal records—the FCRA mandates strict procedures to ensure the information is accurate and up-to-date, particularly if that public record information is likely to have a negative effect on an individual’s ability to obtain employment.
You Must be Notified of Your Rights
An employer cannot perform an employment background check unless it makes a clear and conspicuous disclosure in writing to the job applicant or employee before the report is procured. The disclosure must be in a document that consists solely of the disclosure and state that a report may be obtained for employment purposes and that the job applicant or employee has authorized it in writing.
Request a Copy of Your Report
If an employer intends to take an “adverse action” against a current employee (e.g. firing, demoting, etc.) or (in most cases) refuses to hire an applicant because of information contained in a background report there are certain requirements it must follow under the FCRA. The employer must provide employees or job applicants the following:
- A copy of the report
- Notice of their rights, in a disclosure similar to the one that appears here
- Notice that an adverse action may be taken because of information contained in the report
- Note: The purpose of this provision is to allow employees and applicants time to review the report and to correct or explain any errors or misleading information. If an employer does take an adverse action based on a criminal background report, they must provide written notice of the same, in what is known as the “Final Adverse Action.”
Too often, individuals may not closely review their employment background check reports and suffer an adverse employment action because of false or misleading information, or because information was reported that is prohibited from disclosure by law. Employees should review employment background check reports prepared about them because they may contain false or misleading information. In Minnesota, employees and applicants have the right to request their background report at the time they consent to having the report prepared.
Common Employment Background Check Errors
Under the FCRA, background screening companies may be liable not only for inaccurate information, but also if the information is misleading in such a way and to such an extent that it can adversely affect employment decisions. Errors that can appear on a criminal background report can include:
- Mismatching the subject of the report with another person
- Reporting sealed or expunged information
- Omitting information about how the case was disposed or resolve
- Mischaracterizing the seriousness of the offense reported (e.g. reporting a misdemeanor as a felony)
- Misreporting sentencing information
Arrests and Charges
The FCRA also prohibits certain information from being reported by a background screening company. Importantly, a background report cannot include arrests or criminal charges that did not result in a conviction that predate the report by more than seven years. This is an important prohibition, as many arrests and criminal charges never result in a conviction. If a criminal background check reports a criminal charge that did not result in a conviction that is more than seven years old, they may be held legally responsible for reporting that information and the negative consequences that result from that disclosure.
The FCRA allows an individual to bring a lawsuit against a background screening company if that company produces a criminal background report that includes false or misleading information or if it reports information prohibited from disclosure. While the remedies available are specific to each case, they can include compensatory damages, damages for lost wages, punitive damages, and penalties.
Employment Background Checks and Equal Employment Opportunity Laws
The Minnesota Human Rights Act (“MHRA”) and Title VII of the Civil Rights Act of 1964, as amended (“Title VII”), prohibit employment practices that discriminate on the basis of a “protected status,” such as age, race, national origin, sex, etc. These laws prohibit not only practices stemming from animus toward a protected status (called “disparate treatment”), but also include neutral policies that disproportionately affect individuals of a certain protected status (called “disparate impact”).
According to guidance materials created by the Equal Employment Opportunity Commission (“EEOC”), national data supports a finding that criminal record exclusions have a disparate impact based on race and national origin. This data provides a basis for the EEOC to investigate violations of Title VII where it is alleged that criminal record exclusions have a disproportionate effect of excluding employees and applicants of certain racial and national origin groups. Normally, an employer will have to show that its process of excluding applicants or employees with certain criminal records is “job related and consistent with business necessity.” More information about employment background checks and equal employment opportunity laws can be found through the EEOC.
Additionally, the MHRA prohibits an employer from requesting or requiring—before an applicant is hired—an applicant to provide information about the individual’s race, religion, national origin, public assistance, sex, color, marital status, sexual orientation, familial status, age, creed or disability. This prohibition may intersect with employment background check reports as employers may require applicants to provide information (such as date of birth) in connection with a pre-employment background check. It is the Minnesota Department of Human Rights’ position that such an inquiry violates the MHRA. The MDHR provides additional information on prohibited pre-employment practices in Minnesota.
Contact Our Employment Law and Class Action Attorneys
If you have been subject to a background check that contains false or misleading information, or information that is prohibited from disclosure under the FCRA, we want to hear from you. The employment lawyers at Wanta Thome are experienced in handling background check claims and will speak to you without charge for an initial consultation. Contact us to discuss your rights.