| Are Your Background Checks Compliant? |
| We are sending this HR Alert as we have found some clients using on-line background check companies may not be compliant as the background check company is not following BOTH Federal and CA law. You should be aware of this and ensure whatever service you are using is California compliant. What laws apply to employment background checks in California? Fair Credit Reporting Act (“FCRA”): Federal law that requires that employers give a job applicant written notice that a background check. Also gives job applicants the right to obtain a copy of their background check report and to sue for inaccuracies. Consumer Credit Reporting Agencies Act (“CCRAA”): Federal law that has been codified into a California state law. Requires the employer to inform a job applicant before running a credit report check, tell them who is issuing the report, allow them to obtain a free copy of it, and warn them that the report could affect the employer’s hiring decision. Investigative Consumer Reporting Agencies Act (“ICRAA”): Federal law that limits how and when an employer may generate background check reports. Include a seven-year rule on information collected. California Information Privacy Act (“CIPA”): CA state law that focuses on employee privacy protections. Requires the employee place a “checkbox” on the job application or written notice that gives a job applicant the option to obtain a free copy of their report. Employers who hire third parties to run background checks must provide a written notice that states the scope and nature of the background check. Ban the Box laws: CA law – Employer may ask about a job applicant’s criminal record only after they have determined that the applicant meets the minimum job requirements. What notice must be provided to applicant (either from me at the employer or the background check company)? Federal and California laws require employers to provide clear, written, standalone notice and obtain written authorization from applicants before conducting background checks. This notice must include: Standalone disclosure, in a document that consists solely of the disclosure that includes a statement that investigation into character/reputation will be conducted and the specific types of information to be collected (e.g., criminal, credit) Must inform the applicant that a background check (investigative consumer report) will be used for employment purposes Must include the name, address, and phone number of the investigative agency. It must also include a checkbox for the applicant to request a copy of the report The applicant must sign the authorization for the background check. What are the consequences for violating these rules? A person who decides to pursue legal recourse against an employer who looks into their background in an unlawful manner, may be able to do the following: File a lawsuit against the employer for actual damages, which includes both legal costs and reasonable attorneys’ fees. If an employer intentionally violated these laws, however, then the individual may be entitled to collect triple damages, along with standard legal costs and reasonable attorneys’ fees. While this may not seem like a harsh enough punishment for someone who violated a person’s privacy, these fines can actually rack up and become quite costly for an employer. For example, an employer who is required to pay actual damages may be ordered to pay up to $10,000 per violation. Some courts may also issue punitive damages awards, which can result in an amount that is ten times the number provided in the state statute for actual damages. Continue reading here... If you have any questions, please contact your HR Business Partner! |
