What are the requirements for conducting background checks on potential employees?

In California, employers must comply with both federal and state laws when conducting background checks on potential employees. The federal Fair Credit Reporting Act (FCRA) requires employers to provide potential employees with a written notice that a background check might be conducted and obtain their written authorization before doing so. On top of the FCRA, California employers are bound by the California Consumer Credit Reporting Agencies Act (CCRAA) which requires employers to provide potential employees with the following: • A written disclosure that a consumer report may be used. • A disclosure of the nature and scope of the consumer report. • Disclosure of the consumer’s right to obtain a copy of the consumer report or information derived from the consumer report. • A summary of consumer’s rights under state and federal laws. • A notice that the consumer may dispute the accuracy or completeness of the consumer report. • A signed authorization from the consumer allowing the employer to obtain the consumer report. In addition, employers must make a “pre-adverse action notice” to potential employees if employers are considering making an adverse employment decision. This includes notifying the potential employee of the employer’s intent to make an adverse decision, the information obtained from the consumer report and the consumer’s rights to dispute the information. In order to comply with California’s wage and hour laws, employers should ensure that they are in compliance with all applicable federal and state laws when conducting background checks on potential employees.

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What are the requirements for conducting background checks on potential employees?

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