Fri, December 2nd, 2011 - 5:56 am - By Gordon Basichis
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For those who conduct credit reports as background checks for employment screening purposes, please be reminded that new laws go into effect in California, January 1st, 2012. These laws will restrict the usage of employment credit reports to certain types of employment candidates who fulfill the appropriate job description.
With the end of the year approaching, we wanted to remind you of two new California laws that will effect you or your clients. Both of these laws go into effect January 1, 2012 and require revisions to an employer’s Disclosure/Authorization forms.
First, California SB 909 which takes effect on January 1, 2012, and amends CA Civ. Code Section 1786.16, requires that employers include the investigative consumer reporting agency’s (background check company’s) internet website in the Disclosure form. The purpose is so that an applicant can get information about the background check company’s privacy practices, including whether a consumer’s personal information will be sent outside the United States.
Second, California AB 22 amends CA Civ. Code Section 1785 regarding the use of credit in employment decisions. The amendment generally prohibits employers from using an applicant’s or employee’s credit history in making employment decisions. Prior to this legislation, employers could request a credit report for employment purposes if they provided prior written notice of the request to the person for whom the report was sought. Assembly Bill 22 significantly changes this landscape by prohibiting employers from using credit reports for employment purposes unless the report is used for one of the limited purposes enumerated by the statute and requires employers to specifically delineate the reason for obtaining the credit report under the statute.