Update Applicable to:

All employers

What happened?

The Consumer Financial Protection Bureau (CFPB) released an updated “Summary of Your Rights Under the Fair Credit Reporting Act” notice for employers to use before conducting background checks, replacing the previous October 2018 version. The agency has provided a grace period until March 20, 2024, for mandatory compliance.

What are the details?

The summary details the major rights guaranteed under the act. For instance, employers that use a credit report to deny employment must provide the applicant with the name, address, and phone number of the agency that provided the credit report information. The final rule also makes non-substantive changes to the act to include removing obsolete business types such as “Federal Land Banks,” as well as formatting corrections and updated contact information for the CFPB and other federal agencies.

Those who began using the updated notice immediately should be aware that when it was published on March 17, the notice omitted a phone number for applicants and workers to use when seeking to limit “prescreened” offers of credit and insurance based on their report. The original notice listed 1-800-XXX-XXXX as the phone number to use. However, the CFPB has since corrected the notice, inserting the appropriate contact information: 1-888-567-8688. You should check to make sure you are using the corrected notice.

For more information, please see the links below:

Summary of Rights Notice

Final Rule

Notice Page: Link

What do employers need to do?

Employers should promptly update their Summary of Consumer Rights notice provided to applicants and workers before taking adverse employment action based on their background check reports. While the CFPB’s final rule becomes effective April 19, the mandatory compliance date is a year away (March 20, 2024), the Fisher Phillips law firm recommends that employers begin using the updated notice as soon as possible to get ahead of the compliance deadline and ensure that applicants and workers are provided the correct contact information for the agencies listed in the notice. The Littler law firm states that employers should ensure they update their forms by the March 20, 2024 deadline, but that employers may want to defer implementing the updated Summary to see if the CFPB corrects at least one remaining typo. Otherwise, it might be necessary to make the same change twice if the CFPB releases a further revised version. Notably, employers do not need to provide the updated notice to anyone to whom they have already given the prior notice. Employers should simply ensure that they use the most current version of the notice moving forward.

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