Background Checks

There has been a lot of talk in the news this year about the so-called Domino’s effect. The reference has nothing to do with your child’s train of domino’s toppling over after hours of skillfully creating a pattern across the dining room floor. Instead the reference is to Singleton v. Domino’s Pizza, a recent court case that has reminded HR managers and credit reporting agencies alike of the importance of following the letter of the FCRA law when it comes to obtaining authorization to running a background check on job applicants.

Employment applications request all sorts of information and can run dozens of pages even for mid-level positions. With a mind for efficiency and economy, hiring managers often try to consolidate forms to reduce time requirements and paper waste. It is just this process that intentionally or unintentionally landed Domino’s in hot water.

The FCRA specifies that:

A person may not procure a consumer report, or cause a consumer report to be procured, for employment purposes with respect to any consumer, unless –

(i) a clear and conspicuous disclosure has been made in writing to the consumer at any time before the report is procured or caused to be procured, in a document that consists solely of the disclosure, that a consumer report may be obtained for employment purposes; and

(ii) the consumer has authorized in writing (which authorization may be made on the document referred to in clause (i)) the procurement of the report by that person.

The net result is that each hiring organization must obtain permission from the applicant to conduct a back ground search on a form that is separate from the rest of their employment application. Failure to strictly follow these guidelines is interpreted as a willful violation of the FCRA and puts the employer at risk of liability, including statutory damages of $100 to $1,000 per violation.

At Barada Associates, we provide our hiring managers with this separate disclosure form to help ensure they remain in compliance with the law.