Changes to Fair Credit Reporting Act affect dealers as employers

New notification requirements went into effect September 21 for dealers in their role as employers. The requirements stem from changes in the Fair Credit Reporting Act. WANADA wrote in the September 20 WANADA Bulletin about how the changes affect dealers in their role as retailers to consumers. Here’s how the changes affect dealers in their role as employers.

 

If a dealer takes an adverse action based on use of a credit report for employment purposes, he or she must give the affected individual a copy of the recently revised Summary of Consumer Rights notice. For instance, if a dealer decided not to hire someone because of the person’s credit report, the dealer must give the job applicant a copy of the notice. A dealer might use the credit report for job screening or for firing an employee – for example, if someone who wants to work in accounting has a history of bankruptcy.

 

The duties of employers who use credit reports for employment purposes is further explained in the FTC publication Using Consumer Reports: What Employers Need to Know, which includes a link to a Summary of Rights notice.

 

As always, dealers should consult with their legal counsel about their particular situation. General questions may be directed to NADA’s Paul Metrey at pmetrey@nada.org.

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