Adverse and Pre-Adverse Action FAQ’s

Cover your Adverse

With constant amendments, modifications, and updates being made to the Fair Credit Reporting Act
(FCRA), our team at NationSearch strives to educate our clients as to how these changes may impact their hiring processes and procedures. The Notice of Pre-Adverse Action and the follow-up Notice of Adverse Action, are critical aspects of the comprehensive background screening process that all organizations must be aware of and incorporate in their hiring process on a regular basis.

Notice of Pre-Adverse Action

The Notice of Pre-Adverse Action process is to be initiated if information contained in a background
screening report conflicts with an organization’s policies and procedures regarding safe hiring. In order for a company to be FCRA compliant a pre adverse and adverse action policy should be established within the hiring process.

FAQs

FAQ 1: How long does an organization need to wait before sending the follow-up Notice of Adverse Action letter?
As of yet, time requirements are not set per FCRA guidelines other than a ‘reasonable amount of time should be allotted’ for when to follow-up with applicants after the initial Notification of Pre-Adverse Action. The most common practice is for companies to wait five (5) business days before sending out the Adverse Action letter. During this interval, applicants are given the opportunity to exercise their right to contest any findings directly with NationSearch, the consumer reporting agency (CRA) responsible for producing the report. NationSearch is then responsible for clarifying the disputed findings/issues, assisting the applicant with information they might need in order to proceed with resolution, rescreening the disputed issue once the applicant has confirmed resolution and providing the client with the results of the rescreen. It should be noted: it is the individual’s sole responsibility to contact NationSearch regarding the issues in question.

FAQ 2: Is this requirement mandatory?
The answer to this question is a resounding YES. If companies conduct a background screen and choose not to hire based on the information contained therein, the applicant MUST be given the right to refute the findings. Numerous lawsuits have resulted from companies failing to follow the FCRA guidelines with respect to the Pre-Adverse Action/Adverse Action process.

Here are the additional reasons hiring managers should use the preadverse/adverse notificaiton procedures:

1) Full FCRA Compliance:
The stipulations outlined in the FCRA are extensive and PreAdverse/Adverse Notifications
are a crucial detail that companies cannot afford to overlook.
2) Minimized Liability:
NationSearch goes the extra mile to help our clients achieve strong legal stability in the
hiring process. It is essential for companies to cover as many bases as possible in the event
of legal action taken at a later time.
3) Applicant Protection:
Once our clients incorporate NationSearch’s streamlined adverse action procedure, it
becomes standard practice for a company to protect the rights of job candidates.
4) NationSearch Expertise:
Relax. We’ve got this. As experts in the background screening industry, NationSearch can
do all the work when it comes to initiating the Pre-Adverse/Adverse Action process.