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Court rules inadequate background check disclosure form does not render authorization invalid

Under the Fair Credit Reporting Act, employers must both provide a proper disclosure and obtain the authorization in order to conduct a background check on a prospective employee. A court recently rejected an argument that if an employer’s disclosure is inadequate then the authorization would too be invalid.

The case at hand saw a plaintiff claim he received a background check disclosure form that failed to meet the FCRA's requirement that it be a clear and conspicuous and consist solely of the disclosure that his potential employer would be obtaining a background check for employment purposes. Therefore, since he was not provided a valid disclosure, the plaintiff claims that he did not provide a valid authorization permitting the company to obtain a background check. 

Ultimately, the court found that because the company’s disclosure form contained a liability waiver the plaintiff had adequately stated a claim for a willful violation of the FCRA with specific regards to the disclosure. However, the court ruled the plaintiff failed to state a claim in regards to the authorization form, rejecting the proposition that an inadequate disclosure in a form automatically invalidates the authorization obtained on the same form.

Source: Troutman Sanders LLP, 6/13/2017

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