Litigation against employers for screening violations—especially those pertaining to the violation of consumer rights—have never been higher. This means that education for our partners is critically important. So today, let’s start our new monthly ongoing education series designed to empower and protect you and your company in this litigious climate.
Adverse Action Administration
A hot area of current litigation is pursued when not compliantly following the Federal Adverse Action Administration process, as required by the FCRA (15 USC 1681) Adverse Action 604(b)(3)(A). The Fair Credit Reporting Act (FCRA) governs everything related to the protection of consumer rights and the use of their information in making decisions that may adversely affect consumers based on that information. In employment screening, this is specifically related to the use of criminal information, driving history, employment verification, education verification, or drug testing.
While the process itself is very basic, many states, counties, and even cities have now added their own requirements as a result of “Ban the Box” laws and other specific geographic regulations. Let’s start with the basics:
How do you follow the Adverse Action Administration Process?
Before declining, terminating, withdrawing employment or denying promotion or transfer, an employer MUST perform pre-adverse action if their decision is even partly based on the background check information received by the background screening firm.
Where to Start
Start with the PRE-Adverse action letter, as detailed below:
Pre-Adverse Action
- You must send the applicant/consumer a copy of the background check report along with a PRE-adverse action letter and a FCRA Summary of Consumer Rights.
- Wait 5 business days before sending the Adverse Action letter. You can wait longer if you choose (and are required to wait 7 days in certain jurisdictions – San Francisco, CA, Prince George’s County, MD, and Montgomery Co., MD)
- Please note: certain states, counties, and cities require special letter verbiage, procedures, and notices (IL, CA, MA, Seattle, WA, Montgomery Co., MD, Prince George, MD, Philadelphia, PA, and New York City, NY). If you already use VICTIG as your background check company, those letters are conveniently located in our system for you.
Adverse Action
- If there’s no contact from the consumer disputing the information/report, you can send the second letter: the “Adverse Action” letter. Remember, the first letter is to notify the applicant that you are ‘inclined’ to decline them based on the information you have at hand but they still have the opportunity to dispute anything in the report and offer you any additional information they feel may positively affect your decision. This could include rehabilitative efforts, employment after release from incarceration, achievements, etc.
- Certain states require special letter verbiage, procedures (such as listing the SPECIFIC convictions that affected your decision), and notices (IL, MA, San Francisco, CA, Los Angeles, CA, Montgomery & Prince George’s Co., MD, Chicago, IL, NYC, Philadelphia, PA, Austin, TX, Portland, OR). Again, if VICTIG is already your background check partner, those customized letters are in our system and will automatically pull and send to your applicant based on their location.
FAQs
What happens if the applicant claims the background check is incorrect?
This is called a Dispute. Under the FCRA, all consumers are entitled to a copy of their report and the opportunity to dispute the criminal record or other information.
How long does it take to resolve a dispute?
A screening firm has 30 days to investigate & must begin immediately, but VICTIG will wrap up disputes much faster. It’s a reinvestigation of going back to the courts to re verify the information originally reported.
What actions should I take?
An employer should never be involved in the process. If you receive a call from an applicant, simply refer them to our Dispute Resolution Department.
Don’t Forget! More to Consider
During the adverse action process, there are few other things to keep in mind. First, the adverse action process clock stops when a dispute is filed by an applicant, meaning that you should not fill the position with another candidate. Doing so would put you at risk of turning down an applicant negligently.
Second, if you’re declining an applicant for the job at hand based on the background check but may consider them for another job, you must still complete the adverse action process as each job should be treated separately.
Finally, if you have any questions or concerns or would like to talk with our team, please let us know. We’re here to help and are always at your disposal.
Protect Your Company With VICTIG
At VICTIG, we don’t just consider ourselves your background screening firm—we’re your true partner. As part of that relationship, we are committed to doing everything we can to protect you. Empower your company and avoid harmful litigation with VICTIG, the #1 background check company on G2.
