Social Media: Fair Credit Reporting Act

Background Reports and Social Media
An applicant or employee may raise claims if a city relies on inaccurate, incomplete, misidentified, or unlawfully obtained online information in making an employment decision. Depending on the circumstances, claims may involve discrimination, privacy, defamation, negligent hiring or retention, state-law protections, or the Fair Credit Reporting Act (FCRA).

The FCRA may apply when the city uses a third-party consumer reporting agency to obtain a background report for employment purposes. A report may be a consumer report under the FCRA when it includes information bearing on an applicant’s or employee’s character, general reputation, personal characteristics, or mode of living, including information obtained from social media.

A city employee’s independent review of publicly available online information generally is not a consumer report under the FCRA. However, the city must still comply with applicable employment-discrimination, privacy, records-retention, and other laws.

FCRA Disclosure and Authorization
Before obtaining a consumer report for employment purposes, the city must:

• Provide the applicant or employee with a clear and conspicuous written disclosure that the city may obtain a consumer report for employment purposes.
• Present the disclosure in a stand-alone document. The disclosure may not be included in an employment application or combined with unrelated notices, acknowledgments, releases, or liability waivers.
• Obtain the applicant’s or employee’s written authorization before obtaining the report.
• Certify to the consumer reporting agency that the city has complied with applicable disclosure and authorization requirements and will comply with FCRA adverse-action requirements.

The authorization may be included in the same document as the stand-alone disclosure if the document otherwise complies with FCRA requirements. As a practical risk-management measure, cities may use separate disclosure and authorization forms.

Adverse Action Procedure
Before taking adverse employment action based in whole or in part on a consumer report—such as denying employment, withdrawing a conditional offer, denying promotion, reassigning, disciplining, or terminating employment—the city generally must provide the applicant or employee with:

• A pre-adverse-action notice.
• A complete copy of the consumer report relied upon.
• A copy of the current federal document, A Summary of Your Rights Under the Fair Credit Reporting Act.

The city must give the applicant or employee a reasonable opportunity to review the report and dispute inaccurate or incomplete information with the consumer reporting agency before making a final decision. Although the FCRA does not specify a fixed waiting period, a period of at least five business days is commonly used as a practical compliance measure.

If the city decides to take final adverse action, it must provide a written adverse-action notice that includes the consumer reporting agency’s name, address, and telephone number; a statement that the consumer reporting agency did not make the employment decision and cannot explain the specific reason for it; and notice of the individual’s right to dispute the report’s accuracy or completeness and to obtain an additional free copy of the report from the consumer reporting agency within the applicable period.