Negative information on a background report or credit check can sink your opportunity to land your dream job. As a result, employers routinely request that job applicants consent to one or more screening reports, especially if the job involves a position of trust or access to sensitive information.
When damaging information surfaces, the employer may rethink extending your job offer.
Unless you are diligent about checking your credit report and background report, you are most likely to learn about negative information from the employer.
Your employer highlights the negative information in your consumer report by providing you with a pre-adverse action notice and a copy of the report. This notice is your cue to review the information and take appropriate action to fix any inaccurate or false information.
You may wonder how to dispute a failed background check. It’s not always easy or quick; however, you must dispute incorrect information in your credit report or background report. While you may not be able to get this job, future employers are also likely to come across the same information.
Fixing the incorrect information at the source, with the company that performed the screening report, helps ensure that future employers have a complete and accurate picture of who you are as a candidate.
Types of Incorrect Information on a Background Check
Knowing how to dispute a failed background check begins with understanding the types of inaccurate information that can surface on a background or consumer credit report. Understanding the most common information background and credit reports that get incorrect will help you know where to look when checking your report.
When you receive notification that your employer is considering not hiring or retaining you because of a background report, you will also receive a copy of the background report your employer received. Again, this comes at no cost to you.
While your employer’s notification will summarize the negative information it is considering in making its decision, you should still review the entire report for other inaccuracies.
Some of the most common types of information found to be incorrect in background checks include:
Check to ensure that your name, date of birth, and Social Security number, if listed, are all accurate. You are ensuring the report does not belong to someone else or that someone has stolen your identity. Review your contact information, your employment history, and your address history.
Criminal History Information
Next, if the check includes information about your criminal convictions, make sure that those convictions are truly yours. If you do not recognize any, it may be possible that your name and record got crossed with another person at the data repository. It could also indicate that you have been the victim of identity theft.
Be alert for any convictions appearing on your report that you believe have been expunged from your record. While expungement is not an automatic process, it does limit who can see the expunged records.
If an expunged conviction appears on your record, you should speak with an attorney who can look into the matter further.
Third, review any credit information contained in the report. For example, ensure that all loans and credit products listed on your report belong to you and reflect an accurate payment status and balance.
You should be aware that credit obligations are often listed by the company that is financing the debt, not necessarily the company through whom you made your purchase.
Review any late payments listed in the report if these late payments are not correct or differ from your records, and dispute background check findings in the report.
Late payments, charge-offs, and other derogatory information on your credit report can lower your credit score, making it appear you are a riskier candidate or more open to financial coercion.
Process for Disputing a Background Check
What is the process for how to dispute a failed background check? Once you have found inaccurate information in your report, the next step is to prepare and send a background check dispute letter to the screening agency.
You will want to do this as soon as possible after receiving notification from your employer about the failed background check.
The background check dispute letter need not conform to any specific format. However, at the very least, it should specifically identify the inaccurate information in the report.
In as much detail as possible, you should also explain why you believe the information is incorrect. In addition, including a copy of your report’s portion containing incorrect information can be beneficial.
Once the screening company is notified of your dispute letter, it will investigate to verify the accuracy of the information it is displaying on your screening report. It does this most often by contacting the company or source of its information and asking for verification of its records.
Once the reporting agency receives a response, it notifies you whether your report will be updated.
When you dispute background check information, there is no presumption of validity attached to your allegations of inaccuracies. Therefore, if you have documentation that supports your claim of inaccuracies, make copies and include those copies with your dispute letter.
Make sure to respond promptly to requests for additional information from the screening company.
If your dispute is decided adversely to you, you may have the right to have an explanatory note included with your report. This note will be provided to anyone who requests the background report in the future and informs them that you dispute the information’s accuracy.
While the report will still display the challenged information, an explanatory note can alert potential employers that you believe the information to be false.
Is an Employer Required to Hold a Job During a Background Check Dispute?
Once you have received notification about negative information on your background check and you indicate your intention to challenge it, you may believe that the employer must give you an adequate opportunity to correct your consumer report.
An employer must indeed wait a “reasonable time” before taking an adverse employment action against you based on a consumer credit report or background check. But the employer need not hold the position or opportunity open for you until your dispute is finished.
The Fair Credit Reporting Act (FCRA) requires that employers send a pre-adverse action notice to you whenever it intends to take negative employment action against you because of a background report.
These adverse actions could include denying an opportunity for employment or declining to continue your existing employment. It must then wait a reasonable time after sending you the notice before actually taking action.
The FCRA does not:
- Define a specific length of time as “reasonable.”
- Require the employer to hold the position open for you until a reasonable time has passed
- Wait until you have successfully disputed the inaccurate information with the screening company.
- Refrain from interviewing other candidates until the “reasonable time” has passed.
- Reinstate an offer if you successfully dispute your screening report
In other words, nothing within the text of the FCRA prohibits the employer from proceeding with its intended course of action, even if that course of action was initially premised on inaccurate information.
What Is Pre-Adverse Action and Adverse Action?
When negative information about you turns up on a credit report or background check, and the employer intends to act upon that information, you will receive both a pre-adverse action notice and an adverse action notice. Although these notices are related to one another, there are significant differences between the two.
A pre-adverse action notice alerts you that a background check completed by your employer has uncovered negative information. It also advises that the employer is considering taking adverse action against you. This notice should come along with a copy of the background report in question and a notice of your rights.
Armed with this information, you can file a background check dispute and seek to correct the negative information. You also have the opportunity to provide your employer with any information that mitigates, explains, or disproves the negative information.
It is important to remember. However, your employer is not obligated to correct your background report for you or to continue with the hiring process.
Once proper notification has been given to you and a reasonable time has passed, the employer can proceed with the intended course of action.
When it does, it must provide you with an adverse action notice. This notice serves to document that an intended adverse employment action has been taken and was based, in whole or in part, on information in your background report.
An employer must send out a pre-adverse action notice to you whenever it intends to take an adverse action, even if it is considering other actions, too. It must also send a pre-adverse action notice if the employer initially intends to take an adverse action but later decides against it.
Conversely, an adverse action notice is only required if and when the employer actually follows through with its intended course of action. For example, no adverse action notice is required if the employer decides to hire or retain you because none was taken.
When to Contact an Attorney
Receiving a pre-adverse action notice can be an unpleasant occurrence, but it is a good opportunity to investigate the matter further and potentially correct the incorrect information. So how do you respond to a failed background check? Challenging the information as soon as you are alerted that such information exists is the best response.
Even with an attorney’s help, disputing the information in your background check is no guarantee you will eventually receive the job you are after. However, disputing inaccurate information can put you in a better position for the next job to which you apply.
You may have legal recourse if your employer refuses to hire you based on a background check but fails to give you a pre-adverse action notice.
The pre-adverse action notice is statutorily required under the FCRA. Employers are mandated by law to provide it to you along with your background report so you can dispute information if needed.
If you believe your rights under the FCRA were violated or have questions about disputing inaccurate information in a background report, Wenzel Fenton Cabassa, P.A. can help. You can also contact us if you attempted to dispute the inaccurate information but believe employers ignored your compelling documentation.
Our experienced employment rights attorneys are well-acquainted with the provisions of the FCRA, and we will work to ensure the rights you are afforded under the FCRA are respected.
Please Note: At the time this article was written, the information contained within it was current based on the prevailing law at the time. Laws and precedents are subject to change, so this information may not be up to date. Always speak with a law firm regarding any legal situation to get the most current information available.