Ninth Circuit: Fair Credit Reporting Act Pre-Adverse Action Notice Is a Procedural Requirement and Not an Actionable Right
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APPLIES TO Employers with AK, AZ, CA, HI, ID, MT, NV, OR, WA, Guam, and Northern Mariana Islands Employees |
EFFECTIVE July 13, 2018 |
QUESTIONS? Contact HR On-Call |
In Dutta v. State Farm, the Ninth Circuit Court of Appeal stated that an employee did not have standing to sue a prospective employer for failing to comply with the pre-adverse action notice requirements under the Fair Credit Reporting Act (FCRA). The FCRA requires employers to give applicants notice before they take any adverse employment action based on the results of a consumer report (e.g., credit report). This requirement is meant to give the applicant an opportunity to contest or correct information in the credit report. After providing such pre-adverse action notice and certain timing requirements are met, an employer may then take the adverse action if it still intends to do so.