FCRA in the Headlines

The Fair Credit Reporting Act (FCRA) may not be as glamorous as the Kardashian Family but business owners and HR professionals are probably used to seeing just as many headlines. Or at least they should be. On a daily basis, companies are facing litigation for not being aware of the strict regulations of the Fair Credit Reporting Act. Other news stories focus on FCRA violations from the point of view of those it was made to protect. Here are a few of the latest FCRA headlines. 

Uber And Lyft Sued Over Background Checks

This is the second time that Uber has faced litigation with regards to the FCRA. Last year, a driver was fired for information that the company found on his background check but he was not given the option to explain the contents before he was terminated.

See also: How to Obtain Applicant Consent and Authorization to a Background Check

Georgia Enacts “Mini”FCRA

The Fair Credit Reporting Act was originally passed into law in 1970. Since then, several states including California, Maine, New York, Oklahoma and others have passed their own versions of the FCRA. Georgia is the latest to adopt its own. 

The new law affects credit reporting agencies that provide information on people who reside within the state. It follows closely the regulations stated by the federal act and also prohibits state agencies from using prior criminal convictions as an automatic disqualification from a job opportunity. 

See also: What Employers Need to Know About Ban the Box

LinkedIn's Reference Search Does Not Violate FCRA

Recently, the Sweet, et al. v. LinkedIn case was in the news addressing the issue of reference reports generated for premium subscribers to LinkedIn. The allegation was that LinkedIn acted as a consumer reporting agency when it provided references for individual candidates applying for jobs. The plantiffs said they were denied jobs because of information provided by references through LinkedIn and therefore violated the FCRA.

The judge dismissed the case and said that LinkedIn did not violate the FCRA. It does bring into focus how social media plays into hiring decisions and may lead to more FCRA amendments as more lawsuits are filed.

See also: Can You Include Social Media in Background Checks?

Don’t let a natural disaster become a data security calamity

In 2005, the FCRA was amended to include regulations with regards to properly disposing of the consumer information gathered by any business or individual for a business purpose. Last month, the FTC warned that natural disasters can not be used as an excuse for failing to comply with the law. The article details many tips to minimize the amount of paperwork and records stored on any individual as well as links to properly dispose of the information gathered. 

As a best practice for human resources, the article includes other helpful information for preparing your business for any natural disaster and how to help your employees or customers after the fact. 

See also: HR Record Retention for Background Screening Consent Forms and Information 

With regulations and amendments affecting hiring practices, it is suggested that human resources, hiring managers and business owners stay abreast of FCRA news. There is a decided increase in class action lawsuits for FCRA background check violations. With the right information, your company won't be one of them. 

FCRA Compliance Resources

ComplianceCloud features a list of complimentary web services to help your business take charge of it's FCRA obligations. Gain access to electronic applicant consent, e-signatures, background screening interfaces, and FCRA adverse action notifications.