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Fair Credit Reporting Act (FCRA) Basics

Fair Credit Reporting Act (FCRA) Basics

The federal Fair Credit Reporting Act (FCRA) and several state statutes regulate employment background screening.

The FCRA regulates background screens for “employment purposes” if the employer procures records or information on an individual from a background screening company such as HireRight (known in the screening industry and under the FCRA as a “consumer reporting agency”).

The FCRA broadly defines the term employment purposes to include the evaluation of a job applicant for employment as well as decisions concerning promotion, reassignment or retention of an employee.

The FCRA’s name may be somewhat misleading.

While the FCRA does regulate employment credit checks, the scope of the law is broader than credit history information to include what is referred to as consumer report information.

For example, the FCRA also regulates requests for criminal, educational, military and driving records from a consumer reporting agency, such as HireRight.

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