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What’s the scoop with Adverse Action?

In short, this article will run down the steps you should take and your obligation as an employer.


1) When you plan to make an adverse decision because of the information found on the report furnished by your background screening company (CRA), for the purposes of employment, (including hiring, promoting or dismissing), you must proceed with the Pre-Adverse Action process. This includes:


  • Inform the candidate/employee you plan to make an adverse decision, provide them a pre-adverse action letter. Also,

  • Give them a copy of the report, to review and correct, if needed. Also,

  • Give them a copy of the Summary of their Rights, under the FCRA. (Some States/Cities/Municipalities have additional documentation requirements.)

  • Track your communication and be sure to stay on top of your requirements under the law, including Federal, State and locality based.


2) Give them time to review and make corrections, if needed. Under Federal law this time should be considered reasonable. This specific time isn’t defined, but guidance has observed a minimum of 5 business days as reasonable. Again, keep in mind your internal policy or local laws may have other requirements. Complaints or corrections should be brought to the attention of the CRA.


3) Once adequate time is given, you may proceed with Adverse Action.


  • Inform the candidate you are making this decision based on their background report.

  • They are entitled to another copy of their report.

  • Even though you have given them time to review, they should be informed of their rights to dispute the information found on the report. Don’t be reluctant to hear their possible concerns or requests to make corrections with the CRA.


Am I required to do this? Yes, per Federal law you are required to provide notice and allow the candidate to dispute information found on their consumer report (ie: criminal, credit, etc.)


How do I provide these notices? You may provide a hard copy or electronic notices/letters.

What can we do, as the background screening agency/CRA, to help?


  1. Provide you with sample documents for your legal counsel to review and adjust for your use.

  2. Provide an optional service for you to email/mail your notices.

  3. Keep you informed if your candidate starts a claim to dispute information.

Jolene Johnston

Vice President/Chief Operating Officer


Note: This article is intended to provide general information and should be not be interpreted as legal advice.

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