Under the Fair Credit Reporting Act (FCRA), effective January 1, 2013, employers are now required to use new forms as part of their background check process. These form changes are the result of a shift in interpretation responsibility from the Federal Trade Commission (FTC) to the newly created Consumer Financial Protection Bureau (CFPB). The primary revisions in the forms concern changing whom consumers may contact to obtain more information about their rights from the FTC to the CFPB. These changes affect the mandatory “Summary of Rights” section that employers must provide to applicants and employees when they issue a pre-adverse action letter and in certain other situations. Employers who “negligently” or “willfully” fail to comply with FRCA requirements may open themselves to lawsuits brought by applicants or employees.
For more information on an employer’s obligations under the FRCA, contact a member of KDDK’s Labor and Employment Law practice team.