Disclosure and Authorization Forms and Recent Litigation


Disclosure and authorization forms are legally required to be provided by the employer to applicants during the pre-employment screening process.

The requirements for the authorization & disclosure are on page 13 of the Fair Credit Reporting Act. If both a disclosure & authorization are not obtained, an employer does not have a permissible purpose to obtain a report.

604 – 15 U.S.C. § 1681b

(2) Disclosure to Consumer.

(A) In general. Except as provided in subparagraph (B), a person may not procure a consumer report, or cause a consumer report to be procured, for employment purposes with respect to any consumer, unless –

(i) a clear and conspicuous disclosure has been made in writing to the consumer at any time before the report is procured or caused to be procured, in a document that consists solely of the disclosure, that a consumer report may be obtained for employment purposes; and

(ii) the consumer has authorized in writing (which authorization may be made on the document referred to in clause (i)) the procurement of the report by that person.

Full text here.

Recently, the Ninth Circuit Court of Appeals ruling for Gilberg v. California Check Cashing Stores LLC stated that additional state law notices must be separate from the disclosure page. The presence of additional state notice son the disclosure page violates FCRA for extraneous information.

Maintaining up-to-date authorization and disclosure documents is essential to remain compliant under the Fair Credit Reporting Act (FCRA).

While S2Verify does not provide legal advice, and this post should not be considered as such, we would like to highlight this recent ruling and encourage employers to review their documents with their legal counsel or compliance officer. Consistent review of these documents is recommended.

To read the opinion of the Ninth Circuit Court of Appeals and view a copy of the document that this case is focused on, you may visit https://s2verify.com/app/uploads/2019/12/Ninth-Circuit-Court-of-Appeals.pdf

S2Verify does not provide legal advice, and this post is only intended for educational purposes.