California Background Check Laws Complex, But Not Impossible to Navigate

Two California court rulings are showcasing the complexities of the state’s screening laws.

Background check laws in California are notoriously difficult and more stringent than in most other states. Two laws in particular were designed by the legislature to better protect people’s privacy.  

The Investigative Consumer Reporting Agencies Act (ICRAA) governs reports that seek character information.

The Consumer Credit Reporting Agencies Act (CCRAA) mandates consumer credit reports. First implemented in 2012, it says that California employers can only perform credit checks on employees who meet very specific categories. Click here for the full list.

In one case an employee alleged that her employer’s background check violated California’s ICRAA screening laws. Lower court dismissed the suit on the grounds that the background check could arguably be governed by both the ICRAA and the CCRAA. But the employee appealed and won when the appellate court held that the ICRAA was “unconstitutionally vague” as applied to tenant screening reports containing unlawful information because that information related “to both creditworthiness and character.”

Another case has proved the ICRAA is “not unconstitutionally vague.” You can read the background of that case here.

As these cases continue to unfold, California employers are being reminded of how important it is to comply with all applicable laws, from the local, state and federal levels.

We came across this blog post from California Employment Law Report and want to share some of the highlights with you.

On the differences between the three main statutes governing CA background checks:

“Generally speaking, three applicable laws apply to California employers who perform background checks: the federal Fair Credit Reporting Act (FCRA), California Investigative Consumer Reporting Agencies Act (ICRAA), and the California Consumer Credit Reporting Agencies Act (CCRAA).  Just as the three names of the statutes indicate, the laws are complex and are very detailed.  For example, the FCRA defines a “consumer report” as “any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer’s credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used or collected in whole or in part for the purpose of serving as a factor in establishing the consumer’s eligibility for…employment purposes….”  Alternatively, California’s ICRAA uses the term “investigative consumer report”, and this pertains to generally the same items as the FCRA but not credit reports. California’s CCRAA applies to credit reports, and defines the term “consumer credit report” to refer to credit reports and credit worthiness of an employee.”

On searching public records:

“Generally, if the employer conducts the background checks itself, the FCRA, ICRAA and CCRAA do not apply to the process. 
One exception to this rule is that the ICRAA requires that if the employer searches “public records” the employer must produce a copy of the public record to the employee within seven days of receiving the information (this applies to records received either in written or oral form). 
“Public records” are defined as “records documenting an arrest, indictment, conviction, civil judicial action, tax lien, or outstanding judgment.”

On the overlap between CA and federal laws:

“The interaction between the federal FCRA, and California’s own requirements under the ICRAA and CCRAA adds another level of complexity to the analysis. It is important for employers to review these laws closely to ensure compliance, and it is highly recommended to have experienced legal counsel review the practices.”


Credit goes to Anthony Zaller of Van Vleck, Turner & Zaller, LLP for these excerpts.

As for our role, Active Screening does everything possible to make screening a transparent, fair and legal process for both employers and employees. We have a number of California Specific Compliance Documents that anyone can view and/or download. Click here to head to our resources page where you’ll find these informative pieces as well as dozens of other important screening documents (New York is another state with complex screening laws).

But the best thing we can do is be a voice for you! What concerns do you have about California’s screening laws, or your state’s screening laws? Share them with us – either comment below or Tweet us. We’re always ready to listen and help.

This entry was posted in Background Screening, Criminal Records, General, Human Resources, Identity & Credit, Industry Solutions, News, References & Credentialing and tagged , , , , , , , , , , , , , , , , , , , , , by Patricia Carlson. Bookmark the permalink.

Patricia Carlson is a content writer who specializes in B2C and B2B inbound marketing. She blogs regularly for clients about the background screening and finance industries, and generates newsletters, white papers and email campaigns for a variety of businesses. Patricia also produces a heavy rotation of editorial material for home design, law enforcement, and family magazines. She’s been writing professionally for more than a dozen years, and for Active Screening for more than two of those. Check out LinkedIn for a roster of Patricia’s clients and links to published works. When she’s not interviewing sources or researching trends, she’s living a fast-paced Florida life questioning the antics of her two young children, partner and mischievous cat. Patricia loves to talk tennis and TV on Twitter – give her a shout @pattycfreelance.

 
        
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