Employment Screening Adverse Action

adverse action
Navigating employment laws can be a tricky endeavor. The Fair Credit Reporting Act (FCRA) adds induces pain staking chances of making a mistake and opening your company up to litigation. The FCRA as strict guidelines that companies have to follow when considering "not" hiring an employment candidate called Adverse pre employment checks Action which applies when utilizing a background screening company. Adverse Action is defined by the FCRA as “A denial of employment or any other decision for employment purposes based in whole or in part on a consumer report that adversely affects any current or prospective employee.” -FCRA §603(k)(1)(B)(ii) and FCRA §615. Not following the Adverse Action guidelines is the main reason for class action lawsuits for FCRA violations.

How does your company avoid this type of litigation?


Follow these simple steps:

If you think you might not hire the candidate:
  • Write a letter tot he candidate (the pre-advese notice) explaning that the backgound checfk results are under review and a decision is pending
  • Include copies of the following with the letter
    • A copy of the candidate's background check results.
    • A copy of “A Summary of Your Rights Under The Fair Credit Reporting Act”
  • Keep copies of the letters and attached document and note the date it was sent.
  • If you are sending the letter yourself, send using certified mail with a return receipt
  • Wait at least five (5) business day before taking any additional action allowing the candidate time to dispute inaccuracies
At the highligted words above, you can see samples of the adverse action letter or you can view and print the pre-adverse and adverse action letters by logging into your Instascreen account.

If you decide to not hire:
  • Write a denial of employment adverse action letter to the applicant informing them of your decision and that the decision was based on, at least in part, of their background check results.
  • Make sure to include the name, address, and phone number for the Credit Reporting Agency (CRA) that performed the background check and a statement explaining the CRA was not the decision maker during this process, and won't be able to explain explain why adverse action was taken.
  • The candidate has the right to request a free copy of the background check within 60 days and the right to dispute inaccurate information. Make sure to inform the candidate of their right to do so.
  • Be sure to keep a copy of the letter and attachments, and document the date the letter was sent (send by certified mail if sending them yourself)
Insta Screen Instructions:
  • Select the applicant you would like to send the adverse action letter to
  • On the reports results page scroll down to the “Disclosures and Forms” section and use the drop down box to select the appropriate document.
  • Your choices at that time are to view, print, or email to applicant.