Criminal Background Checks in 2013: FCRA, Meet Title VII

As we all know, if an employer uses a third party to conduct criminal background checks for it, the Fair Credit Reporting Act (FCRA) applies. Generally speaking, there are three (3) steps mandated by the FCRA in terms of the communications between the employer and the applicant or employee:  (a) prior written authorization; (b) pre-adverse action notice; and (c) adverse action notice. Effective January 1, 2013, there are new  forms that must be used as part of the process.  In particular, an updated “A Summary of Your Rights Under the Fair Credit Reporting Act,” must be given to applicants and employees as part of pre-adverse action notice (with regard to criminal or other records).

In the case of investigative consumer reports, which include personal interviews as opposed to relying solely on documents of record, the revised notice must be given as part of the first step, too.

For a copy of the new form, paste and see Appendix K:

In this regard, it is important to note that the FCRA no longer is enforced by the Federal Trade Commission (FTC).  Rather, it is enforced by the Consumer Financial Protection Bureau (CFPB).  The CFPB assumed enforcement and rule making authority from the FTC under the Dodd-Frank Wall Street Reform and Consumer Protection Act. As employers update their forms to comply with the FCRA, now is also a good time to update their forms to take into account the EEOC’s guidance on criminal records. See

Generally, the EEOC requires that employers make individualized assessments, using the Green factors:  (a) nature of job; (b) nature of conviction(s); and (c) time frame since conviction. Green refers to the seminal appellate court decision in this area. As part of recommended individualized assessment, the EEOC encourages employers to do more than consider the Green factors.

The EEOC has stated that the  individualized assessment also requires “that an employer informs the individual that he [or she] may be excluded because of past criminal conduct; provides an opportunity to the individual to demonstrate that the exclusion does not properly apply to him [or her]; and considers whether the individual’s additional information shows that the policy as applied is not job related and consistent with business necessity.” The FCRA requires only that employers notify applicants and employees of the conviction record which would be disqualifying and provide them with an opportunity to correct any mistakes.

The individualized assessment inquiry is a due process right that gives the applicant or employee an opportunity to provide potentially “mitigating” factors for the employer to consider, even assuming the conviction record is correct. This very small change can make employer decision-making more defensible before the EEOC. It also is consistent with general notions of fundamental fairness.

It should be noted that the EEOC recognizes that there can be “targeted exclusions” such that an individualized assessment is not necessary.  That is where there is tight nexus between the 3 Green factors.  More detail on targeted exclusions can be found in guidance referenced above.

Don’t forget state and local laws, too.  For example, Newark has become the most recent jurisdiction to “ban the box.”

For now, however, let’s keep it easy.  Update your forms to comply with the FCRA and consider including an inquiry as part of your pre-adverse action notice consistent with the EEOC’s preference for individualized assessments.