If you are responsible for employment or tenant screening, you probably know that you need to comply with the Fair Credit Reporting Act (FCRA). And if you have been looking online to find someone to do the background checks for you, you may have noticed that virtually every web site says that they are “FCRA compliant”. Does this mean they can be used to screen employees in a legal manner? Not necessarily.

Many websites rely on a linguistic trick to claim FCRA compliance. The FCRA only applies to background checks that are used for job screening, tenant screening, or other protected purposes. It does not apply if you are checking out a friend or spouse. That means that a website can say in the fine print, “These background reports are not to be used for employment or housing”, while mentioning the FCRA proudly in their ad. As long as the criminal checks are not used for an FCRA purpose, by definition they are FCRA compliant! A neat trick, as long as you are not the unlucky business owner who misses the restriction in the fine print. Employment and housing lawsuits can be very expensive.

How can you tell which is which? A key thing that every screener must provide is a way for people to correct any errors in their record. This can be difficult to do and as a result many non-FCRA sites refuse to help. Since people frequently do self-checks, and get upset when they see incorrect or expunged criminal records, this issue is often addressed in the Frequently Asked Questions section of a website. If the site states they cannot fix a faulty record, then they are not FCRA compliant. (Please note, this is different from saying that criminal records cannot be removed. Criminal records are public information and suppressing valid results would run counter to the idea of a comprehensive background check.) A responsible screening agency will also you provide you links and guidance for FCRA-related material such as background check release forms and the FCRA summary of rights.

One Comment

  1. John Kennedy June 23, 2011 at 5:52 PM - Reply

    Is there a list of FCRA compliant companies somewhere out there? Do they have to register with any governmental agency?

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