The FCRA, Background Checks, and Clean Slate Laws

New "clean slate" and "ban the box" laws are reshaping background checks and criminal history screenings in hiring. The FCRA, or Fair Credit Reporting Act,  has been around since 1970, and it was originally designed to protect consumer's personal information. It has expanded over time to include employment background checks.

Under the FCRA, employers who run background checks need to:

• Get written consent before running a background check,
• Provide clear disclosures about how the information will be used, and
• Give candidates a copy of the report and a "pre-adverse action" notice before making any negative decision based on it.

Recently, federal, state, and local governments have passed "ban the box" and "clean slate" laws.

Some laws limit look-back periods and others require more transparency, individualized assessments, and written notice before taking any adverse action. They also reflect a trend towards rehabilitation-focused hiring and privacy conscious data use.

In light of the FCRA and clean slate laws, employers should:

• Review when in the process background checks are ordered,
• Make sure consent and disclosure forms meet both FCRA and state law requirements, and
• Double check that vendors are compliant and up-to-date on local rules.