{"id":397052,"date":"2026-06-15T12:06:55","date_gmt":"2026-06-15T17:06:55","guid":{"rendered":"https:\/\/ability-fl-prod.internetbrands.com\/ability-law\/?page_id=397052"},"modified":"2026-06-15T12:03:53","modified_gmt":"2026-06-15T17:03:53","slug":"fair-credit-reporting-act-compliance-a-guide-for-employers","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/smallbusiness\/employment-law-and-human-resources\/fair-credit-reporting-act-compliance-a-guide-for-employers.html","title":{"rendered":"Fair Credit Reporting Act Compliance: A Guide for Employers"},"content":{"rendered":"\n
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Fair Credit Reporting Act Compliance: A Guide for Employers<\/h1>\n\n
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\n By Catherine Hodder, Esq.<\/a> | Legally reviewed by Laura Temme, Esq.<\/a>\n | Last updated\n
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Editorial Note: We earn a commission from affiliate partner links on FindLaw. Commissions do not affect the editorial integrity of our legal content.<\/p>\n\n <\/div>\n \n

\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n\n\n

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Key Takeaways<\/h2>\n

The Fair Credit Reporting Act<\/span> (FCRA) is a federal law<\/span> that regulates how consumer reporting agencies<\/span> collect and share sensitive credit information. Employers conducting background checks<\/span> with credit reporting agencies must comply with specific rules under the FCRA, including providing notice to applicants and obtaining written consent<\/span> before requesting reports.<\/p>\n\n <\/div>\n <\/div>\n<\/div>\n\n\n

Credit and criminal background checks<\/span> are part of the standard hiring process<\/span> for many employers. These checks provide a snapshot of job candidates and help you make informed hiring decisions<\/span>.<\/p>\n

Requiring a background check<\/span> for employment purposes<\/span> is legal. But employers must comply with specific requirements under the Fair Credit Reporting Act<\/span> (FCRA) when using third-party companies to obtain this information. Checking a prospective employee’s credit information could bring legal problems if done improperly or in a state that bars the practice.<\/p>\n

In this article, we’ll explain what information is collected in an employment-related credit check, which businesses must comply with the FCRA, and what their obligations are when making employment decisions<\/span>.<\/p>\n

What Is the Fair Credit Reporting Act<\/span>?<\/h2>\n

The <\/u>Fair Credit Reporting Act<\/span> (FCRA)<\/u><\/a>\u200b is a federal law<\/span> that governs how companies collect, share, and use credit information, such as credit reports. Employers requesting a copy of someone’s credit report must comply with the FCRA.<\/p>\n

Credit reports contain sensitive information that can leave consumers vulnerable to identity theft if it isn’t handled with care. The FCRA aims to protect the information obtained from credit bureaus by limiting how consumer reports<\/span> are used and shared.<\/p>\n

Under the FCRA, employers must get the applicant’s written permission before ordering a report. Some states have additional requirements<\/span> beyond federal law<\/span>.<\/p>\n

Pre-Employment <\/span>Background Checks<\/span><\/h2>\n

Potential employers must pay for employee background checks<\/span>, so it’s common to screen job applicants<\/span> only after making a conditional job offer. A typical employer pre-employment <\/span>background check<\/span> includes:<\/p>\n