Employers using third parties to conduct background checks as part of their hiring process should be aware of the updated Summary of Consumer Rights published by the Consumer Financial Protection Bureau (CFPB). These updates coincide with a final rule that made non-substantive corrections and updates to CFPB and other federal agency contact information. The final rule is effective April 19, 2023; however, mandatory compliance for certain parts does not take effect until March 20, 2024.

When do I need to provide the Summary of Consumer Rights?

Under the Fair Credit Reporting Act (FCRA), employers may be required to provide applicants/employees with the Summary of Consumer Rights in certain circumstances when they utilize a third-party to check any of the following in connection with a job applicant or current employee:

1. Criminal history;
2. Credit history;
3. Driving record;
4. Educational history;
5. Job references provided by the individual;
6. Employment history, including contacting prior employers or prior co-workers; or
7. Any other type of background check or investigation regarding the individual, including any Internet or “Google” search or social media review.

The Summary of Consumer Rights must be provided to the individual before taking any adverse action based on the results of any of the above, or if the employer will be using a third-party to conduct an investigative consumer report.

How do I comply?

Employers should make sure they are using the updated version of the Summary of Consumer Rights, available on the CFPB website. Mandatory compliance with using the updated contact information is not until next year, but employers should start using the updated version now to avoid confusion later. As with most government-provided forms and documents, it is a good practice to regularly check the version available on the respective agency’s website to ensure you are using the current one.