California employers performing employee background checks must follow the California Investigative Consumer Reporting Agencies Act (CA Civil Code Sec. 1786) and the federal Fair Credit Reporting Act (FCRA) or be subject to fines and/or legal
The FCRA covers “consumer reports” in addition to credit checks, such as employment background checks for hiring, promotion, retention, and reassignment. It only applies to employment background checks prepared by outside screening companies and
requires employers to do three specific things:
Employers must provide “pre-adverse action notices” and a copy of the background report before taking any adverse action such as termination or not hiring a candidate, or not promoting an employee. A second notice after adverse action is also required
explaining how the employee can dispute inaccurate or incomplete information.
California law (CA Civil Code §1786) is broader than federal law regarding employment background screens. It covers employers who conduct background checks themselves, which the FCRA does not. The California law differs from the FCRA with terms and notices. Employment background checks in California are called “investigative consumer reports” and are
covered in the Investigative Consumer Reporting Agencies Act (ICRAA), (CA Civil Code §1786).
Before a California employer conducts a background check with an outside screening company, a notice must be sent to the employee or applicant stating:
If the individual wants a copy of the report, the employer must send it within three business days of the date it’s received. If a California employer conducts a background check itself without an outside ICRA, the employer is not required to give the same detailed notice that’s required when an outside agency is used, but must still give the individual being investigated the opportunity to receive a copy of the public records compiled in the report. This is usually offered with a box to check on the job application form.
For more information about employee background checks go to: https://www.privacyrights.org/employment-background-checks-california-focus-accuracy
Contact PAYDAY for more assitance on employee background checks in California.
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