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 five-day 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 name of the background screening company and its contact information, informs the consumer that the screening company did not make the decision to take adverse action, and informs 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 information contained in the report will not result in adverse action, they can click the “Pass” button and a notification email will go to the user who ordered the search to let them know the candidate has been approved so the user can move to the next stage of the hiring process.
If the Administrator determines that adverse action should be initiated, they will click the “Fail” button and the Pre-Adverse Action notice along with a copy of the FCRA Summary of Rights 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.
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.
Five business days after the Administrator clicks the “Fail” button and the Pre-Adverse Action notice has been emailed to the candidate, 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.
This new feature is optional in our system. Clients wishing to activate this feature should send a request to email@example.com with the words: Please activate the Pass/Fail feature on our account.
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.