California Investigation Reporting Law.

California Employer Note: California and Federal Law

Subject: California Law Adds Requirements For Employment Reporting; Will Affect Employers in All States Who Investigate California Applicants

A law, effective January 1, 2002, requires that every employee or applicant for employment be provided with a copy of the investigative consumer report* if one is procured by the employer. Heretofore, employers were only required to provide a copy of the report when adverse action is taken based in whole or in part on the report.

Among other sections, Assembly Bill 655 amended Section 1786.16 of the California Civil Code and subdivision (b) of 1786.16 which now states:

“(b) Any person described in subdivision (d) of Section 1786.12 (refers to any employer) who requests an investigative consumer report regarding that consumer shall provide the consumer with a copy of the report and information on who issued the report and how to contact them, either at the time of the meeting or interview between the consumer and the person who requests an investigative consumer report regarding that consumer or within seven days of the date such person receives the report, whichever is earlier. “

With regard to employment, Section 1786.16(a) requires in part:

“1786.16. (a) Any person described in subdivision (d) of Section 1786.12 shall not procure or cause to be prepared an investigative consumer report unless the following applicable conditions are met:

(2) If, at any time, an investigative consumer report is sought for employment purposes other than suspicion of wrongdoing by the subject of the investigation, the person procuring or causing the report to be made shall, not later than three days after the date on which the report was first requested, notify the consumer in writing that an investigative consumer report regarding the consumer’s character, general reputation, personal characteristics, and mode of living will be made. This notification shall include the name and address of the investigative consumer reporting agency conducting the investigation, the nature and scope of the investigation requested, and a summary of the provisions of Section 1786.22.”

Note the difference between the federal FCRA (Fair Credit Reporting Act) and the California Civil Code Definition of investigative consumer report. The California ICR is not just interview information:

Section 1786.2 (c) “The term” investigative consumer report “means a consumer report in which information on a consumer’s character, general reputation, personal characteristics, or mode of living is obtained through any means. “Labor Lawyers in California are advising out of state consumer reporting agencies that for applicants in California, they should advise their clients to provide the applicant with a copy of the pre-employment investigation report as per Section 1786.16 above. This should not be construed as legal advice and investigators and their clients should rely on the advice of their attorneys.

Attention California Employers

January 1, 2002 California Legislature’s AB 655 amending both the California Consumer Reporting agencies Act and Investigative Consumer Reporting Agencies Act (“ICRA”). This bill changed a number of provisions affecting the provision of Investigative Consumer Reports for employment purposes.

Based on new legal interpretation, our counsel has advised that the definition of “Investigative Consumer Reports” be revised to include all background checks conducted on persons with a California mailing address, even where all or a portion of the background check is done directly by the employer. Accordingly, we are recommending that in order to be in compliance with this legislation, our customers should follow these steps for every candidate with a current address in California for whom you request a background report or check a reference:

  1. Send a notification letter (“CA Compliance Letter”)
  2. Send a copy of their consumer rights (“California Disclosure” in English and Spanish and “FTC Summary of Rights”)
  3. Send a copy of the complete background verification report to the Applicant within seven days of receipt of the completed report from Employer’s Choice Screening.

The applicants do not need to request the report copy; it must be provided automatically.

With respect to reference checks, even for those done internally, the applicant must be supplied with the feedback received from the references, and the persons from whom the references were obtained. These requirements apply even if you are conducting an in-house verification without using Employers Choice Screening services. This also applies to background verification conducted on current employees. As with all legal issues, we recommend that you consult your legal counsel to determine your obligations and compliance with new and existing laws. Employers Choice Screening may not actively practice as a legal adviser.

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