Every business has new applicants applying for open jobs daily. When you consider obtaining that consumer credit report and complying with the Fair Credit Reporting Act (FCRA), DO NOT think about conserving paper by including multiple key points all in ONE DOCUMENT – that eco-thinking decision will put you in violation of the FCRA.
In April, Home Depot USA Inc. agreed to a $1.8M settlement to resolve a putative class action alleging violation of the FCRA. Home Depot’s job application background-check form included the required disclosure statement, but also a release from all liabilities, and stated the repercussions for providing false and misleading information. Based on the way the courts have been interpreting the FCRA, Home Depot was smart to settle the case and avoid going forward in the litigation.
FCRA requires that the employer must:
- Provide a clear and conspicuous disclosure to each applicant in writing that a consumer report may be obtained for employment purposes.
- Obtain the applicant’s authorization for the report in writing.
So on that single disclosure document, ONLY include #s 1 and 2 above. This disclosure document must consist of “solely” a disclosure but just to show the statute has a little flexibility, you can include the “authorization” on the same document and based upon the holding in Reardon v. ClosetMaid Corporation, you still fit within the “solely” requirement.
Note: There are additional requirements for the employer to get an “investigative consumer report.”
So use another piece of paper, put the liability release on a separate page (“solely” does not include release verbiage) and protect yourself, by keeping your disclosure and authorization on one document and all other key provisions on a separate document.
If you have any questions or would like additional information on this topic, please contact Joe Guffey.