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The EEOC and the FTC Issue Joint Guidance Regarding Employer’s Background Checks on Employees

On March 10, 2014, the Federal Trade Commission (« FTC ») and U.S. Equal Employment Opportunity Commission (« EEOC ») issued joint guidance on how the anti-discrimination laws and the Fair Credit Reporting Act (“FCRA“) apply to employers performing background checks on employees or applicants when making the decision to hire, retain, promote or reassign them. The joint guidance comprises two documents, one directed at employers and the other directed at employees and applicants, and aims to provide high-level practical assistance and answers to commonly asked questions that arise during the application process.

Background checks can be used to find out about different information regarding the employee’s or applicant’s works history, education, criminal record, financial history, medical history or use of social media. When making those background checks, the employer should keep in my mind that it should be done within the limits of the law and that he should comply with federal laws protecting employees and applicants against discrimination, including discrimination based on race, color, national origin, sex, religion, disability, genetic information (such as medical history) and age (protecting employees or applicants over 40).

The EEOC recommends to treat everyone equally by applying the same standard to every employee or applicant because it is illegal to check and employee or an applicant background if it is based on their race, color, national origin, sex, religion, disability, genetic information (such as medical history) and age (protecting employees or applicants over 40).

According to the FTC, when obtaining information regarding an employee’s or applicant’s background information from another company in the business of compiling such information, there are additional procedures required by the FCRA: telling the employee or applicant that such information might be used for decisions about his employment; telling the employee/applicant the scope of the investigation and getting the employee’s or applicants written permission.

The joint guidance also contains information regarding how background check information should be disposed of. The EEOC requires any background information on applicants or employees to be preserved for one year after the records were made. The EEOC extends this time period to two years for educational institutions and for state and local governments. The Department of Labor extends it to two years for federal contractors that have at least 150 employees and a government contract of at least $150,000.) However, in case of litigation started by the applicant or employee and relating to a discrimination claim, employers must maintain the records until the case is concluded.

According to the FTC, after an employer satisfied all the legal requirements regarding preservation of background checks records, an employer is allowed to dispose of any background report, as long as it’s done in a secured manner. Physical documents may be pulverized, shredded or burnt. Electronic documents canshould be disposed of so that they can’t be read or reconstructed.

If you are an employee and you believe your rights regarding background check have been violated by your employer, please contact the Harman Firm P.C.

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