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Authorization

 

Disclosure that a consumer investigative report may be requested, and authorization for the report to be completed must be provided before an employer may request or obtain a consumer report.
Adverse Action, Notice

Before formulating a decision based on the results of a consumer investigative report that adversely affects an applicant or employee's employment, the employer must provide the affected person with the informaiton below:

A copy of the report and a written description of the person's rights under the FCRA.

The name, address and telephone number of the reporting agency (including the toll-free number, if a national agency)

Notice of the person's right to obtain a free copy of the report from the CRA if requested within 60 days.

Notice of the person's right to dispute the accuracy or completeness of the report with the CRA.

Notice that the CRA did not make the decision to take the adverse action and is unable to provide the person the specific reasons why the action was taken.

Causes of Action and Penalties

Employers who fail to give appropriate notices or obtain authorizations may be sued by affected individuals.

Consumer reporting agencies and users of consumer information who willfully or negligently fail to comply with any requirement imposed under the FCRA may be liable for actual damages, court costs, and reasonable attorney's fees. Punitive damages are also available for civil penalties of not mor ethan $2,500 per violation.

However, no consumer may bring any action or proceeding for defamation, invasion of privacy, or negligence with respect to the reporting of information against any consumer reporting agency, any user of information (including employers and prospective employers) or any person who furnishes information to a consumer reporting agency unless the information is false and has been provided with malice or willful intent to injure the consumer.

Consumer Reporting Agency A consumer reporting agency is defined under the FCRA as any entity "which for monetary fees dues or on a cooperative, non-profit basis regularly engages...in the practice of assembling or evaluating consumer credit information or other information on consumers." The Federal Trade Commission (FTC) has broadened this definition to include agencies retained by employers to investigate employees with respect to workers' compensation claims and other private entities and organizations hired by employers to investigate workplace misconduct such as sexual harrassment allegations, fraud, and employee violence.
Consumer Reporting Agency, Notice

Before a consumer reporting agency may provide or prepare a consumer report for an employer, it must be notified of the following:

  1. The employer certifies the required disclosure to the applicant or employee has been provided.
  2. The employer certifies that written permission from the applicant or employee to obtain the report has been received.
  3. The employer certifies the the information received will not be used in violation of any applicable equal employment opportunity law or regulation.
  4. The employer certifies that it will comply with the requirements before taking any adverse employment action.

 

Disclosure

Disclosure that a consumer investigative report may be requested, and authorization for the report to be completed must be provided before an employer may request or obtain a consumer report.
  1. The rules regarding disclosure may vary by state, with some states requiring more than the minimum required by the FCRA. The following are required by the FCRA.
  2. The employee or applicant must be informed no later than three days after the report is requested.
  3. The employer must inform the applicant or employee that the report may include information as to his or her character, general reputation, personal characteristics and mode of living.
  4. The employer must provide the applicant or employee with A Summary of Rights under the FCRA.
  5. The employer must inform the applicant or employee that they are entitled to a copy of a "complete and accurate disclosure of the nature and scope of the investigation." If the applicant or employee requests a copy of the report, they must be provided one within 5 days of receipt of the request.
Investigative Consumer Report An investigative consumer report is defined as a "consumer report or portion thereof in which information on a consumer's character, general reputation, personal characteristics or mode of living is obtained through personal interviews with neighbors, friends, or associates of a consumer reported on or with others with whom he is acquainted or may have knowledge considering any such intems of information." This broad definition includes personal references, interviews with neighbors regarding workers' compensation investigations, and interviews with coworkers regarding personal conduct.
Permissible Purpose

Permissible purpose, as far as employment reports are concerned,includes pre-employment and employee misconduct investigations.

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