One of the Costliest Screening Mistakes: Adverse Action Non-Compliance

One of the biggest mistakes an employer can make is failing to comply with Fair Credit Reporting Act (FCRA) requirements if they use background checks in their hiring decisions, specifically when choosing not to hire a person. Big companies like Amazon, Wells Fargo, Petco, and Dollar General each have paid hefty costs for the way they handled candidates they didn’t hire. A compliant adverse action process involves designating hiring guidelines in advance, using individualized assessments, and notifying the applicant with the required “Pre-Adverse Action Letter.” Some candidates could file a dispute, in which a re-evaluation should be conducted, along with final adverse action, if necessary.


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Posted Under: Legal Issues

Post By Ken Shafton (2,365 Posts)