What Is The Adverse Action Process?

What Is The Adverse Action Process - pre-adverse action notice, adverse action letter, employment withdrawal, denial, fair credit reporting act, FCRA, Total Reporting

What Is The Adverse Action Process?- 24 Apr

What exactly is the Adverse Action process?

Whenever a background check provided by a third-party (such as Total Reporting) is used to deny employment, cease an existing employment relationship, deny advancement, or in any way adversely affect the subject of the background check, the Adverse Action process must be followed.

Adverse Action is a process that is mandated by federal law, under the Fair Credit Reporting Act (FCRA). It is a two-step process:

• Pre-Adverse Action
First, a Pre-Adverse Action Notice should be sent to your applicant/employee notifying them that you may be taking adverse action as a result of the background check. This notice must be accompanied by a copy of the background check run by Total Reporting and a document called “A Summary of Rights under the Fair Credit Reporting Act”.

All of the required documents for this step can be found in the Total Reporting backgrounds system on the report results page for each candidate, see examples below.

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When pulling these forms from the Total Reporting system, they will be pre-filled with your applicant’s information, and can be sent to your candidate via email (number 2) as long as your candidate’s email address was provided with the background check, or can be printed off and mailed to your applicant by first viewing the form (number 1).

• Adverse Action
For the second step in the process, the FCRA requires you to wait until the Pre-Adverse Action Notice has been received and reviewed by the candidate. The FCRA does not provide a strict amount of time that an employer should wait. But the FTC has given a suggestion of 5 business days before you can provide the Adverse Action notice, thus effectively denying employment due to the results of a background check.

Total Reporting has two different forms for Adverse Action, one to be used if a conditional offer of employment has already been made (Adverse Action – Employment Withdrawal of Offer), and another for when no such offer has been made (Adverse Action – Employment Denial).

If you have further questions about the Adverse Action process or how to access our Adverse Action forms, our Backgrounds Team is more than happy to help (backgrounds@totalreporting.com).

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