Monday, December 14, 2020
The Federal Reserve anticipates an approximate two percent reduction in unemployment by June 2021, envisioning rapid mass-hiring by employers once governments lift the more stifling COVID-19 restrictions. Businesses requiring pre-employment background checks may be uniquely exposed to liability under the Fair Credit Reporting Act (“FCRA”) if minor mistakes are amplified by mass-hiring events.
The FCRA requires, among other things, that an employer inform and obtain consent from an applicant regarding the employer’s intent to obtain a consumer report. Specifically, the employer must provide a “clear and conspicuous disclosure … in writing … in a document that consists solely of the disclosure.” Two recent Ninth Circuit cases further explicate this standard, and when it applies.