A background check cost me a job
If an employer is going to turn you down because of a background check, the Fair Credit Reporting Act requires it to give you a copy of the report and a summary of your rights before it acts, so you can point out errors. The company that made the report must follow reasonable procedures to assure maximum possible accuracy and, for public records likely to hurt you, either tell you it is reporting them or keep strict procedures to make sure they are complete and up to date.
The interview went well. The offer came, contingent on a background check. Then the recruiter stopped answering, or a short letter said the company had decided to go another way. Somewhere in that report was something that is not true, or not yours, or too old to be there.
Employment background checks are consumer reports under the FCRA. Both the employer and the company that sold the report have duties, and the most useful one kicks in before the decision is final.
What the employer owes you
- Disclosure and permission, first. Before getting the report, the employer must give you a clear and conspicuous written disclosure, in a document that consists solely of the disclosure, and get your written authorization (15 U.S.C. § 1681b(b)(2)(A)).
- A copy before it acts. Before taking adverse action based in whole or part on the report, the employer must give you a copy of the report and a written description of your rights (§ 1681b(b)(3)(A)). This is often called the pre-adverse action notice.
- A notice after it acts. If it does turn you down, it must tell you the name, address and phone number of the company that made the report, that the company did not make the decision, and that you can get a free copy within 60 days and dispute it (§ 1681m(a)).
The window between the first notice and the final decision is your chance. If the report is wrong, tell the employer and the background check company at once, in writing.
What the background check company owes you
- Accuracy. Reasonable procedures to assure maximum possible accuracy of the information about you (15 U.S.C. § 1681e(b)). Reporting another person's criminal case because of a shared name is the classic failure.
- Care with public records. When it reports public record information for employment that is likely to hurt you, it must either notify you at the time, with the name and address of the employer receiving it, or keep strict procedures to make sure the information is complete and up to date (§ 1681k(a)). A case reported without its dismissal is not up to date.
- Age limits. Arrest records, civil suits and most other adverse items more than seven years old may not be reported (§ 1681c(a)). Convictions are the exception. So is a job above the statutory salary threshold of $75,000 a year, where the seven-year limits do not apply (§ 1681c(b)).
- Your file and a reinvestigation. On request, all the information in your file and its sources (§ 1681g(a)), and a reasonable reinvestigation within 30 days of a dispute (§ 1681i(a)).
In New York
New York's Fair Credit Reporting Act adds limits of its own. A consumer reporting agency may not report arrests or criminal charges that did not result in a conviction, unless the case is still pending (N.Y. Gen. Bus. Law § 380-j(a)), and on its face the statute bars reporting convictions more than seven years after disposition, release or parole (§ 380-j(f)(1)). Whether each New York time limit survives federal preemption depends on its history (15 U.S.C. § 1681t(b)(1)(E)), so check before relying on it. New York's statute provides actual and punitive damages for willful noncompliance, plus costs and fees (§§ 380-l, 380-m). See New York.
Your claim
A lost job because of an inaccurate report is concrete harm: the report went to a third party, the employer, as TransUnion v. Ramirez requires. For a willful violation the FCRA allows actual damages, which can include lost wages, or statutory damages of $100 to $1,000, plus punitive damages; for a negligent one, actual damages (15 U.S.C. §§ 1681n, 1681o). Willful includes reckless disregard, under Safeco Insurance Co. v. Burr. The FCRA requires a company found liable to pay the consumer's reasonable attorney's fees and costs. The deadline is the earlier of two years after discovery or five years after the violation (§ 1681p).
The background check errors page covers the claim in full, and the FCRA page covers the statute.
What to do this week
- Find the notices. Check your email and mail for the pre-adverse action letter, the report copy and the final notice. Note the dates.
- If you have not been sent a copy, ask for one from the employer and from the company named in the notice. Within 60 days of a denial notice, the company must provide your file free.
- Mark every error: a case that is not yours, a charge without its dismissal, an item more than seven years old.
- Dispute in writing with the background check company, attaching court records, and send the employer a copy.
Sources: 15 U.S.C. §§ 1681b(b), 1681c, 1681e(b), 1681g, 1681i, 1681j(b), 1681k, 1681m, 1681n, 1681o, 1681p, 1681t; N.Y. Gen. Bus. Law §§ 380-j, 380-l, 380-m; Safeco Ins. Co. of America v. Burr, 551 U.S. 47 (2007); TransUnion LLC v. Ramirez, 594 U.S. 413 (2021).
Common questions
Does an employer need my permission to run a background check?
Yes, for a consumer report. The employer must give you a clear and conspicuous written disclosure, in a document that consists solely of the disclosure, and get your written authorization before it obtains the report.
Can a background check show an arrest from ten years ago?
Under the federal FCRA, arrest records and most other adverse items that are more than seven years old may not be reported, unless the job pays $75,000 a year or more. Records of criminal convictions have no federal time limit. New York's own statute bars reporting arrests that did not lead to a conviction, unless the case is pending.
The report mixed me up with someone who has the same name. Is that a violation?
It can be. A background check company must follow reasonable procedures to assure maximum possible accuracy of the information about the person the report is about. Reporting another person's criminal record is a common kind of mixed-file error, and a dispute triggers a 30-day reinvestigation.
Tell us what they did.
One conversation with an attorney, in your language. We tell you which laws the collector or the credit bureau broke, which deadline runs first, and what to save this week. If it is not a case we can take, we say so and tell you where to go.
(718) 484-7510The FDCPA and the FCRA require a company found liable to pay the consumer’s reasonable attorney’s fees and costs. Our fee arrangement is confirmed in a written retainer before we begin. English, Russian and Spanish in-house; an interpreter for any other language.