The Fair Credit Reporting Act & social media: What businesses should know

You have some job openings at your company or maybe you’re thinking of promoting people to new positions. You’ve winnowed that stack of resumes down to some promising candidates. Now it’s nitty gritty time: background checks.

Employment background checks can include information from a variety of sources: credit reports, employment and salary history, criminal records — and these days, even social media.  But regardless of the type of information in a report you use when making hiring decisions, the rules are the same. Companies providing reports to employers and employers using reports must comply with the Fair Credit Reporting Act.

The FTC staff recently looked at a company selling background reports that include information from social media to see if they were complying with FCRA.  Staff’s letter to the company emphasized that when reports include information derived from social media, the same rules apply.  For example, companies selling background reports must take reasonable steps to ensure the maximum possible accuracy of what’s reported from social networks and that it relates to the correct person.  They have to comply with other FCRA sections, too — like providing copies of reports to people and having a process in place if people dispute what’s said about them in a report.  In addition, companies must give employers who use their reports information about employers’ responsibilities under FCRA — like their obligation to provide employees or applicants with advance notice of any adverse action taken on the basis of the reports.

Another key requirement:  Companies selling background reports for employment must require that employers certify the report won’t be used in a way that would violate federal or state equal employment opportunity laws or regulations.

Of course, given the sensitive nature of the information in reports, everyone — companies selling the reports and employers using them — has a legal obligation to keep them secure and dispose of them properly.

Read Employment Background Checks and Credit Reports to find out more about what the law says about using credit reports in the workplace.