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When a company is on top of things, they make sure all policies, procedures and documents are up to date and ready for use. When a company gets behind a bit, or neglects to make the necessary updates, this is when they can fall prey to the lawyers and others looking to bring a lawsuit due to negligence on behalf of the company when it comes to the proper use of background check information and documents pertaining to these checks.

For companies that run background checks, they need to make sure that their forms and policies regarding background checks are up to date and compliant with the FCRA.  In the spring of 2015, the Consumer Financial Protection Bureau made some minor, but important, modifications to the “Summary of Your Rights Under the Fair Credit Reporting Act.”  This is a document that provides the applicant/consumer with an understanding of their rights under the FCRA, which ensures fairness and accuracy in the information that is disseminated by the Consumer Reporting Agencies.

Companies that conduct background checks must comply with the FCRA across the board, from the way information is gathered, to the way information is handled when utilizing it for an employment decision. Disclosure and Authorization forms should contain language that is acceptable and compliant with the FCRA. 

PeopleG2 provides its clients with updated forms, reviewed by their legal team, whenever updates are mandated by the CFPB and the FCRA. When it comes to background checks, compliance is something that cannot be overlooked.  Occasionally, companies may feel that they can fly under the rader, and not be the focus of a lawsuit because they “do things well enough.” While some may skate by, putting a company at risk due to non-compliance is not an advisable practice.  HR professionals, hiring managers, recruiters and anyone involved in the day to day handling of background checks should always ensure that their company is compliant, review policies, and make updates as often as needed when new information becomes available.