In the context of background check, this could mean denying the applicants from employment, but can also include denying a promotion or transfer, offering employment in a lesser position,or other negative outcomes.
Because Adverse Action adversely affects consumers (by nature), it is a common area of litigation and compliance risk for you. In fact, the Fair Credit Reporting Act (FCRA) requires that you follow certain procedures if you decline to hire, engage, or promote a candidate on the basis of information contained in a background report.
The Adverse Action workflow is critical because it allows the candidate to raise any concerns about their report, and the FCRA requires that employers/end users (which includes companies that use independent contractors) to follow this stringent process.
Some employers are tempted not to communicate with candidates whom they decline. However, if you don’t follow a defined and consistent Adverse Action process, you’re opening yourself up to legal risk. For more information, please watch our video or read our comprehensive article on the Checkr Help Center.
Identifying the services to be added to the background check
Hiding records on background check reports
Defining exceptions in the background check
Interpreting the status of the background check report
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