USE OF CONSUMER REPORTS FOR EMPLOYMENT PURPOSES Employers who wish to obtain a consumer report for employment purposes should be aware of notice and consent requirements on employers who seek to obtain credit reports for use in connection with the hiring or promotion process. (A consumer report is a report prepared by a consumer reporting agency bearing on a person’s credit worthiness, credit standing, credit capacity, character, general reputation, personal character or mode of living that is used in connection with employment, or eligibility for credit or insurance). Prior to obtaining a report, an employer must fulfill notice and consent requirements. First, the employer must provide notices to the applicant, in “clear and conspicuous” language contained in a separate written disclosure form that discusses only the notice, that a report may be obtained for employment purposes. Second, the employer must obtain the applicant’s written authorization to obtain the report. Third, the employer must certify to the reporting service that it has properly notified the applicant; that a copy of the report and summary of consumer rights will be provided to the applicant if any adverse action is taken based on the report; and that information from the report will not be used in violation of any applicable Federal or State equal employment opportunity law or regulation. Finally, before taking any adverse action based on information in the report, the employer must provide the applicant with a copy of the report and a summary of consumer rights. Employers who obtain credit reports for job applicants, whether potential or current employees, should develop disclosure and consent documents. The Federal Trade Commission, which implements and enforces the Federal Fair Credit and Reporting Act for most industries, has issued sample notices. Federal Trade Commission rules require all businesses that use consumer reports to properly dispose of sensitive information that they receive from the consumer reports. The affected businesses include lenders, insurers, employers, landlords, automobile dealers, and debt collectors. Proper disposal includes burning or shredding paper documents and destroying or erasing electronic media. The destruction can be outsourced if appropriate due diligence is conducted. For further information about the FTC’s Disposal Rule. TESTING RECORDKEEPING The federal Age Discrimination in Employment Act requires retention for one year from date of personnel action of the results of employment and physical testing or examinations. Federal regulations on testing for the use of alcohol or controlled substances impose various recordkeeping requirements of from one to five years. Each year a comprehensive update of federal record retention requirements is published in the Federal Register. A business or government reference librarian can direct employers to the latest compilation. BACKGROUND CHECKS When hiring persons to perform certain jobs, employers are required by statute to perform a background check. For example, employers hiring security guards are required to check their backgrounds with the Minnesota Board of Criminal Apprehension; employers hiring certain counselors are required to check their references for evidence of sexual contact with patients or former patients. Also, other Minnesota laws require rental property owners to request background
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