SafestHires Implements New Feature That
Fully Automates The Adverse Action Process

In an effort to make its background screening technology even more convenient for its customers, SafestHires has implemented a new feature that fully automates the adverse action process.

The new feature eliminates steps to manually download and email Adverse Action Notices and prevents users from having to manually track the waiting period between Pre Adverse Action and Post Adverse Action.

Adverse Action is the legally required process employers must follow when deciding to reject a candidate based on the results of their background check.

Employers who rely on information provided to them from a background screening company need to understand Adverse Action and its procedures as defined in the Fair Credit Reporting Act (FCRA).

The FCRA defines Adverse Action as a denial of employment or any other decision for employment purposes based in whole or in part on a consumer report that adversely affects any current or prospective employee. 

Before rejecting a job applicant, denying a promotion, reassigning or terminating an employee based in whole or in part on information obtained in a consumer report (i.e., a background check), employers must follow a two-stage process; pre-adverse action and post-adverse action. This process provides the applicant or employee the opportunity to review and dispute information in the report, if they so choose. Employers must follow the process correctly in order to protect their organization, as well as the rights of the applicant or employee.

Stage1: Pre-Adverse Action

If a background check reveals information which might lead you to take adverse action against the individual, you will begin with Pre-Adverse Action.

In this stage, you must provide the applicant or employee with a pre-adverse action notice, which consists of a letter indicating that adverse action may be taken as a result of information contained in the report. The letter will include the reason for initiating adverse action and why that reason would disqualify the candidate. It will also include the name of the background screening company and its contact information, inform the consumer that the screening company did not make the decision to take adverse action, and inform them about their right to dispute the completeness/accuracy of the information. In addition, a copy of the completed report, as well as a copy of “A Summary of Your Rights Under the FCRA” must be included.

With SafestHires new automation feature, those who are set as an “Administrator” on the account (people who are authorized to initiate Adverse Action) can navigate to the “Reports & Orders” screen in our system, locate the searches with records and decide whether or not to initiate adverse action.

If the Administrator determines that the report will not result in adverse action, nothing further is required.

If the Administrator determines that adverse action should be initiated, they will click the “Send Pre-Adverse” link and the Pre-Adverse Action notice along with a copy of the FCRA Summary of Rights, legally required disclosures and a copy of the completed background check report will be emailed to the applicant. The user who ordered the search on this candidate will also be notified by email that Pre-Adverse Action has been initiated.

Individualized Assessment Tools

The EEOC strongly encourages employers to perform an Individualized Assessment when taking adverse action. Basically, an individualized assessment process allows a candidate to provide evidence that a conviction is not related to his or her ability to perform a job and allows employers the opportunity to determine whether a criminal record is specifically related to the position being applied for.

The EEOC expects organizations to first apply the “Green Factors” when assessing applicants’ criminal records and job-relatedness. These are components identified in the 1975 8th Circuit Court of Appeals decision in Green v. Missouri Pacific Railroad and include taking into account:

> The nature and gravity of the offense.
> The time that has passed since the offense and/or completion of the sentence.
> The nature of the job sought.

After considering these factors, employers are supposed to conduct an individualized assessment, case by case, for each individual and each conviction. While the guidance is not law and can’t be enforced by law, if you don’t follow it, you could be ripe for an investigation by the EEOC or plaintiffs’ counsel.

Individualized assessments are not required for all jobs. For example, a day care provider can screen out applicants with past convictions for child molestation without assessing the applicant further. Always consult legal counsel before establishing your Adverse Action policy.

When initiating Pre-Adverse Action in the SafestHires system, the user will be prompted to enter the reason for Pre-Adverse Action and a brief explanation of why that reason would disqualify the candidate (according to the Green Factors).

This kicks off the Individualized Assessment. Next, in the Pre-Adverse Notice, which gets emailed to the candidate as a PDF attachment, there are two active hyperlinks: one takes the candidate to an online portal where they can easily file a dispute, challenging the accuracy of the information and the other takes the candidate to a different online portal where they can provide an explanation of the circumstances and even upload any supporting documents. All of this is part of the Individualized Assessment process. 

Stage 2: Adverse Action

While there is no time period specifically referenced in the Fair Credit Reporting Act (“FCRA”) indicating how much time must pass before sending a Post-Adverse Action notice, the Federal Trade Commission (“FTC”) has provided guidance that suggests five (5) business days is a reasonable time period that should elapse before sending the final notice. However, some states now require up to 10 days so this is the default setting in our system.

Ten business days after the Administrator send the Pre-Adverse notice, our system will send a reminder email to the Administrator, asking them if they wish to send the Post-Adverse Action notice. If the candidate has submitted a dispute or provided a satisfactory explanation, the Administrator can choose to do nothing at this stage and continue with the hiring process. However, if the Administrator wishes to proceed with the Post-Adverse Action notice, they can click a link in the email message, which will trigger a Post-Adverse Action notice being sent to the candidate and a notification email being sent to the user who initiated the order.

The final adverse action letter will inform the individual that adverse action has been taken based information revealed in the background check. The letter will also include the name of the screening company and its contact information, informs the consumer that the screening company did not make the decision to take the adverse action, and informs them about their right to dispute the completeness/accuracy of the information.

Watch this demo video to learn more:

It’s very important that employers comply with the adverse action procedures because litigation is increasing and non-compliance carries stiff penalties. We’ve tried to make this process as easy as possible.